Disclaimer: This post features eCommerce industry predictions for the 2020 holiday shopping season. These are merely predictions intended to spark conversation, they are not meant to be official business advice.
2020 has been a year like no other (and it’s not over yet). Between a global pandemic, mass shutdowns, and the rise of social distancing, eCommerce businesses became the “lifeblood of supply to America”. While eCommerce has seen unprecedented growth this year, eCommerce businesses have also faced many unexpected challenges including FBA delays of non-essential items, sudden increases in consumer demand, supply chain disruptions, USPS issues, limited availability of traditional financing options, and much more. However, many eCommerce entrepreneurs also jumped on new and unexpected opportunities like back to school in March, “new essentials” such as home office and home fitness equipment, and DTC. Who knew bread makers and loungewear would be so hot this year?
Overall, our guesses for what Q4 2020 will look like are as good as yours. However, as the pandemic and social distancing continue to be part of our daily lives, we doubt that we’ll see the traditional Black Friday rush to stores. In fact, we’re not sure how much holiday shopping we will see at brick and mortar stores this year. While the holiday shopping rush has been moving more and more online each year, eCommerce holiday sales are set up to grow exponentially this Q4.
With the holiday shopping rush just around the corner and Prime Day potentially landing in October, we asked our friends, the experts from across the industry, what challenges and opportunities they expect sellers to see in Q4 2020.
Now, on to the predictions…
“While online channels will continue to accelerate their share of total retail sales this Q4, the combination of consumer confidence declines, continued COVID exposure, and unusually high unemployment are likely to temper consumer spending this year. I also expect luxury or higher end brands will not enjoy the same online growth as everyday consumables, while consumers focus more on “sensible” purchases.” James Thomson, Chief Strategy Officer, Buy Box Experts
“It’s clear that Amazon is already anticipating their operations to be limiting sellers in both inventory and speed. Their FCs have increased in capacity by 50% but they are already limiting what can be sent in. Accept this and work around it. Have inventory ready to send in the day that Amazon says your sell through will allow you to send in more units. Make sure that you don’t have “inbound” units orphaned on a shipping plan you never sent. Think now about some of your storage options. While it’s cooled off a bit during the summer right now, fear of another wave of the pandemic will absolutely drive Christmas shoppers online. This will be big and inventory needs to be in the right places. Consider finance options to make sure you’re taking full advantage of this moment. If you’re playing your cards right, December shouldn’t be that stressful. It’s all the work you do leading up to it that will ensure your success. You don’t need a gangbuster Cyber Monday strategy, you need a good all year round strategy to make Cyber Monday pop.” Scott Needham, Host, The Smartest Amazon Seller Podcast and CEO of BuyBoxer, the largest catalog of Amazon Prime products in the United States
“Flexibility, creativity, and embracing change are the characteristics of brands that will win this year. The only certainty is that things will change and your ability to manage and persevere through will be the difference between winning and losing. It’s a great time to be a digital brand!” Jeff Cohen, VP of Marketing, Seller Labs + X-Cart
“The COVID-19 pandemic has shifted more consumer spending online since March. While it’s impossible to predict the future, particularly in a year as unpredictable as this one, we believe it’s in the best interest of brands and retailers to remain prepared for heavier-than-usual online demand. According to our survey of 1,000 U.S consumers in May 2020, 38% predict they will shop online more in the future than they did before the pandemic, with most of the rest expecting to shop online about the same as before. For your business, this means being visible and having products for sale where consumers are exploring and shopping, ensuring that your products are in-stock and priced appropriately both on your sites and those of channel partners, and having diversified fulfillment operations in place that can meet demand.” Mike Shapaker, CMO, ChannelAdvisor
“Q4 2020 is shaping up to be one of the busiest holiday seasons yet. With more customers shopping online and in-store Black Friday shopping being canceled by some retailers, Amazon sellers should expect a big increase during this time. For a successful Q4, sellers need to go in it with a plan and stick to it. Some are experiencing FBA inventory limits so be sure to have a back up 3PL warehouse/FBM shipping plan to keep up with demand.” Brian Connolly, Ecommerce Expert & Writer, Jungle Scout
“While e-commerce was destined to be the future, its present reality has created an unparalleled time for savvy entrepreneurs and innovative brands. As we move to the latter half of this year, proactive brands can fully take advantage of a Q4 that has no best practices or clear roadmap. The perspective brands take could be the difference between exponential growth and possibly dying on the vine.” Troy Johnston, Co-Founder, Seller.Tools
