By Rieva Lesonsky
Most of us small business owners start the new year with mixed emotions. We’re hopeful and optimistic about growing our businesses, yet with anxious about all the challenges we know we’ll face.
To find out what lies ahead, I’ve collected a number of tips, predictions and advice from people in the know. We’ll be exploring general consumer, financial and economic trends, as well as what to expect in the fields of marketing, technology, retail, HR and money.
We also have contributions from guest authors—just look for the What to Expect in 2019 illustration all week.
Consumers Prefer Shopping via Mobile
Ibotta, the starting point for rewarded shopping on mobile, recently released its first Mobile Commerce Report, highlighting key trends on how and when consumers engage in mobile shopping and what smart retailers can do to strengthen their mobile commerce strategies to reach new audiences in the years ahead.
The growth of mobile commerce: Over the last decade, consumers’ shopping preferences have changed drastically with the continued adoption of mobile across the retail industry. Mobile commerce will soon eclipse desktop sales and become the primary screen for driving conversions in the United States, with mobile retail sales expected to top $400 billion within the next three years. An increased shift to mobile is further evidenced in the results from Ibotta’s 2018 Mobile Commerce Survey, which found that 47% of respondents are shopping in-store retail locations less today than they did five years ago.
“Mobile has changed every aspect of the shopping experience. From the way consumers shop, to the way they research purchases and make decisions about what to buy and even how they engage with the brands they love,” says Bryan Leach, founder and CEO of Ibotta. “Everyone’s shopping behavior is different and unique to them, and brands cannot expect customer loyalty with a one-size-fits-all approach.”
What the mobile shift means for retailers: As the consumer journey continues to evolve and mobile becomes an even bigger part of shoppers’ lives, smart retailers must shift their focus to mobile and deliver more personalized offerings with a clear value proposition to obtain new customers and increase incremental sales. These tactics will help retailers deliver the most valued shoppers to their business.
“Every shopper wants a good deal, but more importantly, they want to be rewarded for their loyalty,” Leach says. “Retailers who are able to deliver more tailored and rewarded shopping experiences on mobile will best position themselves to be successful in this new era of retail.”
You can download the complete Mobile Commerce Report here.
State of Social Commerce
Social commerce has evolved over the past two years. In 2016, digital commerce consultancy SUMO Heavy conducted a series of surveys on the topic. SUMO recently launched a follow-up survey to see how consumer behavior and sentiment have evolved.
In 2018, fewer respondents reported using Facebook regularly (79% in 2016 vs. 67% in 2018) but it remains the most influential platform for shoppers.
- Social media’s influence is on the rise. 58% of respondents say social media influences purchasing decisions today, compared to 45% in 2016.
- Social commerce has stalled. Despite the hype, 82% of shoppers have yet to use social buy buttons or other forms of social commerce.
- It’s not for a lack of awareness. 80% say they’re familiar with social commerce, but concerns of security, privacy and legitimacy are stopping shoppers.
- Chatbots are gaining favor. 72% find chatbots to be helpful and informative, and 74% are now open to shopping through a chatbot, compared to 55% in 2016.
Want to Grow Your Brand? Here’s 4 Ways to Do It
Naama Bloom, VP of Brand at zulily shares her expert insights:
1—Don’t fear the data: By observing patterns and optimizing product, every day can be an opportunity to better understand customers and to inform what you offer, how you present that product and more. Don’t be afraid to use findings from previous years and sales to inform your advertising on social and search.
2—Digital shopping can be a destination: Up-and-coming retail brands can now, with the help of lean, low-cost digital tools, dress up their digital storefront in a way that’s immersive and engaging. Just make sure any solution you choose has high functionality and works on mobile—an increasingly integral part of how your customers will find you and shop your brand.
3—Low cost, high conversion: Cultivating a strong organic social media presence is a low-cost way for up-and-coming e-commerce brands to really stand out. You’ll also score authenticity points with consumers who want to connect with products they can see and engage with before it’s on their doorstep.
4—Prioritize your customer support: Even small brands without a formal customer service infrastructure can employ strategies like having a clear, easily findable FAQ page for new shoppers, ensure all product details are clear and descriptive.
