Why Ecommerce Is About to Get Even Harder (Here’s How to Survive)
Feb 4, 2025
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Ecommerce is bracing for tougher times with rising ad costs and evolving tariffs. AI is revolutionizing workforce dynamics, boosting productivity while altering jobs. Traditional marketing strategies are losing their effectiveness, pushing brands to innovate. The need for human insight in client interactions is greater than ever, as automation reshapes tasks. Learn how to assess your business's resilience and adapt to these challenges to stay profitable in a shifting landscape.
Ecommerce businesses must adapt to rising ad costs and tariffs while leveraging AI to enhance operational efficiency and profitability.
Workers need to reassess their skills for a tech-driven landscape, focusing on tasks that require human creativity and emotional intelligence.
Deep dives
Emerging Creative Trends in Advertising
A new report outlines seven critical creative trends in advertising for 2025, driven by insights from $100 million in ad spend analysis and surveys from 500 direct-to-consumer advertisers. One significant trend is the rise of lo-fi content, which is gaining popularity for its authenticity and ability to connect with audiences on a personal level. The report also highlights the importance of nostalgic advertising to foster trust among consumers, suggesting that brands can leverage this to enhance their campaigns. Utilizing AI technologies for ad production is another key area where businesses can gain a competitive edge, allowing for more efficient creative processes.
The Impact of AI on Workforce and Efficiency
Workforce dynamics have dramatically shifted in the past few years, with companies experiencing significant reductions in employee count while simultaneously increasing revenue and margins. For instance, a service company reduced its full-time equivalent workforce by 65%, improved operating margins by 300%, and lowered customer costs, demonstrating a strong correlation between technology adoption and business efficiency. This trend is likely to accelerate, especially as AI technologies continue to support tasks that were traditionally performed by humans, enabling companies to rely less on human input for certain repetitive functions. The introduction of AI tools allows organizations to create a more efficient business model that retains high-quality outcomes while minimizing labor costs.
E-commerce firms currently face unique challenges, particularly regarding margin pressures exacerbated by rising tariffs and increased competition in marketing. Unlike service-based companies, e-commerce businesses cannot as easily leverage labor efficiencies when a large portion of their expenses is tied to cost of goods and marketing compared to labor. These economic factors necessitate a strategic reassessment for businesses to identify solutions that can enhance their profit margins without relying solely on reduced labor costs. In this turbulent environment, innovative thinking combined with effective use of new technologies will be crucial for survival and growth in the e-commerce sector.
Adapting Skills for the Future Workplace
As the role of AI in business expands, employees must proactively reassess their skill sets to remain relevant in a changing marketplace. Assessing which tasks can be automated or efficiently handled by AI allows individuals to focus on high-value activities that require human interaction, creativity, and relational skills. Furthermore, conducting a self-audit of one's responsibilities can identify areas of vulnerability, especially in jobs that involve repetitive or monotonous tasks. By positioning themselves for roles that require complex problem-solving and emotional intelligence, employees can better prepare for a workforce increasingly influenced by automation and AI advancements.
Ecommerce is facing major challenges in 2025—rising ad costs, AI disruptions, and now, new tariffs. If you’re running a brand, you need to know what’s coming and how to adapt before it’s too late. In this episode of the Ecommerce Playbook Podcast, we break down:
The biggest threats to e-commerce right now
How AI is reshaping the workforce and business costs
Why traditional marketing strategies are failing
The key moves you need to make to stay profitable
Don’t get left behind—watch now to future-proof your business!