Over the past ten years, North America has seen tremendous growth in e-commerce. Online shopping has grown in popularity as a result of the internet’s introduction and technology’s increased accessibility. Current estimates indicate that the North American e-commerce market will grow at a rate of 105% per year and reach $1.05 trillion by 2023.
Key Takeaways
- E-commerce is growing rapidly in North America.
- The US and Canada are major drivers of e-commerce growth in the region.
- COVID-19 has had a significant impact on e-commerce in North America.
- Mobile commerce is on the rise and has a promising future in the region.
- Social commerce is emerging as a potential game-changer in North America.
Online shopping has become more popular due to its convenience and ease of use. Instead of dealing with the inconvenience of crowded stores and lengthy checkout lines, customers can peruse and buy products from the comfort of their own homes. Also, because customers can now shop online whenever and wherever they want, the popularity of mobile devices has increased the convenience of online shopping. The expansion of e-commerce in North America has been largely fueled by the US and Canada. With more than 40% of all e-commerce sales made globally, the US has the biggest e-commerce market worldwide.
Despite its smaller size, Canada’s e-commerce market has grown significantly. Even though e-commerce has grown in both nations, there are some significant distinctions between their e-commerce trends. Online retailers like Amazon, which provide a vast selection of goods for sale, control the e-commerce market in the United States. However, domestic e-commerce platforms are given more importance in Canada, where businesses like Shopify are becoming more well-known. North American e-commerce has suffered greatly as a result of the COVID-19 outbreak.
Lockdowns & other social distancing measures led to a shift in consumer behavior from in-person retail toward online shopping. Consequently, during the pandemic, there was an increase in online shopping. In May 2020, the US spent $82 point 5 billion online, up 77% from the same month the year before, according to a report by Adobe Analytics.
Online sales in Canada surged by 99 percent to $3.9 billion in May 2020, a record high when compared to the same period in 2019. In addition to speeding up e-commerce growth, the pandemic has altered consumer behavior. Even after the pandemic passes, a lot of customers who were previously apprehensive about shopping online are likely to stick with it. In North America, mobile commerce, or m-commerce, has been increasing.
Shoppers can now do their shopping while on the go thanks to the growing popularity of smartphones and tablets. A report published by eMarketer projects that by 2024, mobile commerce sales in North America will total $488 billion. One reason for the growing popularity of mobile shopping is its convenience. Mobile apps and websites with optimized mobile experiences make it simple for customers to explore and buy products. The checkout process has also become more quick and easy thanks to features like mobile wallets and one-click payments. Mobile commerce in North America appears to have a bright future.
Mobile devices are going to be a bigger part of our everyday life as long as technology keeps developing. This will probably lead to more growth in mobile commerce, along with the expansion of high-speed internet access and enhanced mobile shopping experiences. In North America, social commerce—the blending of social media and online shopping—has become a popular new trend. Businesses can now more easily reach and sell to their target audience thanks to features introduced by social media platforms like Facebook & Instagram that let users shop straight from their feeds. North America has a huge potential for social commerce.
A report published by eMarketer projects that by 2021, sales of social commerce in the United States will total $36.62 billion. Since customers are more likely to believe recommendations from users they follow on social media, the growth of influencer marketing and user-generated content has also contributed to the expansion of social commerce. Even though it is still in its infancy, social commerce has the potential to grow into a significant force in the e-commerce sector.
Businesses will have more chances to interact with their customers and increase sales as social media platforms develop and add new features. In the e-commerce sector, personalization is becoming more and more crucial. Because customers have so many options, companies must figure out how to differentiate themselves and offer a customized experience. Ninety-one percent of consumers are more likely to purchase from brands that offer recommendations and offers that are relevant to their needs, according to an Accenture report.
There are various ways that personalization can improve the consumer experience. Through the analysis of customer data and preferences, companies are able to customize offers and product recommendations for specific customers. This raises the possibility of a sale while simultaneously enhancing client loyalty and satisfaction. And customization doesn’t have to stop at suggestions for products.
From the design of their website to their interactions with customers, businesses can customize every aspect of the shopping process. Businesses can provide a smooth, customized experience that entices customers to return by knowing and anticipating their needs. The expansion of e-commerce in North America has been significantly fueled by the advancement of payment options. Although credit cards & PayPal are still popular payment options, new payment methods are also being developed to adapt to the shifting needs of consumers.
