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eCommerce Industry Trends and Predictions to Look out for

The eCommerce industry is rapidly adapting to new technologies, market and economic shifts, and the reactions of big players like Amazon. Adapting to those changes is critical for online businesses, whether you work in sales, shipping and logistics, marketing, or any other aspect of the sector. Understanding what to expect will help you keep up so you can adequately prepare and plan for those shifts in eCommerce industry trends, while watching how others in the industry respond.

In 2023, MyFBAPrep landed at #20 on the Deloitte Technology Fast 500, #44 on the Inc. 5000 and was the highest ranked in the logistics and transportation sector, with a three-year revenue growth of 8,773%. As a leader in the fulfillment niche, here’s our team’s prediction for what to expect in eCommerce industry trends in 2024.

1) AI will optimize supply chains in new ways

Merchants and companies are already experimenting with AI to identify new opportunities to improve different components of their logistical operations. Some key highlights include:

2) Returns and reverse logistics will give businesses an edge

Returns have gained considerable attention in recent years, with almost half of all eCommerce businesses offering free return shipping. In 2024, this will continue to be a priority within the eCommerce industry trends. Even Amazon is making changes to their return fees structure; for instance, they’ll charge $1 to shoppers who return goods at a UPS store if there’s a free return option within the same or a shorter travel distance. With 20%–30% of all online purchases returned, it’s crucial to refine the returns process moving into 2024.

To that end, businesses are searching for cost efficiencies in the form of leveraging 3PL return centers and pre-printed return slips, as well as in their products, such as adopting reusable packaging (e.g., Boox) for customers to ship back their products (and which can be reused).

3) Amazon aggregators will turn to portfolio consolidation

2023 saw difficult times for Amazon’s aggregators, from bankruptcies and dissolutions to mergers and acquisitions (not to mention the decline of a $10B company). We anticipate additional shifts in 2024, and so aggregators may struggle to raise necessary capital. Our prediction is that aggregators will continue to have an appetite for growth, but the priority may shift towards portfolio rather than brand acquisition. This means single brands may have fewer opportunities to sell, because aggregators will seek out acquisitions of experienced brands that have already worked out their kinks and consolidated.

4) Consolidation will increase

Mergers and acquisitions have consistently been a popular and growth area within the eCommerce industry trends. However, we expect to see more larger players in eCommerce turning to consolidation and acquisitions to expand, which should affect internal resources, business partnerships, and customer acquisition. That’s reflected in ContextLogic selling the eCommerce platform Wish to Qoo10, which essentially gave the latter a stepping stone from markets in Asia to a global audience. We’ve also seen this trend in smaller acquisitions, like SendCloud’s acquisition of Tracey, a predictive AI for parcel tracking, which SendCloud intends to add to their shipping platform.

5) The move toward 4PL will continue

From 3PLs branching into freight to freight forwarders moving into 3PL services, everyone in logistics is shifting to the 4PL model. This is a smart move, since offering customers a single touch point for logistical services reduces costs. Consolidations are also likely to play a part in this: 4PL services are currently predicted to have a CAGR of 7.4% and an estimated value of $129.4B by 2032.

6) Supply chain resilience must remain a priority

The fulfillment industry made significant shifts toward introducing resilience and fixing weak points in the global supply chain in 2023. This eCommerce industry trends is likely to continue in 2024, especially with disruptions to shipping lines forcing logistics groups to reroute vessels around southern Africa or suspend shipping routes through the Red Sea. We expect merchants and businesses to continue to prioritize supply chain resiliency with tactics like manufacturing network diversification, inventory buffers, and ecosystem partnerships. AI could also play a large role here, as it’s already in use for supply chain optimization.

7) The shift to private logistics fleets will continue

Amazon started to push away from domestic carriers in 2012 with the introduction of Amazon Freight Partners. Today, that’s a major part of eCommerce operations, with more than 7,000 trucks relying on Amazon Relay to optimize freight and transportation. Due to the move toward 4PL, brands are also increasingly motivated to embrace private logistics fleets to reduce costs across the board.

That could also result in fewer companies participating in FBA. For example, in 2023, Amazon introduced the program’s first return processing fee. Then, in June 2024, that’s set to become a standard across all high-return products in all categories except for apparel and shoes. The return fee will only apply to sellers, not customers, which will raise the price of certain products and encourage brands to move them out of FBA and into a private 3PL or 4PL warehouse.

8) Transparency and brand protection will gain in importance

The rise of live shopping, social selling, and AI-generated deepfakes means it’s easier than ever for counterfeit products to find their way into marketplaces. New legislation like the proposed SHOP SAFE Act could force platforms to take more precautions to prevent counterfeits and remove merchants caught selling them. Amazon is already heavily invested in these measures, with new tools like Transparency to verify product authenticity and Project Zero to help brands automatically flag and remove counterfeits. Those measures are likely to extend to other marketplaces, especially as multi-warehouse fulfillment becomes the norm.

9) Inventory placement optimization will continue to take precedence

Placing inventory closer to the customer has been a focal point for 3PLs for years. However, that importance is growing within this eCommerce industry trends, with even Amazon now incentivizing it: Come March 2024, the marketplace will split inbound placement fees based on whether you want Amazon to distribute your inventory across their warehouses or you want to ship your FBA inventory to multiple FBA locations yourself. Other changes like the increased multi-channel fulfillment fee display Amazon’s attempts to reduce expenses associated with fulfillment, mostly by shifting those costs to the seller. That’s likely to show in other parts of the industry as well, with potentially higher fulfillment costs.

10) There will be further innovations in advertising

Amazon’s strategic use of first-party data to craft targeted advertising campaigns represents a seismic shift in digital marketing. Additionally, their ability to leverage data from their vast pool of consumer interactions, particularly in high-visibility contexts like Thursday Night Football, has opened new avenues for personalized advertising.

In our recent interview with James Thomson, managing partner of Equity Value Advisors, Thomson’s excitement about these developments is palpable in his prediction of “a profound impact on advertising strategies and consumer engagement.” This will enable a level of specificity and relevance in previously unattainable advertising, which promises to redefine the benchmarks for successful digital marketing campaigns.

11) We will see increasingly personalized marketing

The move towards more personalized marketing strategies, fueled by Amazon’s rich datasets, is both a significant opportunity and a challenge for brands.

Thomson noted, “The potential … poses both opportunities and challenges for brands.” The dual nature of this evolution opens immense potential for brands to engage with consumers in more meaningful and effective ways. However, that shift also demands a higher level of sophistication and understanding of data-driven marketing techniques from brands.

The ability to customize marketing messages to consumers’ individual preferences and behaviors is becoming a critical component of successful digital marketing strategies. That, in turn, punctuates the increasing importance of leveraging data to inform and guide advertising efforts.

Wrapping up — Keep your eyes on the eCommerce horizon

Most of the expected eCommerce industry trends for 2024 are simply continuations of those already happening. Those changes will center around AI technology, shifts towards accounting for increased costs, and further optimization of supply chains and warehousing. The overarching theme is reducing expenses without diminishing quality of service, and the fulfillment industry is embracing a wealth of tools to achieve that goal.

What do you think? Do you see any other trends in eCommerce and fulfillment for 2024?