intro image
 
INTRO
2023 eCommerce Trends

If there’s one thing that eCommerce brands can expect in 2023, it’s a whole lot of unpredictability. Now, we know what you’re probably thinking – isn’t this report about predictions for the new year? How can you possibly predict the unpredictable? Here’s why: because no matter what the future holds, eCommerce isn’t going anywhere. There are ways that brands can set themselves up for success no matter what the market or even the universe throws at them – and you’ll find them all in here.

It’s not exactly a secret that 2022 was a tough year for eCommerce brands. With skyrocketing customer acquisition costs, privacy changes, supply chain woes, and consumer spending plummeting due to inflation, brands looked for ways to grow their bottom line in a difficult climate. And what many realized was that customer retention was the key. Growing repeat customers has always been important, of course, but it’s never been this important.

Realizing that you need to move the needle on retention and actually doing it are two different things, though. In fact, we recently surveyed eCommerce brands, and 52% of them said they were more focused on retention, but over 40% haven’t made any changes to their strategy in order to improve it. Why haven’t they? 34% said their biggest challenge is the lack of a clear strategy.

Our takeaway from that data is that brands know how important retention is, but are unclear on how to get started. And without a solid strategy, you’re left with a “hopefully they liked us enough to come back” approach, which clearly isn’t working — 70% of those surveyed said their retention rate has either stayed the same or gotten worse over the past year.

We wanted to learn what the biggest changes were going to be this year in eCommerce – what new strategies brands were going to try, and where they planned to focus their energies (and budgets). So we talked to a ton of experts from brands, eCommerce agencies, and tech companies, and pulled out eight trends that are going to be a big deal in 2023. The overarching theme? If you want customers to make a second purchase, and a third, and (you get the idea), you have to get to know them better, and deliver next-level experiences that foster brand loyalty.

With the insights and strategies in this report, you’ll be able to stay ahead of the major trends that will impact retention in the new year, and not just survive the economic climate, but to thrive in spite of it. Let’s dive in.

Table of Contents
01
The metrics for retention will expand and mature
02
Customers will struggle with decision fatigue and favor focused communications
03
Education will draw customers closer to brands
04
The bar for what it means to know your customers will be higher than ever
05
Brand loyalty will lead the way for the next phase of D2C sustainability
06
Brands will find new ways to offer customers convenience
07
eCommerce brands will find new ways to connect with shoppers offline
08
Subscriptions will get an upgrade to VIP-level memberships
01
The metrics for retention will expand and mature
02
Customers will struggle with decision fatigue and favor focused communications
03
Education will draw customers closer to brands
04
The bar for what it means to know your customers will be higher than ever
05
Brand loyalty will lead the way for the next phase of D2C sustainability
06
Brands will find new ways to offer customers convenience
07
eCommerce brands will find new ways to connect with shoppers offline
08
Subscriptions will get an upgrade to VIP-level memberships
Metrics
will
mature
Prediction #01
Prediction #01

The metrics for retention will expand and mature

Brands are redefining the metrics they use to measure retention to better reflect the entire buyer journey — and sustain longer lasting relationships with customers.


The first step to understanding retention? Knowing what metrics to measure and how to track them.


However, defining these metrics can actually be more complex than many brands realize. As a result, retention metrics remain a blind spot for many brands. They just aren’t quite sure what to measure to define retention.

Retention Retention Retention
0 %
of brands define retention only as RPR

According to a recent Yotpo survey, over 72% of brands are primarily defining their retention rate as their repeat purchase rate (RPR). While repeat purchase rate is an important metric to track, it’s not the only metric brands need to pay attention to when measuring retention.

When the majority of brands are only defining their retention rate as their RPR, it’s no surprise that over 70% of brands report that their retention rate has either stayed the same or gotten worse over the past year. This data reflects the broader lack of understanding across the industry.

Put simply: the majority of brands are not currently  tracking retention  comprehensively — and in 2023, that’s going to change.

Simplify retention metrics, once and for all


Retention metrics have historically been complex, and that’s one of the primary reasons brands don’t know where to start with their strategy. So, it’s understandable that most brands look to repeat purchase rate to define retention — it’s an easy metric to track. They can clearly go into dashboards and understand who’s a repeat buyer, what they’re purchasing, and maybe make some educated assumptions about their product preferences and shopping behavior.


However, RPR doesn’t account for every touchpoint that should go into measuring retention, because it’s only focused on transactions in the form of purchases. And, that approach to measuring retention just won’t cut it.


Without visibility into the most important data to measure (and why!), brands are entering the year with a retention strategy full of gaps. Investing in retention is only half the battle if your brand is unclear on how to track, measure, and improve your strategy over time. Put simply, if you’re blind to the right data, you won’t be able to prove the value of your retention strategy.


A comprehensive understanding of retention is critical to succeed in the coming year, and we predict that brands will broaden their attention to understand and measure their customers’ engagements in between purchases as well in order to track retention effectively.

In 2023, brands will need to pay attention to the following:

  • 01Repeat purchase rate
  • 02Average order value
  • 03Time to next purchase
  • 04Churn rate
  • 05Channel growth and engagement
  • 06Purchase recency

For retention, we're looking at AOV, time to next purchase, and growth on additional channels. Every business is different, so CLTV can be measured based on your business strategy and goals.

James Reu, eCommerce Manager, LSKD James Reu, eCommerce Manager, LSKD
James Reu, eCommerce Manager LSKD logo

All of these metrics contribute to understanding customer lifetime value — the most comprehensive retention metric a brand can track. Reconsidering retention in this way will enable brands to build longer-lasting relationships with their customers than ever before.

