Online retail is undergoing tremendous growth, owing to the rapid increase of the handheld user-base. What are the new trends that will creep into this industry? I have anticipated some of them here.
Availability of payment options
Customers expect multiple payment options. They may feel hesitant to proceed further into the checkout process if there’s only one way to pay. This applies to physical retail outlets too. The
The rise of M-commerce
E-commerce is now M-commerce. People buy online and they buy from their mobile phones. This trend is quickly becoming mainstream, compelling analysts to forecast a remarkable growth of M-commerce in years to come.
What are they predicting?
Brace yourself, the stats are coming:
- In the US, mobile transactions make up almost 30% of total e-commerce transactions.
- It makes up 34% of global e-commerce transactions.
- In Japan and South Korea, M-commerce accounts for 50% of total e-commerce transactions.
- In the United States, the quarterly growth rate of M-commerce is 8%. See the infographic below:
According to eMarketer, retail M-commerce will increase 242% from 2013 to 2018. Take a look at the growth prediction chart below:
Here are some key observations, which date back to 2014.
- The year-over-year growth of the handheld traffic was 62%.
- In the third quarter of 2014, the year-over-year revenue increase was 141%.
- Health and beauty sector registered the highest Smartphone revenue – 191%, followed by house appliances – 184% and brick and mortar – 174%.
To catch up with this phenomenal growth, a retail business needs to have a responsive site, which loads smoothly from every device. This will ease customers who want to make a purchase using their Smartphones/Tablets.
Alongside this, they need to have an app. Going without anapp only would be a dumb move. Vision Mobile’s study revealed 55% mobile apps earn less than $500 a month and 25% Smartphone owners use downloaded apps only once. They delete 80-90% mobile apps from their phones, including the online shopping ones.
Retail data consolidation
It’s not uncommon to hit upon retailers having physical outlets as well as online shops. Many have started to compare and unify online and offline data. This gives them an upper hand in understanding consumer behavior.
One such retailer is Barneys. In an interview with Washington Post, the company’s executive vice president Matthew Woolsey described how the unification of offline and online data helped them.
Many customers, who surfed their website to check the collection, ended up buying from their physical outlets. If Barneys only had an online store, they would’ve lost the opportunity to serve these customers. What this indicates is there are customers, who visit an online store and browse through the collection there, but prefer to buy from offline stores.
Hence, by having a presence in both online and offline verticals, a retail brand can get the best of both worlds. The large-scale retailers don’t have budget constraints and therefore, they can easily afford running a physical retail store alongside an online store.
Customers demanding personalization
Personalization has started to play out in the B2C vertical. Like many B2C segments, it is affecting online retail. Customers are demanding personalization. If a retail store fails to catch up with this demand, it will see a declining sale.
There are two ways a retail brand can offer its customers a personalized experience:
- Salespeople and store managers can treat each customer as a valued customer, offer them giveaway goodies, give them advice related to buying. In short, do their best to establish a bond with the customers.
- Data-based personalization. This model requires the employment of cutting-edge tools to track customer behavior, buying pattern and purchase history. Based on the data gathered, recommend different products to different customers, which match their taste.
Rewards and coupons add to the personalized buying experience. Almost all retail networks today are offering discount options and exciting gifts to customers.
Shopping is no longer a solo act; it is now social. Customers are sharing product experiences with each other on social media. Social media aside, online review sites and user-generated content aggregators are also pushing this trend. Social media influencing shopping is no secret, but social shopping is a relatively new trend.
Today, nearly 70% customers research online before buying something. An average customer reviews more than 10 resources to make a buying decision. Despite a surge in online retail, 56% of retail transactions are non-web-based and offline. Word-of-mouth marketing still prevails in the retail segment.
Put simply, shoppers have become damn serious about every single dime they spend and they value the opinion and experience of other shoppers. Retailers need to keep this in mind. They need to make sure the product experience is top notch, so that customers write favorable reviews and other customers could trust those reviews.
What can you deduce from the five tips discussed in this article?
Success in online retail depends on the right amount of automation, the right amount of customer engagement and the right amount of social outreach – Sort of cooking a recipe, if the ingredients are all added into it in the right amount, then the dish would be tasty.
Similarly, when you apply all the strategies maintaining a balance so that no strategy overshadows the other, your retail firm will surely attract plenty of new customers and retain the existing ones.
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