Top 5 Online Retail Trends for E-Commerce in 2023

The e-commerce industry can navigate the crisis in the coming year, but it is not expected to achieve the record growth rates of previous years. However, 2023 is likely to be anything but boring for e-commerce retailers.

While it’s not appropriate to say that the celebration in e-commerce is over, there is currently a somewhat subdued mood. The IFH Cologne has recorded a decline in growth in B2C e-commerce for the first time in a long time. Nevertheless, revenues remain high. Factors such as inflation, issues in supply chains, and consumer restraint have led many retailers to act cautiously. Therefore, the record numbers of previous years are unlikely to be repeated.

But how does this affect e-commerce, which is expected to reach a revenue of 100 billion in the coming year? We consulted the industry and compiled the key trends.

How much revenue the online trade will generate in the coming months depends directly on how well retailers can ensure delivery capability,” says Hansjürgen Heinick, online market expert at IFH Cologne. “If the general economic situation improves, this will also impact the revenue growth in online trade. In our various scenario variants, we expect positive growth rates by 2026,” adds Hansjürgen Heinick, online market expert at IFH Cologne.

But more than ever, it will be crucial in 2023 for retailers and brand manufacturers to optimize their supply chains. ‘To enable faster integration of trading partners and make processes more transparent, the automation of all processes is required. This can only be achieved through the use of artificial intelligence in the complexity that modern e-commerce requires,’ explains Mark Sturzenegger, Senior Director Central Europe at Boomi.

Therefore, even medium-sized retail companies will have to undergo what large corporations have already implemented in their IT strategy. The introduction of more agile processes and the migration of multiple processes to the cloud to ensure maximum flexibility. Especially in the field of supply chains, communication with customers must keep pace. While in the past, the question of the lowest price often determined a purchase, the question of the availability of products is now increasingly coming to the fore.

“Buy now pay later” boosts revenue

Throughout this year, only one topic in the payment industry has been present, seemingly pursued by all payment service providers and payment service providers: “Buy now, pay later.” In the face of the crisis and the tense economic situation, consumers are increasingly opting for this payment method. For both retailers and customers, this represents a welcome solution.

On the one hand, “Buy now, pay later” contributes to short-term liquidity. This is evident in the fact that customers in this way also buy things that they could either hardly or only pay for in the long term. However, on the other hand, this also poses risks, as Ken Serdons, Chief Commercial Officer at Mollie, explains: “Banks and financial service providers are concerned about consumer indebtedness, and their efforts in consumer protection are intensifying.” The CCO also fears that the pricing model of many service providers may not withstand the pressure of a recession. This could lead to cost increases that are passed on to the retailers.

Cybercrime is increasingly manifesting itself in e-commerce

“Follow the money” is a well-known saying when it comes to the risks of cybercrime. These threats from increasingly well-organized criminal syndicates are increasingly affecting online retailers and their service providers. They face both classic ransomware that disrupts or paralyzes business operations and conventional fraud cases where buyers’ credentials are obtained to order goods under their user accounts.

A study by Yeswehack found that merchants are increasingly better equipped against these risks. However, there is still catching up to do for smaller retailers. Seven out of ten surveyed companies use IT architecture and IT security solutions, both in hardware and software. About half (52 percent) rely on regular security training for new and existing employees. Phil Leatham, Germany Managing Director at Yeswehack, believes that bug bounty programs for identifying vulnerabilities could offer improved protection for companies next year.

The Bochum-based cyber defense provider G-Data is also convinced that more sophisticated and efficient threat scenarios will come to retailers. Andreas Lüning, co-founder and board member of G-Data, emphasizes that a central problem for IT security in Germany is that companies often do not take warnings about vulnerabilities or security risks seriously. They underestimate the real risk of cyberattacks and rely on the principle of hope. Lüning also warns of dangers to private smartphones. Especially iPhones, as their users are considered affluent and increasingly use their iPhones for payments, key management, and banking. “Social engineering attacks can hit anyone and aim to intercept personal data or information from victims.”

Secondhand works – if the quality is right

The scarcity of certain products in the past year has led to used goods becoming increasingly popular. This is generally a positive trend, even if it means less demand for brand-new devices in areas such as smartphones and notebooks.

According to a recent survey by the German Retail Association HDE, every third person between the ages of 24 and 44 has given away a used device. In addition, the number of those who opt for refurbished products for their own use is much higher. However, it is crucial that retailers like Refurbed or Rebuy not only deliver reliably refurbished goods but also improve service and handle complaints better.

In the new year, not only the proportion of traded used goods may increase, but new product categories could also be developed. Another option is quasi-new goods that can no longer be sold as new, such as overproductions or seasonal goods. This offers opportunities for savvy retailers and platforms like Momox Fashion or Zalando Lounge.

Oliver Klinck, Managing Director of Ebay Germany, also believes that current purchasing behavior shows unexpected changes. Many of them, however, are leaning towards used goods and sustainability. “Never before in my career have I seen such drastic changes in shopping behavior as this year. At the moment, every tenth person is already reaching for the more affordable used or refurbished alternative more often.” The lower price (63.7 percent) and sustainability (65.7 percent) are the most important reasons for consumers to increasingly buy used products. “The offer of used, refurbished, and reconditioned items has multiplied sixfold this year,” emphasizes Klinck.

Shopping experiences: Entertainment and gamification are part of it

Another trend in commerce takes into account that it is increasingly challenging for online retailers to stand out. It is now generally known that trying to do this mainly through the price is not a promising strategy. Also, conventional common criteria often do not reach their supposed potential.

The entire aspect of entertainment when shopping should not be underestimated. A study by Epoq shows that entertaining elements motivate young customers to make a purchase. Thorsten Mühling, Managing Director DACH at Epoq, recommends that retailers who want to integrate entertainment elements into their shops should consider which shop elements are suitable for entertainment. “For example, they can integrate interactive product sets on the product detail pages and place interactive search widgets on the homepage through which users can quickly find their favorite brands.”

The gamification approach generally leads to a longer stay and engages visitors more intensively with the content on the site. Thus, it is natural that this approach is not limited to the webshop or the brand’s website. Video formats, social media events, and high personalization can help ensure that customers come back.

This works not only in Asian or South American markets in the future but increasingly also in the German market. Although this does not apply to all customers and industries, it appeals to a growing number of young customers.