Ecommerce Trends for 2021

John LeBaron

March 8, 2021

Last year’s ecommerce trends were unlike anything we’ve ever seen before. Compounded with Covid-19 restrictions that pushed more consumers to shop online, the already steadily thriving ecommerce industry made huge gains in 2020, and the horizon for digital sales is looking more promising (and competitive) than ever.

So what did 2020 look like for ecommerce? We’re here to break down all of the ecommerce trends to keep in mind for 2021.

Ecommerce growth trends

A quick look at ecommerce growth data shows you just how well the industry is doing. For the past 10 years, ecommerce was growing an average of 15% year-over-year. In 2020, it grew over twice that number.

U.S. ecommerce grew 32% in 2020 to reach $790 billion—that’s up from $598 billion in 2019! Ecommerce also represented 14% of total retail spending in 2020. Again, for comparison, it only represented 11.3% in 2019.

The market peaked during the second quarter, when widespread lockdowns led to brick-and-mortar store closures, restricted hours, and a ballooning need for online goods and curbside delivery. MarketplacePulse reported that Q2 ecommerce saw a 16.1% share of retail sales. As businesses adjusted to mask and social distancing measures and shoppers could safely return to in-person shopping, retail spending recovered and ecommerce percentages decreased.

The holidays also saw unprecedented sales numbers for ecommerce businesses. Total holiday retail spending surpassed $1 trillion for the first time in 2020, and ecommerce sales alone grew 32.5%. Cyber Monday 2020 was massively successful. It was the largest online spending day in history, rising 15.6% to $10.78 billion. Insider Intelligence reports that Black Friday sales increased 22% to $8.92 billion, while Thanksgiving sales rose 21.4% to $5.02 billion.

Ecommerce trends for 2020 are also interesting outside of the U.S. Latin America saw stand out ecommerce growth last year (36.7%), with North America, Central & Eastern Europe, and Asia-Pacific following. It’s a good reminder that the international ecommerce field is ripe with opportunity for U.S. brands wishing to grow even more.

The upward trend in ecommerce growth isn’t expected to stop, though less dramatic increases are expected with vaccine rollouts and a more predictable market in 2021.

So, what are the ecommerce trends your brand should be aware of?

1. Use online marketplaces

2020 was a challenging year for businesses, with many experiencing inventory issues, closures, and significant adjustments to marketing and sales to meet a new retail landscape. While some of those same challenges carried over to online marketplaces—you might recall that Amazon saw significant delays and inventory issues last spring due to the Covid-19 pandemic—marketplaces overall saw exciting growth.

In spite of shipping and inventory issues, Amazon was the biggest winner, growing significantly during initial lockdown periods and with greater fulfillment capacity than its competitors. Amazon’s annual revenue increased 38% to $386 billion—an increase of over $100 billion year-over-year—and the company’s net profit was up 84% in 2020 compared to 2019. That’s a lot of Benjamins.

Amazon’s Sponsored Brands saw exceptional growth during Prime Day promotions, which were postponed from the summer to October 2020 due to the pandemic. Markle reported that advertisers who ran deals on Prime Day saw a sales lift of 240%, which outpaced their spend increase by 210%. Amazon continues to prove they aren’t going anywhere.

Smaller marketplaces are also thriving beyond 2020. Walmart surpassed eBay to become the second largest ecommerce marketplace—its revenues grew $35 billion in 2020—and, for the first time in its history, Target leaped into the top ten ecommerce marketplaces, landing a position at number seven. The company made over $13 billion in sales in 2020, a 104% year-over-year change from 2019.

2. Create a convenient customer experience

Both Walmart and Target have seen large returns due in large part to their investment in curbside pickup and same-day delivery options. These are two trends that are not expected to go away in 2021, as they’ve been met with a largely enthusiastic response from shoppers.

