No let-up in online shopping, but demands for free delivery will test etailers – The Loadstar

Surging “socials-driven” e-commerce and increasing demand for free delivery and returns will test the limits of global supply chains before the decade is out.

DHL’s E-commerce Trends Report, released today, polled some 12,000 consumers across 24 countries, with the results suggesting a 12-fold increase in purchases made through social media platforms by 2030, their value climbing from $700bn today to $8.5trn.

DHL eCommerce CEO Pablo Chiano said: “With the rise of social commerce and online marketplaces, online shopping is growing and crossing borders fast.”

Driving this trend has been platforms like Facebook, Instagram and TikTok – 37% of those polled saying they have purchased from Facebook, with 28% and 18% buying via Instagram and TikTok, respectively.

And while globally 50% of those polled said they had made purchases through social media platforms, in Thailand, that number jumps to 90%.

Amid the rising sales, consumer preferences appear to lean towards models that supply free delivery and free returns: 67% demanding free delivery; 48% want free returns; and 41% not completing a purchase due to delivery costs being too high.

This trend has emerged as traditional retailers look to move away from ‘free’ policies, Amazon, for example, silently increasing its minimum order to qualify for free delivery.

And UK fashion retailers Oh Polly and PrettyLittleThings have begun revising their free returns policies to tackle the largely social media-driven trend for outfits being bought, worn once and then returned for a refund.

Oh Polly has moved from a flat fee of £2.99 to a price calculated on the rate of returns, with buyers returning 90%-100% of their purchases being charged £8.99 per return.

It told customers: “One of the ways we keep pricing down is being fair to all. Customers with high return rates increase the cost of the business, and we can either alter prices collectively for all or only for those who fall into the higher returner category.”

Amazon’s increasing minimum purchase for free delivery comes as it faces heightened competition from Chinese heavyweight rivals Shein and Temu.

However, with 51% of those polled having shopped at Amazon, its competitors have some way to go – but with 24% already having shopped at Shein and 18% at Temu, and Asia now the growing market, the e-commerce behemoth may soon be feeling the pain.

More worrying, for Amazon, however, is that Shein and Temu have shown a willingness to absorb losses as they eat into the market.