Engagements between purchases demand more attention


According to our recent survey, over 42% of brands agreed that their biggest challenge in improving customer retention is the lack of engagement between purchases. It’s difficult to drive behaviors from shoppers, but it’s essential for building lasting connections.


In addition to tracking the transactional behaviors customers take, brands will need to start considering the entire buyer journey as building blocks to maximizing retention.

They’ll need to ask questions about every shopper interaction, such as:

  • 01Do they follow you on social media? Are they a member of your community?
  • 02Are they an active member of your loyalty program?
  • 03Do they interact with your text messages?
  • 04Are they a subscriber?
  • 05Have they left reviews? Positive or negative?
  • 06Do they participate in your virtual or in-person events?
  • 07When was the last time they purchased? On what channel?
  • 08Do they need informational or educational content on the products they purchased?

To answer these questions, brands will focus on streamlining the technology they use to build better, more unified profiles for each customer. Then, with a deeper recognition and understanding of their engagements in addition to purchases, a brand can see a shopper as so much more than just a customer — they’re also a loyalty member, subscriber, texter, emailer, reviewer, and more — and brands will need to treat them as such to drive retention in 2023.

A word from our expert
Expert
Heather Dougherty,
VP Customer Success
00:00

“We measure any kind of reactivation between two segments — from lapsed or inactive customers back to active. What effort did we make that pulled customers back to active? Where did they engage?”

Redefining retention metrics in this way will enable brands to better understand their shoppers, and in turn create experiences that they want — and that will keep them coming back.


“Retention is a long-term game,” says Regan Colestock, Associate Director of Email & Lifecycle Marketing at Wpromote. “It’s essential to get anchored in that long-term mindset, because the right strategy is something that’s worth investing in.”

Get ahead of the trend

Retention metrics are the foundation on which a successful repeat purchase strategy is built. Use these tactics to create a customer experience that keeps them coming back for more.

01

Audit your current retention strategy

To be most successful, take a step back to understand how your team is tracking retention currently. What metrics are you reporting on, and how often? Recognize where you may be missing important metrics, and establish a cadence going forward to broaden your definition.

02

Leverage cross-channel data, or even better — look to a platform

A connected eCommerce marketing platform that showcases all your customers’ data in one place is the most effective way to consider retention comprehensively. Think about consolidating your tech stack, or working with your tech providers to connect data from multiple channels.

03

Personalize the holistic customer journey

Seek to understand the engagements every shopper takes in addition to the purchases they make. A customer is more than just their transactions; their sentiment toward your brand is just as important. Leverage the retention data above, and use it to personalize every experience.

End
Decision
Fatigue
Prediction #02
Prediction #02

Customers will struggle with decision fatigue and favor focused communications

Shoppers have more choices than ever, and brands taking a “throw everything at the wall and see what sticks” approach aren’t giving customers what they really want (and need) to make purchasing decisions with confidence — personalized recommendations and content relevant to their interests.


Grappling with too much inventory and the threat of reduced or diverted spending, many brands have been bombarding customers with an onslaught of offers to catch their attention. But with a return to brick-and-mortar alongside new ways to consume, engage, and buy online, shoppers now have more options, and therefore more choices to make, than ever before. And it is possible to have too much of a good thing.


When faced with information overload, instead of being driven to purchase, consumers may actually become fatigued, delaying decision-making — or so paralyzed by choice that they never make one at all — causing conversion rates to plummet. And brands that opt for a blanket approach to marketing risk losing their customers’ interest and dollars.


In the new year, smart brands will commit to a new strategy — prioritizing focused communications that rise above the noise to both capture attention and increase customer retention.

The value of a simplified approach to combat information overload


A simplified approach to marketing may be just what brands need to help customers focus and keep conversion rates high. Luxury home goods brand Karen Jai Home has already adopted this strategy for an impressive 62x ROI on SMS marketing campaigns.


When sending a promotion, the brand zeroes in on just one product — which has no variations in size, color, or other attributes — so that the only choice a customer has to make is whether or not they want to buy.

The simplicity of it really helps the customer focus and consider more easily than having five options to consider. It allowed us to take away discounts and just focus on the product.

janelle janelle
Janelle Langford, Founder & Creative Director of Karen Jai Home janelle

Bangn Body, an Australian skincare brand, also prioritizes simplicity when engaging with their audience. To help shoppers find the right products, the brand offers a quiz where shoppers can enter their skin concerns, and then offers products and how-tos based on those concerns.


“Simplicity is better,” says Founder Priscilla Hajiantoni. “We really push that as a way to open up different options and opportunities for the consumer who might be incredibly overwhelmed.”

In a sea of offers, personalization grabs customer attention — and keeps it


Simplifying doesn’t just mean limiting the customer’s experience, though — it means tailoring it.


In a surge of communications, it’s the one that is personalized and relevant that is going to stand out both to influence consumers’ decision making, as well as to foster relationships so that they choose you again and again, extending their lifetime value.

There's more brands than ever trying to get the attention of consumers. And consumers are becoming more discerning with the economy, with their wallets. So they're going to go to brands that they build a relationship with and they trust. And the best way to absolutely build that, in my opinion, is to really personalize that experience.

Ben Parr, President & Co-Founder of Octane Ai
foobar
0 %
of consumers are more likely to purchase from brands that personalize
0 %
claim messages from brands are more engaging when they’re relevant to their interests
0 %
are more likely to make repeat purchases from brands that offer personalization

According to McKinsey, 76% of consumers are more likely to consider purchasing from brands that personalize, while 78% are more likely to make repeat purchases, and another 78% are more likely to refer their friends and family. Survey data from Yotpo showed similar sentiment, with 60% of consumers claiming messages from brands are most engaging when they are relevant to their interests and past purchases.


