In 2021 there were 4.7 billion internet users around the world, roughly 60 percent of the global population. Digitisation and e-commerce are now key aspects of a successful business model and consumers will judge a brand based on its digital prowess.
Here are the major trends for 2022 that businesses should keep an eye on in the virtual world.
Loyalty in the digital era will be about less tangible features.
The notion of ‘Rewards’ has evolved from a customer simply receiving a free product, to creating memorable experiences – connected more to moments a company or brand creates along the customer journey.
These shifts are creating the perfect storm for next-gen loyalty. Consumers increasingly expect brands to tailor their services to them, which also means that consumers are having to share more of their personal data and more sophisticated consumers are willing to do this.
Almost 40 percent of consumers surveyed by Euromonitor said they shared data in order to receive personalised and targeted offers. This commercial trade-off has become more front of mind for consumers.
With consumer perception of loyalty in flux, those companies who amass the most useful data and leverage to maximum benefit are best positioned.
Delivery in Minutes
With e-commerce penetration permanently elevated as a direct result of the COVID-19 pandemic, more consumers than ever before are ordering products for home delivery. As consumers are becoming familiar with these services, expectations surrounding delivery are changing rapidly.
Going forward, reducing delivery times will be key to continued e-commerce growth. Slow delivery times continue to be one of the biggest impediments of consumer uptake of delivery services.
Quick commerce business models are evolving to meet rapidly changing consumer expectations. For example, GoPuff has built its success on the rapid delivery of convenience store items. Today, it operates nearly 600 of its own hyperlocal dark stores. The company delivers in 900 US cities, and in November 2021 expanded into its first international market, the UK, where it services 12 major urban centres.
In late 2021, Colombian delivery platform Rappi announced the launch of its Rappi Turbo Fresh programme, which offers grocery delivery in less than 10 minutes. Given the popularity Rappi already enjoys in Latin America, Turbo is expected to change consumers’ delivery time expectations in the region’s urban areas.
With ultrafast delivery times now attainable in many cities, urban consumers can utilise the internet to make what are, in effect, impulse purchases.
The pandemic educed e-commerce surge has also led to a rise in environmental awareness, including concerns over high carbon emissions of mass delivery, non-recyclable packaging waste and excessive returns that have fuelled the tensions between convenience and sustainability.
Online players are under increased pressure to make products, packaging, and deliveries more sustainable as consumers demand green e-commerce. And these consumers are no longer a niche market, green online shoppers are becoming increasingly mainstream.
Brand reputation is at the heart of industry shifts towards green e-commerce and the transition towards green e-commerce will require brands, retailers, and others to make strategic adjustments. For example, In 2021, Deutsche Post DHL Group announced significant investments to accelerate the electrification of its last-mile delivery fleet. The company expects it can strengthen its last-mile position by transitioning early to emission-free deliveries.
Climate action will become a key focus of consumers and policymakers amid the growing urgency to find ways to make e-commerce sustainable.
With e-commerce surging, consumers are increasingly choosing to pick up their digital orders.
Delivery has long been the default fulfilment method for many consumers, but as e-commerce accelerates, click-and-collect is becoming a popular alternative.
Click-and-collect appeals to consumers because it combines the convenience of online ordering with the immediacy and instant gratification of picking up an item from a physical outlet – an aspect delivery cannot replicate (yet). Price-conscious consumers also gravitate toward click-and-collect.
As supply chain issues intensify into 2022, click-and-collect is set to expand.
As rising concerns over supply chain issues force consumers to look for delivery alternatives, click and collect will become a preferred option for some items.
Into the Metaverse Shop
Virtual commerce technology has the potential to take online shopping to the next level. These advancements could add more dimension to the online shopping experience, including more accurately recreating the interactions and emotions associated with the physical world.
Virtual engagements gained momentum with the onset of COVID-19 as consumers turned to digital channels. Add to this a boost in consumers using virtual and augmented reality technology to try products.
Nike partnered with online gaming platform Roblox to create a virtual world. In Nikeland, users will be able to dress up their avatars in Nike-branded apparel in this alternative world. As the metaverse comes to the forefront, small and big brands are exploring how they can make money. While Nikeland will be free at launch, it could become a plan to test new products.
Virtual commerce technology will take online shopping to the next level with advancements like the metaverse adding more dimension to the experience.