Future of Commerce: Predictions for 2021

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show notes.

• [06:09] Young consumers are changing business forever
• [10:37] Social media and selling to gen z
• [11:41] Skincare and younger buyers
• [15:10] Focus on experiential commerce
• [17:21] Physical retail is changing
• [17:39] Contactless payments
• [18:48] Shop independent
• [24:04] Humanize your brand
• [25:40] Customer service is everything
• [30:29] Free returns and shipping if you are able
• [31:59] Conversational commerce
• [33:20] Shoppable social media
• [34:49] Customers are voting with their wallets
• [36:41] Be transparent
• [37:44] Choose sustainable whenever possible
• [40:06] Modern financial solutions will be a game changer
• [40:21] Buy now, pay later
• [42:57] Accelerated checkout
• [45:12] Shopify Capital

resources. 

• Snaxshot
• Isle de Nature
• Shopify Local Delivery App
• Store Pickup + Delivery
• OLIPOP
• Everlane
• Motherly
• Shopify Capital
• Omsom
• Homesick

transcript.

Kelly (00:00):
Now that we're finally nearing the end of 2020, it's time to look into the future and see what we might expect for the world of commerce in 2021. This year Shopify released their first annual Future of Commerce report outlining five key predictions for what to expect next year.

Kelly (00:15):
This week on the podcast, we're going through their predictions and giving you our perspective. And we're also highlighting some ways to kick start the new year in good shape. Let's dig in.

Rhian (00:28):
Welcome to Commerce Tea, a podcast to help you succeed on Shopify. I'm Rhian.

Kelly (00:33):
And I'm Kelly. Grab a mug and join us as we talk about all things commerce.

Rhian (00:38):
Hey, Kelly. How can merchants leverage customer data to drive more revenue and increase retention? How can they create personalized experiences customers love?

Kelly (00:54):
I recommend Octane AI, the leading buyer profile platform for Shopify and Shopify Plus merchants.

Rhian (01:00):
How does it work?

Kelly (01:00):
Octane AI features a shop quiz, Facebook Messenger, and SMS, and opt-in tools. Using the shop quiz, merchants can get to know customers with interactive questions. From product recommenders to gift finders, you can learn about a customer's needs, preferences, pain points, and more. This information gets saved in the buyer profiles, and you can sync your buyer profile data with your Facebook Messenger, SMS, email, and ad campaigns for personalized customer journeys.

Rhian (01:26):
What kinds of returns can brands expect?

Kelly (01:28):
Brands [inaudible 00:01:29] in the shop quiz have increased email signups by 16 times and driven a 28% increase in average order value. Facebook Messenger and SMS see 80% to 95% average open rates and drive up to a 20% increase in revenue. Better yet, Octane AI has plans for any sized business and offers a 14-day free trial.

Kelly (01:49):
Every plan gives you access to the shop quiz, Facebook Messenger, SMS, and opt-in tools. There are also plans available where Octane AI's experts will help you set up and optimize your tools for success.

Rhian (02:00):
It sounds great. Where can merchants go to learn more?

Kelly (02:03):
You can learn more, book a demo, or try it free at join.octaneai.com/commercetea.

Rhian (02:20):
Hello, Kelly.

Kelly (02:22):
Hello, Rhian. How are you today?

Rhian (02:25):
I am doing very well. How are you?

Kelly (02:29):
I'm good. Happy Hanukkah.

Rhian (02:33):
Thank you. Happy Hanukkah to you too. Who doesn't need a little bit more light in their life?

Kelly (02:40):
I need all the light in my life, especially right now.

Rhian (02:45):
It's a lot of light and a lot of fried foods, two of my absolute favorite things combined. So, we're having a good time over here.

Kelly (02:54):
What a treat.

Rhian (02:56):
Yeah.

Kelly (02:56):
Yeah. We started buying all of the things that we're going to be doing for Christmas gifts this year.

Kelly (03:05):
Early in the pandemic, we bought a bunch of local goods for friends. And we just assembled gift boxes or gift bags and dropped them off/ship them if we couldn't see them. And we just dropped them on their front porch and then run away. It was a very early pandemic thing to do, it was really great.

Kelly (03:22):
But we're doing it again because it's now the holiday season, and I'm really excited about what we bought.

Rhian (03:29):
This is reason 400 and million point five why you're more organized than I am.

Kelly (03:34):
Oh, no. Let me be clear. I was working on a Sunday, and Daniel comes over and sits next to me and he's like, "Hey, I had this list of gifts that we're going to buy. This is what I think we're going to get. Let's go through this list together to see if I'm missing anything."

Rhian (03:50):
Okay.

Kelly (03:51):
He's the organized one.

Rhian (03:52):
In this conversation, I'm like, "I haven't bought my business partner a Christmas present yet.

Kelly (03:57):
I haven't bought my team Christmas presents yet.

Rhian (03:59):
So Josh, if you're listening.

Kelly (04:01):
If you're listening, I'm so sorry.

Rhian (04:01):
Yeah. I'm so sorry. I think it'll still get here by Christmas. Probably not. It's fine. Everything is fine.

Kelly (04:09):
You know what? Everything is fine. You have the excuse of just being like, "Well, shipping delays."

Rhian (04:13):
Shipping delays.

Kelly (04:15):
You don't show up eventually.

Rhian (04:16):
Yeah, it's not that I ordered it way too late. No, that is not the reason.

Kelly (04:21):
I attended a virtual baby shower on Sunday. And it was my first time doing a virtual baby shower of service thing. And there was a gift-opening time but because everything was just delivered to her house, she opened everything in advance, so you wouldn't have to sit there and watch her open boxes from Amazon and stuff.

Rhian (04:41):
Okay.

