As one of the fastest growing and most dynamic industries the consumer electronics industry is showing no signs of fading in terms of revenue or innovation. Two recent developments that have accelerated the industry are the pandemic-fueled home entertainment boom and the expanding digital transformation.
However along with this growth the industry as a whole has had to weather some storms in recent times with the supply chain disruptions. But even with these disruptions the consumer electronics industry has proven to be resilient and evolving. The evolution and growth in the industry has also led to an emergence of new trends particularly around consumer behavior's and sales channels.
Although there are some market and demographic variances in terms of how consumers prefer to shop online there are also some clear trends in 2022. Convenience options and high-quality product information are three attributes for which consumers show an overwhelming preference across the board.
In this post we'll cover some of the key consumer electronics industry trends that you need to know about in 2024.
One popular consumer electronics industry trend is the demand for fast delivery and free shipping. A recent survey showed that 80% of consumers expect free shipping over a certain amount and 91% of consumers expect their online order to arrive within a week. Therefore in order to keep up with this demand and compete with Amazon Prime shipping other retailers and marketplaces are increasingly expanding their shipping incentives.
For brands and retailers that are not in a position to offer free shipping on all items many have introduced free shipping over a certain spend amount. Another way to provide better shipping options for consumers is through setting up a loyalty program with shipping incentives for members. Brands can also limit free shipping to certain locations or for certain products so that it doesn't cut too much into margins.
Along with the increase in online shopping and demand for low-cost and fast shipping another consumer electronics industry trend we are seeing is the concern for sustainable eCommerce. Product packaging in particular is a consideration for consumers with 43% of consumers in the United States citing environmental impact of eCommerce packaging as extremely or very important.
Some further sustainable actions that eCommerce brands can take are reducing deadstock implementing sustainable shipping options reducing returns and exchanges offsetting carbon and implementing circular practices. These are all ways that consumer electronics brands can contribute to sustainable eCommerce and better meet consumer demands going forward.
Along with the increase in online shopping has been an increase in mobile shoppers. This trend referred to as mobile commerce or m-commerce is expected to increase substantially in the coming years. It is projected that m-commerce revenue will increase to $105.28 billion in the United Kingdom by 2024 so brands would be wise to get on board.
Brands can use a few methods to ensure they are optimized for mobile shoppers including; launching a mobile app ensuring your brand site is optimized for mobile using messaging apps for marketing and customer service and implementing geo-targeted mobile ads at brick-and-mortar locations. These steps will all ensure you're meeting this growing customer demand for mobile commerce.
Related to the trend of m-commerce is the increase in the extent that consumers engage with brands over social media. Although the trend of social media eCommerce is primarily prevalent among gen Z 49% of consumers overall in the U.K. report interacting with brands over social media particularly on TikTok which experienced a 10% increase in 2021. ChannelSight client data aligns with this trend as social media is the second highest channel in terms of traffic. There were two months in 2022 in which traffic from social media accounted for over 5% of the total. Therefore consumer electronics brands should consider creating or optimizing a social media strategy to stay competitive.
As a mode of delivery for online shopping click and collect also known as 'buy online pick up in store' (BOPIS) is expected to continue to grow in importance in 2022. In fact even pre-pandemic data suggests that the demand for click and collect was already strong with 53% of consumers starting their shopping journeys online before making an in-store purchase. In addition 70% have picked up an item to avoid shipping fees.
To implement a click and collect option for your brand you'll need to first follow a few steps. Introducing an inventory monitoring system such as Digital Shelf is key to ensuring you keep an overview of stock levels. You'll also need to set up a click and collect option for your online store and set up collection points whether they are lockers curbside pickups or in-store. Through implementing a click and collect model you'll be sure to reap benefits like increased conversions reduced cart abandonment and an improved customer experience.
Another consumer electronics industry trend related to omnichannel shopping is known as 'researching online and purchasing offline' (ROPO). This involves consumers using brand websites social proof and other sources of information primarily for research but making the final purchase in store. Particularly for higher cost consumer electronics consumers expect to see high-quality product information as well as ratings and reviews in order to feel confident in their purchase.
However while this information is available some shoppers may still want to make the final purchase in-store. It's key for brands to understand if there are particular products most often researched online and purchased in store. The effect that ROPO has on your sales can be monitored through GPS data or by tracking how many consumers click to view product availability in-store. Although ROPO may not always be straightforward to measure as it is a growing trend it is key for brands to understand this buying behavior in 2022.
A further development in eCommerce is the move towards a wider variety of payment options. Alternative payments such as PayPal and Stripe are becoming increasingly preferred by consumers due to the speed and convenience in which payments are processed.
'Buy now pay later' (BNPL) is another payment model that has recently grown in popularity. Similar to the traditional layaway model 'buy now pay later' enables consumers to pay for their purchase with an instalment plan. For higher priced consumer electronics products implementing a buy now pay later model would enable customers the payment flexibility to purchase items that they may otherwise not be a position to do. BNPL apps like Klarna are becoming increasingly more prevalent as a way to meet this growing demand.
Consumers are increasingly expecting shopping experiences that are convenient quick and easy. And in order to give them this an omnichannel customer experience is key. Although multichannel retailing is already quite common omnichannel retailing takes this business strategy to a different level. The difference is that with omnichannel retailing all sales channels customer support and marketing campaigns are integrated.
Integrating these functions provides customers a convenient path to purchase from wherever consumers start their journey. One way to provide an omnichannel experience is to add a Where to Buy button to your brand website in order to easily guide consumers to retailers where they can purchase the product. This reduces extra steps and is a straightforward way to hop on this trend.
First beginning in China around 2015 live commerce or livestream shopping has now spread to other markets including Europe and the United States. Brands and media platforms worldwide are catching on and are increasingly adding livestreams to their shoppable video features.
One example is the launch of Amazon Live in 2019 with the objective of helping members of the Amazon brand registry better engage with shoppers. Additionally Walmart recently partnered with TikTok to offer products via livestream. Instagram also offers in-app shopping across content including Instagram Live and Facebook has launched Live Shopping too.
The expanding digital transformation and increasing global urbanization and access to internet are also key drivers of growth in the consumer electronics industry. Along with expanding into new markets the industry continues to evolve in the types of products manufactured and sold.
Products that were once purchased solely in-store such as home appliances are now purchased online at higher rates. This shift presents both challenges and opportunities for marketers in the consumer electronics industry as it's never been more important to understand the consumer journey at a granular level. As we see from ChannelSight data three-quarters of 2021 showed an increase in year over year global traffic growth. We expect this trend to continue into 2022 with the expansion of product types and of online shopping globally.
The consumer electronics industry is continuously evolving and innovating as new technologies are developed. Some of these developments include the internet of things 5G connectivity artificial intelligence and parallel worlds such as the Metaverse. These innovations will all shape the industry and contribute to changing consumer behavior and demands.
With each successive year the segment of the population that purchases consumer electronics is also set to increase. While older populations have been a notoriously challenging demographic for the consumer electronics industry this will look very different when digital natives who are accustomed to high digital connectivity become the older demographic. Therefore brands should consistently be keeping on top of trends and adapt to the changing consumer behavior and demands.
It is more important than ever for consumer electronics brands to understand the consumer journeys and how to meet consumers before the competition does. Brands that remain agile and on the pulse of their consumers will prove to be the ones that can weather the disruptions and stay ahead of the competition.
ChannelSight has a team of experts that can help you build a robust and data-driven eCommerce strategy to help you. Contact us today to book a demo.
