“Let me grab my crystal ball.” That was Flora & Fauna founder Julie Mathers’ first response to the question ‘What do you think is the future of e-commerce?’. It was also a fair take, given the endless possibilities that lie ahead for Australia’s e-commerce founders in 2024.
Yet that very uncertainty underpinned a more in-depth answer, one that provides a useful guide for entrepreneurs planning to sell online in the year ahead. The other founders SmartCompany spoke to, spanning from digital marketing mavericks to tech leaders, all provided insightful responses to the open-ended question.
Here are some of their responses, lightly edited for length and clarity.
Fewer tech leaders have a clearer view of how social media is powering e-commerce than Alex Zaccaria, co-founder of Linktree. What began as a ‘link in bio’ provider has expanded into a major conduit for digital transactions, driven by social media creators who want a direct line between their engaged audience and e-commerce revenue. Brands will prosper by acknowledging the power of social media creators, Zaccaria says. Of course, Linktree stands to benefit from that trend, too.
When it comes to e-commerce, the growing influence of creators cannot be overstated. And looking at our recent Linktree data, it’s clear that the future of e-commerce will be creator-led. Over the last few years, we’ve seen creators become the new storefront, driving more commerce and sales than ever before. We estimate our 41 million Linktree users drive over $6 billion in sales each year, and almost 15% of all Linktree clicks are for online shopping and retail sites.
We’re also seeing a growing number of creators linking to products and curated storefronts in their Linktrees, and making hundreds of millions of dollars in commission each year from the hugely lucrative affiliate economy. And we don’t see this slowing down anytime soon. Helping creators better reach and grow their audiences and monetise has always been a top priority for Linktree and we’re always blown away by the uptake from creators when we release new features to help them capture more sales.
Earlier this year, fashion retailer ShowPo became one of Australia’s first e-commerce platforms to use artificially generated models in ads across the Meta ecosystem. The experience clearly left an impression on founder Jane Lu, who predicts artificial intelligence will continue upending e-commerce functions.
AI is set to revolutionise:
We did a trial earlier in the year with Meta last year using AI models for Meta ads — since then, so much happened in this space and it’s only the beginning. This will really shake things up in the industry!
Logistics will witness faster and more adaptable delivery solutions, meeting the demand for immediacy. But also gone are the days of it giving away for free as e-comm businesses all focus more on margin and profitability.
Social commerce and content marketing will continue to grow in dominance, leveraging social media for a more seamless shopping experience and creating a dynamic e-comm ecosystem.
Heritage faceless brands will need to step up to compete with emerging businesses that are social-led and have a strong focus on storytelling and community building.
Julie Mathers is about as busy as an e-commerce leader can be. But between her CEO role at baby clothing retailer Snuggle Hunny, and her work revitalising Flora & Fauna — the brand she founded and is helping to revive — she found time to share her thoughts about the sector’s future. Like Calvert, she believes marketplaces will rise in prominence. Before that, though, e-commerce brands should approach 2024 as a year for stabilisation and ensuring cost-effectiveness.
We have a couple more years of trying to stabilise as an industry, and I think that’s really important. It’s probably going to sound really boring because I’m not going to talk about robots and AI and stuff, but I think there’s a couple of years where as businesses, and as an industry, we need to stabilise. We need to massively focus on our customers, on who we are, and what makes us different, and on our cost base and margin. And that’s the reality of it, because we are in a world at the moment which is very unpredictable. Supply chain costs are unpredictable. We’ve got orders at the moment that are stuck at the ports because there’s huge issues with the ports. There are so many things that are just unpredictable for us, interest rate rises, etc. For the next couple of years. I think that enormous amounts of stabilisation to be done. And just people will get crazy focused on their businesses, and the operations behind them.
Of course, we need to be exploring other things, so I believe that other channels will become more important. It varies whether you’re a retail brand etc, but marketplaces, and we’re already seeing it with Amazon, marketplaces… I think others may disagree with me, but I think they will become more important if you pick the right marketplace for your brand. You’ve got to think about, ‘How can I get out to different people?’ and we cannot rely on Facebook and Google anymore, because it’s just too costly. So we’ve got to think differently. I think there’ll be a bit of a rise in marketplaces.
