Every year, we identify over fifty mostly technical trends that are impacting eCommerce. After narrowing the list down and removing very obvious trends or those that have remained the same for many years (e.g., move to mobile, increased personalization, AI, social commerce), the final list favors trends that are immediately useful and actionable for a typical merchant or those interested in eCommerce. For each of these 2021 eCommerce trends, we will clarify:
• What the trend is
• The metrics behind the trend
• The risks or downsides of the trend
Read on for an in-depth look into each of the top eCommerce trends for 2021. In addition, this year we included a list of the top trends we feel are over-hyped.
ECOMMERCE TREND #1: RE-NORMALIZATION OF ECOMMERCE
2020 was a unique year, and eCommerce growth rates exploded as traditional offline channels were not a readily available option for many consumers. At the height of the pandemic in 2020, 10 years of eCommerce growth happened in just 90 days in the U.S. 2021 will certainly not see the same year-over-year growth in eCommerce that 2020 did. However, the rapid need for consumers to shift more purchasing to eCommerce channels should result in more comfort and preference for online vs. offline purchases in the future—and much of the shift to online will not subside when the world gets back to normal.
2021 and beyond will likely see eCommerce growth rates go back to the projected norms of 15–20% of annual growth—but 2020 created a new higher baseline for this growth.
The 2020 pandemic rapidly increased the growth of eCommerce, and as normalcy is reached, the risk is that eCommerce may be shunned as consumers prefer the renewed experience of safely shopping in-person. The desire for the in-person interaction may overwhelm the newfound comfortability and preference of eCommerce.
ECOMMERCE TREND #2: EXPANSION TO INTERNATIONAL MARKETS
2021 will be the year that cross-border eCommerce and the expansion of eCommerce brands beyond their home countries starts rapidly accelerating. Why? Because the ease of doing so is multitudes greater now than it was only a couple years ago. Language, payments, localization, logistics, distribution, and shipping obstacles are no longer technical constraints. Accepting orders from a new country once took many months to set up, but now—with even basic eCommerce platforms and some outsourcing—this can be done within a week’s time. In addition, many of the fastest growing eCommerce opportunities are in emerging countries, which may not have all the internal product categories and brands desired. This is opening the door to sellers outside their borders.
Global cross-border B2C eCommerce will reach $4,820 Billion USD by 2026, comprising 12.2% of the total global eCommerce market expected in 2026. We expect this figure will turn out to be an underestimation as cross-border sales increase faster than currently anticipated.
The traditional non-technical barriers to cross-border transactions will not be going away anytime soon. Jurisdiction constraints, legal hurdles, tariffs, and taxes are all barriers to entry and decrease margin in international markets.
ECOMMERCE TREND #3: INTEGRATION OF BLOCKCHAIN AND CRYPTOCURRENCIES
Although the application and benefit of blockchain and cryptocurrencies can be separated, for the summary purposes here we are going to put these in the same bucket.
With blockchain technology already becoming its own distinct platform that’s being incorporated in more and more everyday transaction activities, we will see many B2C eCommerce implementations have integrations into public/private blockchains. Blockchains for supply chain, tracking shipments, and content management have already become commonplace. With many more direct blockchain integrations to come, many traditional solutions and markets are going to be disrupted or displaced.
Furthermore, as legal jurisdictions allow them, cryptocurrencies will become a more and more common payment type. In many countries, we are already seeing cryptocurrencies being used for majority of online payments. In 2020, we have seen PayPal/Venmo enable cryptocurrencies for payments and several crypto-based credit cards being announced.
$2.7 billion was spent worldwide on business blockchain solutions in 2019.
Because of blockchain’s incredible integration potential (supply chain, payments, inventory, product data, and security being some of the top areas), 53% of global businesses say blockchain was a top 5 priority for 2020.
Many of the largest retail brands accept cryptocurrency for eCommerce payment, including the likes of Microsoft and AT&T. Although there are currently no trusted metrics out yet for the expected percentage of eCommerce transactions that will be completed via crypto, it will definitely be in the multiple billions of dollars USD.
Blockchain technologies (including cryptocurrencies) are still often considered the “wild west.” There are thousands of potential blockchain projects companies can undertake—and selecting the right technology and application for your business involves some serious due diligence. Also, governments are equal parts fascinated and terrified of blockchain technologies and cryptocurrencies, resulting in many legal and regulatory restrictions to navigate through in most countries.