The State of
Commerce 2022
Inside retail’s reset after the chaos of COVID
You’d think 2022 would be a time for retailers to rest after two years of scrambling during a pandemic that saw rapid-fire ecommerce growth and dramatic change in consumers’ habits and preferences.
But retail doesn’t take a breath.
The State of Commerce 2022
inside retail's reset after
the chaos of covid
You’d think 2022 would be a time for retailers to rest after two years of scrambling during a pandemic that saw rapid-fire ecommerce growth and dramatic change in consumers’ habits and preferences.
But retail doesn’t take a breath.
This new chapter comes at a time when customer acquisition and fulfillment costs are on the rise, inflation is climbing, the supply chains are in disarray and ecommerce has become a much bigger piece of the retail pie.
Based on insights from our network of thousands of merchants, partners and proprietary consumer sentiment survey, we’re here to shed light on several emerging ecommerce trends to help your business succeed in a post‑pandemic economy.
Key ecommerce trends within the report
The transformation of online payments
Optimizing payments brings the promise of higher conversion
Payments have entered a new era of transformation. It’s one of the few remaining places where merchants hold the key to increasing revenue by capturing sales that they’ve been overlooking for years.
At the heart of any buying excursion is payment, but the customer experience can fall apart at the buy button when a customer finds that their preferred payment method isn’t available.
The challenge for many retailers is that the current state of payments presents a blurry vision of the identity and intent behind each order, leading to false declines and delays in order approval. Retailers who optimize their payment stack to provide a holistic view of authorization and approval performance stand to increase sales by 5% to 9%.
The explosion of online returns
Handling returns without mishandling customers
Online returns are booming — both legitimate and fraudulent. As ecommerce has grown from a single-digit percentage of sales to 20% or 30% in some verticals, returns have become a crucial part of the online shopping experience and an opportunity to increase top line revenue.
In 2019, the National Retail Federation reported that 4.9% of online returns were fraudulent. That figure had jumped to 10.6% in 2021. During the same period, the cost to retailers jumped by more than 10x — from $2 billion to $23.2 billion.
The challenge for online retailers is embracing the increasing number of returns as an additional opportunity to interact with consumers, while protecting themselves from this escalation in returns abuse.
would buy more from a brand based on having a good returns experience
would stop buying from a brand based on having a poor returns experience
The increasing diversity of omnichannel fulfillment
BOPIS and curbside are no longer just nice to have
Even as COVID-19 restrictions fade, consumers are not ready to let go of the rapidly implemented fulfillment initiatives born during the pandemic. With their online shopping base growing rapidly, retailers need to figure out how to operate these new channels profitably to serve a significant market that is not going away.
BOPIS has seen years of steady growth. Signifyd data shows pickup orders are up 176% by sales in the last 12 months, compared to the previous 12 months. The direction is clear. BOPIS and curbside pickup have gone from a competitive advantage to a must-have service for retailers.
However, due to the nature of BOPIS and curbside, retailers are left with little margin for error and little time to review orders to determine whether they’ve been placed by legitimate customers or someone attempting to defraud a retailer.
The growing strength of online marketplaces
Selling on a marketplace is a balance between risk and reward
Today, two-thirds of global ecommerce sales are realized on marketplaces and 35% of consumers report starting their product searches on marketplaces.
Within the last decade, marketplaces have branched out with retailers looking to gain access to new consumers that they wouldn’t otherwise build relationships with and increase average order values. Marketplaces also provide access to large pools of existing customers who are ready to buy.
The risk in opening up a marketplace is losing access and control of the data that customers provide through browsing and buying online. New customers can come with new, perhaps unfamiliar, shopping and buying behavior that can be mistaken for a threat in the form of fraudulent orders or policy abuse that prevents retailers from reaping the benefits of the marketplace gold rush.
State of Commerce report 2022
Download the report for an in-depth look into the 2022 ecommerce trends shaking up the industry.
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