Ecommerce Trends for 2023: Exploring the Future of Ecommerce (Part 1)

Ecommerce sales have been breaking records year after year as the world continues to get more connected and technology adoption grows at an unprecedented rate.

For Ecommerce merchants and business owners, it is vital to stay ahead of the curve and understand the Ecommerce trends shaping the customer journey.

We're more than 6 months into 2023 and we've created a 2 part series covering Ecommerce trends we've seen shaping up this year.

Part 1: 14 Ecommerce trends shaping up the Customer's Journey in 2023

1) Gamified data collection

When the consumer hits the "Find your perfect lash style"; on Doe Beauty's website, they answer a series of questions such as what kind of look you prefer, how often you wear false lashes, your eye shape, and the style that resonates with you. Within 40 seconds, the false eyelashes brand gives eyelash suggestions and sends them to your email id.

The results of this quiz were stunning:

• 44% of all Doe Beauty's email subscribers come from the quiz
• 11% higher AOV (average order value) in customers who take up this quiz
• 24% of all revenue was created through this quiz

Like Doe's Beauty, you'll find several smaller DTC and Ecommerce brands encouraging customers to take quizzes. Apple's iOS 14.5 anti-tracking updates have posed challenges for smaller brands that relied heavily on third-party app data for customer acquisition and advertising strategies.

A major Ecommerce trend of the future we see is brands leaning on quizzes and incentives to gamify data acquisition to work around anti-tracking updates.

2) Competing on community, not price

In a saturated ecosystem where new DTC brands are popping up every other day, DTC brand communities evoke a strong loyalty for your brand and they're on an upward trajectory. Owing to increasing digital ad prices it only makes sense for Ecommerce businesses to incentivize the existing community of buyers to purchase more often rather than seeking new ones.

While communities facilitate maintaining meaningful connections with people and loyalists who love your brand, they are not something you can replicate overnight.

Ideally, think of building a loyal community from the time you launch your DTC/Ecommerce brand so that it can drive brand awareness and word-of-mouth marketing.

That said if you're just starting to embrace this 2023 Ecommerce trend, start small, say by educating your broader audience about your products and pain points, and have a branded hashtag that encourages genuine conversations on social media.

3) Blending human talent and AI

The future of Ecommerce is needing more talented employees to run your business or completely relying on AI to automate tasks.

Instead, maintain a balance between your workforce and AI tools that boost their productivity. For example, equip your marketing teams with smart AI headline generators and AI email writers to automate content creation for marketing campaigns so that they can focus on strategic activities like optimizing performance.

The AI revolution: what started as an Ecommerce trend in 2023 is only going to become the norm going forward.

4) Content first, commerce second

The truth is, your acquisition channels change as your brand grows. While initially Facebook, social media, and Google ads helped you acquire new customers, you would need a strong content engine as a brand acquisition and retention strategy.

Don't miss out on the potential of organic content. Educate the readers first, and then sell to them.

By doubling down on educational content, you can become the go-to brand for all customer queries.

For a better context, let's take the example of MUD/WTR, a coffee alternative with organic cacao, ayurvedic herbs, and functional mushrooms, helping customers abandon caffeine dependency.

The brand has an educational hub with MUD/WTR recipes, coffee detox programs, and blogs that talk about the benefits of caffeine alternatives.

In other words, an interesting Ecommerce and DTC trend for 2023 we've seen brands embrace is trying out innovative content assets that help the user.

If you're starting out with content marketing, think about the FAQs your customer asks, or how your products add value to the potential user, and try creating content that caters to their queries. It does not have to be always long-form, but it can also be recipes, educational videos, or learning kits.

5) Short videos that showcase the brand's lifestyle

Consumers are more advertising-averse than they've ever been. The future of Ecommerce is going to be where brands fit into the consumer's story, in an authentic way.

Toy subscription company Lovevery places authentic storytelling in the form of short videos to share the brand's story which fits into the wider story of the child's development.

Go beyond the usual marketing tactics to communicate your brand's lifestyle and mission, communicate the brand values, and tie them with the social cause you support.

6) Time-sensitive offers and flash sales

We see many DTC brands experimenting with the-good-old incentives like flash deals and time-sensitive offers to sell surplus inventory and sell to customers looking for bargains.

Calpak, an Ecommerce company for luggage and accessories hosted the first-of-its-kind back-to-school campaign offering a 10% discount on products like backpacks and lunch boxes. The discounts led to a 145% increase in sales as it appealed to parents on a hunt for a deal.

If you're looking to run a flash deal or time-sensitive sale, some important tips to implement are:

• Colourpop Cosmetics uses a formula that combines: urgency, great discounts or buy one get one, and a promotion strategy to let existing customers know about the deals (SMS, email, or social media ads).

