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3 trends shaping the future of online commerce


Over the past decade, we've seen significant consumer behavior changes, driven by the move from offline to online commerce. And the COVID-19 pandemic has supercharged this shift. According to data from Shopify, ecommerce volumes reached an all-time high in 2020, accounting for 16.4% of total global retail sales. And 98% of consumers told us they'd shopped online during the pandemic.

The growth of ecommerce payment processing volumes is only half of the story, however. The other, and perhaps more interesting development, is the changes we've seen in the factors that lead consumers to spend money with one brand over another.

In the offline world, price, availability and proximity are usually the key determining factors for consumers when making a purchase. That's less the case online. Instead, shoppers are looking to spend money with brands that deliver a complete end-to-end experience that meets their unique requirements and expectations — and making it happen with as little friction as possible. 

In other words, it's those brands that allow consumers to shop where they want, when they want, and how they want that will succeed in an increasingly crowded digital marketplace. 

What does that mean in practice? Here are three areas that I see the most innovative brands focusing on to deliver a best-in-class digital shopping experience. 

Deliver frictionless commerce

It's no secret that speed and convenience are often top of mind for consumers when shopping online. Consumers want to find what they want, order in as few clicks as possible and have it delivered the next day. 

Tapping into this consumer need and reducing friction at every step of the process — whether consumers are on mobile, desktop or tablet — is one reason that Amazon has become such a dominant player. And people will pay for the service. Today there are over 150 million Amazon Prime members worldwide, spending over $1000 a year on average.

But removing friction is easier said than done. And one area where friction often becomes especially acute — and costly — is at the checkout. 

The checkout is the most pivotal moment in the customer journey as it's when you make a sale. Despite its importance, I often see merchants fail to spend any time or effort focusing on this part of the customer journey. And it's a conversion killer that directly leads to lost revenue. 

The good news is that fixing this step in the process isn't overly complicated if you have the right solution. Payment Service Providers (PSPs), like, provide merchants with a flexible range of tools to seamlessly build a checkout experience that their customers love.

Depending on your objectives, this may include providing 'one-click' payment options to streamline the process for returning customers. Or it might mean offering a range of different payment options tailored to individuals markets or customer segments.

For example, if you're a retail brand selling primarily to millennials, you probably want to offer buy-now-pay-later options like Klarna. If you're selling on social or through mobile, you'll want to offer Apple Pay and Google Pay. Or, if you’re business selling in the Netherlands, for example, you probably want to offer iDEAL as a form of payment.

No matter who you are targeting, though, the demand for new payment options is growing. According to our research, 2020 saw a surge in digital payments with 50% of consumers using a digital wallet at least once in the year and 5% using cryptocurrency at least once.

56% of consumers are permanently put off a site if it is not offering their preferred payment method. and Oxford Economics research

Another vital point to remember is that consumer trends aren't static. You must regularly check the pulse of your target customers and adjust the checkout experience and payment methods you offer to meet changing preferences. And that's where it pays to have a payments partner with in-depth local knowledge in your key markets to help you stay ahead of evolving payment trends.

Unlock new commerce channels

It's estimated that nearly four billion people use social media worldwide. That's roughly 58% of people on the planet. And since their conception, B2C brands have used social media to market their products with great success. For example, today, over 600 million people now seek out new products on Instagram alone.

45% of consumers in the Middle East prefer to shop through social apps and bypass traditional ecommerce channels. and YouGov research

But as social networks evolve, more and more brands are starting to use them not just to advertise their products but to sell their products directly to consumers. This is known as social commerce: a sub-set of social commerce where the end-to-end consumer journey happens within a social networking platform. And it's a market set to be worth $604.5 billion by 2027.

Social commerce is an exciting way for merchants to tap into new pools and potential customers and increase revenues. But it's not without its challenges. And one big challenge is accepting payment when somebody isn’t on your site.

That's where a solution like Payment Links comes into play. It allows you to bring your checkout experience to your customers wherever they are in the digital world. So when they're ready to make a purchase, they can, without ever leaving their social app, creating a completely frictionless end-to-end experience.

Today, 40% of consumers aged 18-24 say the ability to make purchases via social media would increase their online shopping frequency. And I expect that percentage to grow in the years to come as Gen Z and Gen Alpha become a large part of the global consumer base.

The key to success for merchants in the years to come will be to understand what networks their target consumers are using and to meet them on those networks to drive sales. 

Reinforce trust with your customers

Trust has always provided the foundation of the relationship between a business and its customers. Consumers wouldn't use a business unless they trusted it would provide quality products and services at a fair price. 

In today's digital world, establishing trust is more important — and complicated — than ever. Research from Salesforce finds that 73% of consumers say that trust in companies matters more now than before. The same study found that just over half of consumers also say that it's harder now than ever for companies to earn their trust.

Why? Consumers shopping online are concerned with getting a quality product or service at a fair price. They also care about the security of the personal information they provide to make a transaction online. 

Financial data is especially important, with RSA finding that 78% of consumers are most protective of their financial information. That makes securing the checkout — the place where that sensitive information is shared — a key priority for merchants looking to foster loyalty with their customers.

There are many ways that merchants can safeguard their customers and establish this trust. These include:

  • Ensuring that you're PC DSS-compliant — or working with a PSP that allows you to become PC DSS-compliant.
  • Providing your customers with trust triggers throughout the checkout. This might include independent ratings, like Trustpilot, regulatory badges and clearly stated returns or exchange policies. Our research finds that 71% of consumers actively look at these details and abandon their cart if unsatisfied. 
  • Using tokenization in your payment flows to store customer card details securely. This is especially useful for those businesses with a high volume of returning customers and is a prerequisite for solutions like 'one-click payments.
  • Strategically applying incoming regulations like Strong Customer Authentication to provide extra layers of security for your customers at the checkout. Yes, this may create a little more friction, but our research finds that most consumers are willing to accept that to feel secure. 

Winning the future of online commerce 

The future of commerce is still being written. Many question marks remain over how consumer behavior will change coming out of the pandemic. But what's for sure is that merchants seeking growth cannot achieve that without an online presence. 

And, increasingly, even an online presence isn't enough. To win the hearts and wallets of the modern consumer, you must ensure that you're meeting customers where they want to be met, providing a seamless end-to-end experience from discovery to delivery, and ensuring their personal information is secure. 

The checkout is a crucial part of this process and the experience that you create for your customers. Get it right, and you'll set yourself up for success. Get it wrong, and you will likely push existing and potential customers to spend money with your competitors.

About the Author

Moshe leads the UK Sales team at working with clients from all industries to help them optimize their payments and deliver greater value to customers. A payments expert with over 14 years of experience across consumer and commercial banking and payments. Moshe has worked in strategy, consulting, new product development and customer management. Before joining Moshe led commercialization for Visa Direct across Europe, driving the adoption of real-time payouts across multiple markets.

Profile Photo of Moshe Winegarten