Target is an especially fascinating example. In January 2021, they reported that their same-day shipping services—Drive Up, Order Pickup, and Shipt—grew a combined 193% during the holiday season. Nearly $700 million of those sales came from their Drive Up service alone, which increased 500% year-over-year from 2019, and those sales didn’t negatively impact their in-store pickup. In fact, in-store pickup increased more than 50%.

Customers are looking for safer, more convenient, and more diverse ways to make their purchases in 2020 and 2021, and the pulse of the industry seems to suggest that faster shipping, digital selection, and easy pickup services will continue to do well.

3. Pay attention to categories

There were several “pandemic shopping categories” that emerged as leaders in the pack in 2020. Essential goods, in-place entertainment, and home projects saw a record-breaking year. But, the biggest standout category is grocery.

Before the Covid-19 pandemic, many stores were already building out their grocery order pickup and delivery capabilities. It has, until recently, been a relatively small niche in the grocery industry, but a growing one. During the pandemic, however, data shows that the popularity of online grocery exploded.

In August 2019, U.S. online grocery sales totaled $1.2 billion. By June 2020, that number was $7.2 billion, with a massive 79% of U.S. consumers turning to online grocery after the outbreak of the pandemic.

A study by PwC Global found that 63% of respondents are buying more groceries online or by phone now than before social distancing, and 86% of respondents are likely to continue to shop online for groceries when social distancing measures are removed.

With expanded curbside and delivery options, online grocery is expected to carry that momentum with it into 2021 and beyond. Business Insider reported that online grocery is expected to reach 55% of U.S. consumers by the end of 2024.

Online grocery isn’t just good for grocery. With the ability to add products from other categories to groceries in an online cart (i.e. Walmart.com), the shopping experience has become more convenient and efficient for marketplace consumers across the board.

4. Expand to an omnichannel strategy—don’t forget social media

Omnichannel strategies continue to be an important trend for brands in the ecommerce industry looking to expand. With more customers shopping online, the importance of having a cohesive and consistent brand across a diversity of channels, including marketplaces and social media, is greater than ever.

Two platforms that are particularly interesting right now are Instagram and TikTok. Instagram surpassed 1 billion global users in 2020, and it continues to build upon its Reels and Stories features in ways that brands can leverage for their ecommerce.

According to Markle, Instagram Stories ads generated 35% of impressions and 29% of total Instagram ad spend for brands. It’s anticipated that advertising features on Reels will be available to brands in the near future.

Instagram, more than any other social platform, is the platform shoppers are turning to to follow brands, and not only is it a popular B2C platform, but it’s growing in popularity for B2Bs who are wanting to raise awareness of their brand as well.

TikTok is the interesting newcomer in this space. The app saw explosive growth in 2020, and marketers, once distrustful of the app, are now paying close attention. Last fall, TikTok and Shopify announced that Shopify merchants can now create and run TikTok campaigns within the Shopify dashboard. The app has also added ecommerce-focused ad units, like a dynamic catalogue, that are attractive to brands. Marketers are expected to spend more on the app this year as it continues to expand its ecommerce features and dominate in the social video space.

Ecommerce trends for 2021

Overall, focusing on the end consumer is a big key in ecommerce. This year, focusing on finding where your target customer already is, and then showing up with convenience and support. No matter who your audience is, they can’t purchase your product offering if they don’t know about it. But, don’t neglect traditional channels in pursuit of new ones, maintain a balanced omnichannel strategy to keep both existing and potential customers happy. Not sure how to manage an omnichannel strategy effectively? We’d love to help.

Contact Pattern to talk about your ecommerce needs or request a demo of services today.