Digital wallets, which let users safely store their credit card information & make purchases with a few clicks, are one such payment option. Since they provide a quick and safe option to make online purchases, digital wallets like Apple Pay and Google Pay have grown in popularity. A growing trend in the e-commerce sector is the use of cryptocurrencies such as Bitcoin. Cryptocurrencies, despite being relatively new, have advantages like reduced transaction costs & enhanced security.
In the future, cryptocurrencies might become a widely used payment method as more establishments start accepting them as payment. The e-commerce sector now heavily relies on artificial intelligence (AI). Artificial intelligence (AI)-driven technologies, such as chatbots and virtual assistants, have enhanced customer service by offering prompt and customized assistance. Also, AI algorithms are capable of analyzing consumer data to recommend relevant products and enhance pricing schemes. AI can also improve product discovery and search functionality, which will benefit customers. Artificial intelligence (AI) algorithms have the capability to generate more precise search results and recommend products based on the analysis of customer behavior and preferences.
Customers save time and there’s a greater chance they’ll buy something as a result. AI can Also assist companies in increasing productivity and streamlining their operations. AI-driven inventory control systems minimize the chance of stockouts & overstocking by anticipating demand and optimizing inventory levels. To find areas for development & spur product innovation, AI algorithms can also examine sentiment and customer feedback.
Consumer concern over sustainability is on the rise, & e-commerce businesses are paying attention. Consumers are searching for more environmentally friendly options due to the growth of fast fashion and the effects of packaging and shipping. By implementing environmentally friendly practices across their supply chains, e-commerce businesses can increase their sustainability.
This entails cutting back on packaging waste, utilizing sustainable materials, and maximizing shipping routes to cut down on carbon emissions. Enterprises can also inform customers about how their purchases affect the environment & offer environmentally friendly options. E-commerce businesses that put sustainability first not only lessen their environmental impact but also draw in eco-aware customers. 73% of millennials are willing to pay more for sustainable products, according to a Nielsen report, underscoring the potential for sustainable e-commerce to boost sales and client loyalty.
E-commerce appears to have a bright future in North America. The e-commerce sector is expected to continue expanding and changing as a result of shifting consumer behavior, technological breakthroughs, and the growing acceptance of online shopping. The COVID-19 pandemic has expedited the trend of consumers shopping online, and even after the pandemic passes, a large number of them will probably keep doing so. Businesses now have more ways to connect and interact with their customers thanks to the growth of social and mobile commerce.
Further improving the e-commerce experience will be developments in AI & payment methods. Personalization and sustainability should be given top priority by companies as the e-commerce sector grows. Personalized & seamless shopping experiences allow businesses to stand out from the competition and cultivate a devoted clientele. Also, e-commerce businesses that embrace sustainable practices can draw in eco-aware customers and help create a more sustainable future. In conclusion, e-commerce in North America has a promising and exciting future.
Businesses can profit from the rising popularity of online shopping & establish a strong online presence by implementing the appropriate plans & making the necessary financial commitments. The e-commerce sector will expand and change as long as technology and consumer preferences do, offering new chances to both companies and customers.
FAQs
What is e-commerce?
E-commerce refers to the buying and selling of goods and services over the internet.
What is the current state of e-commerce in North America?
E-commerce is growing rapidly in North America, with the US and Canada leading the way. In 2020, e-commerce sales in the US reached $794.50 billion, while in Canada, e-commerce sales reached $62.7 billion.
What are the factors driving the growth of e-commerce in North America?
The growth of e-commerce in North America is being driven by factors such as the increasing use of mobile devices, the convenience of online shopping, and the availability of a wide range of products and services.
What are the challenges facing e-commerce in North America?
Some of the challenges facing e-commerce in North America include concerns about online security and privacy, the need for reliable and fast delivery services, and the competition from traditional brick-and-mortar retailers.
What is the future of e-commerce in North America?
The future of e-commerce in North America looks bright, with continued growth expected in the coming years. Experts predict that e-commerce sales in the US will reach $1.2 trillion by 2025, while in Canada, e-commerce sales are expected to reach $108.4 billion by 2023.
