The holidays are here, and despite nearly two years of pandemic challenges, the outlook is strong for holiday sales in 2021, especially for eCommerce brands. The past several years have shown tremendous growth in online retail and proven that online shopping experiences are essential to modern shoppers of all ages. Today we’re taking a look at how online shopping plays a role in these successes.

The rise of ecommerce

While ecommerce began as an untested alternative shopping option for bold shoppers, it has blossomed into a critical component of modern sales strategy. Even large, legacy retail brands have turned to ecommerce as a way to remain relevant—especially since the pandemic. This has created a rising tide effect for all ecommerce brands, leading consumers to trust online shopping today far more than they did several years ago. 

Every few decades we see the introduction of new holiday traditions that last a lifetime. The 2010s were the decade we saw the emergence of ecommerce. 

• In 2010, ecommerce comprised 7.2 percent of total retail sales in the United States. That doesn’t sound like a lot, but digital marketing, algorithmic feeds, and online shopping had just debuted.
• Throughout the decade following 2010, U.S. ecommerce’s year-over-year growth never fell below 13 percent. Overall, the retail sector’s year-over-year growth rate didn't nose above five percent. That means ecommerce’s growth significantly outpaced retail growth in general.
• 2010s Cyber Monday saw U.S. shoppers spend $1.028 billion, debuting the first billion-dollar online shopping day in history. For Cyber Monday in 2019, U.S. shoppers spent $9.4 billion, an 814 percent jump over nine years prior.
• Throughout the twenty-teens, mobile shopping started becoming increasingly common. Instead of browsing the internet from a desktop computer, people were shopping in spurts from a mobile device. Web layouts needed to become mobile-optimized, and shopping apps started to appear as retailers met increasing mobile demand.

Now we’re in the 2020s, and the phenomenon of ecommerce is no longer news—it’s ingrained into our daily lives.

• People are concerned about public health and sustainability, and they’re valuing their time together as they spend more time at home. Digital retail is still growing at a rapid pace, and there’s no reason to think it will stop. 

• Mobile shopping apps are still debuting and adding new features like 3D photos, video clips, AR, and digital streaming. 
• Who knows what new trends will emerge in the next decade?

2021 Holiday sales forecasts and online shopping

According to NRF President Matthew Shay, “There is considerable momentum heading into the holiday shopping season.” Consumers are shopping earlier—and they’re shopping more—than any year in the last two decades. Holiday shopping started in August, and it gained momentum through September and October before hitting full swing in November. 

Deloitte predicts a 7-9% holiday sales growth in 2021, while the NRF anticipates 8.5-10% growth. Meanwhile, Inc. reports holiday ecommerce growth projections of 11%. 

Mobile shopping continues to increase. Aside from retailers like Walmart or Target having their own branded apps, shopping apps like Instacart or Honey are also making their mark. And while online shopping moved from browser searches to branded searches, these other shopping apps may move the trend back toward a comparative multi-brand shopping experience. 

2021 ecommerce trends and developments

Online shopping in 2021 looks much different than it did in 2010. Massive ecommerce marketplaces, artificial intelligence, consumer data, augmented reality, voice search, social media, influencer marketing, mobile shopping, and subscriptions have all fundamentally changed the game.

Ecommerce marketplaces have increased trust and accessibility

The maturation of Amazon, eBay, Etsy, Walmart, Newegg, Rakuten, Cratejoy, and other large online marketplaces has fused convenience and reliability, making it easier for consumers to trust digital shopping experiences. 

Artificial intelligence uses data to personalize experiences

Artificial intelligence offers an edge to ecommerce that retail can’t quite beat. Many modern consumers have learned that they can find wider assortments at more competitive prices online than at local stores. 

Also, while physical retailers have to arrange merchandise to entice the largest number of local shoppers, ecommerce marketplaces use algorithmic feeds and personalized product recommendations to offer tailored shopping experiences for users, increasing niche product discoverability and capturing more impulse buys. 