“There is still a lot of uncertainty on the overall health of the economy in the U.S. Covid-19, elections, civil unrest all have an impact on how people shop. If restrictions like gathering and distance learning are still in place, I think we will have a muted holiday season in terms of overall household spending. Sellers should be cautious on relying on sales data from the past holiday seasons as this year could be very different in good and bad ways depending on the category of products. However, due to the large wave of brick and mortar retailers closing down, there will be much higher demand on certain products and greater opportunities in the future.” Henson Wu, CEO & Co-Founder, FeedbackWhiz
“Generally this is going to be an exciting quarter for sellers. Despite all the chaos out there, online sales are strong and confidence in Amazon is equally strong. It’s the ideal time to boost marketing and advertising — and to really boost online brand presence.” Philip Jepsen, CEO, ManageByStats
“UPS and FedEx have already cited COVID as the reason for increases in surcharges which have made shipping costs much higher, and we are only in the summer! Unfortunately, it appears that we are already reaching peak volumes, which is scary, as the holiday peak will soon be here and shippers may still incur two or maybe even three more price increases before then.” Jose Li, Founder & CEO, 71lbs
“Wow! 2020 has been quite the year to say the least! But with massive change comes great opportunity! This is what entrepreneurs thrive on. Here is what we’re seeing within our industry: 1: A global move to e-commerce at a speed what we expected only 5 years from now 2: On average our customers are doing 4 to 7x their revenue over 2019. There is no question that in 2020 there is more interest, more traffic, more customers, and much more competition! Here are 3 key factors that have contributed to our customers success in 2020: They rely on and utilize data to validate product opportunities. You’re looking for a niche within a niche. You need data to find and validate these opportunities! They implement our optimization methodology for SEO ranking of their products. Finding keywords that beat your competition is critical for capitalizing on organic ranking growth in this competitive space. They diversify into various categories. This is one of the biggest factors that have helped sellers be successful during COVID-19. It reduces risk and ensures growth as an overall metric. The opportunities are still here to stay and implementing these key strategies above will help you to be successful in Q4. Wishing you the best! It’s going to be a ride!” Jon Tilley, CEO, ZonGuru
“Regardless of the state of retail, and whether stores and malls are open, you can practically guarantee that this will be the biggest online shopping quarter in history, and disproportionately so – growing faster than previous expectations – with Ecommerce Black Friday and Cyber Monday sales driving a significant portion of that revenue. What does this mean: You can expect fiercer competition than ever before, which will lead to heavy discounting. You can expect massive shipping delays due to overwhelming demand. You can expect higher than ever customer service inquiries and complaints, and should prepare to deal with them. Basically, it’s going to be a madhouse and the only way to come on top is to over prepare, so get started!” Derric Haynie, host of “The Future of Ecommerce” podcast and Chief Ecommerce Technologist at Ecommercetech.io
“As we edge closer to Q4, I think we’re going to see a lot of Amazon sellers expand to additional marketplaces, whether that be additional Amazon marketplaces or other marketplaces entirely. With so much uncertainty regarding the continued impact of COVID-19 in various regions, it’s going to be increasingly difficult for sellers to rely on just one or two regions to sustain their online business. It’s more important now than ever for online sellers to diversify the regions that they are selling their products in.” Brittany Line, Product Marketing Manager, Informed.co
“If the last few months have proven anything, it is that consumers are now more inclined than ever to shop online, especially via e-marketplaces such as Amazon and Walmart. Based on the growth curves seen during the first half of 2020, we anticipate overall growth of e-marketplace sales to increase 32%–35% in Q4 compared to the same period last year. However, given stress on supply chains, we predict brands and retailers will become more selective with the products they choose to sell online, especially during the holiday season, to ensure that the right assortment is merchandised in the best ways to capture demand and meet consumer expectations.” Dani Nadel, President and COO, Feedvisor
“For sellers, we know this Q4 will look very different from years past: consumers are spending less and will turn to eCommerce to avoid crowded shopping trips, and logistics constraints are driving up the cost of doing business. Sellers should focus on reaching discount shoppers this year—people who shop all year for holiday gifts instead of concentrating their spending in November and December. This may seem counterintuitive to achieving a big holiday sales boost, but these shoppers are less concerned about the hottest brands; instead they look for lower cost unbranded versions of trending items. Now is the time to focus your resources into discovery marketplaces and retailers where shoppers are already buying gifts and holiday products. Focusing on discount shoppers who are starting holiday shopping now, will pay off in lower shipping costs and allow you to invest in more affordable inventory instead of high priced branded goods—all while still achieving the high volume associated with Q4.” Sree Menon, COO, Tophatter