As looming privacy changes threaten to make this difficult to achieve, brands in 2023 will therefore be seeking out ways to learn about their customers on a deeper level and apply those insights for marketing that is infinitely more powerful. From purchase history to loyalty program behavior, customer data will be critical to crafting tailored messages that deliver real value, reducing the pressure of choice while ensuring customers are engaged — not fatigued.

Consistency breeds trust and makes choice easy


This personalization extends to the overarching brand experience as well, as consumers are more likely to return to brands they know and trust when they are ready to buy. Are you committed to authenticity? Are you shaping seamless, cohesive journeys for customers that are aligned with your company image, vision, and values?


Marketers will resolve to create this consistency across all touchpoints and communications to ensure their brand is one that consumers routinely choose when it comes time to make a purchasing decision. Those that don’t will struggle to maintain visibility at a time when we have more of everything, everywhere, all at once.

Consistent branding and colors and scheme at everything from your email to your ads to whatever in-person things you might even be doing to the products themselves...all of that matters in the sequence to customers as they're trying to make lots of choices.

Ben Parr, President & Co-Founder of Octane Ai
octane
A word from our expert
Expert
Iveta Makedonska,
SMS Lead
00:00

“Even when you think about SMS, people are actually sharing the phone number because they want to hear from you, but they don't want to be bombarded. They want their privacy, they want their personal space. So of course they want to receive only content that's relevant for them and they would engage with.”

Get ahead of the trend

Much like a needle in a haystack, standing out in today’s eCommerce landscape might seem like an impossible task. Brands that shift their strategy to deliver simple, focused, and above all personalized experiences at every turn will make it easy for customers to discover and ultimately choose them. Follow these three tips to get ahead.

01

Create data-sharing opportunities

Interactive engagements like quizzes, surveys, or conversational flows allow brands to capture high-quality data and deeply understand each customer’s unique needs and interests. The more you learn, the more you can personalize to stay afloat in a sea of competitive offers and nurture loyalty.

02

Simplify your offers

Turn to that data you capture to get really strategic and efficient with your messaging, engaging each customer with a single item, offer, or call to action that is most relevant to them to ease the pressures of decision-making and increase the chance of conversion.

03

Accelerate the path to purchase

Brands that encourage quick decision making will suffer less from consumers’ choice paralysis and see more sales. Leverage the immediacy of a channel like SMS, alongside exciting incentives like loyalty rewards or innovations like Click-to-Buy, to motivate your customer to purchase in an instant.

Education
builds
loyalty
Prediction #03
Prediction #03

Education will draw customers closer to brands

As emotional marketing becomes increasingly essential in today’s eCommerce landscape, customer education will convince customers to buy new products and come back for more. In 2023, shoppers will want to know the nitty-gritty details behind you, your brand, and your products.


Whether brands combat competitors or introduce an entirely new product to the eCommerce space, education matters. With so much choice at their fingertips, today’s consumers want to know why: Why your brand and product? And what can it really do for them?


In 2023, brands will address the biggest challenge in eCommerce with new urgency and creativity: shoppers can’t experience the product IRL. eCommerce brands are thinking outside the box when it comes to familiarizing their target audience with their products, from unique packaging to TikTok campaigns to deep dives into their products’ origin stories.

Consumers want to be in the know, now more than ever


High inflation rates are on everyone’s minds, and customers are more concerned than ever about where their hard-earned cash is going. According to Deloitte research, American concerns around inflation have remained between 70% and 80% throughout this past year. eCommerce shoppers want to make sure they’re making the right decision before committing to a purchase.


And with shifting consumer loyalties toward brand values and corporate responsibility, shoppers want to see behind the curtain on brands’ business practices, supply chains, and sourcing. Simply, customers want to be in the know. From virtual live shopping events to storytelling that builds a brand rather than pushes a product, brands are going the extra mile to use education to spark an emotional connection.

“You're trying to build purchase affirmation, or you're trying to build trust at checkout. [As a consumer], you want to know that this is a good purchase.”

Anh Vu-Lieberman, Vice President of eCommerce Operations & Brand Strategy at Nogin
nogin
Values Values Values
0 %
Of shoppers buy based on values

Brands will invest in marketing storytelling and experiences


When a customer gets to your checkout page, they want to feel confident in their purchasing decision; they want to know your product and brand are right for them. This confidence starts well before a customer is in the market for a new sunscreen or winter boot. It starts from the moment customers come across your company.


Anh Vu-Lieberman, Vice President of eCommerce Operations & Brand Strategy at Nogin, recommends that brands double down on creating unique experiences for their products in the coming year. Live trunk shows with influencers, early access for top brand VIPs, secret collections — experiences like these craft how consumers should be thinking about your brand and products.

You’re not just selling a product; you’re selling who this shopper could be if they had the product. This investment in storytelling will develop  lasting relationships  with shoppers in 2023.

Consider Evelyn & Bobbie, a women’s intimates brand, that has prioritized customer education and top-notch experiences down to the packaging of their products. Since the brand’s bras mold to different body shapes over time, the bras tend to fit tighter within the first few wears. Evelyn & Bobbie’s CX team made sure their packing slips include information and visual aids on how to put on the bra for the first time along with contact details for further support.


The brand also made sure to highlight their founder’s story, reiterating to shoppers that Evelyn & Bobbie was built by women for women. By offering this information to shoppers, the brand sees fewer returns, higher satisfaction with their products, and customer enthusiasm around the brand’s origins.

