The world of eCommerce is always changing. Instead of focusing on growth and growth alone, brands are focused on making sure they’re turning a profit as marketplace dynamics continue to shift.
To succeed in 2025, you need to know what’s coming and how to plan for it. Here are the top five trends to keep in mind for a profitable selling strategy next year.
Ready to unlock new levels of profitability next year? Subscribe to The Climb for updates and content designed to help your business grow. 🌿
1. Demand for Low-cost Products Will Rise
With consumer purchasing power in flux, the unveiling of Amazon Haul is an important indicator of where the eCommerce ecosystem is headed. As demand for discount products rises, affordable channels like Shein, Temu, and TikTok will continue gaining ground.
And if Amazon’s 3PL arm is anything to go by, growth will happen fast. Multi-Channel Fulfillment (MCF) handled over 70% more orders for sales channels like TikTok in 2024.
As cost pressure grows, even premium brands can find ways to benefit from this trend. Here are some of the top strategies to consider:
- Differentiate your products: To avoid devaluing your brand, consider adding lower price-point products or brands to attract a growing base of cost-conscious buyers. Or lean in the other direction and focus on demonstrating your value as a premium brand.
- Experiment with new marketplaces: Start selling on other channels using Amazon’s fulfillment network or your own 3PL. As you expand, adjust your ads and prices to balance sales and profits, while keeping your inventory levels stable.
- Price competitively: With shoppers increasingly concerned about their wallets, competitive prices matter more than ever. Use dynamic pricing tools to make sense of the market and set prices that maximize sales, while maintaining margins.
Not sure where to start? If you’re in a category like toys or health and beauty, consider linking new channels like TikTok to drive sales directly to your Amazon store. If you see a healthy uptick in revenue, lean in with your own branded storefronts.
2. The Dust Will Settle on AI
To put it mildly, 2024 was a massive year for AI. But the rapid adoption of emerging technologies means that brands and consumers quickly got acquainted with both its perks and its perils.
Chatbots made up fake flight discounts and offered brand new Chevys for $1. Google overviews directed searchers to eat rocks and put glue on pizza. And Amazon rolled out Haul, where AI-generated product images create a collage of floating kitchen appliances and deep sea glove-monsters.
In 2025, consumers will be able to sniff out low-quality AI images a mile away. To stand out as a brand that cares about shopper experience, focus on:
- High-quality tools and images: Understand AI’s limitations and seek out tools that use AI for what it’s good at.
- Think beyond text and images: AI can be used for so much more than product descriptions and images. For example, using AI to optimize your advertising and pricing can help you increase return on ad spend (RoAS) and outperform competitors.
- Always use human oversight: Think of AI like your absent-minded apprentice. It’s smart and well-trained, but you still need to tell it exactly what to do, and watch it closely.
As the dust settles (hopefully not on top of our pizza), the AI hype is finally beginning to stabilize going into 2025. Brands are zooming in on AI’s real value, choosing high-quality tools with industry-specific use cases and clear human guardrails.
➡️Up Next: Unlock the power of video in 2025. Learn how to stand out and drive sales by incorporating videos into your Amazon product listings.
3. Authenticity Will Dominate
With the rise of AI, customers will crave the human touch more than ever. Expect a rise in personalized ads that speak directly to shoppers’ needs and an influx of customized products designed to fit their lifestyles.
From your influencer campaigns to your Amazon pay-per-click (PPC) strategies, customers want to hear your brand story from the communities they trust, not from the brands themselves.
To reach customers on a deeper level, focus on:
- Crafting detailed, accurate product listings: Keep your content authentic and trustworthy, with accurate product descriptions and images.
- Monitoring your reviews: To win community support and the sales that come with it, forget everything you know about selling your product. Instead, focus on building a high-quality product that consistently earns positive reviews. Incorporate feedback (both positive and negative) into your next campaign product release.
- Use messaging that speaks to real needs: Your paid ads are another opportunity to market authentically, on a personal level. Use market insights to understand what your customers really want, and segmented advertising strategies to tell them about it.
- Increase your Average Order Volume (AOV): Leverage shopper insights to cross-sell related products to customers in a way that feels natural.
In the age of virality, focus on building a brand with staying power. Speak directly to your customers’ values and keep that message consistent across all channels.
4. Profitability Will Matter Most
From $6 trillion in 2024, global eCommerce sales are now expected to top $8 trillion by 2028. Yet many marketplace sellers are still struggling to turn a profit, even as revenues grow. The combination of rising costs, higher competition, and pricing pressure means brands have to work harder than ever to protect their margins.
But claims of the death of profitability on Amazon aren’t new – and the truth is, both early and long-time sellers are still making it work, with brands that joined five years ago or more driving half Amazon’s gross merchandise value GMV.
To increase your Amazon ROI:
- Decrease your Cost of Goods Sold (COGS): Take a close look at your labor, shipping, and raw material costs. Negotiate with suppliers for better rates, and/or consider switching or consolidating vendors to reduce COGS and boost your margins.
- Adjust your pricing: Pricing has a clear and direct impact on your margins, but with rapid changes in competition and demand, it can be hard to keep up. Use dynamic pricing tools to automatically adjust pricing based on market demand, competitor intelligence, and changes in supply.
- Decrease your Customer Acquisition Costs (CAC): Use Amazon Marketing Cloud (AMC) data to leverage Loss Leaders and Halo, Gateway, and Hero Products to grow your customer base while optimizing your spending for your most profitable ads and products.
- Increase your Lifetime Value (LTV): Invest in driving repeat purchases by using Demand Side Platform (DSP) to retarget visitors and create cross-sell campaigns with “bought X but not Y”.
In Q3 of 2024, Amazon reported an 11% increase in sales, with roughly 60% of those sales coming directly from third-party sellers. To make it work on Amazon, Walmart, or any other platform, focus on refining the balance between sales volume and profitability.
➡️Up Next: Watch our deep dive on Profit Per Session: The Core KPI to Grow Profitably on Amazon and learn to balance profits with sales growth.
5. Merchandising Will Be the Make-or-Break
Amid rising customer acquisition costs, increasing seller fees, and the absolute necessity of paying for first-page placement, margins are getting harder to eke out. But successful brands aren’t sitting on their hands waiting for the market to improve—they’re taking active measures to carefully increase sales while keeping profitability strong.
For a business strategy that puts profits first, focus on optimizing the 4Ps of eCommerce merchandising:
- Product: To build trust and increase rankings, optimize your listings for maximum visibility with engaging content and positive reviews.
- Placement: Get your products in front of exactly the right customer, in the right place, at the right time, with targeted ads and sponsored placements on Amazon and beyond.
- Promotion: Use deals, coupons, and planned promotions to win new customers and increase order volumes.
- Pricing: Use dynamic pricing to keep prices high enough to maintain margins, but low enough to protect your Best Seller Rank (BSR).
To grow profitably in 2025 and beyond, think strategically about how you can optimize every dollar for maximum visibility and sales.
Plan for Peak Profitability with Trellis
As customers seek authentic brand connections in a sea of product offerings, the coming year will mark a major shift for merchants. To position your brand as a market leader, you’ll need a deep understanding of your customers and scalable process for maximizing profits.
Trellis’s complete suite of eCommerce merchandising solutions helps you optimize all 4Ps of eCommerce merchandising for stronger profitability today and tomorrow. Reach out for your free personalized demo and watch your profits grow. 🪴
