How Emerging Technologies Are Shaping E-Commerce in the Era of COVID-19

An online storefront is no longer a choice for most companies.

It is easy to say that the COVID-19 pandemic has been responsible for a tremendous shift from brick-and-mortar retail to e-commerce. After all, consumer spending on e-commerce jumped 31.8% from Q1 to Q2 2020, even as retail sales decreased.

However, also at work here is a force that, in pre-pandemic times, quietly expanded the frontiers of e-commerce: disruptive tech that makes the e-commerce experience highly desirable for consumers. Ironically, for consumers, most such tech is borderline invisible; it simply creates an enhanced user experience. 

Thinking Beyond AI, VR, and AR

Understandably, artificial intelligence (AI), virtual reality (VR), and augmented reality (AR) are the big, flashy technologies that everyone likes to talk about in an e-commerce context. The ability to show customers what clothing looks like on their bodies is a strong substitute for trying on these items in a store. Similarly, being able to test-drive a car virtually is an enticing, playful option that saves time. Amazon uses AI for its Style by Alexa fashion recommendation tool, and Ikea even developed an AR app to allow customers to see where its furniture fits in their living spaces.

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However, the less buzzy tech is the true driver of e-commerce. Supply chain technology has improved considerably in a short time and can introduce previously unheard-of efficiency and predictability. For example, companies can now leverage sensors and connected devices to monitor storage conditions and track movement speed in real time. These additional insights can help organizations optimize their manufacturing and distribution operations, identify problems early, and improve risk management and mitigation. The introduction of robotics into warehouse labor also has the potential to transform the entire industry.

On the consumer side, AI chatbots that can smooth wrinkles in the shopping experience have gained popularity in recent years and have become essential during the pandemic, as has just-in-time personalization that uses AI to analyze data and make proper connections at various touch points throughout the customer journey. 

If consumers use a company’s app to order goods and services and receive them without any hassle, they will often continue to spend money with that company.

Contactless shopping, perhaps best known as BOPIS (buy online, pick up in store), is another popular option in the age of COVID-19. In most cases, customers select their product and pickup locations, and advances in mobile technology allow for a paperless, touchless experience. Customers who cannot receive packages at home, who order perishable items, or who simply cannot wait for shipping will likely remember the ease of curbside pickup (or its difficulty, if a business has not implemented these changes correctly). 

Consumers seldom consciously remember these enhancements because they make the shopping experience seamless. However, they are essential to securing brand loyalty. If consumers use a company’s app to order goods and services and receive them without any hassle, they will often continue to spend money with that company.

Be the Disruptor, Not the Disrupted

E-commerce now accounts for 16.1% of all U.S. sales. That proportion will only increase as VR and AR become more mainstream and the 5G network enters the consumer market. Indeed, e-commerce companies have emerged as major players in industries that were bastions of physical retail. For instance, exercise-bike company Peloton brings in money that was previously spent in person at gyms, which has encouraged Apple to launch an expanded fitness offering of its own. In addition, food-delivery company Goldbelly has soared in recent months by connecting iconic but suffering restaurants with people stuck at home and delivering gourmet meals across the country—for a healthy premium. 

If e-commerce can disrupt going to the gym and going out to dinner, few industries are immune.

The coronavirus pandemic will abate eventually, but research from Kantar indicates that young people, particularly millennials and members of Gen Z, are likely to keep the habits they develop in quarantine—including online shopping. In addition, for many seniors, who were previously reliable in-store shoppers, learning how to use these new technologies was likely the hard part, so the convenience of e-commerce should change their habits as well.

User experience is the new retail space. Shifting resources from brick-and-mortar stores to e-commerce tech may not be the right move for every business, but for many, now is the time to consider doing so. The soaring revenue reported by companies such as Shopify, which helps retailers operate internet storefronts, shows that many businesses are indeed planning these moves. 

Moreover, with so many businesses considering shifting resources to e-commerce, competition will be stiff. This is an opportunity to refine your brand and messaging: Who are you, and what unique benefits do you provide your customers? How will you inspire brand awareness and loyalty? 

Combine the answers to those questions with the right technology, and you will be ready to ride the coming e-commerce wave.