Kelly (04:42):
And somebody forgot to hit the Place Order button. And so, of all the people that were in attendance, I was the only one who didn't have the gift there yet.

Rhian (04:54):
No.

Kelly (04:55):
So speaking of not being organized.

Rhian (04:57):
It's okay.

Kelly (04:57):
It's okay. It arrived later that day but it just wasn't during that time.

Rhian (05:03):
It's like a bonus present at that point. She's already sampling. [crosstalk 00:05:06] all the presents that she got. And she's like, "Here's another."

Kelly (05:09):
Exactly. I was just doing her a favor. [inaudible 00:05:13]

Rhian (05:14):
I love that. So today, we're talking about... So Shopify put out their first annual Future of Commerce report, which is really beautiful and pretty. And it has five key predictions and some sub predictions underneath there.

Rhian (05:37):
I want to dig into it a little bit because some I'm totally on board with and some I'm like, I don't know.

Kelly (05:43):
That's the thing to remember about predictions like, sure, yes, Shopify is pulling from a million stores to try to figure out what these predictions are going to look like. But did any of us predict what 2020 was going to look when the pandemic wasn't over by Easter?

Rhian (06:00):
No.

Kelly (06:01):
So anything can happen. So take these predictions, they're a grain of salt, but there are actually some good recommendations in here [inaudible 00:06:09]

Rhian (06:10):
Absolutely. So, prediction one. Young consumers will change the business landscape as e-commerce charges ahead. Thoughts?

Kelly (06:23):
Absolutely. 100%. I feel this is a given. You have a young daughter.

Rhian (06:31):
True.

Kelly (06:34):
I feel like she's now at the age, while she is using your credit card that she has buying power to a level where she's deciding what she wants.

Rhian (06:43):
Absolutely. You know who really has been talking about at least young consumer aesthetic a lot is a woman named Andrea Hernandez and she has a sub stock called Snaxshots or Snaxshot. It's S-N-A-X shot.

Rhian (07:01):
Anyway, she curates all of these beautiful brands that are well branded and well-designed and something she's been talking a lot about is this return to nostalgia 90s, nostalgia and maximalism also on website because recently, I think going on to sites, I'm like "Whoa, this is a lot." But at the same time, it's really resonating. So I'd recommend everybody check out her incredible curation work, nothing else, if you want to see some well-designed stores and some cool products.

Rhian (07:33):
But I'm going to pre say what my the week is right now. And that's Omsom. And it's a brand, it's like a cooking, a cuisine brand. But if you go onto their store, it's really loud. It's really in your face. It's a little 90s throwback, but it works and it is selling and also kids right now are cooking, teens, and the younger teens, and elder teens, and whatever the gen or I guess, they're still Gen Z.

Kelly (08:07):
Whatever they are.

Rhian (08:07):
The older Gen Z's before they become millennial or before they're millennials, people are cooking it and it's just things are changing and people want to see something different. They're tired, hot take here of the DTC look.

Kelly (08:22):
Yes, there is a formula for DTC. And we've all seen it.

Rhian (08:28):
Yes.

Kelly (08:28):
There's like the certain font pairing every single direct-to-consumer plants brand looks the same.

Rhian (08:36):
They all look the same. They all have a Sarath muted colorways.

Kelly (08:42):
Yep.

Rhian (08:43):
And for those of you who are like-

Kelly (08:45):
[inaudible 00:08:45] natural, yeah. Oh, yeah. Direct-to-consumer.

Rhian (08:47):
Direct-to-consumer.

Kelly (08:49):
Yeah. It's absolutely a thing. It's important to know, these design, these are very common design trends. We go through these trends all the time in terms of designing websites. So it's nice to see the comeback of something that's literally outside the box thinking.

Rhian (09:10):
Yeah, I'm enjoying it. And especially, so the 90s are big. They've been big for a while, I grew up in them.[inaudible 00:09:18]

Kelly (09:20):
So I do too to a lesser extent.

Rhian (09:22):
So I don't find them all that nostalgic, but I'm sure when we have the 80s trend when I was in college. Also, my parents didn't find that very nostalgic either. So we're seeing that as a trend in general. And there I say I'm beginning to like it for myself. But I have a rule where if I were in high school, I won't wear it now.

Kelly (09:46):
Okay. Yeah. I was trying to think of some examples of things that I wore in high school that I wouldn't wear now. Do you have some examples?

Rhian (09:55):
Baby doll shirts?

Kelly (09:58):
Low rise jeans.

Rhian (09:59):
Low rise jeans.

Kelly (10:02):
Sorry, true religion. You're no longer in my closet.

Rhian (10:05):
RIP. Yeah, absolutely. So yeah. Overall, young consumers are changing this landscape. They have buying power, they're also on the computer all of the time, we're not expecting a return to "normalcy" for months and months, regardless of the vaccine. So they have way more screentime then it would normally have, which means more time to look at products, and to be served ads on Instagram and Snapchat, and TikTok. Well, and that's another thing to talk about, TikTok.

Kelly (10:37):
So, a few things to unpack here in terms of targeting younger audience. First of, shopping via social media. So TikTok, definitely, a really great opportunity. I feel like not enough brands are taking advantage of what you can do on TikTok, especially how easy it is to have one video go viral.

Rhian (10:57):
It just takes one.

Kelly (10:59):
Because the algorithm is so different compared to any other social media network.

Rhian (11:03):
Yeah, it just takes one video to go viral. And then it's money.

Kelly (11:08):
Also, things that you should consider doing, impact. Talk about the impact your brand has. We'll get to this a little bit later for one of the predictions, but people are wanting to have an impact on the purchases that they're making. Things carbon footprint offsetting like using fully, recyclable materials, things that might cost a little bit more money, but people want to be mindful with their purchasing.

