Six things we learned about e-commerce this year
Despite rapid growth and rising consumer interest in e-commerce, many retailers remain slow in adopting new, customer-friendly technologies.
As global e-commerce booms, many retailers have yet to prioritize the online and offline, end-to-end shopping experience needed to earn lifelong customers. We’ve launched this blog series to share the forward-leaning insights of our partners, customers, and commerce executives.
E-commerce now accounts for just over 9 percent of US retail sales, but many retailers have been slow to adopt technologies that could help them secure market share.
That’s one finding in a year-end report by eMarketer—“Key trends in e-commerce—Roundup 2017”—which provides a snapshot of the e-commerce marketplace. The report, sponsored by Sitecore, predicted that overall US retail e-commerce sales would grow 15.8% this year to $452.76 billion.
E-commerce had already generated 9.1% of total retail sales by the end of the third quarter, according to the US Commerce Department. With that sort of momentum, one might think brick-and-mortar retailers would be doing all they can to win a share of the growing online market, but that wasn’t always true. Here are six take-aways we found in the eMarketer roundup:
- The big got bigger. The 10 largest US e-commerce companies increased their slice of the e-tail pie to 64% of sales from 58.2% in 2016, according to eMarketer. Amazon alone saws its share grow to 43.5% from 38.1% a year earlier. Still, it’s growth rate was somewhat slower than some other Top 10 companies with much smaller footprints. For example, Walmart’s e-commerce sales grew by 46.9%, and Wayfair’s rose by 41.4%.
A curious footnote surfaced in a separate survey by Kenshoo, which found 85% of consumers in France, Germany, the US, and the UK, researched products first on Google—about 13% more than those who used Amazon as a source of product information. That suggests that many consumers do their research first, then go shopping for particular goods.
- We’re still waiting. As eMarketer put it: “The World Wide Wait is still a thing in retail.” A study by Retail Systems Research (RSR) found retail sites took an average of 9.5 seconds to load on mobile devices and (yawn) 16.6 seconds on desktop machines. The study of 80 major sites, sponsored by Yottaa, which helps retailers improve their page load speeds, blamed about three-quarters of the wait on the 70 third-party applications used by the average retailer in the group. RSR also noted that 55% of the site content consisted of images, many of which simply wouldn’t load.
- Retailers phone it in. A study by BRP found six in 10 retailers had created a mobile site or app by mid-year, and that more than half of the remainder had plans to follow suit. These larger retailers—two-thirds had sales over $1 billion—felt they could do better at upgrading their approaches. For example, only 23% had implemented in-store mobile offers, and less than half of those (9%) said they were working well.
- Consumers are speechless. Since voice-enabled systems were introduced, there’s been growing speculation about whether consumers will order products over them. First, the shoppers need to become aware of the systems. A survey by Morning Consult in August found more than two-thirds of US consumers weren’t aware a Walmart and Google partnership would let them order Walmart products through Google Home.
A separate study by Walker Sands in March found 67% of consumers were not likely, or were somewhat unlikely, to make a purchase through voice-enabled systems this year. The remaining third, however, said they were somewhat or very likely to do so, suggesting the potential for growth as consumers learn more about shopping by voice.
Technology adoption drags. A survey of 65 North American retail executives by International Data Corporation (IDC) found more than half saying their companies lacked up-to-date technologies for such basic tasks as email, mobile, text marketing, and text messaging. Naturally, they were even less likely to be on the cutting edge for technologies like personalization, where only 11% had modern systems in place. However, another 59 percent said they were in the process of adding personalization capabilities or that they planned to do so in the coming year.
- Marketers lack resources. One thing that may be slowing the adoption of personalization is a lack of time, money, and talent. Forty-two percent of companies lack one or more of those resources, according to Sailthru, which surveyed 146 commerce, publishing, and retail companies in the US and UK. Sailthru, which makes personalization technologies, reported other obstacles were: challenges connected with data (23%), strategy and knowledge of how to do personalization (17%), other technical challenges (14%), lack of executive/organizational buy-in (10%), and challenges with cross-team/internal cooperation (10%).
Related e-commerce posts
- Holiday boom shows need for new cross-channel tactics in 2018
- How to overcome challenges in your digital commerce transformation
- Why retailers need adaptable e-commerce architectures
- 10 tactics that take e-commerce personalization beyond product recommendations
- In B2B commerce, make life easier for you and your customers
- Forget the 'retail apocalypse' and seize the opportunity