Third & GroveThird & Grove
Aug 25, 2020 - Justin Emond

Six Must-Watch eCommerce Trends for Specialty Brands in 2020

Six Must-Watch eCommerce Trends for Specialty Brands in 2020

When it comes to eCommerce in 2020, the reality is that the once-in-a-century pandemic has not so much changed the landscape for merchants but somewhat accelerated trends that were already underway (whether you were aware of them or not). For merchants to thrive over the next year, they must pay close attention to and plan for some of the less obvious trends that will impact sales.

Here are the most critical trends that COVID is accelerating for specialty retailers in 2020:

Trend #1: Lean into your socially positive brand (if you have one)

With less real-life events happening and a slow return to the dining out scene, consumers have more time to reflect on the values of the brand they are buying from. This can cause long term shifts in brand loyalty when merchants properly lean into their mission-driven brand.

Take a look at clothing retailer Tentree: Right at the top of the home page, they strike a terrific balance between merchandising and promoting their sustainable mission. It’s perfectly aligned and presented. Brands with a positive social impact component are wise to take a fresh look at how they are leveraging that as part of their overall digital commerce strategy.

As positive social impact commerce expands, look for opportunities deeper in operation to showcase alignment with customers: Eco-friendly supply chains, sustainable manufacturing, and zero-waste packaging are potentially rich areas to investigate.

In online retail, demographics is not destiny; who isn’t buying your product today is destiny.

Trend #2: The future isn’t headless

Do you know what is fun, really trendy, and super popular with developers right now? Building stuff in JavaScript. It’s fun, it’s new, and everyone is talking about. All your developer friends will think you are fresh for doing it.

But you know what doesn’t matter for successful online specialty retail? The developer experience. OK, that isn’t entirely true, it does matter, but it certainly matters much less than the merchandiser experience. Why? Because all retailing is merchandise sales. Every other problem is solvable by a specialty retailer and is a secondary concern to the one issue that is fatal every single time: a lack of sales.

The dirty secret about headless commerce that no one will tell you is that it provides a terrific developer experience at the expense of the merchandiser experience. All of the plugins and extensions for your favorite ecom stack -- whether it’s Shopify Plus, or BigCommerce, or Magento, or whatever -- are designed to work only in a traditional, non-headless setup. Go headless, and you have to rebuild everything on the front end, and all that lovely merchandiser backend the apps provide doesn’t work without, well, more work.

From the perspective of the online merchant, every eCommerce experience is a compromise between the developers’ knowledge and the experience of the merchants. Going headless simply tilts far too much in favor of the developers.

But wait? What about the statistics that show that next year more than half of eCommerce will be done on a mobile device? Working well on mobile means the site loads fast and is responsive. You don’t have to go headless you achieve that, you just have to build your website with care.

Headless is a lot like teenage sex: Everyone talks about it, some people try it, and looking back a few years nobody thinks it was all that good.

Trend #3: Get your customer data in order right now, or suffer later

We all know that direct-to-consumer sales are growing and that going D2C means you collect first-party data and collect more meaningful information about your customers. That is all great, but what are you going to do with all that data?

In a few years, the tooling intersection of marketing automation and personalization platforms will allow marketers to use them as quickly as they use email today. But suppose you don’t have all of your customer data in order, in a format ready for consumption, wrapped around APIs for easy integration. In that case, you will not have the raw inputs necessary to generate the insights that power truly impactful commerce.

Trend #4: Premium private label sales are growing

You read that right. The premium tiers of private labels are the only tiers of private label sales that have shown meaningful growth:

“While it’s true that consumers are turning to private labels to save money, previous perceptions that private label products are of lesser quality seem to be fading. IRI reported that most consumers feel that the quality of private label products is just as good as national brands, as well as a better value than national brands. This is especially true among Millennials, among whom about three-quarters shared those sentiments.”

Watch your premium-level private label competitors closely and often.

Trend #5: Thoughtful automation drives productivity growth for digital marketing

Forget automation getting rid of jobs -- it probably won’t, but that is a topic for another post -- and think about automation differently. Automation is the force multiplier that makes an hour of digital marketing worth several times the hour of a less informed digital marketer.

The number of tasks are endless, like dealing with high-risk orders, preparing for major events, flash sales, triggering workflows outside of and downstream of your eCommerce platform, and enriching collected customer data.

Take just this one expensive area for all merchants, high-risk transactions: “Importantly, eCommerce automation is also protecting brands from a rising threat: fraud. Instead of manually cross-checking orders with shopper purchase histories to determine if individual orders are fraudulent, brands rely on automated fraud protection natively embedded in their eCommerce platform. Automation can prevent high-risk orders from being fulfilled and prevent costly chargebacks.”

Trend #6: Radio podcasting is the new radio

Black Friday programmatic impression growth grew an astonishing 85% in 2019 compared to 2018. Connected TV grew even more. Pay close attention to these new channels, and review your strategy accordingly.

Six Must-Watch eCommerce Trends for Specialty Brands in 2020