“Q4 2020 will be even busier than usual for sellers, particularly if an increase in COVID cases drives additional Amazon sales for essential items. With Prime Day at the beginning of the quarter to kick off an already busy season, staying in stock will be crucial, especially as sellers are already experiencing FBA receiving delays.” Derek McMillian, President, eComEngine
“In times of chaos and change Darwin’s advice to “adapt or die” is even more important. eCommerce will come out of this as the most powerful retail channel in the world. Those who can sell and operate well online will thrive in a COVID and post-COVID world. Those who can’t… will suffer Darwin’s predicted fate.” Jon Ruby, CEO, Jonar
“This shopping season is going to be like nothing we have seen before. I predict the highest volume of online sales ever recorded and stores to shift to a fully online strategy if the pandemic continues. My advice to eCommerce sellers: Those who think 2020 is just going to be an average year will be left in the dust.” Chris Wilkey, Founder, FBA Master
“From the Amazon policy compliance perspective, Q4 2020 will be no different from Q4 2019. Sellers are likely to experience a significant increase in suspensions in October and November.” Evelin Goldin, COO, Sellercare
“2020 has been a pivotal year for eCommerce. As a full time eCommerce seller, I am thankful that I have been able to grow my business during this time. As an eternal optimist, I feel that 2020 has been an opportunity for new growth across marketplaces and I am grateful to have the knowledge and resources to capitalize on the large shift to eCommerce. I am excited for the future growth across eCommerce platforms.” Jess Hill, Co-Founder, Ecommerce Empowerment
“While it’s hard to predict what this holiday season will look like for Amazon, we can base our assumptions on what we’ve seen happen during Q2. I think we should expect to see record sales as more people continue to rely on delivery and eCommerce for their shopping needs. With that, I do think Amazon will continue to struggle to cope with the influx of inventory and reduction in workforce capabilities and numbers, so don’t be alarmed when your orders have extended shipping times.” Tim Dworianyn, Senior Amazon Consultant, Awesome Dynamic
“COVID-19 has acted as a catalyst for the growth of eCommerce and other digital services, and most likely has changed consumer behavior forever. It is extremely safe to say that we will see eCommerce continue to flourish throughout Q4, leaving the future of traditional retail uncertain. Brands reluctant to these changes in consumer behavior will need to adapt or die out.” Andrew Michaud, Chief Marketing Officer, Valet Seller
“To put it short, Amazon sellers should expect chaos in Q4. This sounds bleak, but it’s not too far off what 2020 has been so far. We can expect even more of this year’s holiday shopping to be done online, so sellers should prepare for worst-case scenarios. Have a plan in place for situations like those that have already happened this year – shipping delays from Amazon, supply chain holdups, for example. If increased demand leads to more delays on Amazon, be prepared to switch to alternative fulfillment methods or sales channels at the drop of a hat, so you don’t miss out on what is going to be a huge holiday period for eCommerce.” Andrew Buck, Head of Marketing & Customer Success, LandingCube
“Speed will matter more than ever in eCommerce. As legions of shoppers move online, opportunity has never been greater, and competition has never been fiercer. That means everyone will be looking for more differentiators, from marketplaces to brand websites. 5-day delivery won’t cut it anymore as shoppers are getting increasingly savvy and learning where to find free and fast options. It’s up to merchants to meet market demand when it comes to free, 2-day or faster deliveries.” Rachel Go, Content and Partnerships Marketing Manager, Deliverr
“Sellers will continue to expand beyond Amazon to channels such as Facebook Shops, Instagram, Walmart, and Shopify. This growth means they’ll either need better tools for multi-platform management or agencies will take on a bigger role to handle it for them. And as competitive as all these channels are, the importance of visually compelling ads, videos, and listings will increase.” Justin Chen, Co-Founder, PickFu
“Despite the continued challenges with COVID and a weakening economy, eCommerce will continue to push forward at a brisk pace. Online competition will increase taking up the slack from brick and mortar sales. And with Amazon Prime Day (now week) scheduled for October, I think sales will start earlier and last longer than previous years. So, sellers need to be holiday ready earlier than ever before.” David Cooper, Principal, Online Seller Consulting
“I believe that due to the visible supply chain disruption many people have already started shopping, and will be in full holiday shopping mode by Prime Day. The capacity issues of most last-mile delivery services will make BOPIS more important than ever to get purchases to people on-time. Labor disruptions due to COVID means fewer people to do more work, distribution should have its processes perfected to ensure a smooth workflow.” Kim Wren, Director of Business Development & Partnerships, SkuVault
“From what I have seen from working with thousands of eCommerce merchants and hundreds of eCommerce enabling companies, I anticipate massive growth in eCommerce for Q4. Due to COVID, even more people have become comfortable, and I would say, now prefer to buy products and services online. New online shoppers have joined the existing crowd, older people who may have been wary of online shopping, to now even more busy moms who are truly needing the convenience. Plus, the expanded product lines that a single store can’t stock, simple price comparisons, and the now important lack of crowds will make this Q4 the biggest eCommerce quarter in history.” Jason Kumpf, Head of Partnerships, OFX