Rhian (11:41):
Yeah. Gen Z has grown up totally different than millennials. And there's a lot of millennials and Gen X and obviously, Boomer store owners and beyond. But realistically, I think we need to sit there when we're selling to younger consumers and think, "What are the issues that matter to them the most?" So, whether that's, if you're in skincare, cruelty-free skincare. That matters. Are you offsetting? Is this recycled? Can I recycle this in the future?

Rhian (12:18):
This is a generation and I don't mean to speak in broad strokes, because obviously, a generation is not a monolith. But it's the generation that tends to care a lot more about climate change than any other generation. They are very well aware of it and they want to do something. Especially, [inaudible 00:12:36].

Rhian (12:35):
I feel like that's been amplified [inaudible 00:12:38], but they're sitting at home and they're like, "We want to change things." So they're more conscious consumers. And I think millennials are fairly conscious consumers. But Gen Z really pumps it up a notch.

Kelly (12:48):
Yeah, for sure. Yeah.

Rhian (12:52):
Anecdotally, my daughter's like, "Well, we can't buy from this brand because of X, Y, Z, 10 reasons." And it's interesting because there's this perspective and I'm like, "Well, all your friends are buying from the brand." And she said, "I don't care." So you have these kids who are just like, "Nope, this is how it is."

Kelly (13:08):
It's so interesting, especially because I don't have a teenage daughter learning what trends exist in the next generation. I took way longer to learn of the existence of Vsco girl and the products that are associated with that.

Rhian (13:27):
That's outdated now, Kelly.

Kelly (13:29):
It's outdated now, I know. No, I know. I'm not saying this a recent thing. I was late to that game.

Rhian (13:35):
Yeah, that's fair. Well, my daughter was a Vsco girl which is why I'm so... It's interesting because this generation, again, another thing Gen Z is [inaudible 00:13:43] it on, skincare. When I was growing up, I was concerned with acne. I wasn't thinking, "Here's my 10 step skincare that I'm going to do at night." But this is much more normalized. And in self-care, is much more normalized.

Kelly (14:02):
It's good. Yeah.

Rhian (14:02):
It's really great. And discussing mental health, it's much more normalized. These kids are onto something. They're going to change the world. I think.

Kelly (14:09):
It took us too long to catch on. So, just some quick stats before we move on, in terms of... Because young consumers are changing the business landscape and one big key part of this is a shift to shopping online versus shopping in-store. And obviously, we saw a big shift to shopping online with the pandemic. 84% of customers have shopped online since the pandemic and 65% have shopped in-store. And 79% of consumers say they'll shop online regularly in the next six months and only 57% say they'll shop regularly in-store.

Kelly (14:47):
I'm definitely part of that. I also realized that this next bullet point, I'm actually part of this group because 67% of younger consumers ages 18 to 34 shifted more of their spending to online shopping since the pandemic was declared comparing to the 54% average. So, significantly, more younger people are shopping online.

Rhian (15:10):
First of all, I'm a little offended that I'm now considered an older consumer at 35. But it's okay, Shopify. I'll forgive you this time. But it is very true. I think before, when you would shop in person, there's something a little bit ritualistic about it. It was fun, you got to touch the things. So now it's so important that when we're selling online, we're really mirroring the experience of shopping in person. People want that.

Rhian (15:41):
There's a brand, it's called Isle de Nature. And they make candles. And, of course, candles are hard to sell online. And especially, this is $125 candle, so it's not a cheap candle. And so, you've got to prove, Why am I spending this much money on a candle? And so, you can get from them before you buy a scent coin so you can smell the aroma of the candle.

Kelly (16:06):
That's so smart.

Rhian (16:08):
Is it not genius?

Kelly (16:11):
Man. Even if you're selling $30 candles, which is still not cheap for a candle. You can pick up a cheap candle at Walmart if you really wanted to, or Bed Bath and Beyond, I guess. But even for the lower-ish price point candles at $30 to be able to say like, "I want a set of six scent coins." With the intention of only buying one candle and you get this pack, and you're like, "Wow, I really love three of these cents. So I'm going to buy three candles instead of one."

Kelly (16:43):
Getting experiential commerce is very difficult because we're in front of a screen. Obviously, there are things that we can't try things on. We can't smell things. We can't really use our senses except for our eyes. So, I guess, if you're listening to music and deciding you want to buy an all that counts.

Kelly (17:03):
But you're not going to taste anything unless you lick the screen which, please don't do that.

Rhian (17:07):
Yeah, don't do that. It's going to taste like dirt and sadness.

Kelly (17:11):
Taste like your fingerprints.

Rhian (17:12):
It tastes like fingerprints.

Kelly (17:14):
Please stop touching your screen.

Rhian (17:16):
Definitely go wash your hands.

Kelly (17:18):
Taste lie dirt and sadness. Yeah.

Rhian (17:22):
Okay. So that's why that's so important to me, which I really segues into Shopify's next point, which is physical retail will transform as we know it giving local business new advantages. What are your thoughts on that?

Kelly (17:39):
It's totally true. We're already I think this year more than... Because of the pandemic, we have become more cognizant of the businesses that are around us locally, who are just struggling to stay afloat, really, because they usually depended on that foot traffic for going in-store. And we want to keep promoting or keep these local businesses in existence, which really gives these local small businesses a leg up. People want to support independent, they want to support small, they want to support local.

Kelly (18:09):
So not only that, but the tools that have been created over time have just allowed us to keep supporting local business without having to risk our lives. Contactless payments and curbside pickup and delivery. These three things have just entirely changed the way I personally shop.

Rhian (18:32):
I don't think we're going to be back to go... So my family because I'm immunocompromised, which I think I've talked about before, we don't go out to restaurants. Also right now in California, you don't leave your house.

