Shoppers want it all. And they want it fast.
Disruption is the buzzword in business these days. Everywhere we look – from computing and mobile communication, to energy, transportation, and manufacturing – we see technology breaking business models in ways that require alert analysis, often-dramatic innovation, and aggressive risk management.
Retail e-commerce rose 13% in 2013, to $211 billion, a heady growth rate that shows no signs of abating. Research suggests that e-commerce may represent as much as 10% to 12% of all retail sales today. But that may be nothing compared to what lies ahead: Consultants at Deloitte predict that by 2021, 90% of retail sales will be digitally driven.
This upheaval is creating understandable anxiety within the industry, with some analysts questioning whether the shift online could threaten the very existence of brick-and-mortar retailing.
At UPS, we’ve conducted extensive research into e-commerce trends. And what we see is a more subtle and complicated business model evolving in retailing – driven by consumers’ relentless pursuit of convenience and the best deal. Our studies show that these changes in consumer behavior offer important new opportunities for the merchants who can do what we call “omni-channel retailing” right.
Indeed, retailers who can offer a shopping experience that is easier, clearer, and more seamless and service-driven across a multitude of platforms will enjoy solid growth and profitability.
Among our latest findings:
- Many shoppers want “clicks” and “bricks.” Online shoppers told us they make 40% of their online purchases through cross-channel methods, researching online and buying in store, or vice versa.
We describe this group as “flex” shoppers because they are quite comfortable mixing and matching different channels for their research and purchasing.
- Retailers have more work to do with mobile. While mobile continues to rise in popularity, with 11% of online purchases now being made via smartphone, 44% of shoppers still go to their desktop PC or laptop to finish the transaction.
Among those making the switch, 43% said that the product images on the retailers’ mobile sites were either too small or lacked detail, leaving them hesitant to hit the “buy” button. That represents a lost opportunity for retailers, who have work to do to ensure that the imagery they present is device-appropriate, and that the product descriptions and details are ample and well displayed for all devices.
- Product searches often start with retailers. Interestingly, more than 43% of product searches begin on retailers’ channels – 18% on a website, another 18% in a store and 7% via catalogs or promotional circulars. Amazon.com (28%) and search engines such as Google (19%) account for most of the rest.
We discuss these findings in more detail in the 2014 UPS Pulse of the Online Shopper, our third-annual study of consumer preferences. In the latest study, released June 11, we surveyed 5,800 online consumers who told us they shop online at least two times – and, in many cases seven times or more – in a typical three-month period.
This year, we worked with the e-tailing group, a leading retail consultancy, and comScore to analyze how online shoppers behave, what they want from the experience, what they like and don’t like – and most importantly – what retailers can do to keep their customers happy and coming back.
This latest UPS Pulse of the Online Shopper study offers a detailed exploration of the flex shopper’s experience, and how mobile devices, product selection, shipping and returns pricing and policy, social media, and security and privacy considerations, are shaping this new retail reality.
Over the coming weeks, I’ll discuss each of these in more detail – explaining how retailers can improve and enhance their online and in store shopping environments to take full advantage of this new flexible, fast-shifting world of commerce.
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Reprinted with permission of Longitudes, the UPS blog devoted to the trends shaping the global economy.