If it is your first purchase, we’re making sure we're sending you that educational content, showing you some other products you might like, or if you've been looking around and we know that you're considering it, sharing some more information about our company and how we got started. We find our founder's story really resonates with people because our products were made by a woman who was tired of this product not existing.

Elizabeth Connell, eCommerce Program Manager, Evelyn & Bobbie
evelyn_bobbie

Radical transparency builds community


Since eCommerce customers often can’t see, touch, or taste your product, transparency is so critical to gaining consumer confidence.


Write blog articles, update your product detail page, record unboxing videos, send recipes, create how-to videos — the possibilities are endless! This creativity will make your brand stand out from the crowd and draw shoppers in closer. And make sure you’re looking at education holistically. Consumers want to know what’s in your product, how to use it, and where it came from — and it can’t hurt to be inspired at the same time.


Doughp, a fun-loving cookie dough brand, rewards loyalty members for reading their baking tips. Not only do they give advice on curing cookie crumbles and remedying runniness, Doughp also explains how to achieve the right cookie for the reader: chewy, crunchy, soft in the middle.



Chantal Robertson, CEO and Founder of Upful Blends, has gone so far as making custom product tutorials and an educational app for her customers. “It bridges the gap even more with the intimacy and connection,” she says.


Looking forward, it will become even more essential to maintain happy, repeat shoppers. By offering these out-of-the-box experiences to customers to help them learn more about your brand and products, you’ll solidify that emotional connection consumers crave.

Get ahead of the trend

Get consumers excited about your products by empowering them with the information they crave.

01

Reward Shoppers for Engaging With Educational Content

Reward customers with points and perks for engaging with educational collateral: watching videos, reading blogs, and even joining communities like Geneva and Discord. This provides shoppers with clear value, and boosts confidence in your brand.

02

Make Every Channel Count

Whether you’re sending shoppers a Welcome text message or directing them to your About page, use every touchpoint as an educational opportunity to give more context about your brand's goal.

03

Think Holistically & Creatively About Education

Ditch the simple how-to lists in favor of why-this infographics, where-it-came-from maps, and what-we’re-striving-for articles. Just like you want a 360-degree view of shoppers, shoppers want a 360-degree view of your brand. And we can’t emphasize this enough: think outside the box!

Know
your
customers
Prediction #04
Prediction #04

The bar for what it means to know your customers will be higher than ever

In 2023, brands will leverage accurate and insightful data to deliver top-notch customer experiences at every touchpoint along the buyer journey.


The key to delivering exceptional shopping experiences is knowing your customers on a deep, individual level. How are they using your product? What’s the right way to engage with them between purchases? What other products are likely to catch their attention? How do they want to hear from you?


All of this information can help you adjust both your acquisition and retention strategies and make your messaging feel ever more personalized and relevant over time. The trouble is, with third-party data now an unreliable source, how do you get such a deep knowledge of your customers?


In 2023, brands will seek to solve this challenge, finding new ways to get a richer understanding of their customers that brings every interaction and touchpoint together into a single picture.

Why owned data is the holy grail of eCommerce marketing


With the global shift in privacy policies and changes in data regulation, forward-thinking marketers can’t rely on third-party data anymore. Brands need the right customer data to outsmart their competitors and deliver relevant, personalized experiences that keep shoppers engaged and coming back for more.


But are consumers willing to share personal details about themselves, and in exchange for what?

Loyalty Loyalty Loyalty
0 %
of consumers will share private data in exchange for loyalty perks

A 2022 Yotpo survey showed that the majority of shoppers are willing to submit private information in order to get personalized offers, tailored discounts, exclusive experiences, and other loyalty perks from their favorite brands. When customers share zero-party data, it’s usually their email address (81.6%), name (74.8%), date of birth (70.1%), product preferences (55.6%), and phone number (39.5%).


While this type of data is submitted intentionally and proactively by shoppers, first-party data is information that companies collect and own, such as previous purchase history, the number of orders, the total amount spent, and more.


Ultimately, it all comes down to showing the right product or offer to the right person at the right time. Nowadays, zero-and first-party data has become the most valuable commodity in eCommerce as it empowers brands to provide captivating and unique shopping experiences.


According to the Zendesk Customer Experience Trends Report in 2022, 93% of consumers say they are willing to spend more with companies that don’t make them repeat themselves.

“So if you know this customer, you know the relationship that they have with your brand, they’re likely to be more loyal, and they’re likely to spend more with you.

Ciera Nahale, Senior Product Marketing Manager at Zendesk
Zendesk

Unified technologies open the door to next-level data


Not so long ago, being able to predict your customers’ behavior or influence purchase decisions would have been considered wishful thinking or even plain sorcery. Nowadays, through AI-powered, data-driven tools such as predictive analytics and data reporting, eCommerce brands can seamlessly recognize key engagement opportunities, help shoppers discover relevant products, and even respond to real-time behavior.


Integrated and unified martech solutions provide valuable aggregated data, such as top-purchased products or highest-spending customers, that, together with AI-based algorithms, can help brands predict the performance of future campaigns and track customer sentiment and product lifetime success over time.


In essence, brands will be looking for a more complete picture of their customers and how they will behave.


Advanced target conditions and data-driven segmentation engines will enable brands to build holistic customer profiles and create personalized customer journeys based on zero-and first-party data. By leveraging all these valuable insights, companies will be able to define trends, forecast behavior, make informed decisions, and achieve optimal results.


”Implementing integrated solutions or consolidating the information that they provide might seem like a challenge for growing businesses, but many of these tools are more accessible than ever before. All of Yotpo’s solutions, for example, connect their data “out of the box.”

