E-commerce is a channel NO retailer can ignore. Product or service aside, e-commerce is a necessity, and it is evolving.
Many of 4M Performance’s clients are retailers. It is vitally important that they stay informed on the latest trends and developments in the e-commerce space.
These are 3 top trends impacting e-commerce right NOW!
Buy-Now-Pay-Later Financing Is REPLACING Credit Card Transactions
As e-commerce has grown so have layaway financing services, such as Affirm, Afterpay, and Klarna. These payment alternatives have grown exponentially in the last few years. Their growth stems from the fact that, unlike credit cards, consumers don’t have to pay any additional interest when using buy-now-pay-later services.
Buy-Now-Pay-Later (BNPL) is short-term financing that allows consumers to make purchases and pay for them at a future date – ofter interest-free. Normally, an upfront payment of 25% with the balance paid in predetermined installments, with no interest charged.
This financing trend started in Brazil, which has more BNPL transactions than any other country, but the use of these payment services is growing in the U.S. – and FAST. BNPL finance companies get paid by the merchants selling the product/service, usually 2-8% of the sale. And in interest and late fees if payments terms are defaulted upon.
Particularly convenient for big-ticket items such as consumer electronics and appliances, U.S. shoppers are now embracing it.
Most people and brands are becoming more aware of this trend and like it vs. credit card purchasing. Peloton, for example, has done very well using the BNPL process. For big-ticket items, people would rather pay off those purchases over 24 to 36 months.
For e-commerce selling the BNPL option may be a viable selling tactic for your business.
Livestream shopping: an experiential and exciting way to shop. Gives users real-time insights into products as compared to traditional online shopping.
Promoting a product/service through a video that is completely LIVE!
Livestream shopping in China totaled over $170billion in 2020. The U.S. lags far behind, but therein lies the opportunity for forward-thinking brands. Companies such as Instagram, TikTok, YouTube, have been experimenting but this is in its infancy and I expect it to grow exponentially.
Shopify will thrive in the e-commerce space
There is no doubt that Amazon is the e-commerce monster that is starting to do its own private label versions of products that are selling well on its platform. Brands are now starting to worry that selling on Amazon runs the risk of helping Amazon amass more data to develop their own private label versions.
To counter, businesses are turning to platforms, such as Shopify, to either kickstart or retail their products to lessen their risk of competition from Amazon.
These three trends will impact e-commerce NOW. Be prepared and be aware that if you’re using e-commerce to market your products and take advantage of these ongoing trends.