Brandon Isner, CBRE’s Head of Retail Research, gave GlobeSt. one of the most bullish predictions regarding the ecommerce share of retail in coming years.
By 2030, e-commerce’s share of total retail will increase to 29.3%, Isner told GlobeSt. “Consumer preference is the primary factor, as we have more choice and agility than ever before.”
We asked Isner what made him so confident about e-commerce’s growth potential, and he told us the rise of “m-commerce” would fuel the growth of online sales.
With three years to go, mobile commerce – online sales on social media platforms by shoppers using mobile phones – will become the dominant form of e-commerce, according to CBRE’s top retail expert.
According to Isner, m-commerce is the future and present of e-commerce. A consumer is truly benefited by being able to connect with a retailer’s supply chain network while enjoying coffee at an outdoor café. Retailers who aren’t strategizing how they will cultivate this activity for their business will be left behind.”
According to Colliers, “global social commerce” — embraced by Gen Z and amplified by influencers — will grow three times as fast as traditional e-commerce in the next three years, from $492B in 2021 to $1.2T by 2025.
Nicole Larson, Manager, National Retail Research at Colliers, said social commerce has the potential to reach a wide audience, but its effectiveness will depend on the platform, target audience, and marketing strategy.
According to James Cook, JLL’s Head of Research, social media platforms like TikTok and Instagram are “incredibly powerful” marketing tools, but the cost of acquiring customers will be prohibitive.
For online retailers, the cost of new customer acquisition on a social media platform can be quite high. A brick-and-mortar store in a high-traffic area is usually more cost-effective in terms of customer acquisition.”
According to our experts, brick-and-mortar stores are adapting to millennials’ and Gen Z’s rapid embrace of mobile commerce, and the most successful retailers after the pandemic will optimize all of their sales channels.
We expect retailers to focus on ‘optichannel’ rather than ominchannel – optimizing all channels in play – in the future, Larson said.
“Retailers can provide a more comprehensive shopping experience for customers by combining the convenience of online shopping with the personal touch of in-store experiences,” she added.
As retailers optimize their store footprints, the post-pandemic model is somewhat smaller than a Big Box outlet, with a significant portion of storage space reserved for in-store fulfillment of online orders.
“It’s rare to find a retail store that doesn’t offer click-and-collect today. It will be even rarer in the future.”
“Any store that does moderate pickup activity needs a significant amount of space devoted to storage, staging, and pickup,” he added. “I expect that we won’t see stores get significantly smaller on average in the future. Many chains are still figuring out what the perfect store size is.”