Just before New Year’s, Shopify released their extensive report called “Commerce Trends 2023.” A must-read for curios brands and retailers, eager to jump along the top commerce trends. The report covers trends within 5 categories: supply chain, money, marketing, ecommerce, and retail.
In this blog post, we dive into selected trends from the chapters about marketing, ecommerce, and retail. Especially, we are excited to share some of Shopify’s findings about social commerce and tendencies on social media. This is right down our alley and greatly relevant to brands and retailers interested in live shopping.
Shopify’s research methods
Shopify has collaborated with the global market research firm Ipsos to investigate trends in the commerce industry – and the report covers their findings. The report is based on responses from 900 business owners and decision makers in commerce from 14 countries across the globe.
Shopify combined their first-hand data with third-party data, research on different brands using Shopify Plus as well as qualitative insights from several interviews with leaders, investors, and experts. In other words, Shopify knows what they are talking about.
Consumers want seamless immediacy and interaction
The world has changed throughout the past couple of years. Many businesses faced economic difficulties due to the pandemic and later due to the Russia-Ukraine war. However, online shopping accelerated quickly during the pandemic, and our lifestyle quickly became highly digitalized. We worked online, we did our shopping online, and social gatherings and events happened online. However, this led to an urge to go back to the physical stores and meet face-to-face when lockdowns were over.
Certainly, the last couple of years have been important in determining the commerce trends of 2023.
“The commerce and technology landscape is in perpetual motion. Brands need to respond in real time just to stay relevant.”
Commerce Trends 2023, page 13
No matter if we are discussing online or in-store shopping, consumers are used to having everything within reach immediately. It is the “one click away” era. Consumers are looking for high-value, personal, instant, and responsive shopping experiences. And social shopping is the answer.
Today, online shopping is about much more than just the product, and this is especially evident within the world of social selling. Brands are using social media to engage, convert, and retain customers like never before. Why? Because it works.
According to Shopify’s research, 9 out of 10 people buy from brands they already follow on social media. By being present where the consumers are, social commerce reduces friction, shortening the road from discovery to conversion. Based on their global survey, Shopify concludes that:
“Using social channels for marketing and promotions is the most important customer acquisition and retention strategy for businesses to drive growth in the next few years.”
Commerce Trends 2023, page 11
Now, let’s dive into the trends and learn how to meet consumer demands.
Ecommerce is on an upwards path again
The ecommerce market has been highly affected by the COVID-19 pandemic; this is not news to any of us. Initially, the pandemic accelerated ecommerce growth and many people shopped online for the very first time.
However, 2022 was a tough year for online retailers. The growth slowed down and for the first time in many years, the growth rate was negative. But as the global situation is returning to normal, the market recovers from the changes during COVID-19 and the following reactions.
In 2023, we expect that the growth of online shopping is on an upwards path again. Actually, the growth is expected to be 5% higher than it was before the pandemic. In coming years, the growth will stabilize.
“Social media is infiltrating every part of retail”
If you thought social media had peaked, think again. 95% of the working-age internet users visit social media each month and Gen Z uses social media to research brands more often than they use search engines. Still, social media continues to boom and expand.
It is estimated that social commerce sales in the US in 2023 will be doubled from the sales in 2020. And already by 2025, global social commerce sales are expected to exceed $2 trillion.
Having a good experience with a brand on social media is important to modern day consumers. Specifically, it entails that:
Naturally, this affects how businesses view social media. In the coming years, almost one-third of businesses expect to increase social media marketing in order to grow their business. It is the place to be if you want to win over customers.
Paid advertisement competes with interaction on social media
Another commerce trend for 2023 is increased ad spend. In 2020 and 2021, the global ad spend on social media increased with more than 38%, and the rise continues. In 2026, the total spend is projected to exceed $200 billion worldwide.
However, though ad spend continues to increase, we also witness new social media strategies that – for some brands – are more effective than paid advertisement.
The trend is interaction with consumers on social media. It might sound simple, but for brands such as SKIMS, performance marketing is not a priority, as they utilize their social channels in different ways. Their growing audience is very loyal, and SKIMS benefits from a lot of user-generated content. Through organic initiatives and interaction, they build a strong brand.
Naturally, it is a great advantage to have one of the most popular influencers in the world on board. But no matter what, the deep connections and extraordinary experiences with a brand on social media is a major win.
PRO TIP: Live shopping shows are great for interacting with your audience since you can communicate face-to-face. Ask your viewers questions to engage them – and remember to also answer all their questions in return. It pays off.
How to meet consumer needs in the digital landscape
The ecommerce tendencies and trends speak a clear language. Interaction and presence on social channels are center of attention. Shopify calls it “the most interactive digital landscape yet.” But how do you meet consumer needs in this new landscape? How do you wow your customers?
The key is convenience and personalisation.
Automated live shopping on social media
We have already learned that consumers are looking for brands and products on social media. Therefore, shopping has been implemented on social media with “Buy now” buttons and other initiatives to make it as easy as possible.
But even better are shoppable videos. Live shopping is not just a major trend in China. Since 2019, it has gained momentum in the United States and Europe, and all the tech giants such Meta, Pinterest, and TikTok invested in live shopping technologies during the pandemic.
With shoppable videos, you allow followers and customers to make a purchase directly on social media. This reduces friction, boosting your conversion rate.
