eCommerce Tips & Trends

What's the Future of the Shipping and Logistics Industries in 2020?

2019 was a banner year for eCommerce growth. Read our in-depth outlook for the future of the shipping and logistics industries for 2020 to craft your strategy.
What's the Future of the Shipping and Logistics Industries in 2020?
Gayatri Bhaumik

By Gayatri Bhaumik

 

January 3, 2020

If you're an eCommerce retailers, you'll want to make sure these logistics trends are on your radar. 2019 was a banner year for eCommerce growth around the world, increasing some 20 percent over the previous 12 months. And, in great news for online retailers - that growth is set to break new records in the coming year. Experts estimate that 2020 will see online sales reach a mind-blowing $4.2 trillion and kickstart a shift in shipping industry trends to cope with this rapid growth. Of course, as an eCommerce retailer, you’re going to want to grab a slice of that pie.

But 2019 has also been a year of surprising geopolitical events that have caused turmoil in trade and increasing economic uncertainty. Will Brexit ever be resolved? Will the US-China trade war reach new depths of animosity? What other nasty surprises might our high-minded politicians deliver in 2020? And, could climate change cause problems with your fulfillment services?

We might not have the answers to all these questions - we’re not fortune tellers, after all. But after getting our insightful data teams on the case, we’ve compiled our very own dossier on the shipping and logistics trends to expect in 2020 so that you can prepare to make next year your business’ greatest yet.

Shipping & Logistics Industry Trends in 2020

1. Destination Countries

eCommerce retailers are getting savvy about scaling their business by reaching global customers. That's why one of the biggest shipping industry trends for 2020 is a growth in destinations. The number of international shipments by Easyship clients amounted to about 31% of total client shipments. More importantly, these shipments were going to more places than ever with the number of destination countries increasing from 187 in 2018 to 199 in 2019.

Top Crowdfunding Backers Countries from 2019
Denmark enters the list of Top Crowdfunding Backer Countries at #8.

North America and Europe continue to dominate crowdfunding shipments, with the US, UK, Canada, Germany, France, and the Netherlands all retaining their position in the top 10. New additions for 2019 included Denmark and Singapore, suggesting that Scandinavia and the APAC region could be growth opportunities for crowdfunding in 2020.

 Top 10 Destination Countries for Jewelry in 2019
While Singapore only has a population of 5.6 million, it ranks as having the 6th richest people, making this small nation a juggernaut in jewelry sales.
 Top 10 Destination Countries for Health & Beauty in 2019
While the US is at #1 for Health & Beauty, the APAC region is highly concentrated with Health & Beauty consumers.
 Top 10 Destination Countries for Sport and Leisure in 2019
European consumers are increasingly interested in Sport & Leisure products. Retailers should look to shipping solutions to these countries to satisfy this growing market.

Asia is also jumping on the eCommerce trend for fashion with several countries throughout APAC sliding into the top 10 destination countries for fashion and jewelry. Fashionistas in Singapore, Hong Kong, Australia, Malaysia, and China continued to be big online buyers in 2019.

However, Europe appears to be a potential growth market in 2020 for sports and leisure retailers. Several APAC countries slipped out of the top 10 destination countries in these countries and were replaced by Germany, the Netherlands, and Denmark.

2. Fulfillment

When it comes to fulfillment, two trends are going to come to the forefront in 2020: personalization and efficiency will be key shipping industry trends.

Personalization: Great packaging can now lift customer satisfaction, improve the purchasing experience, and bridge the gap between online and offline shopping. That's why customization - from packaging and tracking to returns and customer service - is one of the biggest logistics trends for 2020.

Branded Packaging Trend
Companies like noissue.co provide sustainable custom packaging solutions for brands.

Efficiency: Customers are looking to find quicker delivery for less. With this in mind, you’ll see a rise of new methods, such as drone delivery or multi-warehouse eCommerce operations to support global dispatch at high speeds. In fact, dones may just be one of the biggest future trends in the shipping industry.

Drone Delivery Trend
Look out for drone delivery in 2020 as consumers look for quicker delivery times.

Experts predict that there will be 2.6 million commercial drones in operation in 2020 and that shipping companies will save $50 million over the year. Amazon is leading the way with over 80% of their products capable of being delivered by drone. Packages can be delivered within 30 minutes for just a $1 delivery cost. So is it any wonder why these flying machines are set to affect the shipping industry growth rate?

3. Going Multi-Channel

Consumers around the world are now seeing brands as singular entities, even if they’re selling on multiple channels. Translation: you’ll need to have a really strong omnichannel strategy in 2020 to stay competitive in the years ahead.

Creating a clever multi-channel eCommerce strategy is one of the smartest things an online retailer can do to stay ahead of the pack in 2020 and beyond. That’s because in one fell swoop, you can access new markets, grow your brand image on a global scale, and diversify your revenue stream. And we all know diversification is a good thing, right?

