As I sat down to write this year in review I was struck by the way 2020 felt more like a decade rather than 12 months. In a typical year of ecommerce we’ll have just a handful of high notes, most of which tie to seasonality — a record-breaking Amazon Prime Day or a sales-smashing Singles Day. I think we all miss the normal ebbs and flows we’ve come to expect, but 2020 was not to be so.
Nobody, of course, wants to read another article about the pandemic and the way it has upended our lives and businesses. Yet it’s impossible to talk about ecommerce, or even retail, without talking about its huge outsized influence. COVID-19 is the elephant in the room.
The pandemic has caused major upheavals in the way we shop, socialize and get our news; we’re not likely to return to “normal” whatever that is, anytime soon. The sustained fear, long lockdowns, and urgent desire for contactless everything has elevated the role of digital and permanently altered our behavior. It really is rather extraordinary.
COVID Accelerated Digital Shopping
Without a doubt the overarching theme of 2020 is our new-found dependence on digital for everything. In a year when hand-sanitizer, rubber gloves and face masks became de rigueur, contactless shopping was a top priority. It wasn’t just the usual convenience of shopping via Amazon (although the pandemic has been good for Amazon’s sales), we bought everything online, including groceries and cars. Forbes reported that coronavirus-induced demand for grocery delivery enabled Instacart to turn a profit for the first time ever.
According to a McKinsey Report, COVID-19 crammed ten years worth of expected growth in ecommerce into just 90 days. Many question McKinsey’s methodology for arriving at those numbers, such as lumping online auto-sales into the mix. Still, no one questions the way the virus increased the number of people who now regularly shop online, as well as the range and the quantity of products we now acquire through digital channels.
Every brand that made digital a central focus of its strategy, from the recently launched DTC company to the legacy brands that spent the last five years embarking on a digital initiative, saw their sales rise exponentially over these past eight months.
Likewise, our preference for digital accelerated the demise of retailers and brands that were dying a slow death, as Scott Galloway pointed out. COVID, he says, has or will kill off thousands of well known, though debt-saddled or otherwise imperilled, brands.
Our massive dependence on digital doesn’t end with shopping. It’s now the basis of community for people who are isolating at home, and it’s how we get our news.
Social Commerce is Huge… To Some, That’s a Worrying Development
Headless commerce blew-up this year with social commerce leading the charge. Shopify and Snapchat strengthened their partnership by announcing an initiative to make it easier for retailers to create ads and set-up campaigns via the Shopify platform. We also saw Instagram commerce roll out in bigger and better ways than ever before.
Platforms like Pendoo and ShopShops, purpose-built for influencer selling, are incredibly effective at prompting impulse buys, richly rewarding the influencers and encouraging them to spend a lot of time livestreaming product placements.
But not everyone is thrilled with their success. The uptick in sales is accompanied by an alarming increase in shopping addiction, the likes of which we have seen since QVC in the 1990s. That, in turn, has led to a spate of interesting legislation in Asia and elsewhere seeking to curb this behavior. China for instance, now limits on the amount of time influencers can livestream.
Will those laws succeed in dampening shopping addiction? Perhaps, but ecommerce is everywhere these days, so it will likely be a case of whack-a-mole.
News Organizations are Becoming Commerce Centric
News and entertainment have been colliding for 20 years now, but what really changed in 2020 is the way media brands became more commerce-centric.
Take BuzzFeed, long considered more like pop news but in recent years has been building its journalist chops, famously breaking “Steele Dossier.” From the get-go BuzzFeed exhibited a deep understanding of the millennial generation, offering the kinds of listicles and click-bait that get their attention.
This year BuzzFeed has upped its commerce game by seamlessly weaving shoppable and editorial content together. Nilla Ali, who runs ecommerce for BuzzFeed, told me and my colleague, Brian Lange that this melding is the future for all media companies.
She’s probably right. NBCUniversal released its NBCUniversal checkout this year — a significant development given the sheer number of properties owned by the company. I predict that shoppable content will soon be so ubiquitous that consumers will consider it a normal way to shop. Many may forget that they ever once had to visit an actual online store in order to buy stuff.
Every Experience Will Be Shoppable
Going up a level, it seems as if every experience is destined to become shoppable in one way or another. Whether it’s written word, passive consumption, watching TV, streaming a video on your phone, the opportunity to buy will never be more than a few pixels away.
This drives home the overarching theme of 2020: digital rules everything around us, and everything digital is shoppable (or will soon be). The line between what is shoppable and what is experiential has blurred, and that’s game-changing. An increase in sales is inevitable, digital is just so freaking effective at monetizing our impulses … are we surprised that our shopping addiction is growing?
One other thing worth noting about this trend: headless commerce will kill the shopping cart. We have no need to mimic the offline shopping experience online, as more and more sales become single-SKU purchases generated from social media and news sites.
The Experience Economy Moves Home
We’ve also seen a re-appropriation of the experience economy from the world at large to the home turf. We used to experience the world outside of the house, and when we talked about experiential retail, it meant going someplace special, like a flagship store, a cruise ship or some exotic location. Now we have those experiences at home.
2020 has also changed the way we share (read: boast about) our experiences. In a year where one is unable to flaunt one’s wealth by sharing selfies from a beach in Grand Cayman, people now post selfies meditating next to their $75 candle.
What we’ve seen over the past eight months is an ever-powerful cycle of digital leading to connection leading to shopping. Our reliance on social media for human connection and news for entertainment — along with their direct connection to commerce — won’t end once it’s safe to go out again. These are trends that will govern our behavior for years to come.
Is your brand prepared? Contact us to discuss your ecommerce strategy.