• Keep the copy of the email or microsite short. Push that time is of the essence.
• Announce the discount in the subject line of your emails as they have a higher conversion rate of over 18% than average!
• Use flash sales to target loyal customers, win back inactive customers, and users who abandoned the cart without buying your products.
• Lastly, if you have some great products that weren't sold as well as you hoped, time-sensitive or flash sales can help move that inventory to make room for new products.

While running flash or time-sensitive deals is not new, this Ecommerce trend works for both parties involved in the purchasing process. As a supplier, your revenue increases, you sell out slow-moving or excess items and increase sales whereas buyers obtain your products at a big discount.

7) Every brand is a collector's brand: limited drops

In the simplest terms, a limited drop is a special release product that is limited and exclusive. Drops sell out fast as they tap into the scarcity FOMO mindset and exclusivity associated with the product to create a much bigger drive for customers than a discount. For many, they are collector's items.

The best part of limited drops: they can be sold for higher margins, they create a community around the brand and customers connect over the items they've managed to obtain.

Crumbl Cookies announces its new limited edition menu on social media, letting customers know the unique cookie for the week. Especially for millennial and Gen-Z consumers who prefer to buy online in the first place, social media is the ideal channel to announce limited drops.

8) Funded by the community, not venture capitalists

In 2023, inflation is at an all-time high, the market is plagued with supply chain issues, and the funding winter has set in. While several DTC and Ecommerce brands have shut shop, the shares of almost all DTC unicorns like Glossier, Allbirds, and Warby Parker have been slashed.

Clearly, the consumer hardline space is experiencing pull-back from VCs. At such times, brands looking to raise capital rounds are turning to friends, family, community, and crowdfunding to raise capital rounds.

For example, Obvi, a collagen and supplements brand raised double its crowdfunding goal in less than 30 days through AngelList's Roll Up Vehicles (RUVs).

There are several such examples of DTC brands finding capital through crowdfunding from the community, a DTC trend that is surely on the rise in 2023.

9) The shift of power from big box retailers to big creators

Let's start with a question: what led to the shift of power from big box retailers to big creators?

Well, today, anyone with an online audience has the power to sell. No-code tools, using technology to directly reach customers, and the rise of social media.

The best example to support the shift in power is that of the leading YouTuber MrBeast, who has 163 million subscribers on his main channel. He's also an entrepreneur who has launched and scaled three businesses:

• ShopMrBeast (Shopify merch store)
• Feastables (Shopify-powered snacking brand)
• MrBeast Burger (delivery first restaurant)

In the interview with Shopify, he explains the power of connecting commerce with content:

"While having a vast following helps Jimmy (MrBeast) sell his products, innovative marketing has been key to his success as an entrepreneur. He experiments with interesting creative concepts that blur the lines between ads and content to build hype for product launches, increase conversions, and connect with fans."

10) Curated and niche products

Ecommerce merchants have one universal problem: finding niche and trending products to sell. The benefit of having niche products is that you can position your brand as the go-to business for a niche product or target certain demographics.

Let's suppose you are running a DTC clothing brand, in this case, you're competing against millions of other apparel stores. On the other hand, if you specialize in a particular clothing niche, such as squat-proof leggings or yoga pants for women, you reach a smaller yet much more engaged audience. In other words, women gym goers who are not looking for low-quality athleisure brands have excluded them from their purchase list.

What are the benefits of having niche/curated products?

• Less competition allows new entrants to establish themselves and thrive without being overshadowed by bigger brands.
• With the right product idea, clear target audience, and detailed buyer persona, brands can design high-converting product pages and marketing campaigns.
• Higher profit margins as customers are willing to pay for niche products.

Some of the niche industries we already see curated products are:

• Sexual wellness
• Supplement gummies for health-conscious consumers
• Vitamin-enriched cosmetics
• Pet products like air-dried natural treats

What led to the rise of nice products as an Ecommerce trend of the future are factors like low competition, high search volumes, higher consumer spending power, and most importantly higher profit margins.

11) Cross-category collaborations

From plants to beauty, meal and personal care products are forging cross-category alliances across the DTC world. Interestingly, brands are turning to like-minded partners across categories as a cross-effective way to build brand awareness, engagement, and sales.

What makes cross-category collaboration a key Ecommerce trend and promotion strategy for DTC brands is:

• Brand collaborations are generally free, unlike influencer partnerships.
• Rising costs of social media and search costs have compelled smaller businesses to find innovative ways to market their products.
• Consumers looking at brand content are already in the mood to buy, compared to influencer content which is more of early-stage awareness.
• Lastly, brands can tap into new audiences and there's already in-built trust.

Curie, a clean deodorant and body care DTC brand regularly collaborates with other DTC brands for giveaways on social media the way it recently collaborated with three other brands for an Instagram giveaway.

Other than social media, you can have a microsite or landing page on your website if you're considering monthly collaborations with other brands. Let your customers know about it via email newsletters.