“Shoppable videos lower barriers to conversion even more, with some companies reporting conversion rates near 30%.”
Commerce Trends 2023, page 46
In order to succeed with live shopping, you need to be on top of managing every part of it, such as inventory management and customer care. This is challenging handle manually, so it is beneficial to invest in a live shopping software to get rid of manual work.
PRO TIP: When using ELISA, everything is managed automatically. Thanks to our seamless integrations, ELISA keeps track of your inventory, creates orders automatically as viewers comment on your social channels, likes and answers messages automatically, and much more. In other words, you set up a campaign, host the live shopping event, and lean back while orders come in.
Online and offline shopping go hand in hand
We have learned that online shopping is getting more and more popular each year. But this does not mean that physical stores are becoming redundant. Not at all.
The offline and online experiences go hand in hand and boost each other. Consumers tend to research brands and products online before entering a physical shop. Vice versa, many consumers visit a physical store to interact with a product, before purchasing it online.
This synergy is very important, if you sell both online and offline, and it is very important to clarify what role your brick-and-mortar store plays and what role your online store plays. If you do so, you can make the most of both.
When determining the role of the physical store, have in mind that shopping can happen anytime and anywhere in the digital landscape. Therefore, the purpose of your physical store is not just to sell. Actually, 35% of consumers visit physical stores, because they enjoy the experience and another 24% of consumers go in-store to interact with the product and receive guidance before placing an order online.
Therefore, showrooms have become very popular. Here, the brand focuses on creating a memorable experience, while allowing visitors to investigate the product before purchasing it online. Now is the time for you to determine how to make the most of your physical and online store.
PRO TIP: Live shopping combines the personal experience from the physical store with the convenience of online shopping. Use your physical store or showroom to host your live shows and remember to decorate it nicely. The setting will seem familiar and on-brand to your viewers.
Make partnerships, not competitors
The collaborative nature of commerce is entering ecommerce as well. What do we mean? Think of a festival, where the different bands all attract participant. They form alliances, where every band contribute to bringing people together. The same phenomenon is found in a shopping mall, where all the shops collaborate on attracting customers, thus increasing every store’s chance of making a conversion.
This is not yet common within ecommerce, but it will be. By collaborating, brands get access to new audiences and lower their cost per conversion while boosting credibility.
Collaborate with other brands and businesses
Sharing your audience with other brands and businesses might sound terrifying. But two brands are not necessarily competing for customers’ attention simply because they share the same target audience.
For instance, if a clothing brand is focused mainly on women aged 25-45, that store can easily share customers with a beauty store, a deli, or a knitting store, which are also targeting 25–45-year-old women. Customers are not likely to buy less from the fashion shop just because they also buy makeup in the beauty webshop and delicious chocolates in the deli. Therefore, those shops can recommend each other risk-free. In return, each store expands their reach and most likely also their sales.
PRO TIP: Some ELISA-customers collaborate with other local stores by giving away product samples with each purchase or selling other stores’ products. If another store down the road or another webshop has the same target audience as you, why not utilize it?
Collaborate with content creators and influencers
Social media is packed with influencers and many brands initiate partnerships with selected influencers to promote their products – and with good reason. Almost one-third of shoppers find that recommendations from influencers are more important than recommendations from family and friends.
Additionally, regular customers can also fill out the role as content creators by sharing user-generated content such as photos and videos, reviews, comments, shares etc. User-generated content is actually 8.7x more impactful than influencer-content, so do not take it for granted.
PRO TIP: ELISA offers a tool, allowing you to go live with collaborators such as influencers to attract more viewers. As the influencer goes live from his or her own social channels, it automatically attracts a much wider and larger audience to your live shopping event.
The commerce trends of 2023 are highly focused on social media and social commerce. And this development is happening to meet the demands of modern-day consumers, who expect everything within reach in just one click. Here, social commerce is key to providing high-value, personal, instant, and responsive shopping experiences. Brands and businesses need to respond simply to keep up.
After ecommerce had a setback during the pandemic, it is again projected to increase in 2023. Soon, the growth rate will become steadier, still going up. Social media is also continuing its’ rise, becoming more and more used – both by consumers and by brands and retailers.
Likewise, social commerce is booming, and consumers are using social media to research brands and products like never before – not only Gen Z. Paid advertisement on social media joins the climb, as the global ad spend also continues to increase. But simultaneously, more and more brands prioritize interaction on social media and user-generated content above paid ads.
But how do brands and businesses serve the modern-day consumer in what Shopify refers to as “the most interactive digital landscape yet?” Live shopping fits perfectly. You allow customers to shop where they are already browsing, and you can interact in real time with viewers. This is exactly what consumers search for in a time where shopping is no longer centered around just the product.
Now, it might sound as if physical stores are becoming pointless, but that is not the case. However, it is crucial to specify and determine the role of your physical and online store. The two go very well together, if you know how to use them. For instance, using your physical store as a showroom allows customers to interact with your product before purchasing it online.
Another initiative – relevant to both physical stores and ecommerce – is to develop partnerships instead of competitors. Widen your reach by collaborating with other brands, influencers, or content creators. Recommendations from other brands and influencers and user-generated content are highly effective for boosting conversions.
Interested in more?
Do you want to know more about live shopping and the benefits of social commerce? We have helped more than 1,500 brands and retailers and facilitated +10,000 live shows. Send us a message or give us a call to learn more. We would love to have a chat with you