I think if you’re a brand, then you should be thinking international. And then there are tools, ChatGPT, there’s Google’s version. There’s all that sort of stuff. And those things can help you be more efficient, as long as you use them wisely.
New platforms will emerge, but the need for clear and compelling storytelling will remain. That’s the view of Sabri Suby, founder of digital marketing agency King Kong, who has himself adopted a TikTok and Instagram content creation regimen. Consider how your own e-commerce brand can create a compelling online presence to complement ‘traditional’ SEO strategies and paid social media campaigns, he says. At the same time, remember that form follows function: content filmed on an iPhone could be more platform-appropriate than professional footage, he says.
Now we’re in a day and age where if you’re good at storytelling, you can blow up online through social media. There’s been a boom in TikTok, which has come in and really changed the game, becoming the number one organic channel in the world right now. It has levelled the playing field, so now if you want to get traffic, there’s not just the slow burn organic route or the quick paid route.
My advice is to look at successful creators on TikTok and pay attention to the videos that are going viral. You can get a Google Chrome extension called ‘Sort’ and you can go to any TikTok page, click it and it will sort the most watched videos on that TikTok Channel. Then you can see what they’re doing, how often they’re changing the narrative etc. It’s also useful to check out YouTube creators like Mr Beast — look at what he does, and what other storytellers are doing in that space.
Another big trend I’ve seen is brands shooting ads on iPhones because that’s the native platform. Instead of going big with production, even huge brands in the US are creating content on iPhones. If you think about it, so much of the content that people consume is looking at Instagram photos or TikTok videos, and most of those are taken on a smartphone. This makes sense because the first rule of native advertising and Facebook ads is a native advertising platform. TikTok is even more native than Facebook because its ad platform has not been around for as long. So the aim of shooting on a phone is to make your ad not look like an ad, and the algorithm is much more sophisticated on TikTok. This is why we’re seeing other companies copying it with Instagram reels and YouTube shorts — it’s like an arms race.
Australian e-commerce can learn a thing or two from other economies in the Asia-Pacific region, where marketplaces like Shoppy provide an avenue for brands to sell their goods online. That’s the take from e-commerce consultant Iain Calvert, who predicts Amazon-like platforms will grow in importance. The value of partnering an e-commerce venture with a physical outlet will become more apparent as time goes on, he adds.
I think, particularly here in Australia, there are quite a lot of branded websites. There’s lots of Shopify stores, whereas if you’re looking in APAC, the Philippines, Singapore and elsewhere, they tend to go after marketplaces like Shoppy. I personally think there will be a bit more consolidation with some of the big end of town like Amazon is starting to get quite a bit of traction.
Let’s say you’re selling your particular product, and there’s a hundred other people selling it, be honest with yourself: why is anyone going to buy from you, just because you’re selling it? Whereas, if you stand out and you build a really good, strong brand, then you’re essentially going to win. So I think that the technology side is becoming a lot easier, particularly with things like Shopify, Klaviyo; really, the new frontier is the marketing side, and standing out, having a strong brand. You could previously just spend lots of money on Facebook, and it’s very cheap to make sales, whereas now you have to stand out and be memorable.
I’m advising every single client I coach that you need some other outlet other than just your website. A showroom or wholesale outlet or something like that. So the combination of those two channels works really well together because sometimes people like to go and see the actual product, to have some type of retail experience. And essentially, that’s what we saw after COVID, Right? During COVID, online conversion rates just skyrocketed, because that’s the only place you can go buy. And then all of a sudden they’ve dropped back down again because people actually want to go out, they want to get out of the house. They want to go see something, see what it all looks like. So the combination of those things, I think, is basically the way forward.
Obviously, the impact of AI be huge. I think it’s still early days. It will accelerate all the other things that are currently there. It won’t do the hard thinking for you, it will just lift a lot of those really mundane tasks away from you.
Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