How to leverage data to build stellar customer experiences


Behind every outstanding shopping journey stands a solid segmentation strategy and excellent post-purchase care. And this is where the zero-and first-party data comes in.


For example, you can use SMS or email to recognize your customers on their birthdays and send them a sweet gift in the form of a personalized message and a small discount. Help shoppers discover products that are relevant to their interests based on past items they purchased. If you are a pet store and they bought dog food from you, ask for their dog’s birthdays and extend tailored offers to make them feel closer to your brand.


Or, collect valuable feedback on your products and implement parts of that feedback at critical touchpoints in your communications to make your next interactions with shoppers feel even more personalized. And eventually, your website, emails, and SMS messages will all start working together towards one goal: building a richer and ultra-tailored customer journey.


Bubble is an excellent example of a brand that knows how to leverage customer data like purchase behavior and motivators to create engaging and authentic experiences. By launching a data-backed loyalty program, Bubble captured the attention and repeat business of young shoppers and raised their repeat purchase rate to 73% for redeemers versus 13% for non-redeemers.

Ensure that your customer data can be used across efforts so you're really delivering the most personalized experience possible.

Emma Standing Emma Standing
Emma Standing, Head of Customer Experience & eCommerce, Bubble bubble

Get ahead of the trend

From after-sales care to specific product recommendations, here are three ways to use data to provide ultra-tailored experiences and make shoppers feel like close friends.

01

Excel in post-purchase care

Once customers make a purchase, send a follow-up SMS with timely and personalized order or shipping updates. Transactional messages are a powerful yet seamless way to establish credibility and trust and keep your brand top of mind.

02

Help with product discovery

Provide personalized product recommendations based on customer preferences or previous purchase history. Leverage AI-powered cross-sell or upsell automations to offer items shoppers are most likely to buy next.

03

Nurture loyalty

Introduce shoppers to your loyalty program and use SMS or email to send personalized updates and offers every time they gain points or approach a new VIP tier. Celebrate customers' birthdays with a gift voucher or bonus loyalty points.

Push
sustainability
forward
Prediction #05
Prediction #05

Brand loyalty will lead the way for the next phase of D2C sustainability

Sustainable practices are quickly becoming table stakes for D2C brands. More and more, future-thinking consumers are expecting brands to put their money where their mouth is and push sustainability to the forefront.


2020 disrupted eCommerce in more ways than one, especially when it came to holding brands accountable for their values. With a renewed focus on corporate responsibility — particularly around social justice and environmental issues — today’s consumer looks for alignment in values with a brand before they fully commit.


Increasingly, all brands are expected to consider sustainability in some form, even if their brand isn’t built on that mission. In our 2022 State of Brand Loyalty report, over 84% of global respondents said they are more inclined to buy from a brand whose values match their own. And this is continuing to hold true. Porter Novelli's recent research found that 80% of shoppers believe companies should take part in solving the climate crisis.


From carbon offset credits to reusable packaging and re-commerce, more brands are finding ways to improve their offerings. And at the center of these methods are often brands’ best customers — their loyal ones.


As brands move beyond their own best practices and ask shoppers to get down for the cause — whether that’s reusing packaging for consumables or recycling ready-to-be-retired products — brands have to rely on commitment from their shoppers. This symbiotic relationship will define the next era of DTC sustainability.

Building relationships based on values


Corporations’ dedication to environmental action is no longer a trend or a checked box; in 2023, it will determine the future success of your brand. Taking action is the primary way to show shoppers you mean business when it comes to the environment.


“You want to be as consistent and as authentic as possible. Customers have more access to information today than they ever have before, so it's really easy for them to tell when a brand is greenwashing,” says Savanah White, Head of Partner Success at ShoppingGIves.


From rewarding shoppers to take part in beach clean-ups to completely doing away with single-use plastics, many sustainable methods require loyal, repeat customers to be effective. And eCommerce brands are uniquely positioned to bring these aspirations to fruition; they’re able to motivate customers to do their part and establish a relationship with shoppers based on these mutual efforts.

Loyalty Loyalty Loyalty
0 %
of shoppers buy based on values

One impactful way consumers can support sustainability is by investing in a brand, both with their wallets and behaviors. These conscious consumers have to be the shoppers willing to go the extra mile, like opting for a “renew and return” subscription program or paying more for sustainable shipping.


For example, beauty brand Credo Beauty incentivizes shoppers to recycle their used products in-store through their partnership with Pact, a beauty-focused non-profit organization. To avoid introducing more virgin plastic into landfills, shoppers can deposit small plastic bottles, tubes, compacts, and more in Pact bins throughout the brand’s physical retail locations. The success of the brand’s program hinges on their loyal shoppers, the relationship Credo Beauty has built with these shoppers, and their shared values. Moving forward, we expect even more brands finding ways to engage shoppers with their sustainability practices like this.

Not only do brands need to learn and implement ways to start being more sustainable, but also focus on how they're talking about how they're being more sustainable to customers.

jake jake
Jake Chatt, Head of Marketing at EcoCart eco logo

Sustainability doesn’t have to be all or nothing


In the past, eCommerce has drawn a strict line between sustainable and not. Brands either wholly embraced sustainability and made it their entire ethos — think Patagonia or Toms — or were sidelined from the conscious conversation entirely.


Looking to the future, brands are adopting a more nuanced approach. “At first it was sustainability or nothing. And now people are starting to realize that sustainability is a spectrum,” says Jake Chatt, Head of Marketing at EcoCart.


