Online shopping is rapidly replacing brick-and-mortar stores, with eCommerce growing three times faster than traditional retail. While it’s unlikely that eCommerce will completely replace off-line experiences, it’s important for electronic retailers – or eTailers – to know what the current trends and stats are in the space.
Knowledge is power, and online stores can plan for growth and stability by knowing which way the industry is moving.
The (Continued) Growth of eCommerce
Even without exact numbers, no one is surprised to hear that eCommerce is growing. But by how much?
Big and getting bigger
It’s estimated that 1.92 billion people will be shopping online in 2019, or nearly 25% of the world’s population. And that number is only expected to grow – in only 2 years, that number is expected to swell to 2.14 billion.
The United States continues to add digital shoppers every year. But we’re not the only ones – in fact, we’re no longer even expected to be the fastest growing market.
Five-year projections for 2018 to 2023 list China as the fastest growing eCommerce region, with a staggering 70.7% five-year growth expected, reaching $1,086M in projected revenue. The U.S. is second, but it isn’t even close at 45.7% five-year growth, followed by France (45.6%), Australia (44.6%), Russia (44.2%), and Canada (38.8%) rounding out the top five.
That means if you’re planning to expand your eCommerce business internationally, there is no time like the present.
But it’s still good news for the U.S.
Online retail sales in the U.S. topped $504B and is expected to surpass $735B in the next 5 years. That’s thanks to the 42% of U.S. consumers who have made purchases online, including 40% of people surveyed by Statista saying they buy online several times a month.
For eTailers, that means repeat business is as important as acquiring new customers since consumers aren’t shy from shopping online again and again. In fact, almost 50% of eCommerce transactions come from repeat customers.
Speak their language
eTailers looking to expand into the growing Asia Pacific market should consider creating localized sites and content. According to Common Sense Advisory, who surveyed 3000 shoppers in 10 different countries, 75% of respondents said that they wanted to purchase product in their native language.
Similarly, consumers overwhelmingly preferred to shop in their own currency. Ninety-two percent prefer eCommerce in their native currency, and 33% said they would abandon a purchase if the price is only listed in U.S. dollars.
How Consumers Choose
Even in the digital age, word of mouth is important.
Be ready with returns
Many consumers – 60% of them in fact – review return policies before making a purchase. But even if they don’t, there is still a good chance that they might regret the purchase.
Twenty-one percent of shoppers accidentally purchased something they didn’t intend to. Given that 10% of consumers report that they have “drunk shopped” online, that’s not a shock.
Returns are part of customer services, and people who have had a good experience will tell an average of 11 people about it, whereas those with a poor experience will tell 14.
Given this, having a clear (and perhaps generous) return policy is a good idea.
Speaking of good customer experiences…
Online shoppers prefer to handle problems themselves, as much as possible, with 60% preferring self-service tools over talking to a service rep.
An extension of that, online chat allows consumers to deal with issues without having to stop to make a phone call.
But shoppers have high expectations from chat. Consumers expect to wait no more than 5 minutes to get help from online customer service through chat. To shorten that time, many companies are turning to chatbots.
With 80% of business expected to be utilizing chatbots by 2020, shoppers can get help much faster, and get questions answered much sooner, by the speedy little bots. In fact, the average wait time for chat for companies that use chatbots is a tiny 45 seconds.
The opinions of others
Reviews are a critical part of the online shopping process. Seventy-seven percent of consumers read reviews before purchasing a product, and 69% want more reviews on eCommerce sites.
Onsite reviews are important, but social media is crucial, too – 84% of online shoppers visited at least one social media site before making a purchase.
Conversions and Carts
Converting sales is critically important. Don’t get in your customer’s way of trying to give you money.
Cart abandonment is still big
There are a lot of reasons that consumers decide to abandon a purchase after placing it in their online cart. Those reasons can include a burdensome shopping cart experience, item cost, or even balking and being forced to create an account.
Whatever the reason, nearly 70% of online shoppers abandon their shopping cart. If you’re looking to improve on your cart abandonment numbers, begin by analyzing your checkout process and make sure that you’re not throwing obstacles in the way of consumers trying to give you money.
Product recommendations and high conversions
Personalized product recommendations can reap big rewards for eTailers. Consumers aren’t thrilled with seemingly random recommendations, but those that are targeted and relevant can result in conversion rates that are 5.5 times higher.
While complex recommendation engines might be more costly or complex to implement, they can mean a 70% higher purchase rate for recommended products.
Expanding Beyond Your eCommerce Site
Your web presence isn’t the only place to sell from anymore.
Voice takes center stage
Voice assistance and search are becoming a force to be reckoned with in the eCommerce space. Around 20% of Google searches happen via voice, with that number expected to grow to 50% by 2020.
For those that use a smart speaker – like Amazon Alexa or Google Home – “voice commerce” is becoming more common. Nearly a third of consumers with a smart speaker have added an item to their cart with their voice, while one-fifth have re-ordered or ordered a new item this way.
Video is important
You might not think that your products would be enhanced by video, but you’d be wrong. Nearly 70% of online consumers have a preference to learn about new products via video.
A small 15% of those surveyed said they prefer text to video. If you decide not to go with video, you’ll be in the minority. It’s expected that 87% of companies will be using video to market their products in 2019.
As of 2018, roughly 6% of online shoppers had made a purchase through Instagram, and 11% had done so through Facebook.
If you decide to venture into social media selling, know your audience. Not every target demographic uses ever social media site, so to spend your promotion dollars wisely, you’ll want to choose the one that aligns most clearly with your intended targets.
Be careful with your social media commerce investment, though. Facebook has an average conversion rate of 1.85%, and that’s currently the highest of the social media platforms.
Don’t Disrespect Email
Email may seem like an old fashioned way of reaching your audience, but it remains a highly effective (and low cost) means of driving sales.
Email marketing can help with repeat customers and gives you a chance to connect with your audience. It can also drive as much as 20% of your site traffic.
The (Continued) Rise of Mobile
More people search on mobile today than they do on a computer. For successful eCommerce, you must be ready to offer a clean mobile purchase experience.
Black Friday mobile buying
Consumers aren’t just rushing to the store or standing in long lines the day after Thanksgiving. They are also using their phones to make purchases. In 2018, 40% of Black Friday purchases were made using a mobile phone.
And it isn’t just Black Friday
Mobile eCommerce is only getting bigger. With an expected 67% of digital sales to be completed on mobile in 2019 and a staggering 73% by 2021, mobile is a critical piece of the eCommerce puzzle.
Without a mobile optimized eCommerce site, you could be throwing money away.
And it isn’t just the U.S.
Differentiating a modern eCommerce business requires understanding your products, your customers, and where the industry is headed. Raising the bar means creating a strategy that takes into account where your customers are at, how and when they shop, and what the best customer experience will be. These stats should help guide you in formulating a strategy to elevate your eCommerce business.
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