Online Retail Industry Overview and Trends

Posted 3 years ago by Max Komonov

A good marketing manager watches ecommerce trends carefully to stay ahead in what can be a highly competitive landscape. But if you’re a small business handling your own marketing, being aware of key trends vital to the success of your business falls on you. In either case, if you’re looking for information on retail industry trends, this overview is for you.

The Most Important Ecommerce Industry Trends

For those pressed for time, here are some of the most important ecommerce sales statistics:

18% of retail purchases were made online in 2020
That number is set to increase to 24% by 2024
Ecommerce grew by 44% in 2020
Total retail sales grew an estimated 6.7% in 2020
The National Retail Foundation (NRF) is projecting that growth to increase to 10-14% in 2021.

Online Shopping Trends

The number of people who consider themselves online shoppers has increased by almost 1 billion people in the last 6 years. Even though that growth has decreased a bit in the first quarter of 2021, the pandemic spurred that growth throughout 2020. But who is shopping online, and on which ecommerce sites are they shopping?

The majority of online shoppers are Millennials aged 25 to 34, with Generation X (aged 35 to 44) closing the gap.
Women are 4% more likely to shop online than men
Almost half of all online purchases are made via mobile devices
About 72% of online shoppers found their new products on social media platforms

Online Shopping Tech Trends

Shopping for tech has come a long way in the last five years, and more and more people are expecting a fast, seamless online shopping experience. Personalization is more important than ever before because consumers know that you have the means to customize your products and services. Here are some of the ways that online retail technology will continue to grow in the next year:

Saying our shopping experiences are shaped by AI sounds strange to many people, but artificial intelligence algorithms are what personalize your online experience from one browser or app, or device to the next. Having all of those things synced together requires highly sophisticated AI technology.
It is necessary to have seamless site functionality. Consumers have no patience for an ecommerce website that is slow to load or hard to navigate. Having a solid digital infrastructure is vital to increasing conversions. If your website is no longer meeting your customer’s needs, you might need to think about a digital transformation.
Augmented reality, or AR technology, gives online shoppers the ability to experience products before purchasing them. It takes away some of the discomfort that people have about buying things online. It has been estimated that by 2023 there will be over 2 billion consumers using AR technology on a regular basis.
Protection of consumer data is a hot topic in a world flooded with tech experts, some of which are not on the right side of the law. You must be able to show your customers that their information is protected, if or how it is to be used, and that they can opt-out at any time. A privacy policy and terms of use does this nicely and should be included on any ecommerce website.

Emerging Trends and the Impact of Covid-19

Even though online shopping has increased, local businesses are thriving. That’s because brick and mortar stores are recognizing the need to offer options like delivery, curbside pickup, and shipping, all of which require an active online presence. Even when people purchase in-store, about 90% of shoppers do at least one Google search prior to entering the store.

Subscription services have also increased dramatically since the onset of the pandemic. People are spending more time than ever in their homes, and remote workers are having a hard time maintaining that work/life balance. Subscription services are convenient, require no thought, and add a little spice to their day.

Consumer shopping habits also show that personalized experiences are important. This permanent behavioral shift toward shopping online and spending less time in public places requires the advancement of ecommerce to all retailers, large and small.

Global Forecast and Latest Trends

Overall, the pandemic changed a lot about the way people shopped and purchased products, and a lot of those changes seem to be hanging on in 2021. The upward trend is only continuing to gain momentum going forward. Here are some of the predictions for ecommerce penetration in 2022 and beyond.

Online store growth statistics

In 2022, online retail sales are expected to grow by over $1 trillion
According to Beeketing, we can anticipate a continued ecommerce growth rate of 265%
Statista reported that ecommerce compound annual growth rate will continue at about 7.51%
Multi-channel ecommerce sites will make up almost 19% of ecommerce sales in 2022.

Social media growth is a necessity

Social media use has been growing steadily, but the pandemic pushed even more people toward the platforms. With the addition of TikTok, which is quickly gaining traction, social media has gone from being about Facebook to being about multi-channel social media campaigns. If you fail to keep up with the social media game, you probably won’t get very far.

The most popular social media platform is still Facebook, followed by Twitter, but you might be surprised to learn that TikTok has already reached about 80 million people mid-way through 2021. Instagram and LinkedIn are also gaining traction.

Online retail success is about trust

In 2020, the FTC received over 2 million reports of fraud, and there were around $246 million in losses related directly to online shopping scams. Consumers are also better able to research companies and brands, getting reviews from all walks of life with a few Google searches.

At the same time, they don’t want to give up too much of their personal information. The general public is becoming more and more guarded with their personal data. In fact, 63% of consumers are more likely to make a purchase if they feel like their personal data is protected. If your website’s security certificate is not kept up to date, you will lose customers rapidly.

In addition, 81% of consumers have said that they are more likely to buy a brand when it is advertised alongside the news. Providing industry news on your website alongside promotional content is a great way to turn online shoppers into loyal customers. And since it can cost 5X as much to get a new customer as to retain an old one, that is an important distinction.

Online sales vs retail sales

Online sales are growing at a much higher rate than retail sales in general, but they aren’t necessarily excluding brick and mortar stores. In fact, even though online sales have increased substantially, 70% of consumers say they support their local companies through online shopping orders. Even though the number of online sales is going up, brick-and-mortar retailers don’t have much to worry about as long as they keep up with online shopping trends as well.

The most popular ecommerce sites are in the fashion industry

Did you know that the fashion industry — apparel retailers, jewelry stores, shoes, and accessories — grows almost 30% every year? This trend has been consistent for many years, but in 2020 it increased dramatically with the addition of novelty masks being thrown into the mix. Purchasing apparel online is becoming so common that 46% of all apparel sales occurred at online stores in 2020.

The Most Effective Ecommerce Trend

Have you guessed the answer yet? The most important trend in ecommerce today is the customer experience. Unfortunately, in times gone by people were more worried about SEO and conversion rather than taking care of their customers. Now that people make more purchases online, the competitive landscape requires everyone to be at the top of their customer experience game. If you follow the rest of the information in this guide, you should achieve that with little additional effort.

About The Author

Max has been working in the ecommerce industry for the last six years helping brands to establish and level-up content marketing and SEO. Despite that, he has experience with entrepreneurship. He is a fiction writer in his free time.