7 e-commerce trends you'll see in 2017

Every year, the world of e-commerce produces new statistics and trends that show how the internet is continuing to disrupt traditional retail. Internet Retailer Convention and Exhibition, the largest e-commerce trade show in the world, is an event dedicated to unveiling these changes. This is my fifth year covering the show. Each time, I hunt for trends that will make or break businesses in the outdoor industry.

Here are seven game changing trends that will shape the next year of e-commerce.

1. B2B e-commerce will soon be twice the size of B2C
For many, the word e-commerce implies consumer retail, but the reality is that business-to-business e-commerce will soon be twice as large as business-to-consumer e-commerce, according to a study by Frost and Sullivan. By 2020, B2B e-commerce will reach an annual total revenue of $1.1 trillion, and it’s just heating up.

“This phenomenon can be witnessed by major retailers acquiring distribution systems, such as Walmart’s acquisition of Jet and Lowe’s $512 million acquisition of Maintenance Supply Headquarters,” said Andy Hoar, principal analyst with Forrester.

B2B e-commerce will continue to grow at a rate of roughly $100 billion a year, roughly the GDP of Morocco, to eventually surpass retail e-commerce by double.

2. Screenless search
Think of the last few searches you did on a mobile phone. Chance are, you may have skipped a screen altogether and instead, had a conversation with a robot.

The way of search is changing; many of today’s searches skip screens altogether and the search results are presented through a voice driven AI (artificial intelligence). According to Gartner Research, by 2020, 30 percent of searches will be done by voice.

“This means your SEO efforts will not only have to cater to Google, you’ll have to structure your content for Cortana, Alexa, Siri, and S Voice,” said Eugene Feygin, SEO program manager for quill.com, a B2B bulk office supply site.

3. The growth of Prime and Fulfillment By Amazon (FBA)
Amazon Prime members doubled in the last two years and in March of 2017, reached 80 million subscribers. Prime members spend, on average, 86 percent more than non-prime members ($1300 vs. $700) per year, a number sure to pique the interest of outdoor industry brands and retailers.

Fulfillment By Amazon definitely hurts margins, but it sure helps volume. For some brands and retailers, annual sales could grow by three- or four-fold. Amazon has an FBA calculator open to the public for those considering the service.

Mike Duncan, founder of Skateboard Warehouse, gave an interesting perspective for brands considering FBA. If you have a product offering that allows you to go deep and not wide, FBA could be a good fit. In other words, instead selling one of every SKU you have, find your top sellers, keeping in mind shipping, size, and weight for storage fees, competition, and concentrate your efforts on moving lots of those.

4. Marketing and IT teams will merge

Perhaps one of the most repeated themes of the conference was a trend to combine web teams and marketing teams into one unit. Doing so creates efficiency within the organization and forces IT to support marketing initiatives.

“I’ve seen contracts that should have been kept in house, given to third party vendors because IT wouldn’t support the marketing team,” said Jason Roussos, VP of marketing and e-commerce for the United States Gold Bureau, a precious metal dealer based in Texas. “There will be turnover and resistance [when merging the IT and marketing teams], but it’s worth it. By not merging, there’s a greater chance of failure of both teams.”

Pretty soon, web development teams, e-commerce teams and marketing teams will be one, with marketing taking the lead. In Roussos’s estimation, traditional web technology roles will eventually disappear and be replaced by technical marketing roles.

5. The rise of manufacturer direct to consumer sales
Meet your newest competitor: the factory that makes your products. Increasingly, factories are creating their own brands and launching straight to market via e-commerce. In the process, they’re jettisoning overhead for brick and mortar stores and expensive replatforming mistakes. Because they’re starting from scratch and have lower overhead costs, they’re nimble and able and react quickly to the market. Think Warby Parker, Me Undies, and even scarier, those knockoff brands that replicate branded products on Amazon.

To fight back, give your customers a reason to love your brand through personalization. According to Dan Pingree, chief marketing officer for Moosejaw, if customers love your brand and you’ve made a personalized connection with them, some segments within your customer base will pay up to 10 percent more for a particular product. They know that with some research, the same item can be found cheaper somewhere else online. But they’ll prefer to buy from you because they love the brand experience you give them. The trick is identifying this segment and making sure you deliver a great personalized brand experience.

6. HTML 5 video in email

HTML 5 allows short videos to be embedded directly into email, giving a richer customer experience that, until now, wasn’t possible. This is important because many of the email blasts that brands and retailers send out can’t include sales prices or product promotions of any kind. 
With promotional content no longer on the table, the next best option is highly branded or even highly personalized content. Video in email is a new content format that expands the options of what content an email can contain. As many brands and retailers know, if content is well done, it can drive huge revenue.

7. Personalizing Content via Customer Personas

Defining customer personas, or grouping your customers into marketing categories, is nothing new in marketing and neither is segmented email strategy. But using personalization as a survival strategy is something I had never heard of before.

“As a retailer, if you don’t figure out personalization sometime in the future, you probably won’t be around,” Pingree said. In one example, he tested clickthrough rates in an email that was aimed at two different audiences. The theme of the email was “get ready for skiing.”

The content of the email was catered to two different personas, while one group had generic content to benchmark as a control group. The email sent to the snow sports persona saw a 30 percent increase in clickthrough rate and 54 to 145 percent increase in conversion rate, which in the world of email marketing, is the equivalent of sending three more blasts.

Defining personas can be a fun way to put a face behind customers. It’s often an imperfect science that blends actual research, as well as anecdotes of who you think your customer could be. It can be a creative team-building exercise that can reveal insights into who your customer is.

Try getting your marketing team in front of a whiteboard and draw four to six boxes. Then have someone on the team fill in a box on who they think their customer is. Chances are, the C-level’s idea of the customer may be very different from an intern’s.

Then pull your Audience Overview Report in Google Analytics to see where your theories line up. Note that while personas can be categorized by age and income, they can also be categorized by sport, location, or even whether they are an online or offline shopper.

Yoon Kim has written extensively about e-commerce for SNEWS, Outdoor Retailer Daily, Walmart Supplier News and other B2B publications. When not covering business trends, he spends his days running the operations of Blogs for Brands, a full service content and e-commerce agency. He also runs Outdoor Blogger Summit, which is an annual conference dedicated to content creators in the outdoor industry.