In the U.S., revenue earned from retail e-commerce is estimated to exceed one trillion dollars in 2023. The online shopping revenue in the U.S. is projected to surpass 1.5 trillion dollars by 2027. According to research by Fundera, 16% of all retail purchases are made on e-commerce sites and it is also anticipated that e-commerce will handle 95% of all consumer transactions by 2040.
However, pain points for SMBs can vary based on industry and company, but some are universal. As per market research, SMBs can lose up to 30% of potential revenue each year due to inefficient processes.
SMBs need to look towards better targeted marketing, increased customer retention, seamless automation, and efficient sales processes. By using AI, product recommendations can be personalized based on past purchase history, improving conversion rates by 915% and order values by 3%. AI can also optimize pricing, enhance customer service, segment customers, forecast sales and demand, and even enable smart logistics. Chatbots are becoming increasingly popular, with 40% of consumers using them to engage with retail companies in the U.S.
“Unpredictable shifts in consumer buying habits triggered by rapidly unfolding technologies have created even more challenges for retailers wanting to service their customers online, especially for SMB Davids who are trying to keep pace with the e-commerce Goliaths,” notes Mikel Lindsaar, CEO and Founder of StoreConnect. “AI is revolutionizing the e-commerce industry by enabling personalized shopping experiences, improving supply chain efficiency, and enhancing fraud detection.”
Some of the other top e-commerce trends in 2023 revolve around new payment methods.
Buy Now, Pay Later (BNPL) solutions have been increasing worldwide. Statistics show that the global use of BNPL increased by a staggering 400% between 2019 and 2021, now accounting for 3% of the e-commerce market share. Retailers have introduced BNPL services, and consumers are increasingly using them for their daily purchases. There are currently around 360 million BNPL users worldwide, and the BNPL market is worth over $150 billion. Additionally, BNPL lending in the U.S. is predicted to reach $114 billion by 2024.
Buy Online, Pick-up in Store (BOPIS) is also gaining popularity. The global BOPIS industry was valued at $243.89 billion in 2021 with a projection of $703.2 billion by 2027, growing at a CAGR of 19.3%. U.S. shoppers spent $95.9 billion through BOPIS options in 2022, accounting for 9% of all e-commerce sales. In the U.S., the BOPIS market is expected to exceed $150 billion by 2025. For brick-and-mortar stores, BOPIS increases the chances for retailers to make additional sales once their consumers arrive to pick up their online orders.
According to research, the average percentage of online shopping carts abandoned before purchases are completed is 68.63%. However, a significant 63% of those cases can be recovered with the correct set of offerings, such as providing various payment options.
“With online purchases coming in from all directions, and a heightened demand for a more personalized and rewarding shopping experience, e-commerce SMBs trying to survive and thrive need to accommodate these trends without adding additional labor and expense, and having different payment options not only provides convenience for customers, but it also helps to increase sales and reduce cart abandonment rates,” concludes Lindsaar.
Mikel Lindsaar, CEO and Founder of StoreConnect, is an experienced technology entrepreneur whose mission is to infuse small and medium-sized businesses with the power to be successful in eCommerce 3.0 and scale to meet growing demand. Small businesses can’t waste time setting up their business on a platform only to repeat the process by changing platforms when they want to scale, nor do they want to waste time figuring out how to integrate multiple platforms.