Iain McNicoll, Country Manager, U.S. at Payoneer says now’s the time to expand internationally:
“The rapid digitalization of commerce over the last few years has made it easier for businesses of all sizes to expand beyond the confines of national borders. Significant logistical issues that once served as major barriers are only now being addressed, including: multi-currency receiving accounts, automated solutions to facilitate tax and regulatory compliance processes, and streamlined fulfillment of overseas orders. With the barrier of entry lowered, there is ample opportunity for U.S. small businesses to capitalize on this trend and join the global marketplace in 2019. Additionally, there will be less competition for these American companies in the international market because buyers are increasingly looking for high-quality goods that the US is known for producing.”
5 Factors that Influence Consumer Purchasing Decisions
The Qurate Retail Group (QRG), parent company of well-known and respected brands, such as QVC, HSN and zulily recently surveyed U.S. consumers to find out what influences their purchasing decisions. Here are some tips from QRG, based on the survey findings:
1—Use video as an influential tool to introduce customers to new products. The Qurate Retail Group survey found that 55% of Americans say video product demonstrations influence their purchasing decisions when discovering new products
2—Make your brand story and purpose pop. Customers like to know more about a brand—wwhether it’s the history, the CEO’s background or its purpose-driven mission. The survey found 53% of Americans say their purchasing decisions are influenced by a company’s history, founder’s inspiration, or mission statement and corporate social responsibility
3—Enhance the product experience, especially when it is through the screen. When possible, include video, photo and text descriptions of a product because the survey found 61% of consumers are deterred by not being able to physically touch or try out a product.
4—Provide as much detail as possible when listing a product online. 39% of consumers want more product information, like sizing charts to help them make purchasing decisions.
5—Keep an eye on your customer reviews to inform business decisions. 68% of shoppers rely on customer reviews to help alleviate concerns when shopping online.
3 Ways to Stand Out in a Competitive Retail Market
Guest post by Stefan Midford, founder and CEO of Capango and Natural Insight.
1—Excite, engage, execute: In an increasingly competitive market, success will require physical retailers to become much more aggressive in delivering great retail experiences that draw the consumer in and fulfills the adventure of discovery. This only works if the store is properly staffed with knowledgeable and passionate associates who are ambassadors for the brand and step up to help the consumers make the best choice. Tight margins in retail will require that every retailer do the first two steps with a careful eye to perfect execution.
2—Win the staffing war: Open positions in retail are at an all-time high and will only increase in 2019 as the economy continues to grow and the labor market shrinks. To secure top talent, retailers will need to differentiate themselves in a crowded field and expedite the hiring process. This will require a change in tactics as legacy old school recruiting tools can’t provide the speed and targeted personalization needed to locate the right hire quickly. My advice to employers—rethink how you attract talent, but also ensure the interviewing and onboarding experience reflects the excitement and energy needed to get that new associate in your door.
3—Connect everyone: Lots of attention has gone into how to allow consumers to use smart devices to facilitate buying decisions. Successful retailers in 2019 will also ensure their staffs are equipped with the best possible devices, which oftentimes is already in their pockets. Walmart’s new employee BYOD strategy is a perfect example of an aggressive shift in policy that supports staff as well as improves the consumer experience by eliminating barriers to getting the best information to the floor real-time.
4 Top E-Commerce Trends
What are the biggest e-commerce trends for 2019? Stephen Culp and Andrew Scarbrough, cofounders of PriceWaiter, the free browser extension for business and consumers helping users negotiate prices online, tell all:
1—Omni-channel experience is a multi-channel approach to marketing, selling, and serving customers in a manner that creates an integrated and cohesive customer experience, no matter how a customer connects. The consumer wants a chance to shop from a computer, tablet, phone or in-person, and not incur any discrepancies
2—Negotiation is new to the game but is growing quickly. Customers are asking to control the game by finding a price they are comfortable with—offering and completing the transaction once they feel satisfied that the retailer is displaying the best possible price
3—Personalization is something that a smarter consumer, and retailer, looks for all the time! Customers know their shopping habits are being analyzed—including their propensity to buy specific items. Such data helps retailers create targeted promotions, coupled with incentives geared to each customer, with the natural goal of increasing conversions.
4—Sales Tax, and how it is applied during e-commerce transactions, is evolving in a big way. Recent court rulings on thresholds for sales before taxes are collected—and the category in which the sale resides—has made the conversion process much more labor-intensive for retailers. Now the retail needs to manage sales taxes in multiple jurisdictions.