Kelly (18:46):
You cannot.

Rhian (18:47):
You really can't. But even before when there was outdoor dining, as an option, we didn't do that. But we still try to order from local restaurants, for instance, two or three times a week. And yet it's more costly, but these are folks who this is their entire business, so we want to give back to the community. And actually, when you do drive down through downtown Redlands where I live, there's a giant banner that says, Eat something shop local."

Rhian (19:22):
Basically, no matter what path you're taking through my town, you see this banner. And I think it's really important because whether you're in a big city like New York or you're in a town of 75,000 people like I am, it's still so important or smaller or anywhere in between. It is so important to shop small because it directly impacts your community.

Rhian (19:45):
Don't get me wrong, I love Target, like the next person. But if I can get something that I can get at Target at a locally owned store or an independent. If I can't get local, I will get independent. I will do my best to get independent, and I think there's been this consciousness shift in culture, where folks are realizing, "Oh, all of these stores are owned by people in our neighborhood."[crosstalk 00:20:14] These are human beings. This isn't just a brand I leave a Yelp review on. This restaurant or this boutique employs 10, 20, 30 people, if I don't support them, 10 20, 30 people are out of a job.

Rhian (20:31):
So, I do feel like that's one really good thing that has come out of the pandemic and will continue to be seen next year and hopefully, forever is a want and a responsibility to shop local, shop small, and shop independent.

Kelly (20:46):
For sure.

Rhian (20:47):
Sorry, Target, not sorry.

Kelly (20:49):
Not sorry at all. Two resources I want to plug here. First off, earlier this year, Shopify came out with an app called [inaudible 00:20:58]. Basically, this is a local delivery app.

Rhian (20:59):
Yes.

Kelly (21:00):
And the logic behind this app is really cool. It basically can map the orders that you've received, and help you basically create the most optimized route for delivering these orders. So, you're being efficient with your time as well. This is the free app.

Rhian (21:22):
It is.

Kelly (21:22):
So, if you're offering local delivery, I highly recommend this app. An alternate that I definitely do like and I've used on several stores is called Store Pickup and Delivery.

Rhian (21:33):
Yes.

Kelly (21:34):
I will link this in the show notes. It works. Especially if you have multiple locations, it's really useful.

Rhian (21:41):
It is really useful. I have several friends who have pivoted out in Los Angeles their business, one of whom we've on as a guest before, and between them all, they use those two apps. Those are the apps that they use. They're the ones. I love it.

Rhian (21:58):
So, just some stats to include in here, contactless payments. Compared to the same period in 2019, the number of shops offering contactless payments on Shopify increased by 122% during the pandemic. Love to see that.

Kelly (22:12):
Yeah.

Rhian (22:13):
And then when it comes to pickup and delivery, for local delivery, 50% of consumers are receiving items through local delivery more often than before the pandemic was declared. For buy online pick up in-store or curbside pickup, 64% of consumers are using this. I never used it before. I am using it all the time now.

Kelly (22:33):
Absolutely. Like a click and collect type situation. I had never done it before.

Rhian (22:36):
I love it.

Kelly (22:38):
Yeah, never. And now, I depend on it. I'm not walking into a store.

Rhian (22:41):
No. Hard pass.

Kelly (22:42):
So, if you don't offer curbside pickup, that's entirely contactless. I'm not visiting.

Rhian (22:47):
Right. It's a missed opportunity.

Kelly (22:49):
Yeah. And then, 50% of customers are using a pickup point option more often since the pandemic was declared and a local brewery, they were doing this early on. I don't know if things have changed since nothing's really shut down here anymore. Thoughts?

Rhian (23:07):
Because in Georgia, we have no rules. I'm just teasing.

Kelly (23:09):
But you're right.

Rhian (23:11):
I'm teasing, but I'm not teasing.

Kelly (23:13):
But this particular brewery, it's Monday night brewing. They had a designated pickup point where you can call in or order whatever you want, and then they just pop it right into your car. So you can get your local beer.

Rhian (23:28):
One of my local breweries has soda pops.

Kelly (23:30):
One of my favorites has root beer.

Rhian (23:35):
I love it. I'm not a beer drinker, but they have these soda, they have a gummy bear flavored soda pop.

Kelly (23:42):
Whoo.

Rhian (23:43):
I know. But they serve it to you and I'm just jet. By the way, Kelly, you're going to do this over Zoom as well on my gesturing. It's a big-sized can. It's like four regular can sizes all smushed together. And that's the size that come to be just click and collect.

Kelly (24:01):
That's handy.

Rhian (24:01):
It is handy. [inaudible 00:24:03]

Kelly (24:03):
Okay. So this next one we actually already touched on in the first one. But it is consumers want to shop independent. Businesses will adapt to make that easier. So once again, customers want to support local business, they want to support individual merchants, they want to know the human behind or humans behind the brand.

Kelly (24:25):
This is something I often stress a lot when I'm doing user experience, audits. If I don't know who you are, who is running the company, or if customers don't know that, they're less likely to trust the brand if they've never purchased from you before. Unless you have other factors that have really built up trust such as like 10s of 1000s of reviews. I don't care who owns the brand if 20,000 people liked this product, I might like it as well.

Rhian (24:52):
Right.

Kelly (24:53):
But if you're just getting started, if you're growing, please update your About Us page and your story on there. People want to know who is running this company?

Rhian (25:03):
100%, they absolutely do. When you humanize your brand, it does a lot of things but one, is it makes people want to buy more from you and two, if you do make a mistake, or if the mistake is out of your hands like the shipping throttle that Kelly and I have been speaking of, people are way more likely to be forgiving than if that shipping throttle is coming from somewhere again, poor Target that I'm picking on today, than Target because Target, you're like, "You should have figured this one out."

