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Three digital trends that will shape the rest of 2018

Oct 16 '18

Every quarter, we sit down with our clients to share the most exciting, innovative, and likely impactful trends that we are seeing on the horizon. Here are three that will shape the space for the remainder of the year.

Trend 1: Email is facing competition

Up until recently, the email address was the primary and most important piece of information companies could capture at guest or registered checkouts. Email address allowed our clients to send marketing campaigns to customers, improve cart conversion, and enhance the order experience with customized information. While the sophistication of the process has improved considerably over the years, the email address was always the foundation of the customer experience.

But the long reign of the email address may finally be coming to an end.

If you haven’t heard of Hanacure, you probably don’t have a woman between the ages of 25 and 40 in your life. The current craze among consumers in Korea is at-home facial kits. Hanacure is one of the most popular facial kits available in Korea, and, thanks to some social media love starting in late 2017, the kits have become insanely popular in the U.S. Ask any woman that uses Instagram and is under forty and they probably have seen Hanacure ads in the app.

Take a look at the sign-up screen during the checkout process on Hanacure’s U.S. site:

Hanacure checkout mobile view

They are asking for email or mobile phone number. Hanacure isn’t alone in this trend, we are seeing mobile number or email address options on many hot digital brands this year. And this seemingly modest registration change is actually a titanic shift in the customer journey.

Think about it: By allowing the user to enter their mobile number instead of an email, Hanacure and many other brands are potentially giving up the ability to ever have an email address for a customer. They are saying that capturing a phone number is so valuable to an impactful customer experience that they are willing to forgo online stores have always captured—email addresses.

Now, email isn’t going away; it still has a crucial utility in the marketing mix. So why are we seeing this? It’s the convergence of two important trends.

First, email ubiquity is shrinking from universal use to the more limited (but still important) domain of work life. If you look at the statistics in a recent analysis of email usage by age group, it’s clear that the future of email looks rather rosy and contradicts what I just wrote. But take a closer look,  and you will see a dramatic decline is already underway. Email is losing ground as the preferred method in customer journeys. “According to the study, email is preferred by 70% of Gen Z for company-to-consumer interactions, compared with 72% of Millennials and 79% of Gen Xers.”

The second trend at play is the dominance of Facebook messenger: Eight out of every ten internet users in the United States under 45 uses Facebook messenger. Merchants like Hanacure are simply taking advantage of a shift in consumer behavior and tailoring the customer journey to conversational commerce.

How you can take advantage of this trend: Merchants should immediately begin the process of creating a conversational customer journey strategy built around three primary goals for the next quarter. (Like improving car abandonment, reordering, etc). Look at tools and strategies competitors are using improve KPIs using these approaches.

Trend 2: Using Facebook Messenger to improve cart abandonment conversion

Facebook has a special program for merchants that allows them to connect to a user via Messenger even if the consumer abandons the checkout process early. The experience is nearly frictionless. Startups like Radiance Labs (below) have built machine learning solutions that interact with consumers to automatically improve key metrics like cart abandonment. You can also use these tools in your broader strategy by suggesting reorders and related products and consumer-centric experiences.

Expect the solutions in this space to rapidly improve in sophistication over the next twelve months as machine learning algorithms learn more about your customer buying behaviors and your products.  Merchants who fail to implement a Messenger strategy may find themselves farther behind their competitors a year from now.

How you can take advantage of this trend: Take a crawl, walk, run approach and implement a simple Messenger strategy for improving cart abandonment. Prove the business value for that key metric, and then spend time planning a broader strategy for conversational commerce.

Radiance Labs mobile view

Trend 3: Merchants are wasting too much time on smart speakers

Alexa, Siri, and Google Home, commonly referred to as virtual assistants, are talked about as much today as Bitcoin was a year ago. And the data is pretty incredible: It took TV thirteen years to reach fifty million Americans but it took virtual assistants  just two. That is nearly 20% of the US population in just two years. And last month, Amazon released more than 70 Alexa products as part of what we can only assume Bezos diabolically calls his “Alexa everywhere” strategy, just before bellowing a menacing TV villain laugh.

We have seen clients large and small spend time, meetings, and precious engineering hours on virtual assistant plans. The problem is that in all of the attention and rapid growth, people forget that the use case of a virtual assistant only impacts only a narrow category of products.

You will never shop for a JCrew sweater by chatting with Alexa from your kitchen. Nor is a consumer likely to buy new running shoes that way. There four types of consumer goods: convenience (some toothpaste), shopping (a new television), specialty (new Bonobos jeans), and unsought (life insurance). Just one of these categories, convenience, aligns well with virtual assistants. If you have one in your kitchen today, you are likely using it to add items to your shopping list or Amazon fresh cart. But I bet you haven’t asked Alexa for a new flat screen for your living room, or a cute new part of jeans.

Focus is often the easiest path to success. Ignore temptation and stick with what is really going to improve sales. Winnie the Pooh was right, “Doing nothing often leads to the very best of something.”

How you can take advantage of this trend: Be honest with what you are selling and whether those are products consumers would really buy after chatting with Siri. If they aren’t, ignore virtual assistants for at least twelve months.