Brands should feel comfortable with taking small steps toward sustainability and know that starting small still resonates, especially when you’re making customers a part of your aspirations. Whether you’re offering shoppers loyalty points for picking up litter or shooting for a carbon-neutral supply chain, your actions matter to customers. “People are realizing that sustainable action really is a journey from step one to step two to step three to step four,” says Chatt.


And, these small steps pay off. According to Direct to Consumer, consumers are 4x more likely to purchase from a brand and 4.5x more likely to refer others to a brand “with a strong purpose.” As consumers continue to build parts of their identity around what they buy, their loyalty will impact your bottom line.

A word from our expert
Expert
Dulcie Hanham,
Associate Director, DTC Strategy at The Stable
00:00

“Brands that really create authentic engagement within their customer base by deepening connections based on common beliefs will have an edge over the competition and build stronger loyalty and trust.”

Communication is just as important as action


While taking action is the primary way to show shoppers you mean business when it comes to sustainability, communicating those actions is just as important. Transparent communication is the next step in getting buy-in from your customers in the long term.


Chatt pointed to Chubbies as a prime example of this transparency-first mentality. After realizing that environmental impact was important to their shoppers, the brand partnered with EcoCart and is taking action to reflect customers’ values and concerns. Chubbies is currently working on updating their product pages to include information about their clothing’s environmental impact. The brand also hopes to build out its on-site communications to ensure their actions are seen and recognized by customers.

Get ahead of the trend

Sustainability and customer loyalty go hand in hand. Here’s how your environmental impact can keep shoppers coming back again and again.

01

Reward Shoppers for Taking Action

Your loyalty program is an easy, effective way to connect shoppers with your brand values. Incentivize customers for participating in your larger mission — opting for reusable packaging, choosing slower shipping times, or planting a tree.

02

Educate Customers on the Bigger Picture

Communicating openly and transparently with your customers about your efforts is key to establishing trust. A good first step is including information about your efforts in welcome emails and SMS messages. Then, you can reward customers for engaging with educational content, furthering their understanding of your action plan.

03

Don’t Be Afraid to Start Small

We promise that no one is expecting you to solve climate change single-handedly; shoppers are just expecting you to take part in the solution. Choosing a small sustainable goal to work toward still resonates with customers.


Offer
customers
convenience
Prediction #06
Prediction #06

Brands will find new ways to offer customers convenience

Brands are finding creative ways to make it easier to discover and purchase items that customers love — from flexible purchase options to innovative features that let customers buy without barriers.


Convenience has always been part of the eCommerce origin story — being able to buy something you need without having to get up off the couch was one of the major advantages to shopping online.


Since then, the notion of convenience has transformed again and again. And after the pandemic, we’re at another inflection point.


Consumers have returned to in-store shopping at a higher rate, while competition online has never been more fierce. Customers will continue to turn to online experiences when they offer value that retail does not — which means eCommerce brands need to double down on those core differentiators and set themselves apart in order to win.


Enter our good old friend convenience — or should we say, “Convenience 2023.” This year, it’s no longer about just buying from the comfort of your home. Brands need to reconsider the entire shopping experience and remove any and all blockers to purchase.

Offering convenience by removing friction from the eCommerce experience


Of course, we’ve already seen the telltale signs of this progression; just look at how customers turned to convenience over the past year. According to Adobe Analytics, usage of the flexible “buy now, pay later” payment option jumped by 85% during Black Friday week, while the subscriptions category ballooned during the pandemic to bring products to customer's doorsteps at regular intervals.

Loyalty Loyalty Loyalty
0 %
of consumers will pay more if it’s more convenient

“Removing as much friction as possible for your customers is really important, because there's so much competition in the space and attention is very hard to keep for a long time in our digital and mobile age,” says John Surdakowski, Founder and CEO of Avex, a digital agency building eCommerce experiences for brands. “The second there's a little bit of friction, the more customers you're ultimately going to lose.”


That means that any frustration or blocker that a customer feels during the process is another chip at their will to continue shopping — and impacts their likelihood of coming back to buy with your brand again.


In fact, removing these barriers is an essential piece of the overall retention picture. According to PSD Underwear, retention has taken more of a front seat for them in the past year, and a major component of that has been streamlining the buying experience.


“From a CX perspective, a marketing perspective, a UX perspective, we want to make it as easy as possible for our customers to come back and shop with us again,” Gian Singh, eCommerce Director at PSD Underwear, says, “and do everything we can to make sure that the new customers we acquire become returning customers.”

Removing as much friction as possible for your customers is really important. The second there's a little bit of friction, the more customers you're ultimately going to lose.

avex avex
John Surdakowski, Founder and CEO of Avex avex logo

Knowing what the customer wants, before they want it


Consider, for example, the trends that have emerged within SMS marketing. In 2022, Shopify Yotpo SMSbump announced Click-to-Buy, a feature that enables brands to send customers to a curated cart experience right from a text. It removes several layers of friction to the process, essentially allowing customers to check out in one click.


Personalization also factors heavily into making buying more convenient, in that it elevates the products and pathways that are most relevant to the customer in that moment. The goal is to make it so seamlessly perfect for the customer, they don’t even notice.


“They’re not thinking about personalization, but when it does happen, they're delighted,” Surdakowski says. “And you're just going to build a better customer base and a more loyal customer if you are personalizing to them and their likes.”


The result of convenient product discovery and streamlined pathways is a boost to the bottom line.


Just look at skincare brand Barefaced. Last year, they began sending personalized product recommendations to customers via SMS with Click-to-Buy, with a link that sent them directly to a pre-filled shopping cart. The result? Triple digit ROI. The combination of the right recommendation, sent to where the shopper is, in a convenient format, removed multiple barriers to getting customers to buy again.

