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The Hottest E-commerce Trends For 2022


While you may not think monitoring e-commerce trends is a necessity, it truly is.


For e-commerce business owners, keeping on top of industry trends is extremely important for you to stay competitive and identify new business opportunities. You want to grow your e-commerce business, so paying attention to these hot e-commerce trends can make a huge impact on your future growth.

We’re now six months into 2022, and we’re seeing some interesting e-commerce trends we want to share with you. This article highlights four e-commerce trends to watch during the rest of 2022, while also discussing challenges ahead and how to overcome them. Let's get started.


Trend 1: Competition Increasing Across the Board


A new recent industry report found on Statista shows that e-commerce will account for 20.4 percent of global retail sales by the end of 2022, up from only 10 percent five years ago. In short, the e-commerce space is a little more crowded these days.


There are a number of different reasons why we’re seeing rapid growth in e-commerce;

  • Inflation

  • Ukraine war

  • Covid-19

  • Government policies

  • Consumer behavior

Think about the Covid-19 pandemic for a moment: it changed e-commerce and the world; working from home became a thing.


The Obstacles It Creates


With increased competition, you’re going to have higher costs.


New e-commerce companies are racing to gain consumers' attention. The result is increased costs for advertising and reduced return on ad spend (ROAS). Advertising on Facebook, for example, already costs 47% more than the year before. That’s a huge spike in ad costs — that can be a problem.


Paid ads are not as effective as they once were. Do you remember Apple's privacy updates in iOS 14.5? If you ran ads at the time, you likely know the end results. Cross-app data sharing was prohibited unless users chose to opt in. Due to this new policy, advertising across Facebook and Instagram has become much less effective

then before.


The Solution: Focus on Customer Lifetime Value


One thing we know for sure: Apple’s focus on privacy isn't going anywhere anytime soon. Due to this, many e-commerce companies have begun exploring new and unsaturated marketing channels. Both Snapchat and TikTok have millions of users, and e-commerce merchants will continue to use these platforms and others to grow their business.


Amping up efforts at customer retention is another way out of this difficult situation. As customer acquisition costs continue to rise, maximizing customer lifetime value helps maintain profitable margins for your business.


One way you can adjust is by focusing on the lifetime value of your customers. The best repeat business is current customers. If you can think about ways to increase their lifetime value, you can make up for all the additional advertising costs you’re going to occur.


Trend 2: Conventional Financing Methods Take a Back Seat


Alternative financing is gaining popularity among e-commerce companies. Instead of taking out loans or trading equity for investors' money, many businesses now prefer other means of cash injection, such as revenue-based financing (RBF) and inventory financing.


The paradigm shift didn't happen for no reason. When asked about why they switched from loans to revenue-based financing at Choco Up, some e-commerce marketers shared the following views:


• Bank loans are time-consuming to apply for.

• They don’t have eligible assets (e.g., cars or property) to pledge as collateral for loans.

• Loan repayments in fixed installments would put pressure on their companies' cash flow.


Equity dilution is also a common concern among founders who didn't opt for angel investments or venture capital. After all, giving away equity is expensive.


The Obstacles It Creates


During the past few years, a number of different financial tools have hit the market — many of these have been specifically designed for e-commerce businesses. E-commerce owners should be taking the time to get familiar with the new terminology and financing solutions.


Here’s a good example: for revenue-based financing (RBF), funding is not repaid in fixed installments. Instead, RBF platforms will share a fixed percentage of the company's revenue until the amount is fully repaid.

Yes, traditional financing solutions are still available, but interest rates are climbing thanks to the Federal Reserve’s hikes. These new financing options may be a good fit for your e-commerce business.


Just like with anything, you’re going to have pros and cons. On the plus side, repayment is flexible. On the other side, your business must have recurring revenue in order to use revenue-based financing. If you don’t have that revenue coming in, it’s not going to work.


The Solution: Exploring Alternative Financing Solutions


Market research showed that in Q2 2021 alone, funding acquired by e-commerce companies worldwide totaled $16.8 billion. That is a five-time increase compared to the same period in the prior year.


Evidently, e-commerce companies are poised for growth and challenges ahead. As traditional forms of financing cannot aptly address these companies' needs, alternative financing is here to stay.


Another option is cryptocurrencies. It'sough to see that now with Bitcoin dropping below 2017's all-time highs, but it has been the best performing asset during the past 12 years. With crypto, many companies are investing in the digital asset and holding it long-term. If you held it for four years at any time during the past, you would have made big gains.


Trend 3: More Users Are Buying on Social Media Platforms


Social media is still a powerful tool to use to grow your business. Social media has created a wide range of great opportunities for e-commerce business owners. Social media presents new commercial opportunities, from brand marketing and product discovery to customer service and shoppable advertising.


According to eMarketer, 30 percent of U.S. internet users have made purchases using social media. Even more interesting, global social media platforms are expected to triple that amount by 2025. Thanks to Facebook, TikTok, and other social media platforms, you can sell your e-commerce products on their platform. This presents a big opportunity for all e-commerce businesses.


The Obstacles It Creates


One of the biggest challenges you're going to face is building a loyal social media following. There's a few reasons why so many companies struggle to do so.

  • Don't have a cause, purpose, or solution

  • Don't publish content that their audience relates to

  • Don't publish content consistently

  • Don't use both organic, paid, and groups


Solution: Create Genuine Content


Content is key. Think about your customer’s journey. Buying from you should be simple and easy. It should always be a positive experience from start to finish. Make the speed to purchase as easy and as positive as possible for the consumer. Every touchpoint is key to the overall experience.


No matter what type of e-commerce business you have, users crave content. Companies that produce consistent content daily are going to be the ones that benefit the most. You need to create a content calendar and track the results. This will give you insights to what works and doesn’t.


Blog and article content have another benefit: search engine optimization. SEO is a powerful marketing strategy. When consumers can find you organically through Google when they search for a product you have, it can drive sales and revenue.


Trend 4: Create Live Shopping Experiences


Live video streams are powerful and consumers love them! Companies like HSN and QVC have been utilizing live shopping successfully for decades. Now, you have the ability to do the same. Many brands are rushing to adopt this e-commerce trend, and rightfully so — it works!


Thanks to a new report by Shopify for The Future of Commerce report, the number of app installs for livestream selling grew by 61 percent globally between January and September 2021, compared to the same time period in 2020. You now have access to the technology that the biggest e-commerce brands are using, and that can help make your e-com business an instant success.


The Obstacles It Creates


Customers seek ever closer and authentic relationships with the brands they choose to shop with. If you're not giving your audience that opportunity to build a special bond with your brand, your e-commerce business is going to suffer for it.


Live video is not easy, but it's simple. You need to plan it out. You need to figure out which products to promote. You're setting it up as you would a show. This does present challenges.


Live shopping can be a great innovation to consider as part of your marketing strategy in 2022 to build customer engagement, loyalty, and brand differentiation


The Solution: Start Exploring Live Shopping


Sure, you knew that, but it's true — are you giving live shopping a try? If you're not currently live shopping, it's time to give it a try. Both Facebook and YouTube make live streaming easy.


You don't have to be perfect starting out. It's live video: a lot can go wrong — but a lot can go right. You're never going to know unless you give it a try. One thing we know for sure: live shopping is growing fast and if you don't jump in, you could get left behind.


Want to Join a Thriving Community of E-commerce Entrepreneurs?


If you want to learn more about being successful in e-commerce and want to rub shoulders with some of the most successful entrepreneurs on the planet, make sure to join PDMI. You can become a member here.