8 Trends Accelerating the Future of E-Commerce in 2024

The race toward seamless, hyper-personalized shopping experiences will shift into high gear in 2024.

However, significant economic headwinds will continue to drive the contraction of consumer spend across sectors into the first half of the year. Depleted consumer savings, mounting consumer debt and high interest rates are the main factors preventing consumers from loosening their purse strings.

How can retailers and brands prepare for the year ahead? Investing in artificial intelligence, seamless customer experiences and digital business transformation are key to maintaining a competitive advantage in the e-commerce landscape.

In this article, we’ll explore the top eight trends changing the e-commerce landscape, based on global consumer research and insight from our retail industry experts Sudip Mazumder and Guy Elliott.
 

1. Generative AI, zero-click search turns e-commerce into a conversation

Despite the fast rise of generative AI technology through tools like ChatGPT, many retailers are left wondering how to actually employ the technology in their e-commerce websites, whether or not customers will engage with it on search engines and, frankly, what they need to change to avoid getting left behind.

In 2024, many e-commerce websites will begin to roll out generative or conversational search tools, following Google’s Search Generative Experience (SGE) going live at the tail end of 2023.

Approximately 27 percent of consumers overall are excited about generative AI’s ability to improve real-time deal comparison and overall search results, according to a Publicis Sapient global consumer survey. This introduction of “zero-click” search on Google will have significant implications for e-commerce next year—as links to third-party affiliate websites will fall to the wayside and content from owned brand websites as well as sponsored shopping listings will dominate Google’s top real estate.

While this shift to generative search may take longer to infiltrate brand websites, almost half (43 percent) of consumers that have used a generative AI tool expect that brands will employ the technology to improve their customer experience. Retailers that experiment with the generative style in 2024 will create a competitive advantage.

2. Consumers welcome personalized advertising

It’s time for retail media networks to get more personalized and, surprisingly, consumers agree. Retail media has reached $30 billion in revenue faster than both search and social, according to Luma Partners, and continues to fill a market need for consumer packed goods and branded manufacturers.

Reuters projects that by 2028, revenue from retail media networks (RMNs) will account for 15.4 percent of all revenue from ads, eclipsing television as an advertising platform.

According to consumer data from Statista, targeted advertising is less annoying than it used to be—and consumers actually prefer and expect e-commerce advertising to be customized to their unique wants and needs.

As an example of this, in most cases, RMN advertising that targets loyalty program segments is only differentiated based on recent spend and/or points accumulation. An incredibly diverse group of customers are all hit with the same blanket offerings and promotions, i.e., a “spray and pray” approach.

While the contact information that these loyalty members provide is valuable on its own, RMNs that further segment their promotional offers within their loyalty programs receive higher engagement and return business.

3. Secondhand marketplaces compete for consumer attention

With cost-of-living increases and sustainable purchasing habits on the rise, secondhand marketplaces, rental platforms and resale are going to accelerate more than ever before.

According to a survey of U.K. consumers, over four in 10 (44 percent) buy more secondhand items than they did a year ago, while a further 57 percent say their re-commerce shopping behavior has remained consistent.

While third-party C2C marketplaces like ThredUp, eBay and even Facebook Marketplace have thus far dominated the secondhand market, new B2C and even B2B marketplaces are on the rise.
 

From Walmart’s B2B liquidation auctions to their B2C marketplace, or Lululemon’s “Like New” resale website, retailers will need to experiment with the right price points, logistics and value chains to make these e-commerce platforms profitable and deepen the relationships with their target customers.

Create a retail peer-to-peer marketplace with Publicis Sapient’s open source solution

4. “Slow living” and high-quality products are in

It’s no surprise that consumers care more about sustainability, yet the high cost of living in many areas will complicate their eco-friendly intent vs. action.

The trend of “deinfluencing,” or influencers on social media discouraging consumers from overconsumption and recommending which products to avoid, has prompted a renewed interest in high-quality products.

In fact, the number one corporate sustainability practice that’s important to consumers is the creation of long-lasting and durable products, trumping waste reduction, decreasing greenhouse gas emissions and many other common environmental initiatives.

This trend also accompanies the growing movement of “slow living,” which encourages a more leisurely and sustainable pace of life. While fast and reliable shipping will still be important for many, convenient products located at physical retailers discovered using way-finding tools may be a welcome alternative.

Read more about how e-commerce retailers can reduce carbon emissions in the Annual Guide to Next report

5. Short-term financing and invisible payments accelerate check-out

As the e-commerce experience becomes more personalized and seamless, retailers will accelerate the adoption of frictionless payment options. From Paypal Credit, to Afterpay, to Apple’s Pay Later solution, half of millennial and Gen X consumers have used some form of short-term financing in the last three years.

This rise of BNPL has also pushed the concept of “invisible payments” or transactions that occur without any visible interaction (or friction) between the customer and the payment system.

However, retailers will need to tread carefully, specifically when integrating new BNPL options into their checkout. BNPL users are also more likely to experience financial stress.

It’s crucial that retailers expand these payment options for those repeat BNPL users who prefer splitting purchases over four payments, without encouraging naïve shoppers to take on debt that they’ll be unable to pay back.

6. AI-generated images seamlessly blend into marketing

As generative AI technology advances, creating believable videos of world leaders playing video games and AI headshots of colleagues, online advertising will give rise to AI-generated imagery, particularly used to personalize product images to match different audience segments.

Placing products within a “lifestyle” context can increase e-commerce conversion rates, and generative AI can finally make that process cheaper and faster.

While consumers are concerned about the negative impact of artificial intelligence, from job loss (42 percent) to misinformation (53 percent), 27 percent of those who are familiar with and have used generative AI tools are excited about its ability to generate personalized product recommendations for them, according to a Publicis Sapient survey.

It’s up to e-commerce leaders to perfect AI image generation technology to create ads that draw consumers in, rather than push them away. In 2024, the potential for increased conversion rates, basket sizes and consumer engagement online through AI advertisements will outweigh the risks of getting it wrong, as long as retailers have the right digital expertise and quality assurance practices in place.

7. Word of mouth, product reviews, influencers drive online shopping

Authenticity continues to be paramount for online shoppers, particularly among younger generations. As brands saturate social media through sponsored advertising and influencer partnerships, many consumers are working harder to seek out “unsponsored” product reviews and word-of-mouth advertising from passionate customers and influencers.

Thirty-percent of global consumers report recommending their favorite brands to friends and family, according to a global Publicis Sapient survey, as one of the top ways they show loyalty. At the same time, nearly half of consumers make purchase decisions using online search (45 percent) and product reviews (41 percent).

As social media (Gen Z’s preferred search channel) becomes oversaturated with sponsored content and paid influencers, retailers that seamlessly integrate user-generated content into e-commerce channels, from written to video product reviews, will be the top shopping destination for younger consumers.

8. Smart supply chains will decrease product waste

Global conflict and an increase in extreme weather events due to climate change present a drastic need for retailers to modernize their supply chains, implementing digital twins, demand forecasting, preventative maintenance measures and supplier tracing.

Not only will these resilient supply chains reduce profit loss from unexpected events, they will also provide a reliable baseline for carbon emissions measurement across the value chain for retailers.

While only 34 percent of consumers want companies to publish their sustainability certifications, half of global consumers say they trust companies that instead reveal their sourcing and production methods, according to a Publicis Sapient global consumer survey.
 

In order to present accurate measurements and progress to stakeholders, and even integrate this information into the e-commerce experience, companies need to start with supply chain digitization.

To craft your e-commerce strategy for 2024 and beyond, contact Guy Elliott and Sudip Mazumder below.