E-commerce platforms have changed the way people around the world buy and sell goods and services. In 2019, it might seem that tech giants like Amazon and Alibaba have well-established business models that haven’t changed drastically in the last couple of years. In reality, they are changing constantly introducing new changes and adding new services. There are a number of other companies, both small startups and large corporations, that are currently reshaping the future of e-commerce. This story features five examples.

Digital Laboratories To Test Sales

Perhaps, the most obvious trend in e-commerce is simply that more retailers that have traditionally focused on brick-and-mortar stores are moving to online sales. What’s more interesting than this is the way in which the market transition is occurring. Moving to exclusively or even primarily to e-commerce isn’t something that major companies can do overnight. Instead, more companies are using a “digital laboratory” model to test the waters. A digital laboratory is simply any market in which companies can offer new product lines and technology features to see if campaigns on a global level are worthwhile from a cost-to-earnings perspective. L’Oreal demonstrates one real-world example of this concept. E-commerce makes up 40% of L’Oreal’s sales in China, up from about 2% in 2012. Globally, e-commerce only accounts for 13.2% of the company’s sales. This makes China an ideal market to expand its e-commerce business. L’Oreal has focused on integrating into popular apps like Wechat. Potential customers can buy products from Wechat as well as try on lipsticks virtually through their mobile phone cameras.

L’Oreal is using AR technology on Wechat to provide users with the option to “try on” lipstick colors.

State-Backed Funding For E-Commerce Platforms

When thinking about funding for e-commerce startups, most people likely think of bootstrapped teams or big VC funds. Government might seem like an unlikely backer, but this could soon change. With an initial capital of $1.5 million, Tinh Tinh E-commerce recently became Cambodia’s first state-backed online marketplace. Cambodia Post E-Solutions PLC (venture of Cambodia Post) holds a 10% stake. Other stakeholders include Paxxa Mobile Solutions (40%) and China-based ZVS Investment (50%). The goal of the platform is to help local businesses in Cambodia, especially small and medium-sized businesses, sell their products online to a global market. Although the government’s funding of the company is fairly small in this venture, it could set a precedent for how e-commerce platforms of the future raise capital in some nations. Additionally, being funded by the government could help establish a wider user base and build greater trust in users concerned about product quality, seller standards, and safe payment processing on a new platform.

Can Cambodia’s government-backed e-commerce platform set a new model for startup funding?

Greater Customization of Product Offerings

Decades ago, there was far less competition from manufacturers around the globe in most industries. Today, customization is becoming the norm in an increasingly competitive retail market. The fashion industry, in particular, is continuously evolving to meet changing consumer demands. One interesting example is Atoms, which recently raised $8.1 million to sell its shoes direct-to-consumer on via its e-commerce platform. What’s unique about Atoms is that it offers 1/4 sizes of each shoe. Traditionally, shoes have only been available in 1/2 sizes. Is this new size offering innovative or a novelty? The answer doesn’t necessarily matter. The important takeaway is that this move is representative of the larger trend of customization in e-commerce. With improvements to 3D printing, for example, it’s possible that all online orders sometime in the near future could be made completely customizable and on-demand whenever a customer orders.

Atoms is selling 1/4 size shoes. Will other shoe manufacturers follow by offering similar customization options?

Fresh Food Delivery Services Available Everywhere

Food delivery meal-kits have become a popular option for many people. The problem is that they have been mostly limited to Western countries. For example, HelloFresh has operations in the United Kingdom, Germany, Austria, Switzerland, the Netherlands, Belgium, Luxembourg, France, Australia, New Zealand, Canada, and China. However, in 2017, the United States was responsible for 60% of the company’s revenues.

More startups in this space, however, are arising and offering to other locations. For instance, FreshToHome is a startup from India that sells 100% pure and fresh vegetables and meat by sourcing directly from 1,500 fishermen and farmers across the nation. In late August, the company had 650,000 customers. Available in 10 cities in India, the platform processes 14,000 orders and 20 tons of fresh food every day. This company has also expanded to the United Arab Emirates. The increasing popularity in fresh food e-commerce platforms could lead to the rise of additional startups or market expansion of existing players that bring these dining options to markets that aren’t currently covered.

Fresh food is becoming more accessible across the globe thanks to startups like FreshToHome.

Sustainability Becomes The Standard

With the effects of global climate change, sustainability and a commitment to using renewable energy must become policies, not just promises. Companies like Amazon are ramping up renewable energy projects. E-commerce companies are beginning to implement more eco-friendly standards. Amazon India and Walmart’s Flipkart have pledged to reduce the usage of single-use plastic in India. Flipkart has already achieved a 25% reduction in single-use plastic, with plans to use 100% recycled plastic by March 2021. By the end of 2019, Flipkart will also collect 30% of package materials shipped to customers as part of its recycling efforts. Amazon India plans to use paper cushions to replace plastic dunnage like air pillows and bubble wraps. It’s unclear whether government requirements or conscious consumers will be the biggest catalyst for a more sustainable future of e-commerce. What’s important is that large e-commerce companies are setting a foundation for this change to take place in both developing and developed nations.

Amazon India (Jamalpur fulfillment center shown in photo) and Walmart’s Flipkart pledge to reduce the usage of single-use plastic in India.

Conclusion

Will the e-commerce trends we see today become global standards in the near future? It might be too early to answer this question for the trends listed above. The good news is that trends are helping create several positive changes for the future of e-commerce for consumers and companies alike.