“At the heart of every crisis is opportunity. Some of the most iconic brands were built in the midst of landslide recessions. AirBnB. Pinterest. WhatsApp. Stripe. When everyone is running one direction in fear, the entrepreneur sees a solution amidst chaos and executes. With Amazon’s $87.4 billion of revenue last quarter, growing 20% year over year, and with trillions of dollars moving to the online space while brick and mortar stores declare bankruptcy, we face an unprecedented opportunity. Quarter 4 is going to be like no other. Prepare yourselves.” Seth Kniep, Founder, Just One Dime
“This Q4 is going to be all about logistics. I think this Q4 is going to be the biggest ever by a wide margin, but it’s also going to be Amazon’s most complicated one to date due to challenges related to Covid. We’ve seen the changes to IPI by Amazon to help compensate for instance, and there could be more coming. Staying stock is going to be your biggest challenge…and your biggest opportunity.” Dylan Frost, $25 Million Dollar Amazon Seller + Co-Founder of The Wholesale Formula
“We can safely assume that Q4 is going to be heavily saturated with online sellers. If we’ve learned anything from this pandemic, it’s that the less reliant a seller is on one single platform, the better. Give people a reason to get on your email list, then nurture that relationship to drive sales and loyalty beyond a one-time purchase. Don’t give all the upside from holiday sales to the platforms. To be successful, consider Q4 an integral leg of your eCommerce marathon to build a list of repeat buyers; not a sales sprint.” JD Graffam, Owner, LandingPagePromoter.com
“The effects of COVID-19 will linger for at least another 1-2 years. As a result, eCommerce sales will continue to surge in Q4 2020. While eCommerce as a percentage of overall retail sales was initially predicted to be 15% in the beginning of the year, now it is projected to be 18%+. To succeed in eCommerce as a brand, you must focus on your owned marketing channels. This means putting more effort on email marketing, SMS marketing, your website, basically any platform that you own and fully control should receive the most attention. Amazon’s warehouses may very well get overloaded in the holiday season so you must have a contingency plan in case Amazon increases their prices or changes the rules.” Steve Chou, Founder, My Wife Quit Her Job
“Q4 in 2020 is going to be a very interesting time for e-commerce. With less physical traffic to retail stores, I expect to see continued growth in online sales across the board; but, also possible disruptions to fulfillment. With more brands opting to sell online during this time, competition is at an all time high. So, sellers need to start early to make sure they’re investing in their presence on different marketplaces and enhancing their listings with researched, crafted sales copy and imagery that’s both impactful and structured with search-ability in mind. While companies may be experiencing organic growth due to sheer volume of online shoppers, most will not be able to maintain that level of attention. Gaining a leg-up in Q4 (and thereafter) means taking the time to optimize your online presence to stay at the cutting edge of modern e-commerce trends and at the top of ever-crowding search results. This optimization may be the difference between exponential growth and complete stagnation.” Dana Dench, Senior Operations Manager, Seller’s Choice
“As a third-party repricing solution, Seller Snap is continuously exposed to new data trends within the Amazon selling industry. At the start of the pandemic, Amazon saw a very strong upwards trend in online sales, which was to be expected. With this trend, came the tumultuous nature of the Amazon selling industry and the apparent continuous changes in Amazon’s algorithm. With the Covid-19 Pandemic still lingering and the recent announcement that Amazon is likely to severely restrict the amount of inventory that can be sent into FBA warehouses for Q4, my advice to all Amazon sellers who rely heavily on FBA is to carefully plan your inventory. For example, instead of sending huge batches of inventory into the FBA warehouses, plan your inventory so that you are continuously replenishing stock, but sending in smaller batches. That way, you are less likely to be flagged by Amazon. As well as this, if you are able to use other fulfillment methods such as SFP, this is highly advisable.” Ian Kaneshiro, Head of Sales and Customer Success, Seller Snap
“When preparing inventory counts, don’t narrow your planning to your typical shopper. Given the ever changing landscape from the pandemic, we expect shoppers that typically make most purchases in brick and mortar stores to shift to online shopping. Take this into consideration and ensure you have plenty of stock easily accessible. We also don’t know what a second wave of the coronavirus may look like and how this may once again disrupt logistics. If you purchase products from overseas, focus on getting those into US warehouses as soon as possible to avoid delays that may come up.” Briana Dow, Head of Account Management, Tophatter
Will the 2020 holiday shopping rush move completely online? Will COVID-19 permanently change consumer behaviors? It’s impossible to know what’s to come, especially this year. But, there’s no doubt that there’s never been a more exciting time to be an eCommerce entrepreneur. Best of luck in Q4. It’s going to be a game changer!