E-commerce trends 2013-14

By June 27, 2013Amazon, Ecommerce

I just read the following good list of e-commerce trends for 2013-14 on Quora:

  • Commodotisation of online stores. Even lower barriers of entry for anyone looking to build an online store (or sell something) led by solutions like Shopify,WooCommerceGumroad and Tictail.
  • Consolidation of niche online stores that focus on long-tail products by larger marketplaces e.g. Fab.com & Referly. Possibly leading to more mergers and acquisitions by larger online or offline retailers.
  • Customisation for each shopper. Intelligent & real-time data leads to condition based events that are unique to sub-sets of users or individual users. e.g.GoSquared + contests/recommended product at a special discount
  • Mobile purchases will increase led by better checkout experience from responsive sites.
  • More physical retailers will learn to harness online real-time data in their physical storefronts especially social currencies like positive tweets.
  • Online stores will differentiate by offering more of the standard offering e.g. daily deals and include mechanics that are harder to replicate e.g. videos and live events with high production values
  • Influencers will get more prominent tools to curate beyond what Pinterest or blogs currently offers. Making it easier to reach out to specific demographics and market segments at the top of the marketing funnel, see Your mix of inspiration
  • Shift to higher value density products (e.g. nutritional goods, skincare products and make-up) and fast moving consumer goods (FMCG) by retailers as market saturation peaks for Fashion.

It’s a good list. I would put more emphasis on mobile and add something about niche markets, community, brand and direct relationships with the manufacturer. As Amazon and other large players leverage their scale to drive prices down new entrants will seek to compete by leveraging support from their community, building fun and engaging brands and capturing the margin taken my retailers. This strategy is difficult to execute but large value will accrue to those who succeed.

 

  • Nathan Schor

    Nick,
    ‘It’s a good list’. I agree. But one item is notable by its absence – VRM (Vendor Relationship Management), which advocates a demand-side approach to ecommerce, and whose potential you’ve pointed out several times before (and aptly described in Doc Searl’s ‘The Intention Economy’).

    VRM clearly and immediately benefits both sales transaction parties. Buyers and
    merchants each receive what they respectively value the most – noticeable cash
    for customers and noticeable improvement in sales efficiency for vendors.

    Applying the observation in your last sentence sequentially – ‘This strategy is
    difficult to execute but large value will accrue to those who succeed– ‘ to VRM
    brings up an interesting question. VRM, of course, has execution issues, but
    none are anywhere near insurmountable. But that minimal risk is insignificant compared to VRM’s wealth creating potential, made all the more compelling since its
    newly created wealth, what the World Economic Forum called an ‘digital oil’, an
    asset class for the 21st century. So what’s holding back this obviously
    attractive way for transacting ecommerce?

  • http://RogerEllman.com/ Roger Ellman

    Similar to offline, hanging-on-high-street retailing in many ways: Big and cheap or all-encompassing stores (legacy names but still popular for the spend time-cruise-and-shop-for-pleasure customers), ultra cheap with a limited selection and niche high-experience stores. At least these are the ones achieving passable to fairly good business levels.

    In the end and reduced to the bare and periodic table of what works, the future…it’s all in the Experience – this includes cheap, oh how good to have a recommendation, how wow is that, exciting-new and cute, etcetera. Anything that speaks to emotions of ease, satisfaction, vibrant thrill, did well bargain-hunting, “status or matus” (being in with friends).

    I’m working on this!

  • http://www.theequitykicker.com brisbourne

    Hi Nathan, I remain a believer in VRM, but so far I haven’t seen anything to suggest 2013/14 will be any different to the last five or ten years.
    VRM is a marketplace that requires changes to deeply entrenched behavior on both sides. That’s the challenge.

  • http://www.theequitykicker.com brisbourne

    Thanks Roger. That’s a helpful breakdown. Niche/high end is the most attractive from our perspective as investors. So long as the niche is large enough.

  • http://RogerEllman.com/ Roger Ellman

    I’ll see…what I can do!?!!