For those e-commerce sellers without a crystal ball, 2021 has provided a glimpse into some of the trends we can expect to see next year. As the globe continues to claw its way out of the gridlock caused by the COVID-19 pandemic, e-commerce businesses should adapt their business models to capitalize on these trends. This adaptation can help poise online businesses to expand quickly over the next five years.
So, here are the top four trends to watch out for in 2022.
1. The E-Commerce Talent War
It’s surprising how many large, globally recognizable brands have only a small in-house team managing their e-commerce platforms, and this leads us to the first trend for 2022: Brands on e-commerce will need to find a way to compete for top talent and grow their teams. There’s just too much work to manage without additional help.
The sheer number and complexity of challenges we can expect to see next year means it’s not going to be cost-effective to hire a couple of additional employees and call it good. Brands on e-commerce will need to work with the best if they want to tackle the massive challenges in front of them in 2022.
Of course, these platforms don’t necessarily need to expand their in-house teams. They might look to outside partners to help accelerate their growth and help them navigate a massive and increasingly complex global e-commerce market.
2. Social Selling Is Coming to the US
In China, social selling on platforms like Facebook, Instagram, Twitter, and Snapchat will bring in more than $350 billion in 2021. This trend will come to the U.S. and challenge existing marketplaces for share.
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3. Brands Will Move to Strategic Outsourcing of Major Parts of E-Commerce
With global expansion and platform proliferation, quantitative chops required for extraordinary results will lead to specialization in order to succeed in big ways. The rapid proliferation of technology in emerging markets worldwide means it’s possible to expand into those markets rapidly, but at a cost. Many of the tools and services available to brands are clunky and don’t work well from marketplace to marketplace. Instead of a single selling platform, what brands cobble together often resembles a Jenga tower of software solutions and agency partners — if all the tower pieces were different shapes, that is.
Companies selling consumer products often try to Macgyver together a solution to sell in different marketplaces in Central America, Asia, or Europe. Amazon, for instance, has a marketplace in Mexico that’s completely separate from its U.S. version. Frequently, these companies only have a small team managing their e-commerce, which means they’re vastly understaffed and can’t scale effectively in each area of the world.
This trend will, unfortunately, continue in 2022. However, this also means that e-commerce accelerators will become more sought-after by those companies trying to increase their global reach. Accelerators are companies that have spent years developing software and service layers to help brands accelerate sales and expand globally on e-commerce.
4. Continued Supply Chain Issues
The world has adopted a largely haphazard, decentralized approach to lifting lockdown restrictions. Some countries remain in stringent lockdowns, while others are almost entirely open for movement in and out again. This approach, and the lockdowns themselves, have created an ongoing supply chain issue that shows no signs of slowing next year.
Unfortunately, those supply chain problems will be affecting brands on e-commerce as well. There are problems at all chain levels, from raw materials to manufacturing to shipping and distribution. As a result, significant delays will continue to be a challenge next year, which means brands need to be prepared to order inventory earlier, evaluate their product lines for those products not experiencing issues, and provide customers with reasonable expectations for deliveries.
Many consumers across the U.S. have already started feeling the effects of supply chain disruptions. Images abound online of empty shelves at retailers, and if large stores like Target and Wal-Mart are having issues, we can be sure that online retailers and direct-to-consumer brands are feeling the pinch as well.
Also due to the ongoing lockdowns, brands can expect a release of pent-up online demand for their products in 2022. There are various reasons for this, not least of which include consumers having more cash on hand from stimulus checks and expanding job opportunities. They’ve also been largely unable to take vacations or otherwise spend their money on experiences for the past year and a half, which means they have more cash for purchases.
We’re already starting to see this for the 2021 holiday season. Increased demand and decreased supply automatically lead to a rise in the cost of goods and a longer wait time for those goods. So, practically speaking, it’s a good idea to project purchases, budget more money for those purchases, and start buying them with plenty of lead time. Brands can capitalize on this by selling for future seasons further in advance.
Regardless of how they decide to navigate these trends, brands can’t continue to put band-aids on their problems. Instead, they have to focus on integrated solutions that rapidly scale if they hope to be successful in 2022.