Industry executives and experts share their predictions for 2024.  Read them in this 16th annual VMblog.com series exclusive.

Top 4 Commerce Predictions for 2024

By Bryan House, Chief Experience Office of Elastic Path

The economy has been the X factor retailers have to navigate most in 2023. With overall sales growth in the single digits and consumer sentiment plunging, merchants have been challenged with how to create the best possible customer experience for wallet-wary purchasers.

The bright spot? Merchandisers and marketers alike are getting more creative about reaching customers across multiple channels, unifying in-store and digital experiences to leave a lasting impression. There are more ways than ever to reach customers, yet merchants have proven themselves ready for the challenge. Here are some of the top trends for commerce we're expecting to see in 2024, along with some advice on how to best navigate them.

Fixing the Broken Commerce Catalog

Signs of broken commerce catalog experiences are everywhere you look. Maybe you've seen them in a brand collaboration with inventory available on one brand's website but not the other. Or, a "shop the look" landing page that forces users to navigate through dozens of options before finding the actual sizes and colors pictured in the campaign's photography. These broken customer experiences can not only result in a loss of sales, but also potentially a permanent loss of loyal customers to a competitor.

2024 will be the year the commerce catalog grows up. Legacy enterprise resource planning (ERP) systems are responsible for the rigidity of today's commerce catalogs - making a change is nearly impossible, as most catalogs are tightly coupled with the ERP's rigid structure. Merchandisers will embrace a modern approach where the commerce catalog is broken down into component parts - decoupling the products and prices from the catalog itself. In this model, each component of the catalog can be isolated and separately managed, giving merchandisers the flexibility they need to implement campaigns and revenue merchandising strategies, as well as create separate pricing structures, bundles, and other options without extensive IT workarounds.

Personalization Loses the "Creep Factor"

With the demise of third-party tracking cookies, more and more retailers will need to rely on their direct relationships with customers to personalize the shopping experience. Many brands, like Birkenstock, have doubled down on their D2C presence to gain back control of their own data. This change couldn't come at a better time, as consumer trust for how brands protect their data privacy is at an all-time low. In 2024, retailers will establish a new era of trust with their customers.

It all begins with consent. Consented first-party data can drive better, more personalized experience for customers, where the customer opts into the engagement. Using technology like customer data platforms (CDPs), retailers will be able to get smarter about the way they target customers with relevant offers. This technology can even make traditional channels like direct mail and in-store more effective, by helping brands understand omnichannel customer behavior to tailor their experience regardless of where they choose to shop. The goal is to make shopping infinitely more convenient and fun for customers - bridging the gap between in-store and online purchases and creating more exclusive, "velvet rope" experiences that drive long-term loyalty.

Generative AI Gets a Commerce Interface

It would be hard to make predictions about 2024 without addressing the impact of generative AI on commerce. Leaders in the field like OpenAI (makers of ChatGPT) are leaving it up to developers to create products from generative AI APIs, built for their own purposes. A recent demo day revealed even more opportunities to create custom GPTs that can learn from the data and instructions a user provides - without the need for custom coding.

In 2024, we will see an explosion of new commerce use cases for generative AI. Developers can leverage composable commerce to create any number of "frontend" applications that increase the utility of generative AI for marketers, merchandisers, and other business users. The API economy will lower the barrier to experimentation for generative AI applications, and we'll see them in everything from curated shopping experiences, to optimized ads, to creator- and campaign-specific shoppable landing pages.

Composable Commerce Gets an Operating System

Composable commerce systems provide retailers with the flexibility they need to implement a "best-for-me" architecture for their specific use cases. But, it's not always easy to gain the visibility you need into your infrastructure when there are so many API-connected components. Many of these ambitious commerce replatforming projects fail because there's no central way for developers to monitor and continuously improve their systems as a whole, while drilling deeper into the component parts.

In 2024, we will see a greater need for a "connective tissue" between these components, that serves as an operating system for composable commerce. Developers will require a single pane of glass to understand how their larger, API-connected systems are interoperating with one another. As a result, it will become much easier to monitor and continuously improve composable commerce systems, as well as seamlessly integrate new components on demand.

Preparing for what's ahead in 2024

When looking ahead to 2024, a few things remain true. Retailers have an abundance of options to reach their target audiences. It will remain critical for merchandisers and marketers to tap into a variety of go-to-market channels for customer acquisition, while relying on their owned channels (whether they're D2C or B2B for partners) to drive the bulk of their customer experience. Retailers will seek to regain control of their owned channels so they can create memorable experiences for customers that keep them coming back again and again. We'll see composable commerce at the forefront of driving these experiences, alongside generative AI, CDP and other emerging technologies designed to make shopping easier, more relevant, and more personal than ever.

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ABOUT THE AUTHOR

Bryan House is the Chief Experience Officer at Elastic Path, where he leads the UX, product management, enablement, global services, and customer success teams. He is an entrepreneur, tech executive, and professional raconteur. Bryan has made films in Indonesia, brewed award-winning beer in Boston, and has been leading software startups over the past two decades. Bryan is interested in digital commerce, machine learning,­­­­­ and open-source technology. Previously, Bryan was the Chief Commercial Officer at Neural Magic. He was a founding team member at Acquia, where he held numerous executive roles and helped lead the company to $170+M in revenue. As a leader in recurring revenue businesses, Bryan has developed a deep empathy for customers trying to address cumbersome, often frustrating business problems. In his experience, the best organizations excel at listening and building a culture based on empathy and customer advocacy, along with relentless problem-solving to ensure customers realize the value they anticipate from day one.

Bryan has an MBA in General Management from Harvard Business School and a degree in Journalism from the University of Massachusetts Amherst. Bryan also has a diploma in Brewing Technology from the Siebel Institute of Technology.