The e-commerce industry is booming, made possible by the emergence of new business models based on digital technologies. Traders study the world in which they operate in detail. From the digital wallets that lead the mobile e-commerce revolution to the digital currencies used in the metaverse, how consumers can pay greatly influences the experience offered by merchants. More and more brands are waking up to this fact and developing new and innovative revenue streams and models, leveraging a strategic understanding of online payments.
The beginning of the year heralds many other changes for this sector, characterized by intense competition where innovation is fundamental and potential gains are significant. Decryption of five developmental positions to watch out for to thrive in this context.
The tech sector in the grip of many layoffs
At the UN climate conference COP26 in November 2021, 130 retailers, including Burberry, H&M and Nike, committed to reducing their emissions to half of 2019 levels by the next decade, a 30-year commitment. % higher than your previous commitment. You can see a number of retailers including eco-sustainability and ethical supply chains at the top of their 2022 priority list. Millennials prefer sustainable brands, so retailers are acting in everyone’s interest by prioritizing the concept of sustainability at the start of this era. New Year.
So what would that progress look like for traders? While many are investing in carbon offsets and other large-scale projects, there are also other policy changes with significant effect. Retailers are increasingly looking for ways to combine the resale and rental sectors to ensure their products are in circulation longer. Payment also plays a role in this approach, for example the “Buy now, pay later” (BNPL) deferred payment options that make it possible to make ethical and sustainable products – often offered at a higher price – more accessible to consumers. all.
The successful adoption of social commerce
As more consumers are able to discover the services offered by merchants through social media, whether through advertisements or content creation, the way people interact with their products is changing. European investors and traders continue to increase their adoption of social commerce, especially as European consumers seem very likely to adopt this trend en masse once it adapts to them.
The human dimension of e-commerce is essential, as is the seamless experience that social media platforms seek to ensure. It is for this reason that the integration of shopping methods and payment links is increasingly being used by brands to convert potential shoppers into purchasing customers, through an in-app, in-app, fluid and secure experience.
However, where there are opportunities, there are also opportunists. And with the rise of social commerce, environmental skepticism has also emerged among consumers, who sometimes doubt the veracity of the facts presented about brands on social media. To earn the trust of skeptics, brands will need to collaborate with trusted partners and invest in robust technical solutions to ensure all parts of the transaction process are secure.
Payment optimization and diversification
Rather than remaining passive, brands are better off actively investing in innovative or improved payment technologies that drive more sales through the digital checkout process, preventing fraud and chargebacks.
Indeed, payments are essential to support merchants’ growth ambitions in new markets. Since most consumers will abandon their cart if they cannot pay with their preferred payment method, payment diversification strategies will be vital for brands to generate more sales. In addition to local payment methods, merchants can also favor the integration of BNPL options, digital wallets – including compatible with cryptocurrencies – and QR codes. Payments via digital currencies or even the sale of digital assets like NFTs can be offered as a payment option.
The fight against fraud and cyber risks
As criminals become increasingly adept at fraud methods, brands will need to reduce the risk of fraud and cybersecurity breaches through optimized data analytics technologies and solutions. In 2020, card fraud cost e-commerce professionals an estimated $35.54 billion worldwide. This type of fraud was already increasingly common before the pandemic, but its rise since then has been considerable.
With the increase in the number of frauds during 2021, e-commerce professionals are looking for several solutions to combat this scourge. Small changes like site encryption, regular software updates, and stepping up the authentication process can make a big difference. As competition in the industry evolves in the future, the strategy adopted by brands against fraud will crucially determine their place in the global e-commerce market.
The potential of marketplaces
According to McKinsey data, 50-70% of online commerce is expected to take place on marketplace platforms by 2025.
In fact, marketplaces that bundle special offers or unique items sold second-hand can see the benefits of high demand tied to certain specific situations. And e-commerce professionals are feeling these pressures, as the potential loss of market share for these platforms is a major threat. But perhaps this challenge is actually yet another opportunity for brands that plan to sell more of their products on third-party marketplace platforms in 2022.
As competition between independent sellers targeting the same customers in these markets intensifies, brands may look to expand their digital presence to other platforms to maximize their scale.