Happy New Year! As we all look ahead to 2022 (and possibly make a resolution or two), we wanted to highlight five important eCommerce trends, especially related to the continued popularity of headless commerce. We believe these trends have the potential to influence key technology and business strategies for retailers and brands with eCommerce presences, and could affect your plans for 2022 and beyond.
1. Retailers and brands will stop pursuing technology for technology’s sake and focus on more pragmatic strategies
When it comes to new technology, all that glitters is not always gold. Today, many retailers and brands seem to think they should always chase the next “bright, shiny object” – the latest technology or innovation that promises to revolutionize the shopping experience. Yet the pursuit may divert valuable time, energy, budget, and other resources from proven strategies and best practices. Worse, these technologies could even erode the customer experience these brands enjoy now.
A perfect example of this trend is augmented reality (AR) and virtual reality (VR) technology and applications. These technologies have generated a lot of buzz in eCommerce, particularly with use cases that could help customers see a product, take part in “try-before-you-buy” experiences, tour a product or location, and more.
As innovative as this technology seems to be, it may be years before the technology is powerful enough to support retailers’ and brands’ current expectations and requirements. For example, most VR applications still can’t deliver the experience luxury brands demand – instead offering blocky, pixelated, and cartoonish views – requiring much more of an investment to bring their vision to life.
Also, consumers are not flocking to digital AR/VR experiences in the numbers analysts once predicted.
Research in a recent YouGov survey revealed that less than 50% of consumers today are interested in using VR or AR tools before making a retail purchase.
Clearly technology plays an important role in the online shopping experience and helping retailers and brands generate revenues and profits. But it should never be about technology for technology’s sake; instead companies should only consider it to solve an existing problem. In 2022, we expect that merchants will wise up and focus on technology choices that help them increase site speed, deliver better service experiences, reduce checkout friction, and overcome other similar challenges.
2. An overall increase in headless commerce adoption
Speaking of technology that serves a purpose, the industry will continue to recognize the value of headless commerce and unlock the potential it can deliver. As a result, an increasing number of merchants will implement headless commerce as the first step in adopting the modern commerce stack that works with Shopify and other existing platforms.
As a brief overview, headless commerce is a website architecture design that separates the front end (the store front) from the back end (customer data, product information, shipping and fulfillment, etc.) Headless commerce can deliver a much better customer experience in terms of site speeds, conversion, and customization.
A study by Google showed that consumers are 40% more likely to spend more than planned when experiences are highly tailored, so this could be a great time to go headless. Data shows 64% of large enterprises are developing a bespoke solution to advance their eCommerce plans, and an additional 76% plan to adopt some form of headless technology within the next 12 months.
We understand that many eCommerce teams may still be new to headless commerce, or may not know where to start. For more information, you can download the Nacelle eBook, “Going Headless” today.
3. Developers are taking a smarter, more proactive role in eCommerce technology
As eCommerce teams are adopting headless, their development teams will play a much more proactive role in making the decisions required to bring the vision to life. As they do, many will recognize that the ideal strategy should not be a choice between buy or build, but instead, a hybrid “buy-and-build” approach. Ideally, this way of thinking will allow them to do what they do best – develop innovative new products and features – while buying purpose-built technology that gives them exactly what they need.
One good example of this is third-party data flow and orchestration tools, especially when it comes to inventory availability. Instead of attempting to build this part of the modern commerce stack, development teams will understand that it’s better to buy a solution in this space and partner with external development partners to implement this data flow. Ultimately, data flow ensures shoppers have experiences that feature fresh, consistent product and content on every touchpoint in a timely way.
4. Systems integrators and digital agencies are taking the bull by the horns
Headless commerce is becoming a bigger part of integrators’ business. As a result, many of the companies are now adopting the view that more innovative approaches – such as building progressive web applications on open source technologies such as Vue and React – will be important going forward. As a result, many of them are already looking ahead and building out capabilities, establishing a beachhead in this space.
For example, Scoutside has increased the value of their offerings, so instead of just focusing on Shopify-specific technologies, they are doubling down on the skills needed to build headless storefronts - primarily progressive web applications.
"The last year was a big shift for us as we now are building more headless sites than any other architecture. So much so that we've invested in additional developers to keep up with the demand. With Nacelle gracefully handling the data layer and reliability of the site, our developers get to focus on user experience where our efforts add more value!"
Thomas McCutchen, Founder, Scoutside
5. Gross merchandise value shrinkage leads to a new view of storefronts
Most merchants are moving away from a traditional website-centric eCommerce strategy and are now looking to sell in additional channels, such as social media and marketplaces. It’s a necessary step in 2022, and it will lead to a shrinkage in gross merchandise value (GMV).
GMV measures the total volume of sales transactions through a platform over a given period of time. It is an important metric since it measures the volume and value of merchandise sold. Generally speaking, there’s a correlation between a positive GMV and business results: when GMV is up, the business is usually doing well. Yet if merchants are paying commissions to channel partners or other companies, they could be adversely affecting their business.
While GMV is an important metric, it is still just a measurement of what is happening on storefronts. Retailers and brands are re-calibrating their business to work with marketplaces and social selling in the realization of a trend that’s been a long time in the making.
We expect that merchants will continue to emphasize their experiences on “unowned” properties, making their decisions on their store take a different focus. They will view their storefront as anchors and work to synergize experiences across all touchpoints.
Take advantage of new and emerging trends for a better 2022
One thing is clear: Now is the time for retailers and brands to do all they can to deliver the experiences consumers demand. Those that ignore the many benefits headless commerce and the modern commerce stack can deliver do so at their own peril, and those that embrace it, stand to gain a new – and sustainable – competitive advantage in 2022 and beyond.