Whether it’s online grocery, buy-now-pay-later, or social commerce, these trends will continue to grow. Omnichannel marketing will remain key. As consumers increasingly rely on a blend of online and offline shopping experiences, brands must reach their customers wherever they are. This year, the coronavirus pandemic drove consumers toward digital and drove ecommerce to new heights not expected until 2025.
Consumers are reducing overall spending, opting to shop online instead of in stores, and buying less non-essential items. This includes an online cannabis seed bank, peer to peer online market on social media platforms and other unique “buy, sell, trade” merchants via the internet.
Currently, the US market for “buy now, pay later” (BNPL) is just in its infancy and experienced a 197% YoY growth in GMV. With a small number of players, there are currently four major providers in the US. Afterpay, PayPal, and Google Checkout dominate the market, with Afterpay holding a 70% share of the market. COVID-19 had a minimal effect on BNPL usage, with the majority of users falling within a young female demographic. Despite this, BNPL providers have concentrated on female-oriented ecommerce brands, which are more likely to be found in the US’s millennial-friendly population.
While the BNPL industry may be reluctant to admit it, the technology is widely available, competitive, and transforming the world of payment. The global market for BNPLs is projected to reach $24 billion in 2020. Consumers will likely use this method to make multiple purchases, including luxury items. Furthermore, BNPL has a new angle for companies trying to appeal to lower-income consumers, as it is convenient for the shopper.
Food and beverage sales to account for 4.4% of US retail ecommerce sales in 2022
Food and beverage ecommerce sales are projected to grow at a healthy rate over the next five years, according to Forrester Research. These sales will include online grocery shopping and related services. The market is largely composed of companies involved in the production, distribution, and packaging of food and beverages. In addition, food and beverage ecommerce sales include fresh packaged foods and alcoholic beverages, as well as online food and beverage portals.
The US ecommerce industry will continue to grow at a healthy pace — food and beverage sales are expected to represent nearly $80 billion by 2022. These sales will continue to grow at double-digit rates through the next five years, reaching nearly $1 trillion in total sales. As these sales grow, the major grocery players and food delivery services will continue to invest in new infrastructure to support a growing online marketplace. As a result, a $30 billion industry today will be worth $140 billion in 2022.
Amazon to launch Prime-like service
A new initiative dubbed Buy with Prime by Amazon will allow U.S.-based Prime members to shop through merchants’ websites. It will include free delivery and returns on eligible orders. The new program is currently available by invitation only to some merchants. However, it will be expanded to include other retailers as well. If you’re interested in a subscription to Amazon Prime, you can learn more about it at amazon.com/buy-with-prime.
Initially, the company launched a service called Fulfillment by Amazon, or FBA, which allowed merchants to store goods in Amazon warehouses. Amazon shipped those items on behalf of the merchant and helped to expand the product catalog available for Prime members. This service provided Amazon with a significant competitive advantage and pushed the company’s brand image as an alternative to traditional brick-and-mortar stores. However, there were many risks involved with the launch of Prime, and there were some real tensions within Amazon. Some managers resented the deprioritization of projects and feared that the company would abuse its prime service. Others feared that the service would cost them too much in shipping, and soaring prices could deter consumers from buying from physical stores.
Walmart’s e commerce growth
The current state of the economy is affecting consumer spending and the ecommerce growth of Walmart. It identifies key factors influencing sales and profitability, and examines strategies for ecommerce success. This report examines the brand and seller performance on Walmart Marketplace.For example, Walmart’s price competitiveness has led to higher online sales than its competitors.
Over the past few decades, Walmart focused on building Supercenters, which distracted it from ecommerce growth. However, this focus has afforded the brand with a massive store network that it can leverage for ecommerce growth. In addition, it has remained one of the largest players in the grocery industry. This is a good sign for Walmart as higher inflation may encourage more consumers to shop online. Further, higher inflation may lead to a shift from grocery-only shopping to regular online purchases.
Walmart’s plans to launch Walmart+
The delay in launching Walmart+ may have more to do with the recent pandemic than anything else. Walmart’s plans to launch Walmart+ in April were postponed after the disease hit the U.S., forcing many specialty retail competitors to close temporarily. While online grocery sales during the pandemic doubled, Walmart’s growth rates have been relatively steady. With Walmart+, the company is hoping to maintain its high growth rates, even as more shoppers turn to online shopping.
Amazon has launched its own membership program to rival Walmart’s, but it must differentiate itself from the former. Walmart’s brick-and-mortar store network is formidable. Amazon’s grocery business has opened one store in California this week. The company also operates over two dozen Amazon Go cashierless convenience stores. Walmart operates 487 Whole Foods Market stores in the U.S., making it one of the largest grocery chains in the country.