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Sept 6, 2022

Global Ecommerce Weekly News: 6th September 2022

Get up to date with this week's ecommerce headlines from around the globe. --- Amazon News --- Amazon announces new inventory and distribution service, AWD Amazon has launched Amazon Warehousing and Distribution (AWD), providing inventory and distribution services to its sellers as a means of addressing current supply chain issues. AWD is now available for sellers using Fulfilment by Amazon (FBA), i.e. outsourcing their fulfilment to the platform. Amazon has plans to expand the service outside the platform in 2023. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/02/amazon-introduces-new-service-to-help-solve-supply-chain-challenges/) Amazon Web Services (AWS) launches in the UAE AWS, Amazon’s cloud-computing platform offering, has launched its second region in the Middle East and now provides its services in the UAE. The move will now allow anyone in the UAE who utilises cloud technologies to harness AWS’s advanced platforms and APIs. An estimated $11 billion USD is expected to be added to the UAE’s GDP thanks to the implementation, with an average of 6,000 external vendor jobs to be created annually. AWS is now available in 87 zones across 27 regions, with sights set on expanding further across Australia, Canada, India, Israel, New Zealand, Spain, and Switzerland. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/30/amazon-web-services-launches-region-in-uae/) --- Other Marketplace News --- Lazada to launch in Europe Alibaba-owned ecommerce platform Lazada is set to launch in Europe, marking a refreshed internationalisation push from the company. The move follows toughening economic conditions and performance in Southeast Asia, advancing the need to tap overseas markets. In Europe, Lazada will face tough competition from giants like Amazon and Zalando. Lazada’s exact entry strategy is to be confirmed and will be reliant on macroeconomic and market conditions, according to Lazada CEO James Dong. [Read more on DigitalCommerce360](https://www.digitalcommerce360.com/2022/09/01/alibabas-lazada-to-take-on-amazon-zalando-in-europe-push/) Chinese ecommerce giant Pinduoduo to launch cross-border platform in the United States Pinduoduo, a Chinese ecommerce giant rivalling Alibaba and JD, has announced it will be launching a new cross-border ecommerce platform. The marketplace is set to launch in the United States next month, as part of the company’s larger push into new markets. Pinduoduo found success in China thanks to its rock-bottom price offerings and harnessing of social commerce marketing, emulating strategies similar to fast-fashion giant Shein. [Read more on Yahoo Finance](https://uk.finance.yahoo.com/news/pinduoduo-launch-international-e-commerce-034129263.html) Alibaba launches its biggest B2B sales event, ‘Super September’ China ecommerce giant, Alibaba, has now launched its month-long B2B sales event ‘Super September’. The event provides 40 million buyers and 200,000 suppliers with the ability to connect on the platform, showcasing a ‘virtually unlimited’ number of products. The event hopes to foster new cross-border business relationships to tackle supply chain challenges currently faced by businesses. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/01/alibaba-launches-super-september-b2b-sales-event/) --- Other Ecommerce News --- Klarna’s losses quadruple in first half of 2022 BNPL provider, Klarna, has reported losses of $581 million USD for the first half of 2022. This figure is almost four times larger than a year earlier, where $129 million USD in losses were reported. The company attributes the losses to employee costs, technology investments, and rising credit losses. Klarna’s figure reporting comes amidst worsening economic conditions, fresh legal and regulatory scrutiny, and pressure from Big Tech competitors. [Read more on The Financial Times](https://www.ft.com/content/483451db-9221-4ca4-83a6-b4ddc6bfcfbb) [Read more on the Guardian](https://www.theguardian.com/business/2022/aug/31/klarna-losses-more-than-triple-as-consumer-spending-slows) One fifth of Snap employees to be laid off amidst poor financial performance Social media platform Snap (‘Snapchat’) has announced it will be laying off 20% of its employees and closing out a number of projects following a year of poor financial results.The move will see 1,200 employees globally lose their jobs, saving the company an estimated $500 million USD in costs. Snap is currently valued at $20 billion, an 84% decrease from its valuation of $130 billion last year. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/01/snap-to-lay-off-20-of-its-workforce-and-wind-down-a-number-of-projects/)
Aug 30, 2022

