7ECOMMERCE TRENDS in 2014

Pohlin Lau (@PohlinLau) + GoSquared

Going global while staying localBusinesses need to be able to combine globalised product offerings, with a localised E-commerce experience - through local language, payment options, and marketing offerings.

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Sound like a paradox?

Going global, yet staying local

Source: Wired (2013)

Actually it’s the key to your business being successful globally. Emerging markets are expected to experience huge growth in online spending. Impressively, in 2012 Chinese shoppers spent $213 billion online and are predicted to have outspent the US last year.

In China, people are hungry for foreign goods. However, 60% is still being bought through domestic ecommerce platforms. While foreign goods are highly in demand, consumers still prefer a localised shopping experience.

“Asia will become the biggest contributor to B2C E-commerce, predicted to

spend $502 billion in 2014 - nearly a third of total spend

worldwide.”

Source: eMarketer (2013)

What can you do?

Adapting your marketing campaigns, site language and even preferred payment methods for local needs could give you the edge you need to be successful in the biggest growing Ecommerce markets of 2014.

Mobile payments become easierIn 2014, we’ll be closer to hassle-free payments than ever. Settle your bill at a busy restaurant without the need to desperately eyeball every waiter, Paypal allows you to do all this within a neatly packaged app.

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But it’s not just mobile payments for dinner bills.

Mobile apps like Hailo or Uber allow you order a taxi, track their location on a map, and then pay automatically through a card which is linked to the app. Similarly, you can book & pay for a room through Airbnb on your phone. Even buying your lunch becomes a breeze as you avoid rush-hour queues by pre-ordering and paying through your phone.

In the last year alone, mobile payments totalled $235.4 billion worldwide. And it’s not slowing down yet, as Gartner predicts a further 38% increase to $325 billion in mobile payments for 2014.

Mobile payments become easier

Source: Hailo (2014), Gartner (2013)

“In the UK, mobile will account for approximately 24% of retail ecommerce

sales this year.”

Source: eMarketer (2013)

Making your business mobile payment friendly is the first step. Next steps include integrating with 3rd-party apps like Paypal, and making sure your website renders well on phones and other new devices – perhaps even smart watches.

What can you do?

3As the shopping experience becomes more fragmented, it’s critical for businesses to adapt. Online retailing is about multichannel selling – individual websites, public marketplaces and shopping-comparison websites.

Utilising multichannel selling

Similarly to when a physical retailer will open new locations in order to increase their revenue, an online retailer can sell their products across multiple channels online.

The greatest advantage of multichannel selling is ultimately it levels the playing field for small retailers. Instead of the customer going directly to the biggest retailer, small businesses can now reach the customer directly through a search engine, comparison site, or an online marketplace such as eBay. Even Tesco, the 2nd largest retailer in the world uses eBay UK as a sales channel!

Did you know 39% of units sold on Amazon in Q4 of 2012 were by 3rd party merchants, not Amazon?

Utilising multichannel selling

Source: PracticalEcommerce (Jan 2014), smartinsights.com (2013)

“Amazon sold over 1 billion items (yes, a Billion) for the first time in Q4 of 2012. That was 126 items

sold per second. 7,548 items sold a minute, 452,899 an hour or 10.8

million items sold a day.”

Source: smartinsights.com (2013)

What can you do? Think of alternative places to additionally sell your products. eBay and Amazon Marketplace are popular online channels that retailers choose to sell their products, but 2014 is all about optimising your options. Using integration tools such as ChannelAdvisor, you can manage and automate your product submissions and order processing.

89% of customers said it’s important for retailers to allow them to shop in the way that is most convenient for them.

4Multi-device redefines point-of-sale

*Survey of 750 consumers in the US Source: Accenture (2013)

Tablets have helped redefine point of sale - in the US over their annual ‘mega-shopping’ weekend, 32% of E-commerce traffic came from tablet devices. With tablets driving twice as many transactions as mobile devices, which remains the favourite for browsing, it’s critical to create a seamless shopping experience across multiple channels.

In fact, 49% of consumers feel that integrating in-store, online and mobile channels is the best thing retailers can do this year.

Multi-device redefines point-of-sale

Source: IBM (2013), Accenture (2013), BusinessNewsDaily (Jan 2014)

“Amazon now has ‘Lockers’ in 11 UK cities

with plans for more“

Source: Econsultancy (2013)

What can you do? Use data and analytics to understand how consumers use each shopping channel for which purpose. For example, optimising your mobile site for browsing can strengthen your customer’s retail experience while on the go.

Data + Analytics

Big data has been a buzzword for a while too long now. However, 2014 looks to prove that real value can be generated from smart use of analytics. 

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Data analysis is no longer just about segmenting email lists.

James Gagliardi (Digital River), believes that companies will be able to analyse data to create useful consumer insights. If fashion retailers can use data to suggest products based on existing purchases, they can help the customer build a complimentary and customised wardrobe. 

