Top 2024 Predictions You Can't-Miss to Scale up Your E-commerce Business
Published on July 3, 2024
With so many other online businesses fighting for attention, standing out can be tough. But how do some online stores still seem to be one step ahead?
Well, having effective business strategies is the answer.
In the world of online shopping, it’s not just about keeping up, it’s about leading the way. By knowing what’s coming next, businesses can make smart moves to grow and succeed. Predictions for the year ahead can help e-commerce business leaders come across all the changes happening in the online market.
Let’s take a peek into the future of e-commerce and figure out how businesses can make the most of it to shine.
AI to optimize e-commerce operations
In 2024, the use of AI in e-commerce is set to rise, with the market projected to reach over $126 billion by 2025. The fast rise of AI shows how important it will be in online retail. It sets out to change how e-commerce operations are carried out, content is created, and online shopping is made better for customers. Examples from industry giants like Amazon, Shopify, and Alibaba demonstrate the immense potential of AI in e-commerce. Amazon’s product recommendation system, powered by AI, has significantly boosted sales by offering personalized suggestions based on customer behavior. According to a Statista report, by the beginning of 2024, 34% of brands and companies selling on Amazon have already embraced AI-powered technologies for tasks such as product listing and content management. Moreover, an additional 14% of sellers have transitioned from manual to AI-based production of marketing and social media content. Moreover, Amazon’s plan to teach 2 million people AI skills under the program “AI Ready” for free by 2025 shows the importance of AI in e-commerce.
Shopify’s smart tools use AI to help businesses rank higher on Google and get more people visiting their websites. This enhances sales. Alibaba also uses an AI system to prevent frauds and fake transactions which help make customers feel safer and happier when shopping online.
Looking ahead, AI will continue to enhance e-commerce businesses, particularly in customer experience and supply chain optimization. Virtual try-ons and virtual showrooms will become commonplace, providing intuitive and predictive shopping experiences. These technological advancements don’t just make shopping easier for customers, they also help businesses understand what people want. By using AI, companies can make their products better and even predict what customers might like. So, by jumping on board with these AI technologies, online shops can get ahead of the competition and grow even more in the year 2024.
However, striking a balance between AI efficiency and human creativity is necessary. It’s not just about integrating AI, businesses should use it responsibly and ethically, ensuring it enhances human input and creativity rather than replacing it.
Google’s Circle to Search
Google’s new AI-powered search feature, “Circle to Search,” allows Android users to search for information directly from any app without switching. This feature was launched on January 31, 2024, on select premium Android smartphones, including the Pixel 8, Pixel 8 Pro, and the new Samsung Galaxy S24 series. It enables users to search by using simple gestures like circling, highlighting, or scribbling on their phone screen.
“Circle to Search” allows users to draw a circle around an object they’re interested in, highlight text, scribble over an area, or simply tap on an object or text. Google then analyzes the selection and displays relevant search results within a small panel above or below the app the user is currently using.
For e-commerce businesses, “Circle to Search” presents exciting opportunities. Imagine browsing online and seeing ads for things you’re interested in. This feature helps businesses do just that by showing ads tailored to your preferences. It also lets you easily shop by scanning QR codes on ads or in stores, making it super convenient. Plus, it makes exploring products on websites or apps more fun and interactive. As more businesses use this feature, shopping online will become even more enjoyable, helping customers find what they want and buy it with ease.
Social media platforms as direct sales channels
It is predicted that social media platforms will prove the best channel for online sales in the year 2024. this is because social media platforms can be seamlessly integrated into business systems and provide a highly personalized shopping experience to its users worldwide. The global Social Commerce revenue is predicted to reach $1.64 trillion by 2024 with a further increase to reach new heights of $2.9 trillion in 2026. Businesses are making use of platforms like Facebook, Instagram, TikTok, and Pinterest to engage with customers in real timelines and drive sales.
In Pakistan, where there were 71.70 million active social media users according to a survey conducted in January 2024, accounting for 29.5% of the total population, platforms like Facebook, TikTok, and Instagram are particularly popular, with significant percentages of the population actively engaging on these platforms. For example, approximately 40.1% of the Pakistani audience is on Facebook, 49% on TikTok, and 15.6% on Instagram. Instagram Shopping lets businesses display their products right on their profiles, and Facebook Marketplace helps people buy and sell items in a community-focused way. TikTok’s viral content and smart feed are helping people, especially younger ones, find and buy products more easily.