Global Ecommerce Weekly News: 30th August 2022

Get up to date with this week's ecommerce headlines from around the globe. --- Amazon News --- Amazon set to shut down Amazon Care Amazon is closing its telehealth service, Amazon Care, which launched in 2019 as a trial program for its headquartered employees. Later the service was rolled out nationwide for employees and other companies. The ecommerce giant has now made the decision to move away from the healthcare space, believing it was not the right long-term solution for its enterprise customers. [Read more on CNBC](https://www.cnbc.com/2022/08/24/amazon-is-shutting-down-amazon-care-telehealth-service.html) Peloton closes new deal to sell on Amazon Following a recent deal, Amazon customers will soon be able to buy Peloton fitness equipment on the marketplace, marking Peleton’s first move outside a direct-to-consumer model. According to Peloton’s CCO, there are already around half a million searches on Amazon for Peloton products every month, despite having no presence on the marketplace. Some key products include the original Peloton Bike, retailing for $1,445 and Peloton Guide for $295. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/24/peloton-strikes-deal-to-sell-fitness-equipment-on-amazon/) --- Other Marketplace News --- 60% of Malaysians are buying from local sellers on Shopee A recent survey of nearly 3,500 respondents found that nearly half of the shoppers prefer to purchase from local sellers due to shorter delivery times. Other shoppers decide to shop locally due to the quality of the products made in Malaysia and an interest in keeping the economy running. As a result, smaller local merchants have been able to grow their businesses, and shoppers benefit from shorter delivery times, products of high quality and supporting local businesses. [Read more on The Malaysian Reserve](https://themalaysianreserve.com/2022/08/25/around-60-malaysians-are-buying-from-local-sellers-on-shopee/) Flipkart’s social commerce platform Shopsy crosses 100 million users Flipkart launched a social commerce arm, Shopsy, in July of last year, which has now surpassed 100 million users, ahead of its target timeline being the end of 2022. This acquisition of new users has made Shopsy one of the largest platforms of its kind in the country, and is expected to onboard a further 100 million by the end of 2023. The platform is centred around boosting local entrepreneurship and powering ecommerce for consumers across tier 2+ regions where users face challenges around trust and navigation when shopping online. [Read more on Business Standard](https://www.business-standard.com/article/companies/flipkart-s-social-commerce-platform-shopsy-hits-100-million-users-1220828006851.html) Meta joins Amazon and Walmart in bid for Indian ecommerce market Amazon mentioned earlier in the year that it would be building a logistics division in-house through its purchase of a 51% stake in Ecom Express, an end-to-end logistics firm, to make ecommerce deliveries more efficient in the country. Walmart operates Flipkart in India and is set to continue its investment in the marketplace. In an effort to compete in the Indian ecommerce market, Meta has partnered with Indian ecommerce company, JioMart, to offer customers a grocery shopping platform within its WhatsApp chat feature. [Read more on Pymnts](https://www.pymnts.com/news/retail/2022/meta-joins-amazon-walmart-indian-ecommerce-market/) --- Other Ecommerce News --- Ecommerce in Spain worth €57.7 billion in 2021 Spanish ecommerce saw 11.7% growth compared to last year, largely attributed to cross-border sales. In the final quarter of 2021, ecommerce sales in Spain were at €16.9 billion euros, at least 60% of which came from cross-border sales. Transactions from foreign locations to Spain generated a turnover of €1.56 billion in Q4, a growth of 27.7% compared to Q4 a year before. [Read more on Ecommerce News](https://ecommercenews.eu/ecommerce-in-spain-was-worth-e57-7-billion-in-2021/)
Aug 23, 2022