Netflix has already been using data analytics for this type of customisation for a while. The biggest change will be that Big Data will become part of their core business practise for small retailers.

42% of small businesses which participated in the ShopKeep POS survey, say they are using analytics to make smarter, immediate business decisions.

Data + Analytics

Source: Wired (2013)

“Cloud computing has lowered the costs, and barriers to entry, of all

sorts of technology which is particularly exciting for smaller

businesses who can now compete with the bigger players.”

Source: Econsultancy (2013)

What can you do? In 2014, you’ll be using data to acquire more customers, up-sell to your existing customers and retain them for longer. It’s not just your business which will be getting smarter with analytics in 2014, but the under-lying tools themselves. Analytics and marketing software will be smarter and quicker at producing useful insights.

Source: Wired (2013)

Customers expect a more multifaceted relationship with retailers – social media is not just for shopping, but also for retailers to post high-quality content.

6Shopping gets social

*Survey of 750 consumers in the US Source: Accenture (2013)

“The idea of content marketing is to attract and retain customers by creating and curating relevant and valuable content,” according to the Content Marketing Institute.

This definition gets right at the heart of ecommerce marketing in 2014. Some experts predict that online shoppers will become more fickle in 2014. One possible way to counteract such an unfortunate situation is to be more than just a shop, and to provide useful or entertaining content that will keep shoppers coming back.

Mr. Porter, an online retailer of men’s apparel, is a great example of content marketing in action. Its online publication, The Journal, always has interesting and relevant content. Similarly, American Apparel’s not-safe-for-work product slide shows and provocative Tumblr page entertain and engage shoppers, creating lasting customer relationships that generate repeat sales.

Shopping gets social

Source: Wired (2013), ParctialEcommerce (2013)

“Companies that view e-commerce strictly as a

website-driven channel will struggle to compete in 2014

and beyond.”

Source: Wired (2013)

What can you do? Use analytics to understand the ROI on your social activity and double down on the channels with the highest conversion. Understand why other channels aren’t converting as highly.

Source: Wired (2014)

Services like Shutl and Amazon Prime have pioneered same day delivery. In 2014, expect this to become the norm.

7Delivery 2.0

Amazon Prime registered 1 million new customers in December 2013. There are now 20 million Amazon users who are eligible to get next day or two day shipping. In addition, Amazon Prime users spent 53% more per year than those who were not signed up.

Despite a recent price hike to Amazon Prime in the US, the immediacy of offline shopping is reaching Ecommerce. Being so crucial to the consumer experience, we expect to see huge growth in fulfilment services, such as Fulfilment by Amazon (FBA), to enable smaller retailers to take advantage of one of the most sophisticated logistics services in the world.

Delivery 2.0

Source: Business Insider (Jan 2014), VentureBeat (Jan 2014)

“72% of retailers offered next-day delivery, compared

to 68% last year (2013)”

Source: Micros Multi-Channel Retail Delivery Report (2013)

What can you do? Evaluate the importance of delivery times to your customers and consider outsourcing fulfilment. There have been reported downsides to using FBA, so carefully consider your options.

Source: Wired (2014)

Pohlin Lau (@PohlinLau) + GoSquared

7 Ecommerce Trends in 2014

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Sources Accenture (2013): http://newsroom.accenture.com/news/accenture-study-shows-us-consumers-want-a-seamless-shopping-experience-across-store-online-and-mobile-that-many-retailers-are-struggling-to-deliver.htmI Bloomberg Businessweek (Nov 2013): http://www.businessweek.com/articles/2013-11-14/2014-outlook-easy-mobile-payments-in-reach#p2 Business Insider (Jan 2014): http://www.businessinsider.in/Amazon-Says-It-Has-20-Million-Prime-Members/articleshow/28490564.cms eMarketer (2013): http://www.emarketer.com/Article/B2C-Ecommerce-Climbs-Worldwide-Emerging-Markets-Drive-Sales-Higher/1010004 Forrester (2013): http://blogs.forrester.com/zia_daniell_wigder/13-12-12-the_globalization_of_ecommerce_in_2014 Gartner (2013): http://www.gartner.com/newsroom/id/2504915 Hailo (2014): https://hailocab.com/london Micros (2013): https://reports.micros-ecommerce.com/ PracticalEcommerce (Jan 2014): http://www.practicalecommerce.com/articles/62550-2014-Ecommerce-Marketing-Checklist smartinsights.com (2013): http://www.smartinsights.com/marketplace-analysis/partner-analysis/selling-amazon-ebay-2014/ VentureBeat (Jan 2014): http://venturebeat.com/2014/01/08/fulfillment-by-amazon-what-amazon-doesnt-tell-third-party-sellers/ Wired (Dec 2013): http://insights.wired.com/profiles/blogs/e-commerce-in-2014-seven-key-trends#axzz2pj5CvJ00 !Images !http://www6.pcmag.com/media/images/333583-paypal-app.jpg

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