Augmented reality and voice search make ecommerce more immersive

Augmented reality and voice search blend the convenience of online shopping with hands-on experience. In a store, customers can ask employees for directions and recommendations, and they can hold products side by side for comparison. Now, voice search allows for a more intuitive online shopping experience from the comfort of home, and augmented reality shopping tools help customers imagine products inside their homes.

Social media and influencer marketing help drive ecommerce sales

Social media has become a critical component of ecommerce marketing. Savvy brands use social media to build communities around their products, and they see increased traffic over time. Since 2019 and throughout the pandemic, video—especially vertical video and livestreaming—has taken off as the king of modern advertising. 

Supply chain pivots

Supply chain challenges may have pushed consumers even harder toward online purchases. If one store is out of stock, it’s easier to hunt down a product online instead of physically running from store to store. 

In-stock alerts and restock estimates help consumers feel more confident about whether to wait for a restock or choose a different item altogether. If an item is physically in stock at a local brick-and-mortar location, consumers may order online and pick it up in-store to ensure that they don’t miss out on the limited inventory. 

Mobile shopping innovations

Stuck at home for much of the past two years, consumers were more likely to try new things to eliminate the boredom. Demographics that were previously slow to adopt mobile shopping had no choice if they couldn’t venture out to shop in person. 

Perhaps similarly driven by increased boredom and more spare time, consumers turned toward livstreaming over the past couple of years. As a more engaging way to shop online, livestreams incorporate aspects of social media interaction with online shopping, allowing shoppers to get a better feel for the product before committing to the purchase. 

Subscriptions turn one-time buyers into long-term customers

Online shopping and subscription shopping have arisen hand-in-hand. Consumers love the convenience of automated deliveries for their staple goods, and brands love the recurring revenue from subscription pricing. 

It’s become popular to offer bulk discounts on semi-annual and annual purchases of goods that deliver month to month. Subscription pricing accelerates cash flow for ecommerce brands and reduces income uncertainty from month to month, which gives brands the cash and the confidence to proliferate.

Takeaways from the 2021 Holiday Season

Retailers have made the most of the 2021 holidays with a few best practices:

Forget Black Friday—it’s Black November

Brands broke the mold in 2020 by offering sales weeks ahead of Black Friday, and that trend continued in 2021, as consumers started their holiday shopping earlier than ever. Brands promoted flash sales and holiday deals early via email newsletters and social media. They listed holiday items as early as September, and they pushed holiday bundles throughout the entire holiday season.

Customer service was key

Customers were nervous after two years of economic upheaval. Successful brands showed empathy and alleviated customer fears with clear and easy online returns policies, loyalty and rewards programs, and the option to pay in installments, which helped them feel more confident in their purchases.

Supply chain challenges and opportunities

Savvy brands prevented out of stocks and delays by trimming down their assortments and ordering critical SKUs early and often, and many promoted gift cards as a way to drive sales after the supply chain returned to normal. Brands won customer loyalty with transparent communication about pricing, stock, and shipping. 

Smooth experiences drove conversions

The strongest ecommerce brands used the 2021 holiday to evaluate the consumer experience and reduce friction wherever possible. They leveraged marketplaces like Amazon, Walmart, and Etsy, and they made the digital shopping experience easy by offering sorting, filtering, and keyword searches wherever possible. Strong product descriptions, product photos and videos, free shipping, and satisfaction guarantees increased consumer trust despite tumultuous times.

Prepare for 2022 with agile market research

Agile market research and consumer insights are critical to digital sales success throughout the holidays and beyond. In a world that sees major global events happening almost weekly, the brands with the most knowledge and the boldness to act swiftly will rise to the top.
If you want to find success this coming year,  you’ll need thorough market research and consumer insights to inform your sales strategy. If you’re ready to take your research to the next level, let’s chat.