A word from our expert
Expert
John Surdakowski,
Founder and CEO
00:00

Everyone’s idea of convenience will vary


The range of what brands can do to offer this convenience can vary dramatically, from the minor iterations that improve the experience to majorly new ways to shop. But what’s true in life is true in eComm: don’t assume people want what you think they do.


Surdakowski recommends that brands test everything to ensure that customers respond favorably and that the changes are making an impact on important metrics. That’s the key to ensuring that brands come out ahead in 2023 and focus only on the convenience factors that matter most to their specific customers and industry.

Get ahead of the trend

From curated carts to flexible payment options, here are three ways to add convenience to your marketing strategy in 2023.

01

Make It Easier to Redeem Rewards

Streamlining the point redemption process makes it easier for shoppers to act on impulse, and brands can achieve this using Yotpo SMSBump and Loyalty. Text customers with a link to checkout with their favorite products and points ready to redeem.

02

Give Customers More Control of Subscriptions

One common reason why subscribers cancel? They can’t adjust their subscription. Make it simple by sending their renewal reminder via SMS, so they can modify it directly from their text messages — from changing the delivery cadence to even swapping out products.

03

Make Review Collection Seamless

Introduce shoppers to your loyalty program and use SMS or email to send personalized updates and offers every time they gain points or approach a new VIP tier. Celebrate customers' birthdays with a gift voucher or bonus loyalty points.


eCommerce
moves
offline
Prediction #07
Prediction #07

eCommerce brands will find new ways to connect with shoppers offline

As customer acquisition costs continue to rise and customer retention rates decrease, eCommerce brands will experiment with offline experiences to boost brand awareness and engage with shoppers.


It might seem hard to believe, but one trend emerging in the eCommerce space is actually happening IRL, via physical stores, pop-ups, and more. With the goals of connecting with shoppers and building stronger relationships, D2C brands have been experimenting with offline offerings in addition to their eCommerce stores.


Eyewear brand Warby Parker, for example, is now offering their customers in-store eye exams, while jewelry brand Studs has opened up ear piercing studios in various cities. Why? As customer acquisition costs (CAC) continue to rise, and retention rates decline, connecting with shoppers in-store has become a viable option for engaging new customers and giving them a reason to return to your store.


That said, it’s not enough to just open a physical store or do a products-only pop up. In 2023, brands that engage customers offline will focus on providing new, eye-catching experiences that strengthen their relationship with customers — and show that their brand provides value beyond just their products.


Plus, according to a Harvard Business Review study on consumer shopping behaviors, approximately 73% of consumers prefer using multiple channels when shopping. What better way to boost loyalty and brand awareness than by offering offline services alongside your online offerings?

Offline experiences offer engagement and relationship-building opportunities


There’s a wide range of opportunities in offline experiences, from the one-time VIP event or meetup, to a temporary popup or full-blown store, so brands of all sizes and stages can experiment with the trend.

Loyalty Loyalty Loyalty
0 %
of consumers prefer using multiple channels when shopping

Consider Chubbies, the popular D2C shorts brand. When they decided to move into the brick-and-mortar space, they knew that they needed to create an on-brand experience for their community. They needed a space where customers could connect with one another, and where the brand could continue building relationships with their loyal customers.


Focused on spreading that “Friday at 5 p.m. feeling,” Chubbies not only offered exclusive in-store items, but they also opened up Tiki bars at all of their physical locations where customers can grab a beer and connect with each other. By activating their physical stores with these branded offerings, Chubbies was able to engage with their customers and grow their community.


And as retention continues to be a major priority for eCommerce brands, finding ways to get creative when engaging your loyal customers can encourage repeat purchases.

Partnerships can play a key role for in-person experiences


If customers are contemplating an online purchase, experiencing the product in person can be a major motivating factor to drive them to purchase — or to discover the product in the first place.


For instance, when climate-friendly cracker brand Moonshot started partnering with retailers like Target and Whole Foods, the brand was able to offer in-store demos so that shoppers can try before they buy.


“In-store demos have been a great way for us to reach more people. Once they taste our crackers, we find they often immediately turn around and purchase!” says Julia Collins, founder of Moonshot, a Yotpo Grow brand.


In-person interactions can attract and engage new customers. And by boosting buyer confidence, shoppers will feel more empowered to visit your site for repeat purchases — increasing customer lifetime value (CLTV) over time.

In-store demos have been a great way for us to reach more people. Once they taste our crackers, we find they often immediately turn around and purchase!

moon moon
Julia Collins, founder at Moonshot moon logo

In-store strategies to try

  • 01Free consultations where shoppers can receive expert advice
  • 02Exclusive events featuring special in-store discounts, giveaways, and/or loyalty points
  • 03Complementary services (such as an eye exam if you sell eyewear)
  • 04Quick and easy in-store pickup, returns, and exchanges
  • 05Fun Instagram-worthy photo booths or walls to post on social with branded hashtags

Get ahead of the trend

Having the resources to open up a brick and mortar store or launch an IRL event alongside your eCommerce experience is an amazing opportunity. For optimal success, keep these tips top of mind to get ahead of the trend.

01

Create a sense of FOMO with Instagram bait

Use Instagram bait, like an interactive photo wall or art installation, to encourage your customers to take photos and videos, and share them on social media. Doing so will create buzz for your brand and even a sense of FOMO for other customers.

