What:  An impressive set of 130 pages on the major trends spotted by Shopify for 2022 when it comes to e-commerce, retail and logistics.

Why it is important:  Sustainability is all across the board, and translates into transparent processes and practices, local partners, and use of tech to drive efficiency. Shopify presents itself as a tool which contributes to reduce complexity, seen as a major issue for retailers.

Shopify released its annual report, co-written with Forrester Research, on e-commerce and retail trends, to explore the opportunities and threat on the market as well as promote their own solutions to larger retailers (with the intention to move away from their image of platform dedicated to small-sized retail and entrepreneurs).

According to the report, consumers are more than ever looking for brands resonating with them in terms of geography (47% of the consumers mention that a local presence is a purchase factor), company values or sustainability (77% are concerned with the environmental impact). But in parallel, they also want fast and efficient delivery, even though they might spend more money and accept slower shipping times for the right brand. A balance between brand values and customers new shopping habits and expectations is therefore crucial for retailers to remain sustainable businesswise.

Also, the report states that customers are coming back to brick and mortar stores as they crave the experience, but it is not about one or the other: omnichannel is there to stay and the best brands are the ones able to operate digital and physical in a mixed way, not in silos.

More specifically when it comes to e-commerce:

-    Rising acquisition costs force brands to foster long-term relationship with customers, based on values. In parallel, there are more players online (as entry barriers are lowering), so merchants are spending more and gaining less. In order to limit the impact of this phenomenon, Shopify recommends to:

• Develop a brand measurement methodology,
• Invest in short-term performance marketing AND long-term brand building,
• Diversify the advertising and sales channels to lower the cost of acquisition,
• Highlight the unique differentiators and values at every customer touchpoint.

Shopify mentions that their custom storefronts help brands to build cutting-edge experiences.

-    Death of third-party cookies forces brands to rethink personalization. Personalization is a basic expectation now when it comes to the shopping experience, to the point of not even being anymore a magic bullet for long-term relationship. Loyalty is created through the building of brand communities. To achieve that, Shopify recommends to:

• Invest in the right team to help the community grow,
• Find ways to tie the community back to business results,
• Give members a clear reason to keep coming back.

Shopify mentions that their ability to help brands to sell everywhere their customers are (social media, website) are clearly an asset, as well as the ease of creation and sale of NFTs.

-    New commercial opportunities emerge of the biggest social platforms. The trend is clear: social commerce is a new sales channels for both brands and retailers. Shopify recommends to:

• Create live commerce experiences tailored to the audience,
• Design a social commerce experience that converts,

Shopify’s ability to optimize campaigns across social media, and the possibility to make content shoppable should be the ideal combination.

More specifically when it comes to the future of retail:

-  Digitally native brands drive retail competition leading them, given the ideal real estate conditions, to open physical retail seen as an affordable acquisition option. This creates new expectations from customers. In order to create experiential moments, Shopify recommends brands to:

• Use pop-up shops to test consumer demand for physical retail,
• Invest in creating unique in-store experiences to build brand affinity,
• Use customer profiles to offer personalized recommendations.

Shopify mentions the easiness with which its reports allow brand to identify the right location, as well as the Shopify POS solution to create customer profiles and make the most of its online to in-store fulfilment features.

-    The post-pandemic customer journey will bring about the next phase of omnichannel shopping. Consumers are now connecting with brands across multiple levels, and expect consistency across these channels. Shopify recommends to:

• Turn retail stores into showrooms to improve brand discovery and awareness,
• Unify customer and product data to provide a consistent customer experience across channels.

-    Consumer and employee expectations push brands to reimagine the retail staff role. Customers now expect world-class service from everyone, forcing brands to reimagine retail roles and compensations, through tech. Shopify recommends to:

• Create more specialized roles and increase compensation to match,
• Provide a healthy work environment for employees.

Shopify allows the creation of strong customer service proposals through virtual shopping apps, which will also allow staff to be motivated with best in class tech.

More specifically when it comes to the future of shipping and logistics:

-    Supply chain vulnerabilities force merchants to permanently modify their fulfilment and shipping. The issues from 2020-21 are here to stay in 2022 and brands are revising their shipping strategies. Shopify recommends to:

• Digitize the supply chain to improve visibility and responsiveness,
• Use data to optimize the fulfilment strategy,
• Consider outsourcing the shipping and fulfilment to a 3PL

Automation of fulfilment and centralization of all orders in one place are assets from Shopify to allow to bring the inventory closer to customers.

-    Social and environmental impact will define the next era of shipping and logistics. Sustainability is now a basic expectation from both customers and employees. Shopify recommends to:

• Find ways to reduce the carbon footprint,
• Make product packaging recyclable, compostable or reusable,
• Hold the business accountable to sustainability goals.

-    Customers choose to shop with brands that are transparent around delivery times.  It is not only about free shipping, but having a visibility on the shipping times too. Shopify recommends to:

• Manage customer expectations with clear delivery timelines,
• Offer fulfilment options that match the market’s expectations.

The Future of Commerce Trend Report Shopify