Retailers, take note: It's a fun time to be in e-commerce.
So says Tom Caporaso, CEO of Middletown, Connecticut-based Clarus Marketing Group. The already-huge sector is only going to continue to grow next year as consumers become more comfortable shopping from their desktops and mobile devices. "The more tools we put in their pockets, the more they're going to use them and the more they're going to buy," he says.
Caporaso shared with Inc. his predictions for next year's trends in the e-commerce space. Here are seven you should familiarize yourself with to stay competitive.
1. Mobile, Mobile, Mobile
For a while now, consumers have been using mobile to research products before and after a purchase. But mobile is reaching beyond that now as consumers increasingly feel comfortable doing their shopping in an app or on a mobile site.
2. Consumers Hold the Reins
The old adage "the customer is always right" definitely carries over into e-commerce. Consumers have access to more and more tools like comparison shopping engines and price protection, along with promotions like free shipping and cash back. "The power has really switched over to the consumer and that's not going to slow down," Caporaso says. "The race is how do you get those consumers engaged and ultimately staying with your site."
3. Efforts to Stand Out
In the age of Amazon, you need to set your online retail business apart in some way. Often that can be something as simple as good customer service or live chats on your site to help shoppers find what they're looking for. Another good example comes from Target, which offered free shipping as early as November 1 this holiday season.
4. Holiday Competition
Target's free shipping offer is part of another trend: jumping in on the holiday season as early as possible. "Consumers have roughly $1,000 to spend this holiday season, and [e-tailers are] trying to get those dollars into their store quicker," Caporaso says. "We see that trend happening next year even around other holidays like Valentine's Day or Mother's Day, because there's a very competitive nature and they need to stretch those promotions out early and often."
Retailers that have both an online presence and a physical location are trying to connect the two with promotions like free ship to store in order to get more foot traffic. Many also are creating companion apps and mobile sites that help customers when they're in a store.
6. Driving Loyalty
One of the big challenges in retail is turning a one-time shopper into a loyal customer. "We've trained the consumer to really look for deals, [especially after] the recession of '08-'09," Caporaso said. "The key now is how do you drive loyalty on a year-round basis, not just around price but around value." It's about leveraging a one-time promotion and turning it into long-term loyalty.
7. Free Return Shipping
It's fairly common now for online retailers to offer free shipping with purchases, (especially larger ones), but the next frontier is free shipping on returns. Caporaso estimates that about 90 percent of returns still cost the consumer. And a lot of the time consumers don't understand that they'll be responsible for this cost, so it gives them a bad experience with your brand. "We believe return shipping is the next horizon on e-commerce, and [retailers] have to address it with a flat rate or making it free, or making policies really clear and concise to consumers so they know and don't feel slighted," Caporaso says.