Rhian (25:31):
But if it's a locally-owned business, there's [inaudible 00:25:34]. No, you're much more likely to extend some grace out, I feel like to smaller businesses.

Kelly (25:40):
Yeah. I don't get too many customer support emails from my brand, Modern Geek. But in the past week, I've gotten three emails asking for shipping updates.

Rhian (25:51):
Oh.

Kelly (25:52):
And thankfully, I am well aware of the situation that's going on and I have a good way of explaining what's happening. But every single one of them replied back being entirely understanding of the situation or the scenario. I'm doing the best I can. All the shipping couriers are doing the best they can as well, to be frank. So, it's just a lot.

Rhian (26:12):
Yeah. We're all just doing our best which should be the official [inaudible 00:26:16].

Kelly (26:16):
2020, we're all doing our best.

Rhian (26:18):
We're all just doing our best.

Kelly (26:21):
So, half of consumers look for independently-owned businesses to support for reasons including supporting entrepreneurship, buying unique products, and experiencing good customer service. Let's talk about that last one. Whoo.

Rhian (26:37):
When I think good customer service right now, I think of OLIPOP. I know we've talked about them before, but they do little things for people that are truly delightful. I was reading on Twitter the other day that somebody had written to OLIPOP saying that they really liked the certain flavor and that their father who was dying really liked it and it was the only drink that they could really drink and OLIPOP sent them flowers.

Kelly (27:08):
Aw.

Rhian (27:08):
And it's just like, as a brand, how much time does that take? They read the feedback and they actioned on it in a kind and compassionate way, well, like a note. And I just thought what a difference-maker that is and yeah, it costs a little bit of extra money but you know that A, it's all over social media now and B, it was a kind, right thing to do and it goes above and beyond customer service expectations and it truly does delight you.

Rhian (27:40):
That makes me feel delighted with OLIPOP. It makes you want to buy OLIPOP because I'm like this brand is rad, they care.

Kelly (27:47):
I've been very tempted to buy OLIPOP for quite some time now. So one of these days, I'll actually take-

Rhian (27:52):
You should probably pull the trigger, strawberry [inaudible 00:27:54] is my favorite. I'm just throwing things out of here.

Kelly (27:58):
I want to try their new flavor blackberry vanilla.

Rhian (28:00):
Well, no time like the present. It's also healthy for you.

Kelly (28:06):
Oh, man, I love a good healthy juicy-

Rhian (28:07):
Healthy soda.

Kelly (28:09):
Yeah. Water is so boring. It's good for you but it's boring. My co-working space, I would do sparkling water and add citrus to it, like a slice of lemon, lime, or-

Rhian (28:23):
The other locations had grapefruit and I'm really upset that our location never had grapefruit. So, that is going to be on my list of requirements in order for me to come back.

Kelly (28:32):
My front yard has grapefruit, if you'd like some.

Rhian (28:34):
Please ship me grapefruit. I love grapefruit.

Kelly (28:40):
So, I want to continue down this path of customer service and in what else you can do. One of the things we often talk about, a lot is your shipping rates. People want fast shipping. We're going to pretend that we're past... So we're talking 2021 here. So we're going to work a little bit past this [inaudible 00:29:00] [crosstalk 00:29:00] situation right now. Let's move past the holiday season. People want fast shipping. They want to know when their item is going to be received.

Kelly (29:09):
So, if you can add any, I want to say any guarantee but a range of dates that their item will arrive by. Literally write that in the shipping description, arrives in three to five business days or whatever it might be. Providing that transparency helps people decide what to purchase or what shipping rate to choose.

Kelly (29:34):
I was ordering some candles from Homesick, so I'm also giving away my source out too.

Rhian (29:40):
[crosstalk 00:29:40] talked about it.

Kelly (29:42):
Yeah. I get to the shipping section and there are three options but the first one was $6.99 which is standard shipping. The second one was $7.99 for ground shipping and then in parentheses said, "Choose this one for basically your best bet for this arriving before Christmas."

Kelly (30:04):
So, I love that transparency. I love being able to see exactly when things would arrive. Free shipping. Of course, nobody likes paying for shipping. I have turned away from so many websites just because I was wanting to buy a $10 item and I would have to pay $6 for shipping. I can't math that in my head.

Rhian (30:25):
No, because it doesn't math.

Kelly (30:25):
Charge me more for the product.

Rhian (30:26):
Yeah, just charge me $15.

Kelly (30:29):
Yeah. And free returns, that's another big one. And it's huge for trust-building too.

Rhian (30:36):
You have to give free returns, I'm sorry.

Kelly (30:38):
Again, we're talking, it's like trying to replicate some experience online. If you are selling apparel, please, if you can offer free returns. I see some apparel companies struggle with this. For good reason, people try to game the system.

Kelly (30:58):
I've heard stories of certain Instagram influencers buying a bunch of items, posting pictures with them on Instagram, and then returning everything.

Rhian (31:07):
So sketch.

Kelly (31:09):
So, you could say, you've already returned three items in the past month in three different orders. So, we're going to have to start charging you for returns or whatever. You can set a policy there like three-strikes policy, but if you see somebody gaming the system, you don't want to keep on providing them with that benefit there.

Kelly (31:28):
But for everybody else who's not going to game the system, again-

Rhian (31:32):
Which is most people.

Kelly (31:32):
Exactly. And most people are decent people. Try to offer free returns. Yeah.

Rhian (31:39):
I could not agree more. Another thing pointed out in the Future of Commerce predictions is the uptick in adoption of conversational commerce.

Kelly (31:53):
Yes. I am a big fan of conversational commerce in general.