So how do you go about actually creating a multi-channel eCommerce strategy? That’s easy. Here are five simple steps you can take:

  • Choose the right channels. Assess each channel for profitability, then pick the ones that will be most profitable for you business by putting you in front of the right customers without too many annoying fees. It’s okay to be very pick here! And to smooth the way, try adding one channel at a time.
  • Manage your inventory. Having a smorgasbord of sales opportunities isn’t going to get you far if you can’t fulfill your orders. That’s why it’s crucial to have a strong, integrated inventory management system so you can sell effectively across all channels. Pro tip: we’ve seen a 52% increase in TradeGecko's inventory management system between 2018 and 2019.
  • Adapt for each channel. Bespoke solutions are great. That’s why it’s important to tweak your strategy for each channel you sell on. This isn’t a one-size-fits-all proposition, after all. Make sure you highlight different parts of your business for each channel so that you’re maximizing opportunities.
  • Offer killer customer service. Making sales is one thing, but getting repeat business? That’s eCommerce gold. If you want to keep your customers happy - and coming back for more - you’ll want to make sure that your customer service is on point.
  • Always be analyzing. Sales isn’t a static sport, so keep an eye on your analytics and be sure to constantly tweak your strategies in response to whatever you’re seeing. That way you’re always jumping on every available opportunity.

4. SMBs Go Global

Cross-border eCommerce has picked up in recent years, and it’s going to grow by leaps and bounds in 2020. SMBs have been quick to jump on the global bandwagon - global growth is one of the biggest trends in the logistics industry. It's also one of the biggest drivers of the shipping industry growth rate. In fact, most companies ship to an average of at least four other countries. Additionally, cross-border shipments saw a whopping 85.39% increase between 2018 and 2019. The reason for this should be obvious. Tapping into international markets means a much bigger customer base - and an equally large boost in sales.

Platform Name Destination Countries of Our Clients
Amazon 115
BigCommerce 116
eBay 109
Etsy 117
Lazada 57
Magento 64
Shopify 188
Shopmatic 36
WooCommerce 145

How to Go Global

So you’re ready to embrace global domination? Good for you. If you need a little help getting started, here are some easy tips for taking your eCommerce business global.

  • Grow your social media presence. You already know that social media is crucial for online retailers. That’s why savvy eCommerce businesses are engaging customers around the world using big social media platforms and country-specific channels where possible. Of course, Facebook and Instagram are always going to be a big part of your strategy. But if you’re planning to enter the Chinese market, for example, you need to look at getting on board with Weibo and WeChat.
  • Email marketing can be useful. It’s easy to overlook, but email marketing can still be a great way to drive sales, grow you customer base, and promote your brand - if you do it effectively. Personalizing your emails go a long way, and great content will make a big splash.
  • Use live chat, and do it well. Live chats are a simple, effective way for dealing with customers around the world. They allow your company to deal with questions and concerns in real-time while offering a personalized experience for your customers. Do this well, and it’ll work wonders for brand loyalty. For global audiences, think about offering 24/7 live chats in different languages.
  • Woo customers with a slew of delivery options. We’re living in a time where instant gratification is highly valued. So try and cater to this by offering your customers an array of fast, affordable shipping solutions from multiple couriers. That way, they’re more likely to go ahead and make a purchase. Pro tip: Easyship can help with this, and we also allow you to show dynamic rates so your customers can see exactly how much they’ll pay for delivery.
  • Make returns super simple. Customers are less likely to make online purchases if they think returning an impulse buy is going to be hard. That’s why your return policy should be simple and clearly stated on your website. Arrange for multiple return options and include prepaid return labels so the customer doesn’t even have to think about it.
International Business Expansion Strategy Trend
If you are only thinking of shipping to your own country, think again as cross-border shipping provides access to a whole new customer segment.

5. Shipping as a Growth Strategy

Still a little gun-shy about going global? We get it. Cross-border shipping can be a little intimidating. But, it's certainly one of the most important logistics trends in eCommerce. Over 100,000 online merchants trust Easyship to make their global dreams come true with seamless and affordable shipping solutions so they can reach customers around the world. Of course, since we’re pros, we’re here to help with some crafty shipping strategies. Here are few that’ll help you get started with cross-border shipping:

  • Build trust with tracking. Customers love knowing where their shipments are during the delivery process. That’s why offering end-to-end tracking on your packages can build trust with your customers. They get a good customer experience without any anxiety about if and when they’ll receive their order, and you’ll both get peace of mind. Pro tip: 61% of Easyship merchants use solutions that offer regular tracking updates - no prizes for guessing how much their customers love them.
  • Offer free shipping (but protect your profits). Free shipping may seem like a good idea. But costs can quickly add up, so it’s not realistic for many SMBs. That doesn’t mean you can’t do it, though. Just be smart about it. Why not only offer free shipping for orders over a certain value? That way, the customer feels happy about avoiding delivery costs, and you won’t have to sweat your profit margins. Pro tip: Only 2% of Easyship merchants offer free international shipping - if you can manage it, you’ll be highly competitive.