02

Provide value with unique in-store experience

When opening up a physical storefront, it’s important to ensure that the value you provide is unique to your brand. Consider what your customers appreciate most about your brand and products, and determine what you can do to bring that positive sentiment to life.

03

Make the path to brand loyalty seamless

Inspire loyalty by creating a seamless experience to redeem loyalty points. Allow your shoppers to easily redeem points from your loyalty program online or via QR codes when shopping in-store.

Level
up
subscriptions
Prediction #08
Prediction #08

Subscriptions will get an upgrade to VIP-level memberships

As more brands enter the subscription space, the competition will be fierce. Brands wanting to capture repeat customers will have to offer more than a discount - they’ll have to deliver VIP experiences with unique perks.


When we think about the subscription economy, one of the things that comes to mind is how convenient the model has been not only for the shopper but also for the merchant.


During the height of the pandemic, subscriptions took off largely because of the convenience factor when shoppers were stuck at home. As we continue to emerge in this post-pandemic world the convenience factor is still a strong pull for consumers, but it won’t be enough to truly hook customers for the long term.


In 2023, brands will look at subscriptions more like a membership rather than a repeat transaction to keep customers interested and engaged.

What consumers want from subscriptions


In a recent consumer survey, almost half of the respondents said they expect perks for being a subscriber and want to be treated like a VIP. Brands will meet this demand in the new year, and we expect to see a further entwining of subscriptions with rewards programs - turning subscriptions into a true membership experience that unlocks benefits and exclusives alongside their recurring orders.

Loyalty Loyalty Loyalty
0 %
of shoppers say their subscription “perks” are important to them

This makes a big case for needing to think beyond just the subscription. What are you doing to make your customers feel important? This doesn’t have to be about deep discounting and giving everything away for free, and in all honesty, it shouldn’t be. Discounts alone don’t build connections with customers and, eventually, a good deal won’t be enough to keep them around.


Subscriptions, at their core, are designed to be a recurring retention tool, while memberships are designed to drive community and value beyond the product. If you can implement a subscription model with membership principles, ultimately you’ll increase your LTV while also building a diehard community.

How to make your subscribers feel like the VIPs they are


According to Dulcie Hanham-Gross, Associate Director of DTC Strategy at The Stable, “A subscription is really the closest thing we have to pledge ultimate loyalty to a brand. You're putting your full trust in them. You're literally subscribing to whatever they sell and you've opted into their program against other competitors. In return for that ultimate brand loyalty, customers expect the VIP treatment.”


So, how can you think beyond the transaction and make your subscribers feel like the ultimate VIPs?


Let’s say for example you’re a skincare brand. Could you include samples of complementary products with your subscription shipments? Could you create a member appreciation month and offer those loyal customers something special? Maybe it’s a credit toward their next subscription delivery or exclusive subscriber merch. You could also reward them with loyalty program points for signups, or even for every delivery. These “VIP perks” should surprise your subscribers and remind them of why they love your brand.

Memberships create relationships that last - even when a subscription doesn’t


Conversations surrounding churn, or in this case unsubscribing, are usually looked at from a glass-half-empty POV. The important thing to remember is that a churned subscriber isn’t necessarily a lost customer.

0 %
of consumers say they have canceled a subscription and resubscribed again later
0 %
of shoppers say they continue to shop with a brand after they unsubscribe from a product

Churn happens for so many reasons - some customers just have too much product on their hands, while others don’t need a specific product year-round.


A word from our expert
Expert
Dulcie Hanham-Gross,
Associate Director of DTC Strategy, The Stable
00:00

“Customer retention doesn't have to fall apart when a subscription churns, it's just about effectively gathering the why behind the churn, and then adapting to offer this customer something that, perhaps, is more suitable to their needs at this moment.”

This is where viewing your subscribers as more than a transaction can come into play. Use the relationship you’ve been building with them to your advantage. Remember, the people who have decided to subscribe to your brand are your biggest advocates - reach out to them periodically to gauge how happy they are with your service. Then work to make important changes that will keep them subscribed for longer.


In the end, it all boils down to creating the best VIP experience. Integrate your loyalty program with your subscription to keep your customers engaged and excited about what you have to offer. Those memorable moments customers have with a brand are what keep them coming back, even if it’s no longer as a subscriber. Having a strong integration between your loyalty and subscription programs puts you in a much better position to engage shoppers with other opportunities to buy long after they’ve unsubscribed.


So what have we learned? Brands will build communities alongside recurring revenue this coming year by treating their subscribers as members. Subscribers are expecting the ultimate VIP experience. And finally, just because a subscriber churns doesn’t mean they’re done shopping with you.

Get ahead of the trend

Let’s get ahead of the trend. Here are three ways you can create that membership feeling as part of your subscription offering.

01

Subscription + Loyalty = Members-Only Vibes

Give your subscribers the real VIP treatment when you enable them to earn and redeem loyalty points on their subscription orders. Combining your subscription channel with your loyalty program is a great way to drive subscription adoption and increase subscription visibility within your loyalty program. It also gives exclusive, members-only vibes that in turn make your customers feel special.

02

Engage subscribers with two-way SMS communication

Connecting with your subscribers via SMS is a great way to personally engage with them between their subscription purchases. With two-way communication, subscribers will now be able to modify their subscriptions directly via SMS, streamlining the process and further reducing any existing friction. This direct line to your brand also gives your customers a stronger connection with you.

03

Surprise and delight

A little bit can go a long way. Enhance subscriber's unboxing experiences with added merch, like the recipe cards mentioned above. And celebrate any and every chance you get. Are your customers coming up on their 6-month anniversary? Send them an anniversary gift to thank them for their business. The idea is to catch them completely off guard.

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