Rhian (31:59):
Yes.

Kelly (31:59):
I feel nothing is better than having an actual conversation with your customer.

Rhian (32:04):
Right.

Kelly (32:06):
If you're just able to chat with their support team, and you get a real person, and they're like, a normal person talking to you as opposed to feeling very formulaic and robotic or just not having that option. It has enticed me to place an order before.

Rhian (32:23):
Absolutely, it has. I don't know if I've talked about this before, but Cartier, which is a huge legacy brand, they've started offering phone support to walk you through the site, and to help shop with you while you're on their site. Okay, granted. Is that a step above Shopify paying 100%, but they're Cartier and they're charging 10s of 1000s of dollars for stuff.

Rhian (32:48):
So, maybe they should offer a little bit more of that concierge-level service. But it says something. When those legacy brands change and do something they have never done before, that means they're looking to more SMB style business operation since they're thinking, "Oh, they're onto something here."

Kelly (33:12):
Yeah, I love that.

Rhian (33:14):
I like it too. Yeah. I'm not in the market for anything for Cartier unless [inaudible 00:33:18] wants to buy it for me. But I thought that was a cool thing.

Kelly (33:22):
If you're interested in buying us anything from Cartier, just send us an email and we will give you our address. We don't live together, so you might have to buy two of them but...

Rhian (33:32):
Who's to say?

Kelly (33:33):
Part of the game. And the last thing that they do touch on is shoppable social media. So, make sure you're integrating your shop into your social media. Be promoting your products, tag the products in your Instagram and Facebook posts. Again, TikTok is a really great place. I think Instagram just updated to allow shopping within Reels. So, that's very cool. I'm excited to see that. I doubt that, I've never watched a single Reel in my life except for the little previews that show up in people's-

Rhian (34:09):
So confusing.

Kelly (34:11):
Yeah.

Rhian (34:12):
The Reels activation is so confusing. I think if you're going to... Okay, I'm all about shoppable Reels, but I think the money to be made is in stories still.

Kelly (34:22):
I agree.

Rhian (34:23):
TikTok is the whole other planet. I feel like you can put a brand placement wherever in TikTok and that works. But Instagram, people have a very specific expectation of how Instagram works and it got flipped on its head. And I don't think or I know people aren't super excited about it. So I don't know how that's converting. We should we should get an Instagram ads expert on here.

Kelly (34:50):
I got him.

Rhian (34:51):
Okay.

Kelly (34:52):
For those who are listening in, I just killed a bug that's been flying around me for the past 20 minutes. So, it's a good moment. Yeah, this is staying in the podcast, by the way. Thank you all for enjoying this moment with me because I feel powerful now.

Kelly (35:09):
Anyway, number four, more consumers will vote with their wallets. I feel like we've touched on this one, we're going to touch on it again.

Rhian (35:17):
I think yes and I also think no. Ultimately, it's going to depend. And the reason I say that, yes, from the perspective of people really care about sustainability now, a lot of people care about sustainability. Not all people care about sustainability, and sourcing, and ethics of business.

Rhian (35:40):
However, depending on the economic situation in the United States, and globally, that could change just because typically, sustainable products cost more, to manufacture, therefore, the cost gets pushed to the consumer. So that's my only pushback there is that's assuming best-case scenario with the economy, which I'm going to assume best-case scenario with the economy.

Kelly (36:05):
But I would love to assume best-case scenario, but the reality is sustainable and green products are more expensive.

Rhian (36:11):
They are more expensive. And I just am concerned that people's buying power... I'm afraid we're on a bit of a credit bubble. It's hypothetical. But we're seeing people send more and more and more on credit, obviously, people's credit cards have caps. We're seeing people spend more and more and more on after pay, etc. Those things have caps, or they should if they don't.

Rhian (36:34):
And at some point, people will have to choose the less expensive option. So we'll see how that goes.

Kelly (36:41):
We'll see how it goes. But the one thing you absolutely can do now is on your website, be transparent about your brand and your practices.

Rhian (36:49):
Yes.

Kelly (36:50):
Talk about where you source your products, if you can. Honestly, I totally understand that products made in China are cheaper. I get it. But I still like that transparency of knowing where my products are made, even if they're coming from China.

Rhian (37:07):
Or Everlane does this really well. Is they talk a lot about, okay, this is made in this factory, we do these checks. So it's not that everything's made in the United States. It's not about that. It's about making sure you're not buying a sweatshop made good.

Kelly (37:26):
Exactly. And that is, hopefully, something that you can be transparent about. And if that is not something you can be transparent about because you are making your products or your products are coming from a sweatshop, please reevaluate your practices.

Rhian (37:41):
Yes. I agree. I 100% agree.

Kelly (37:44):
I just shrugged now that you saw.

Rhian (37:47):
Shrugged. So love, we can go over some stats here. This is a bit of a shorter section, but it's worth covering anyway. 53% of consumers prefer green or sustainable products. 49% of consumers... Okay, one thing I want to know with these stats is I want to break it down by segments.

Kelly (38:08):
Yeah. I'd love to.

Rhian (38:09):
So, age group is obviously a big one. Spending power is a big one. What is your household income range? There's definitely going to be, can you afford these sustainable products? Because they are more expensive.

Kelly (38:26):
Yeah.

Rhian (38:27):
So things I would like to know. 49% of consumers respond positively to retailers making a donation to a cause with each purchase. This is something I'm seeing more and more on websites. And it's so easy to add to your store. Even if it's a small percentage, I see Motherly, for example, they have on their store, when you view a product, it'll say, "When you purchase this product, Motherly will donate $1 to this charity, or will donate $0.85 to this charity, even though it's not a significant amount. You can imagine there are many people shopping in the store, that adds up.

