As we step into 2024, the world of e-commerce continues its rapid evolution. In this blog post, we'll take a look at the coming year, delving into what we can expect in terms of emerging trends. We'll also explore how Tangiblee, as a cutting-edge e-commerce vendor, empowers retailers to take advantage of these trends.
Before we do that, however, we should take a moment to reflect on how e-commerce changed in 2023.
A Retrospective Look at E-Commerce in 2023
In spite of a looming recession and global socioeconomic instability, 2023 was a good year for e-commerce. Every quarter thus far has displayed healthy year-over-year growth It's expected that by the end of December, e-commerce sales will make up 22 percent of all retail sales worldwide.
The second quarter of 2023 was particularly noteworthy, with US e-commerce sales increasing by 7.5 percent over Q2 2022 to $277.6 billion. For context, that's higher than the annual total of all e-commerce sales in 2013. The number of online shoppers also grew in 2023, increasing 3.1 percent to 2.64 billion — a full third of the world's total population.
Online spending also increased across all retail categories as the demand for digital grocery and retail shopping options increased. Electronics, fashion, and furniture remain the top retail categories, together accounting for more than half of all retail e-commerce sales in the US. Health and beauty is also a major category, accounting for 11.3 percent of sales.
The major trends that shaped e-commerce in 2023 included:
Issues With AI
Generative AI became one of the most hyped technologies in the world this year, rivaling even non-fungible tokens. Unfortunately, this has resulted in a concurrent explosion of low-quality, ineffective AI-generated content across multiple sectors, e-commerce included. While there were still vendors and companies that managed to leverage machine learning and artificial intelligence effectively, they were vastly outnumbered by those who treated it as some kind of silver bullet.
Mobile and Social Commerce
In 2023, we saw the continuation of two trends that have defined e-commerce for multiple years. Social media networks such as Facebook gained considerable ground as e-commerce platforms, supporting both B2C and C2C transactions all over the world. Similarly, the market penetration of smartphones in online retail continued to grow — as of the first quarter, they accounted for 74 percent of worldwide retail traffic and 63 percent of online orders.
A Growing Demand for Personalization
Modern shoppers expect retailers to meet them where they are and have little patience for those who fail to do so. This has been true for several years now and was equally true in 2023. The days of impersonal shopping interactions are behind us, and savvy retailers have already
Looking Ahead to E-Commerce in 2024
If 2023 was a good year for e-commerce, expect 2024 to be a banner year. US e-commerce sales are expected to top $1 trillion and collectively account for more than 20 percent of all retail sales. The B2B segment will be a major benefactor of this growth, with Forrester predicting that global B2B e-commerce sales in 2024 will total over $2.3 trillion. Expect the number of online shoppers to also continue rising, increasing 2.6 percent to 2.71 billion.
Although online spending will increase across all major categories in the coming year, there will still be three clear winners:
- Health & Beauty (38.8 percent)
- Apparel (37.9 percent)
- Electronics (32.4 percent)
Expect 2024 to be shaped by many of the same trends that shaped 2023, with a few additional caveats:
Hyper-Personalization
In 2023, we experienced the height of generative AI hype. In 2024, artificial intelligence will truly hit its stride in the e-commerce space. Some businesses have already begun experimenting with the use of machine learning to support personalization on a level and at a scale that was previously unthinkable. Expect more organizations to come around to this use case over the next year as people develop a more concrete idea of what AI can and cannot do.
Unfortunately, the technology will still be plagued with issues, and Forrester predicts that generative AI will cost retailers more than it makes them due to hallucinations and errors.
Immersive Shopping Experiences
One of the biggest drawbacks of shopping online has always been a lack of visualization. You can't examine a product over the Internet like you could in person. At least, that's how it used to be.
Thanks to technologies like augmented reality and virtual reality, this is no longer the case. In 2024, expect another wave of retailers to adopt AR technologies like virtual fitting rooms.
Changing Expectations
Personalization won't be the only thing shoppers in 2024 will demand. Retailers can expect increased pressure to offer services like same-day delivery even as cross-border commerce continues to grow. Sustainability will remain a top priority for shoppers, as well,
Social Sales
Social selling will continue to grow in 2024. To master this space, brands will need to build a stronger relationship with their audience and understand dark social — a hidden world of shares, feedback, and reviews sequestered in private channels.
Stay Ahead of the Trends with Tangiblee
Looking towards 2024, it's clear that in order to remain competitive, retailers will need to embrace emerging trends like AR and AI.
Tangiblee’s cutting-edge solutions help enhance customer experiences, reduce returns, and position businesses for success both now and in the future, no matter how the dynamic, competitive e-commerce landscape might change in the meantime.
Tangiblee has always strived to position itself at the cutting edge of the e-commerce space, allowing us to become an essential tool for retailers seeking to thrive in an evolving landscape. Our lightweight immersive commerce solution integrates seamlessly with every e-commerce platform, making it easier than ever for a retailer to enhance their product listings. With Tangiblee, retailers can leverage emerging trends such as AI-driven personalization, all in the interest of creating a better, more engaging shopping experience.
Interested in learning more? Book a demo today to see Tangiblee in action.
