The days of shopping at the mall or dropping by your favorite downtown store may be fading as eCommerce continues to entice consumers to shop online.
With 42% of the world's population having access to the Internet in 2015 alone, according to population figures from the World Bank, Internet shopping is increasingly becoming a way of life worldwide.
In fact, according to eMarketer, global e-commerce sales which include products or services, excluding travel and event tickets, ordered using the Internet via any device, regardless of the method of payment or fulfillment, reached $1.316 trillion in 2014, up 22.2% from $1.077 trillion in 2013. Web sales accounted for approximately 5.9% of this retail sales growth.
eMarketer says it expects retail eCommerce sales to rise to $1.592 trillion in 2015 and represent 6.7% of sales, and increase to $2.489 trillion or 8.8% of sales by 2018.
Clearly, eCommerce is here to stay. Many things are making this possible: online advertising, which is now used across most industry sectors; social media which, according to Baynote, is used by more than 60% of eCommerce shoppers; and automated data collection which enables consumers to gain information and compare prices shop online.
Plus, buying things online is quick and easy. A PayPal-Ipsos study found that 43% of online shoppers do so for convenience and to save time and money. According to PayPal-Ipsos research, mobile is growing at nearly three times the rate of overall e-commerce globally.
Mobile creates an online/offline dynamic as consumers merge online and offline into a single shopping experience. In fact, how consumers use their mobile devices while they're in a store presents a huge opportunity for retailers. Goldman Sachs reports nearly half of smartphone users have consulted their phones to find store information like location and working hours, and an Accenture study found 72% of respondents "showroomed" or bought digitally after seeing a product in a store.
What's more, mobile devices are fast-tracking eCommerce growth particularly in countries where fixed Internet has been out of reach either because of lack of infrastructure or affordability. eMarketer goes deeper to say nuanced trends on the regional and local levels reveal there's a great deal of variety in individual markets--refuting a seemingly more obvious assumption that Amazon, with its dominance of the US market, will replicate its success globally.
"In some countries, such as Russia and Indonesia, the ecommerce landscape remains populated by a large number of homegrown competitors who benefit from an understanding of local language and shopping practices," eMarketer reports. "In regions like Western Europe, friendly trade policies along with small domestic markets for goods drive consumers to price shop in neighboring countries, driving up cross-border ecommerce. In a market like China, however, just a handful of companies--such as Alibaba Group and JD.com--dominate the landscape."
It is only natural that countries in which the Internet market is still developing are seeing the biggest jump in eCommerce sales. While China and India currently report the largest eCommerce growth, Germany, France, the United Kingdom and the United States--all countries in which the eCommerce market is more saturated--have the slowest growth.
Take a look at information provided by Internet Retailer to see the Top 10 countries from 2014 measured by sales.
This yin yang effect among countries may well explain why global eCommerce growth grew 22.2% in 2014 and will level off this year to 20.9%, and decrease to 13.3% growth in 2018 as the market becomes more saturated.
Still, big companies like Staples or Pier 1 have seen their sales rise by powering into omnichannel platforms. Baynote reports many U.S. retailers are closing or redefining their stores to align with a broader eCommerce channel.
Even more, retailers and the vendors who service them are beefing up their eCommerce platforms and strategies. In the future, we will see more close merging of B2C and B2B markets as Staples is doing; free purchase and return shipping costs as PayPal is piloting in 20 markets; and eCommerce transactions touching a brand's brick-and-mortar store(s) as shown by the way Pier 1 is linking its website to its brick-and-mortar retail outlets.
Staying competitive in the eCommerce sector requires retailers to be savvy and ahead of the curve. Consider these strategies:
Grow your technology infrastructure: Replatforming to optimize the tablet and smartphone experience is a must for retailers who need to meet the demands of today's shoppers. This means scaling all aspects of your website design to ensure functionality across multiple platforms.
Leverage third-party integration systems: Inventory management systems that enable customers to determine stock availability are must haves for eRetailers as are improved fulfillment systems which now can include free shipping.
Tie your brick-and-mortar operations to your digital experience: Posting store hours and locations online, providing coupons online for in-store use and advertising other attractive in-store specials via the Internet; or facilitating in-store pickup of an online order. These all are consumer attractions that lead to conversions and more sales.
Expand your product line: Online capabilities allow you to merge B2B and B2C sales channels or include products from other brands to expand your market share.
Attract an international market: Cross-border selling can shore up your eCommerce offering, and, as importantly, pave the way to your long-term growth.