Kelly (39:04):
It does. Question for you, or just a thought. I think this is great. This is phenomenal. If you do this, just talk to your CPA, and make sure you're doing it the right way. Yes, please, yes.

Rhian (39:19):
That's basically, that's [crosstalk 00:39:20]

Kelly (39:21):
When you're doing anything when it comes to impacting how you're spending your money, please talk to a CPA.

Rhian (39:28):
Yeah, especially if you're redirecting it to... Yeah. There's a lot that you can get in the weeds with. So just make sure that you're staying on the up and up there.

Kelly (39:38):
For sure. And then, there's just a trend of, we've already seen this already of more and more consumers choosing to shop at local or independent retailers to reduce their carbon footprint. And on top of that, supporting local business, especially this year was helping to strengthen the local economy and give back to local businesses so they can create new jobs.

Kelly (40:01):
And, of course, just invest money back into your community. So yeah.

Rhian (40:05):
All good things.

Kelly (40:06):
All good things.

Rhian (40:09):
The next big point. Modern financial solutions will disrupt business and consumer banking, finance, and lending. Thoughts?

Kelly (40:21):
We're seeing in adoption of buy now pay later across websites. It took me a long time to come to terms with the fact that it's okay to offer a buy now pay later option because technically, it is very similar to a credit card. But I feel like [crosstalk 00:40:43]

Rhian (40:43):
But it's the only percent APR at least.

Kelly (40:44):
Yeah. So, in some cases, it could be even more beneficial and just be able to split a payment for ways, for example, it can help drive conversions. So, I feel like these installments are absolutely a good thing to be offering on your store. If your average order value, it makes sense to actually offer this.

Kelly (41:12):
If your average order value is like 20 bucks, don't even think about it. If your average order value is 50 bucks, not really sure I do it yet. Above that, so once you start approaching 80 to 100, it absolutely makes sense to start adding them in there.

Rhian (41:26):
I concur. And the number of Shopify merchants who offer buy now pay later has increased by 60% since the start of the pandemic. That is not a small number.

Kelly (41:40):
I don't offer it on my own store. My AOV is a little lower. So my AOV is sitting around like 40-ish, I think. It maybe was like around 100-ish. People buy more stuff, so I can offer this option.

Rhian (41:57):
Well, possibly, they would. See and that's the double-edged sword.

Kelly (42:02):
Exactly. You can require purchases over X amount can have this as an option. You can prevent customers from checking out with the buy now pay later option if their order is less than 20 bucks, whatever.

Rhian (42:20):
Yeah.

Kelly (42:20):
There we go. My last 30-day AOV was 3,554. So I would not add buy now pay later to my store, it does not make sense based on my price point.

Rhian (42:32):
So, in this report, Shopify talks about providing options that traditional banks don't offer, financial solutions that prioritize speed and access to capital, faster ways to pay, and more flexible payments like installments, which we've just gone over. I love faster ways to pay. I love the fastest way you can get in and out of the store, the better.

Kelly (42:55):
Yeah.

Rhian (42:56):
Friction life.

Kelly (42:58):
Let's actually have a conversation about this. So, as I mentioned, we had been purchasing from multiple stores to put together these gifts for our friends and family members. And I'm just minding my own business/working while Daniel is placing these orders, where he's just like, "Shop Pay is just so useful."

Rhian (43:22):
Because it is.

Kelly (43:23):
It is, exactly. Just because you don't have to continue to re-enter your credit card information every single time. I will say, I got an email a couple weeks ago from somebody who was like, "Hey, I bought your book. But it's kind of creepy. I don't think you did anything wrong. But I'm curious how you had my credit card information already."

Rhian (43:46):
Oh, because they didn't quite get that. Make sense.

Kelly (43:48):
Yeah. So you know what? If I get one email every now and then having to explain how Shop Pay works, worth it.

Rhian (43:57):
I'm 100% that person where if I can't buy it through Apple Pay, Shop Pay, or PayPal, and it does not pre-fill my credit card information, I'm not getting up from what I'm doing to grab my credit card. That is a lost sale. That is a abandoned cart with no hope of return.

Kelly (44:16):
And PayPal in particular, I think is worth touching on here as well, because there are people who just don't trust entering their credit card information in a website they've never shopped on before, but they trust using PayPal.

Kelly (44:27):
So highly recommend offering credit card transactions through Shopify payments, enable Shop Pay, Apple Pay, Google Pay, offer PayPal as well. And I've actually been seeing an increase in the number of customers checking out via Amazon Pay as well.

Rhian (44:44):
Interesting. Because I don't think I'm signed up for Amazon Pay. But I will say with PayPal, today, I did check out using PayPal. That's not my preferred method of checking out. But I was, I don't want to get up. Here's an option that I can use." And I did it. And I also know it's secure because they have dual auth on it. And fraudsters right now are running around frauding.

Kelly (45:09):
I love it. One thing that's probably worth touching on as well, this is not only from a consumer standpoint, this is from a merchant standpoint, as well. Having easier access to capital to grow your business is huge. You don't have to necessarily go through the traditional banks to get a line of credit or get a loan. Shopify Capital exists for a reason.

Kelly (45:35):
For everybody who I've talked to who has actually taken advantage of it, it's changed their business.

Rhian (45:42):
Yeah, I've heard nothing but amazing things about Shopify Capital from either friends I know on Shopify or merchants that I've met, they've been able to increase the inventory they have on hand or they've been able to bridge especially in cash flow situations, which are really common in many types of businesses where your cash flow weak but revenue is strong.

Rhian (46:03):
So, I think we've talked about this before. I really like Shopify Capital, I think it's a great thing for merchants to have access to and to utilize.