3 Things Every Retailer Should Know
AdRoll president, Scott Gifis has a lot of advice for retailers:
1—Think about customer lifetime value: “Brands of all sizes will embrace Direct to Consumer (D2C) strategies. The world is changing and with it consumer behaviors and expectations. Brands that aim to survive, let alone thrive, will need to prioritize developing deeper, more meaningful connections with their customers. This will require deeper investments in personalization and connected storytelling across all touchpoints, automation and tools to enable those interactions, and strong measurement platforms to help them optimize and realize growth for their business.
I’ve seen this work first hand with online retailers who combine bold storytelling with the power of unified, digital customer intelligence, activation, and measurement, and in turn end up achieving higher returns thanks to significantly higher customer lifetime value.”
2—Retailers should double down on video in 2019: “Video will continue to grow in popularity because it works at every stage of the customer journey, cuts through the noise of banner blindness and drives higher engagements. In fact, shoppers are 64% more likely to buy a product online after watching a video ad and 80% more likely to purchase when a landing page includes a video.
In 2019, we should see a higher use of video in the marketer’s toolkit, especially as it becomes easier to create and edit high quality assets. Further, marketers will need to harness the power of video by understanding both the individual impact on acquiring customers, to a more cohesive strategy, meaning how it impacts the entire journey, especially with the increased collision of video and connected TV. Ultimately, video will be seen as more than a brand effort. When it becomes available to more brands, the question will be in the quality of content and targeting precision.”
3—2019 will require marketers to leap beyond last-click measurement: “Measurement is hard. For SMBs and mid-market companies, it is harder, and the stakes are often higher. Although last click measurement is an archaic way to measure performance and impact, many marketers still rely on it because they don’t see accessible alternatives, as sophisticated tools are often difficult to set up or not flexible enough to work within their data model.
Yet, marketers are hungry for change and searching for a better way to provide visibility and optimize their campaigns. I see 2019 as the year modern marketers stop relying on vanity metrics and outdated measurement models and start looking at what is actually driving sales. Further, marketers need to embrace multi-channel adoption and prioritize creating connected stories across all touchpoints. This can only be done by integrating solutions powered by machine learning and AI into their marketing toolkit. This will better provide an actionable view on the customer journey and attribution on a level that has never before been available.”
Retail: What Lies Ahead
Justine and Olivia Moore, identical twins and venture investors at CRV share their consumer and retail predictions. The “venture twins” share jobs and industry trends and research in their weekly newsletter, Accelerated.
Continued decline for social giants. It’s been a tough year for social networks, between product issues (Snap), data leaks (Facebook), and rampant bots (Twitter). Consumers are also more careful about time spent online and mental health—it’s exhausting to maintain curated profiles across platforms. But this doesn’t signal the end of social media, as the need to be part of digital communities remains strong. We predict consumers will cut down on activity on incumbent platforms, perhaps choosing one or two places where they feel “at home” instead of trying to surf a flood of content. We also expect consumers to start to explore curated or vertical communities where they can form more meaningful connections with other users.
Expansion outside the mainstream in wellness. In 2018, we saw venture funding flow into exciting new healthcare categories—from telehealth (Maven, Roman) to fertility (Carrot, Modern Fertility, Future Family) to at-home testing (Scanwell, Mira). While new solutions come to the traditional healthcare market, we are also intrigued by increasing interest in non-mainstream wellness solutions. Especially as big companies start to experiment in the space, we believe the buzz around CBD will continue to grow—and we predict more developments in fasting and related diets as well. We also expect to see efforts towards making mental health services more affordable than the traditional therapy visit—Basis, which connects users with trained but unlicensed counselors for a 45-minute session that costs $35, is one example of this.
Social commerce makes big leaps. It’s crazy that Instagram and YouTube aren’t monetizing the billions in product volume sold off of their platforms. We expect to see big social companies find ways to earn a cut of the revenue, but we’re also excited about startups offering better social shopping experiences. This could be livestreamed product shows that combine the expertise of a host with the “FOMO” of HQ Trivia (ShopShops), platforms that use purchase and social data to make recommendations (Finery), or influencer-driven “drop” platforms (Suprize). We also wouldn’t be surprised to see verticalized YouTube-like platforms (Supergreat) based on product discussions and recommendations—especially since influencers seem to be tiring of YouTube’s constantly changing algorithms.