12) Immersive experiences

While the future of experiential retail may be hard to predict, using augmented reality to create immersive experiences is here to stay.

Why should retailers and brand owners lean on AR to give shoppers an immersive experience? For starters, studies have shown that consumers would be willing to pay more for a product if they could experience it through AR.

Although mass adoption is still far away, many retailers now have virtual fitting rooms and smart mirrors in their stores. Customers can pick an item from the store, take it to the virtual room and see how it looks on their body, without the need to change clothes.

13) Highly invested experiences for loyal customers

McKinsey predicts driving personalized and in-store experiences will become critical to facilitate the omni-experience, improving profitability, and driving brand loyalty.

Start small by hosting in-person educational events, perhaps teaching your customers how to use your products.

Fellow, a coffee brand seeks to help its customers understand more about coffee. The brand regularly offers short demos and tasting sessions as well as in-depth classes on brewing techniques by expert brewers.

Two main benefits of creating curated experiences for loyal customers include: you educate them about your products and introducing them to an extensive range of products.

14) Achieving the balance of product/market, content/market, and community/market fit

When you feel like you're spinning your wheels but the sales engine is not moving forward, it is time to think whether you've achieved all 4: product, marketing, content, and community fit.

That's because, without a product and market fit, you have a car without an engine.

Even the coolest designs and marketing are useless when you do not know the problems your audience faces or your product does not address them.

Next comes the content fit. What's the point of having a highly functional product when your potential customers do now know of its existence?

Content helps spark conversations, spreads the word, educates customers, and amplifies your marketing message.

Lastly, your community entails a strong set of loyal users who not only love your product but are brand advocates referring the product to their friends and family. Social proof is one of the best ways to drive new customers.

What makes us confident of these trends are the future of Ecommerce is the fact that brands have already started implementing them.

15) Creator-curated product collections

This year, we've been D2C and Ecommerce brands take collaboration with creators and social media celebrities to a whole new level.

In other words, celebrity creators don't just endorse the products, instead they actively participate in creating new product lines and engage in long-term partnerships. By harnessing the personal power of creators, brands establish themselves as trendsetters in their industry.

Let's take the example of hard kombucha and spirits D2C brand JuneShine which has partnered with athletes, artists, and celebrities like Whitney Cummings, Evan Mock, and Kimi Werner among many others.

What's more, the brand has a separate page where it shares more details about JuneShine ambassadors and their kombucha flavors.

16) Promoting pre-used products

The US second-hand market is projected to reach $82 billion by 2026, almost double the current market size. Re-commerce companies and brands selling pre-used products are expected to gain a larger market share as 62% of Gen-Z and millennial consumers said they look for pre-used items before buying new ones.

The same study predicts that over 50% of the total secondhand dollars are expected to come from online sales.

In the current times when the economic outlook remains bleak, but with inflation driving apparel prices higher and higher, if your Ecommerce brand sells fast-fashion apparel, consider adding a pre-loved section to your online store.

Not only is re-sale a disruptive part of the market but a force that helps your customers shop sustainably.

17) A mission that matters to the community

As a generation, millennials and Gen-Z have shown to be more socially conscious than the previous generations, with the majority supporting a cause or political belief.

You need to figure out what your brand's mission is all about and tie it to a brighter future for the audience.

4ocean is an ocean-clean company that sells eco-friendly products and has a subscription model. What we love the most about them is how the mission of making oceans clean is an integral part of the website and what the brand does.

What's specifically noteworthy about 4ocean is how they reinforce the clean ocean mission with powerful taglines like “Shop now -Clean the ocean”, “Buy it now and pull 1 pound of plastic”, and “how your purchase makes an impact.”

18) Earn digital assets as you complete challenges, quizzes, and levels

Ecommerce brands need a high engagement rate considering that it's difficult to maintain a relationship with customers if your only touch-point is transaction related.

Think about a rewards program that goes beyond “points for purchase” and extends to other behaviors such as offering bonus points for writing reviews, completing challenges, participating in quizzes, and more.

Sand Cloud is a DTC brand selling beach towels and accessories. The brand's tier-based Sand Cloud Rewards are designed to encourage customers to keep engaging with the brand to earn more points that can be redeemed.

In addition, you can reward customers for sharing user generated content on social media to expand your customer base while adding more social proof.

19) Customers as affiliates

We came across this strategy by DTC expert Nik Sharma via Social Snowball.

Taking the example of Wcommerce store Outway Socks, Nik explains how offering a cash commission to customers for referrals encourages them to participate in your referral program.

When a new customer makes a purchase, Outway generates and sends a unique discount code to the customer on the post-purchase thank you page. The customer can refer to their friends and Outway can track the reward referrals.

The brand acquires nearly 500 new customers monthly through referrals which make up nearly 9% of the GMV.