Global Ecommerce Weekly News: 23rd August 2022

Get up to date with this week's ecommerce headlines from around the globe. --- Amazon News --- Amazon to add mental health support to primary-care service Amazon is set to move into mental health therapy with its primary-care division, following its recent acquisition deal of One Medical. The plan is to partner with virtual behavioural therapy service, Ginger, to offer its Amazon Care users with on-demand access to mental health services, licensed therapists and psychiatrists. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/11/amazon-plans-to-add-mental-health-support-to-primary-care-service/) GMB union calls for £15 an hour minimum pay at UK Amazon warehouses Amazon recently offered its warehouse workers a 3% pay rise, which in comparison to the June inflation rate of 9.4% left employees disappointed. Following this, hundreds of Amazon warehouse workers stopped work last week, protesting against the minimal pay increase, seeking a minimum of £15 an hour. Recent protests consisting of employee walkouts and sit-ins aim to get a better offer out of Amazon. [Read more on The Guardian](https://www.theguardian.com/technology/2022/aug/09/gmb-calls-for-15-an-hour-minimum-pay-at-amazon-warehouses-in-uk) Amazon third-party sellers have received their first-ever holiday fee hike Amazon’s third-party marketplaces account for close to half of the company’s online sales. The company introduced a 5% fuel and inflation charge to its third-party sellers earlier this year, and has now implemented another inflation increase charge. Commencing 14 October, any seller who uses Amazon’s fulfilment service is subject to the price hike, which is set to be an additional 35 cents per item for products sold in the US and Canada. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/17/amazon-third-party-sellers-have-received-their-first-ever-holiday-fee-hike/) Amazon puts a pause on UK grocery shop roll-out as the cost of living increases Amazon has slowed down on its UK roll-out of till-free Amazon Fresh grocery stores following disappointing sales and the rise in cost of living. Allegedly, the company is no longer looking for potential sites to expand and if more stores are opened, they will likely no longer use a till-free system, as consumers become more cautious about spending. [Read more on The Telegraph](https://www.telegraph.co.uk/business/2022/08/21/amazon-pauses-uk-grocery-shop-roll-out-following-disappointing/) --- Other Marketplace News --- Shopee overtakes Alibaba across international markets Shopee has surpassed Alibaba and taken the top spot for sales outside of China. Singapore-based marketplace saw a year-on-year increase of 51.4% at the end of Q2 of this year, while Alibaba saw a 3% drop during the same time period. This can be seen as a promising development for start-ups and their ability to compete with some of the largest ecommerce giants in the market. [Read more on Exchange Wire](https://www.exchangewire.com/blog/2022/08/18/shopee-surpasses-alibaba-in-international-sales-amazon-searches-for-entertainment-exec/) H&M reopens its official store to Alibaba’s Tmall ecommerce platform It has been nearly 18 months since Alibaba removed H&M from its Tmall platform, following H&M’s criticism of human rights abuses in Xinjiang. It is estimated that over a million people, predominantly minorities in the area, have been unlawfully detained in camps across the city. Brands including Nike, Adidas, Burberry and Converse were swept up in the controversy, however H&M was one of the first to be targeted for speaking out about the issue. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/16/hm-returns-to-alibabas-tmall-platform-16-months-after-xinjiang-controversy/) Klarna launches new feature allowing UK consumers to view full online order history Buy-now-pay-later company, Klarna, has launched a new feature on its shopping app, which allows UK consumers to view their full online order history, regardless of whether they purchased the product using Klarna. The feature also shows delivery tracking and aids consumers in managing their online purchases more conveniently. [Read more on The Industry](https://www.theindustry.fashion/klarna-launches-new-feature-allowing-uk-consumers-to-view-full-online-order-history/) --- Other Ecommerce News --- Online marketplaces responsible for £280 billion business turnover in the UK Nearly 900,000 UK businesses are currently selling on online marketplaces, generating an estimated £282 billion worth of sales each year. This figure represents 6% of the UK’s annual business turnover, highlighting the notable contribution that marketplaces make to the UK economy, along with the potential for further growth in this area. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/08/09/online-marketplaces-responsible-for-280-billion-business-turnover-in-uk/)