Social commerce is fueled by impulsive purchases, with 48% of social media users admitting to making such purchases after coming across a product on social media. This trend is expected to continue growing, especially among millennials and Gen-Z, who are the leaders of social media adoption worldwide.
As social media platforms are focusing on ways to maximize the generation of revenue per user, many online businesses are considering these social channels for direct sales rather than just using them for brand promotion. In 2024, social media continues to be the top choice for online sales because it seamlessly combines shopping with socializing. With personalized ads and easy access, it’s convenient for both businesses and shoppers.
Video Marketing through TikTok
With 46% of consumers admitting to purchasing after watching a brand video, the power of video in driving sales cannot be underestimated. In 2024, video marketing is expected to be the most effective way for brands to connect with potential buyers, engage them, and inform them about products or services.
TikTok is one such channel that seems to become a major platform for e-commerce, where businesses can reach customers with short but impactful videos. With its expansive reach of 1.92 billion users in 2023, it is expected to grow to 2 billion by the end of 2024. TikTok has now become an essential tool for brands seeking direct connections with a wide base of customers. The innovative features offered by TikTok such as in-app shopping, branded hashtags challenges, live streaming, etc. help brands to develop interactive, creative, entertaining content that attracts users. As the number of users reached a billion in number, TikTok has transformed into an online shopping platform.
One of the standout features of TikTok is its ability to drive purchasing decisions. With millennial users 2.3x more likely to create a post and tag a brand, and users 1.4x more likely to purchase new tech products, the platform presents a lucrative opportunity for e-commerce brands to reach a younger, tech-savvy audience.
Moreover, brands can put tutorial videos telling how their products function. This removes customers’ confusion regarding products and helps them in making purchasing decisions. TikTok is a great social platform for brands to put customer review videos, product demonstration videos, or personal story videos to educate and influence potential customers.
According to TikTok, their ads have a significant impact on viewer perceptions. Brands marketing through TikTok can increase customer trust by 41% and 33% of customers are more likely to feel the brand aligns with their personality after watching promotional TikTok videos of brands. Businesses are increasingly recognizing TikTok’s potential, with 54% of business owners using the platform to promote their brands, and 1 in 4 small businesses using TikTok influencers for product sales or promotions. With an average return of $2 for every $1 spent, e-commerce businesses are seeing this platform as beneficial to drive sales and increase brand visibility in 2024.
Subscription services
As subscription services are providing significant benefits to online businesses demand is increasing continuously. The global subscription e-commerce market is expected to hit US$478 billion by 2025. It’s crystal clear that subscription models are gaining popularity with some regions experiencing nearly 100% expansion in recent years. Companies like Birchbox and Manscaped are leveraging subscriptions to provide curated selections of products to customers regularly.
Beyond just generating revenue, subscription services help build strong customer relationships. They turn satisfied customers into loyal buyers, assuring continuous generation of revenue. The longer a customer stays subscribed, the more valuable they become to a business as it helps to lower business costs. In 2024, e-commerce businesses must add a subscription model to their strategy because by offering subscription services, they can gain valuable insights into customer preferences and automate repeat purchases. It not only helps to make the online shopping experience convenient for customers but also enables brands to set up personalized marketing strategies to meet the individual needs of buyers. This is how brands can scale their e-commerce businesses and differentiate themselves from their competitors in 2024.
Automation
In 2024, the ecommerce industry is predicted to grow and transform further. Many entrepreneurs, e-commerce business startups, and even some mature businesses in Pakistan are unaware of business automation systems. Automation is very beneficial, especially for small retailers experiencing rapid expansion. Online businesses, whether they are just startups or old players in the e-commerce market, have good opportunities to establish their brands and expand globally. Over 400 marketplaces are available where they can sell their products reaching a global audience. However, growing the number of sales channels and providing a consistent customer experience across all sales channels to keep brand integrity is a big challenge.
To effectively manage this growth, e-commerce businesses must switch from basic tools like spreadsheets to more advanced automation solutions provided by software companies such as Ginkgo Retail. Retailers need to automate every aspect of the e-commerce process to maintain a high-quality customer experience.
Businesses implementing automation have observed significant increases in speed and efficiency, with some processes seeing up to a 30% improvement. Moreover, automation in order management systems can reduce order processing costs by as much as 80%. Automating financial management systems decreases transaction errors by 66% and enhances operational reliability and building trust with customers. Therefore, investing in software to automate business systems is essential for e-commerce businesses in 2024.
Obaid Arshad
CEO & Co-Founder