In 2017, e-commerce and retail saw several innovations take the spotlight, such as artificial intelligence (AI), augmented reality (AR), and omnichannel shopping. However, other areas remain lackluster, leaving retailers room for improvement in 2018. For instance, mobile purchases are expected to increase 23% year-over-year (YoY) in 2017, yet many retailers still provide disappointing mobile experiences. Based on our ongoing analysis, understanding of industry trends, and conversations with industry executives, here are our top five predictions for e-commerce in 2018:
1. The Amazon-Whole Foods marriage will likely hurt Whole Foods' reputation, causing Amazon to move to rebrand the grocer. Amazon’s acquisition of Whole Foods got off to a promising start, but the grocer has since raised prices by 1.6% on average, and, although its produce prices have dropped, some consumers feel there's been a corresponding drop in quality. Though Whole Foods reportedly hasn't changed any relevant operations or standards for quality, consumers' perceptions are souring. Whole Foods built its reputation around the idea that high quality justifies high prices, but its image may be undercut by the fact that, under Amazon, the grocer's given its national office more control over purchasing decisions, moving away from the local sourcing that built Whole Foods’ brand. As consumers notice the lack of price drops they hoped for under Amazon, as well as the produce issues and lack of local products, the e-commerce titan will likely look to shed the grocer’s suddenly negative image in 2018 by starting from scratch with a rebrand, and appealing to a more price-discerning crowd. Amazon will likely use the opportunity to try to dominate the grocery industry with its expertise in pricing and logistics without Whole Foods’ consumer expectations, bringing its grocery efforts closer to its overall strategy.
2. Alibaba will bring Singles’ Day to the US in 2018. Alibaba brought in a tremendous $25.3 billion in revenue [...]