20) Curated mystery boxes

Mystery box subscription model banks on the fact that the mystery of the unknown is a captivating force. Mystery boxes are DIY by the sellers and shoppers don't know what products they're getting until the box arrives.

The best part, customers who've ordered feel they get more “personalized” products as the DTC sellers rely on user data to make their selections.

Munchbags, an online store where shoppers can order imported food, has mystery boxes with a wider selection of chocolates, cookies, chips, and more. Users can choose a monthly subscription box with major price savings.

21) Ethical and sustainable sourcing focus

Consumers believe that brands have as much responsibility as the government to create positive environmental changes, found a recent survey. 72% of consumers in the same survey purchase more environmentally friendly products than five years ago.

Your brand can leverage this behavior to create a positive impact by making your sourcing more ethical. Talk about the ethical and sustainable practices your brand follows, while reducing the packaging, shifting to eco-friendly shipping programs, and creating optional carbon offset charges at the checkout.

In addition, develop recycling policies and channels to resell used products or partner with brands that have ethical models for pre-used products.

Shades of Green is a sustainable shopping platform with home decor, kitchen, dining, and bed and bath products. Every product displayed on the website is eco-friendly and has a green score from 1-5 and has a product evaluation meter measuring the sustainability level of products.

22) Flexible return policies

Creating a reasonable returns policy is a critical part of running an Ecommerce/DTC business as overly relaxed policies can cost you money whereas not having free turns can lead to customers not purchasing from you.

There's a clear relationship between return policies and a consumer's view of a brand, which is why returns policy has a huge impact on whether or not a customer shops from your brand.

Have a clearly written returns policy displayed prominently on individual product pages and checkout page, as well as a separate page for returns, the way DTC stationary brand Papier does.

In addition to this, the brand has a returns page elaborating how they don't accept returns on personalized products whereas the other stationery can be returned for free in 30 days.

On the other hand, digitally native mattress brand Casper allows customers to try mattresses for 100 nights before deciding to buy along with easy returns.

The brand also offers 30-day trials for other snooze supplies like pillows, dog beds, furniture, and more.

However, it is important to note that the “try before you buy” policy may not work for smaller Ecommerce/DTC merchants on a limited budget.

23) The growing need to expand offline

Although digitally native brands launched online, many are leaning on brick-and-mortar retail and pop-ups to stand out.

A physical store/presence offers two-pronged benefits:

• A physical store is a place for customers to test products in real before purchasing
• Additional marketing channel that offsets the high advertising costs of acquiring customers online

We see DTC brands struggling with profitability especially owing to the high marketing costs.

There are different kinds of offline collaborations you can explore: pop-up shops, opening offline stores, or partnering with retail shops.

For example, Boy Smells, a DTC brand selling candles, partnered with Nordstrom to host its fragrance product launch.

DTC intimates brand Knix opened its first offline store in 2021, with one in California and three in Canada.

24) Showcase your brand's uniqueness

You need to answer this question: “How is your Ecommerce brand different from others in the same category and the traditional retailers?”

Some of the ways to make your brand memorable are to have a unique brand voice, personality, branding, and visual identity.

Welly, an Ecommerce brand puts a fun twist on bandages and first aid items with bright designs. Traditionally, bandages aren't a fun product but Welly makes them stand out against the plain counterparts with fun and playful colors and designs.

What's more, the messaging: that the brand encourages adventures reflects in the website. It has bright natural colors and fun product packing.

The key is to think about the messaging you want the product to drive and let the marketing center around this.

25) Built with no-code tech stack

Your Ecommerce tech stack would consist of an assortment of tools and software queried to run your online business. No-code Ecommerce tech tools help entrepreneurs without programming know-how or resources to test their ideas and launch products quickly.

For example, Shopify and BigCommerce offer a no-code tech stack to start an online business, sell online, market your products, and manage your stock and orders.

Lifesight Engage is an AI-powered Ecommerce growth platform for emails, forms, SMS, and automation. The key features for omnichannel marketing include:

Integrate - Gather 100+ customer touchpoints in real-time with beautiful forms and integrate with top Ecommerce apps.

Segment - The no-code visual builder segments customers to drive repeat purchases.

Personalize - Easily create personalized product recommendations and coupon codes with our drag-and-drop builder.

Automate - Automatically build and send cart abandonment emails, post purchase upsells, gather reviews, and more to drive sales.

Analyze - Track every visit, click, purchase, and $$ spent over email, SMS, ad channels, and affiliates with real-time analytics and custom dashboards.

Wrapping up

The bottom line is after implementing these Ecommerce trends of the future, tweak your marketing strategy to reflect them to stay ahead of your competitors and hit your revenue goals.

PS: This knowledge about the future of Ecommerce comes from having helped 100+ Ecommerce brands set up their omnichannel marketing on Lifesight.