Kelly (46:13):
Yeah, for sure. Definitely want to read some of these stats just because they're kind of funny.

Rhian (46:18):
Okay.

Kelly (46:18):
Some of them are not funny, but I just wanted to read all of them. Buy now pay later has grown in popularity. The number of Shopify merchants who offer buy now pay later has increased by 60% since the start of the pandemic, and now they're beta testing a native integration with buy now pay later with installment payments at check out. So that's going to continue to roll out, definitely something to look into.

Kelly (46:42):
My personal favorite stat. In the US, millennial fathers are the most frequent users of buy now pay later particularly when spending on high-priced items like electronics.

Rhian (46:52):
I'm just giving my husband the side-eye from my office.

Kelly (46:57):
Same.

Rhian (46:59):
I'm like, "What are you up to?"

Kelly (47:00):
Although Daniel is not a buy now pay later person. He won't buy it unless we already have the money to pay it off.

Rhian (47:10):
I think Rob is the same but we'll see at holiday. It's always hard to hide presents from me because I'm in charge of all of the money because I was a banker. He'll be like, "Stop looking at the Amex. Stop looking." I'm like, "I audit it every month. He said, "Well don't for [inaudible 00:47:29] just stop." I always know what I'm getting way ahead of time because I see it come up on my credit card.

Kelly (47:35):
Got to do what you got to do is responsible.

Rhian (47:38):
Right, it is responsible. That's what I say.

Kelly (47:41):
So, with some final stats here of US consumers that have tried to buy now pay later option, 41% are between 18 and 34 years old, 56% are men, and 52% have children at home. So, when we're saying that the US millennial fathers are the most frequent users of buy now pay later, they literally check all three boxes.

Rhian (48:05):
Facts. That is the fact.

Kelly (48:07):
Yeah. Those were fun. So I think overall, it makes sense. The predictions that they're... Nothing's breaking news or going to change the entire landscape of commerce as we know it as we move into next year. That was reserved for 2020. And I hope we don't have another year like that anytime soon.

Rhian (48:31):
Though I hope never again. Let's not revisit this year.

Kelly (48:36):
Yeah. All right. You want to do some shout out?

Rhian (48:40):
Yeah, I want to do some shout outs and we both accidentally pre shouted them out. But let's do it anyways. My shout out this week is Omsom, O-M-S-O-M .com. Their store is maximalist, and I mean that in a good way. Their branding is cool and it doesn't look like a bunch of other direct-to-consumer brands, which I really like. You get what they're selling and it's a food product. It's like you mix it. For stir fries, I'm grossly underestimating and explaining, I have this but there's recipes, there's a blog, there's a meet us on here. And I love that and it talks about the folks who founded it and it's founded by two sisters and I just really like the brand. I think it's awesome.

Kelly (49:32):
Cool.

Rhian (49:32):
So yeah, highly recommend. And Kelly, what about you?

Kelly (49:37):
So my sore shoutout this week is Homesick, homesick.com. They sell candles and I've never actually bought a candle for myself from Homesick. But I did buy two candles as gifts for people.

Rhian (49:51):
You've never? I have like six upstairs.

Kelly (49:54):
I have never bought one for myself.

Rhian (49:57):
I recommend. You should get a Michigan one.

Kelly (50:00):
I got... She doesn't listen to the podcast, my best friend from Michigan.

Rhian (50:04):
Well, she should.

Kelly (50:08):
I was texting my best friend, actually this past weekend because we're not recording when this episode is released. And she had to cancel her plans to go back home for the holidays, of course, because there's a pandemic. And the last thing that she said to me was "Sorry, I was making Christmas cookies and being homesick and I immediately went to homesick.com and bought a [crosstalk 00:50:31] candle for her.

Rhian (50:34):
Bless her heart though.

Kelly (50:36):
Yeah. So I will say the homesick website, it looks great. But this is what we're saying when it is a DTC website.

Rhian (50:43):
And it's very DTC.

Kelly (50:46):
It looks great. But there is a very clear pattern for how it's set up. But yeah, people rave about these candles. And I have no complaints because I've never owned one before. But you like them?

Rhian (51:01):
I like them. Absolutely. And you can also put a message on them now.

Kelly (51:07):
Oh, yeah. I did not personalize these. Maybe I should have but I did not.

Rhian (51:11):
I think it would be funny, and maybe this is because I had a terrible sense of humor, if you send them to your friends, but you leave salty messages on them. I'm not good at passive-aggressive stuff. [inaudible 00:51:30] It be funny.

Kelly (51:34):
It would be funny.

Rhian (51:35):
Maybe.

Kelly (51:37):
Yeah. Well, I won't get into all my ideas that I've had because I'm trying to stay somewhat pseudo-professional on this podcast.

Rhian (51:44):
Oh, sorry. Yeah, me too.

Kelly (51:46):
Of course. All right. So that wraps up this week's episode. Thank you so much for tuning in. And thanks again to our sponsors for supporting this episode. We have a YouTube channel where we post friendly Shopify store teardowns. We post a new video usually every Thursday unless life happens. You can access those videos at youtube.com/commercetea.

Kelly (52:10):
If you like our podcast, please leave us a review on Apple Podcasts. Reviews make us really happy and we like to see them. And you can subscribe to Commerce Tea on your favorite podcasting service. We post new episodes every Tuesday. So, grab your mug and join us then. We'll see you next week.

Rhian (52:25):
Bye-bye.

Rhian  (52:25):
ClockedIn is a time clock for Shopify. With ClockedIn, your team members can easily clock in and out of their shifts from anywhere. You can manage your team's hours as they work remotely with an intuitive interface that can be used from desktop, tablet, or mobile. Check it out at clockedin.io or in the Shopify App Store.