Rise of “counter-culture” D2C brands. Many early D2C brands focused on creating aesthetically pleasing products that look good on your Instagram feed. They wanted to take market share from incumbents, and advertised on the basis of price, quality, or convenience—typically not making waves around social issues. In the past year, we’ve started to see a number of popular brands emerge with strong statements against the traditional messaging in their industries. Billie, a women’s razor company, went viral this summer for an ad campaign showing real women’s body hair that brought attention to the “pink tax.” A number of bra companies, like our portfolio company Harper Wilde and ThirdLove, have taken stands against Victoria’s Secret and the oversexualization of bras. We’ve also seen a rise in D2C brands tackling previously taboo topics, including Ro and Hims, which offer prescriptions for issues like erectile dysfunction and hair loss.
New infrastructure for freelancers. 35% of Americans engaged in freelance work this year (Upwork), and this is expected to grow to 50%+ by 2027. However, the freelance economy lacks basic infrastructure around benefits (such as health and disability insurance), financial products (saving, budgeting, and getting credit are difficult if you don’t have a reliable income stream), and community (many freelancers struggle with loneliness and isolation). We’ve seen a number of early-stage startups launch products in the past few months to tackle these issues, including Trupo and Oxygen. We expect these products to start to make a splash in freelancer communities next year and are also looking towards startups tackling other problems in the gig economy in 2019.
Explosion in AR games, with some big IP. We’ve been hearing for years now that AR and VR games are poised to take off, but nothing besides Pokemon Go has seen significant traction. We predict mobile AR games will grow significantly next year, for a few reasons. Niantic will release its long-awaited Harry Potter: Wizards Unite, with an enormous built-in audience. Smaller players are hot on their heels—Illumix announced two 2019 game releases, one original and one with licensed IP, and Ubiquity 6 is in Disney’s accelerator (with a hint to “look out for more” soon). We also expect to see more startups emerge in this space as the pool of potential founders continues to expand—developers have now had more than a year to learn how to build on ARKit and ARCore. The number of people with AR capabilities on their phones also continues to increase dramatically, from less than 500M at the beginning of 2018 to 2B+ next year.
AI Usage Soars
Abinash Tripathy, founder and Chief Strategy Officer of Helpshift says AI is coming:
“The retail industry will see massive adoption of AI in 2019 and onward. Retail will use AI and chatbots throughout the online customer journey. During pre-sales, AI and bots will continue to improve customer experience and lower cart abandonment through personalized and predictive recommendations. Today most post-sales interactions are handled manually, but in 2019 AI-powered bots will help customers self-serve and get their problems resolved faster. For example, bots can help with rescheduling deliveries and processing returns. Amazon is already doing this and is leading by example. The biggest benefits of AI for retailers are the ability to be both proactive and reactive in their interactions with their customers.”
Predictions in Call Center Operations: AI, Analytics and Other Leading Trends.
Guest post by Scott Kendrick, VP of Marketing at CallMiner
Managing customer service challenges and demands will continue to be an ongoing issue for numerous enterprises across the globe in 2019. As companies continue to look for innovative ways to improve customer care in the year ahead, here are trends to look out for:
- AI-based analytics will enable automated scoring of all agent interactions. This data will be used to provide agents with continuous performance feedback.
- Auditing for internal and regulatory purposes will benefit greatly from analytics and automation. Non-compliant language can be detected and corrected in real-time, improving audit results and reducing compliance penalties.
- Real-time analytics will enable agents to generate sales. Customer support agents can become revenue generators through access to analytics-based data. For example, the platform can recognize when a customer mentions a competitor’s promo. In response, the agent receives an immediate prompt for a special pricing discount for that particular customer.
- Frustrated or angry customers can be diffused more easily through analytics. Advanced call platforms can detect tone as well as confrontational words. As a customer increases usage of such language the system detects the argument and alerts a supervisor in real time. This dynamic avoids the customer reaching a breaking point.
- Analytics platforms will become smarter in their ability to recognize context and the progression of a call. This will eliminate “false positives” found in outdated call analytics platforms.
- Redaction of sensitive information will occur automatically through the latest platforms. Agents will no longer need to press buttons to “mute” personal data.
Customer Experience Trends
Check out this in-depth, new global trend report, Customer Experience Trends from Around the World from Mood Media. It examines the in-store customer experience across 40 countries and provides 30 examples of successful in-store customer experiences today to uncover the four key trends going into 2019: customization, immersion, community and convenience.
How to Improve Customer Experience: 2019 Trends, Strategy, & Examples
Lots of great information is this report/blog from Hotjar, including the 5 most important customer experience trends, and some advice from me.
Business retail stock photo by Monkey Business Images/Shutterstock