Each year, the world of eCommerce has a wealth of new trends to battle with. 2020 will be no different. Here's a look at some of the most important trends in the logistics industry and how they'll impact online merchants around the world:

1. Shipping Gets a Green Overhaul

Sustainability is a serious buzzword these days, and it appears that goes for the world of logistics, too. Eco-conscious consumers may still want to buy from online retailers near and far, but they want to know those retailers have thought about minimizing their environmental impact.

Eco-Friendly Shipping Ideas Trend
It is important to think about how your shipping affects the environment as consumers are looking to spend at retailers who choose to minimize their environmental impact.

Logistics are responsible for 11% of global emissions and a massive 8% of this is the result of freight traffic (that is shipments being moved by truck, ship, train, and plane). If you want to stay ahead of the pack, you’ll want to look into lowering your carbon footprint. If you want some practical tips on doing this, look no further:

  • Cut out any single-use plastics in your packaging, and don’t use unnecessary amounts of filler and paper.
  • Use recycled materials for all your packaging.
  • Apply carbon offset pricing to your shipping strategy or work with green couriers.

The best part about all this? Not only are you doing our world a huge favor, it can also enhance your brand reputation, lower your supply chain costs, and - most importantly - encourage customer loyalty. How’s that for taking a few steps towards being eco-friendly?

2. Geopolitics Will Still Cause Problems

It seems like the world’s gone crazy in the last few years. Politics have taken a serious nosedive, conflicts have sprung up in normally peaceful places, and climate change? That’s very, very real. There’s no doubt that geopolitics will impact eCommerce and logistics in 2020.

Geopolitics Will Challenge Shipping Industry in 2020
With new trade deals on the horizon, be sure to track how this will affect your global shipping.

The ongoing doom-and-gloom of Brexit is a key issue to grapple with. No matter what form it ultimately takes - and indeed, if anything is agreed to on the January 31 deadline - Brexit will cause chaos for trade and commerce around Europe with the adoption of GDPR across the continent. This will, of course, have wider implications across the rest of the world, too. The escalating U.S.-China trade war will also continue to pose a challenge for trade between the two countries and online merchants could be caught in the fray.

The upcoming Universal Postal Union (UPU) overhaul - at the demand of the U.S., who threatened to walk out of the agreement if certain revamps weren’t implemented - will also likely shake up cross-border shipments. Specifically, inbound shipments to the U.S. sent internationally through postal services will see a price hike. Online retailers will need to pay attention to this and account for it in their budgets.

3. Crowdfunding Goes Global

Crowdfunding is picking up speed as a way for SMBs to raise extra funds. But the big trend for 2020? Global crowdfunding. When you consider there were 6,445,080 global crowdfunding campaigns last year alone, you know is this is something to keep an eye on.

A recent study by Statista shows that crowdfunding had a total transactional value of $6.92 billion in 2019, a 30% increase over 2018. The biggest surprise in this? China was responsible for a whopping $5.58 billion of that. The rest was distributed across the U.S. ($718 million), the U.K. ($88 million), France ($79 million) and Canada ($43 million).

Similarly, TechNavio predicts a $89.72 billion incremental growth in global crowdfunding over the next five years, with 47% of that set to come from the APAC region. If you want to tap into the global crowdfunding market, you’d do well to watch Australia, South Korea, Japan, India, New Zealand, and Singapore.

Don’t imagine that it’s just major players like IndieGoGo and Kickstarter that are running the show here, either. Global crowdfunding campaigns are eagerly embracing other, smaller platforms that let them tap into more local markets. The use of other platforms rose from 16% in 2018 to 21% in 2019, showing that online retailers are getting pretty savvy about raising funds from abroad. Additionally, more campaigns are accessing multiple revenue streams by using multiple platforms to target different geographic markets. Of course, all this means that crowdfunding is having a big impact on global shipping trends, since all these campaigns need to deliver to their backers around the world.


Gear Up for 2020

With so many exciting things happening in 2020, eCommerce merchants will need to stay on top of logistics trends to stay competitive. Being aware of the shipping industry trends for 2020 will allow you to keep your customers happy and your business growing. Easyship offers shipping solutions with 250+ couriers at discounts of up to 70%. Plus, we’re always one step ahead of the curve when it comes to up-and-coming trends. Sign up for a free Easyship account now and see how we can help your business in 2020.