After two intensive days at eCommerce Expo 2011 in London it’s time for a wrap up. One of the biggest eCommerce events in Europe could count on many visitors and most of the relevant market players were exhibiting at the Expo. In two days time you could really learn and network a lot. Now we can conclude what we had already forecasted in the preview on the Expo. It’s time for online commerce to become more personal through mobile and social commerce. You will have to think out your multi-channel strategy. An increasing amount of users is ready for it. Unfortunately, this is not applicable to most of the online retailers.
This post originally appeared at 21webmerceblog » Peter Horsten.View original post.
Current economic gloom hardly touches ecommerce market
The ecommerce market is a healthy growing market and it is supposed to stay like that in the upcoming years. Meanwhile, the offline high street retailers are having hard times. Probably due to the current economic gloom they see their turnover dropping. Recent imrg data as presented by David Smith, Chief Marketing & Communication Director of imrg, at the eCommerce Expo 2011 indicates that the online commerce market growth is slightly decreasing.
At the start of this year imrg forecasted a healthy 18% growth, which was occurring after the first half-year. The growth rate over the 3rd quarter is with 15% slightly less than expected. The growth slow down doesn’t affect all markets. For example clothing showed a 20% growth rate during the 3rd quarter, especially the electronics market is suffering online. Update: Read more about these market changes in our new post.
You will have to seduce the consumer more than ever before
Nevertheless, online commerce is a very healthy market with a lot of potential. For example, in the UK 88% of the consumers has Internet access and 50% of the consumers shops online. But that doesn’t mean it’s easy.
Attracting the consumers is one, but making them buy is a completely different thing.
Today the consumer is very aware of what he wants to buy and at what price. They’re bouncing back and forth in between Google/Bing (and other search engines), different (online) retailers, comparison sites and social networks before they make up their minds. Your shopping cart will be used as a temporary storage, a wish list. They will check their friends’ opinions both in real life and online. And their opinions really count!
This new trend in the online commerce market where the buyer is more and more in control, forces retailers to improve themselves all the time. The customer can check their products through multiple channels, every single second. The opinion about your product must be consistent across all channels to make the consumer decide in favor of you, every second consumers will decide whether to choose your product. This phenomenon of online decision making is named Zero Moment Of Truth (ZMOT) by Google.
You will have to satisfy, or probably even seduce, the consumer across all channels. A real multi-channel strategy implies you have to become personal.
Conversion rates are decreasing
From a statistical perspective this trend has some down sides. Over the past 5 years the conversion rate has decreased by 55% and meanwhile the bounce rate has increased. Miki Balin, CEO of WinBuyer, showed price is the most important decision factor for users to buy a product. It’s clear that buyers are jumping back and forth to find the best deal.
Potentially, the conversion rate is even going to drop more. Increasingly, online shops include many links to other places where you can stay engaged with the brand/product. They link to their Facebook page to have a discussion with their customers, they link to the YouTube page with product related video’s and they stimulate to follow their Twitter account. In the end this will lead to a lot more contact with the customer on many different levels, but of course it will result in more page hits that don’t lead to a conversion. Probably, we should conclude “conversion” is no longer the best figure to focus on. It’s time to measure the engagement level, because sooner or later that will have a major impact on your conversion.
Online retailers expect a lot from Facebook
The Facebook keynote by Ivan Heneghan was probably the most visited keynote. Long queues were in front of the keynote theater long time before the actual keynote started. People were looking forward to hear about the holy social media grail. Many disappointed people didn’t make it into the theater. The “lucky ones” were able to hear what Facebook has to offer to online retailers. Honestly, there is no real magic in it. Facebook wants to be a story engine where consumers can share their experiences with their friends.
For sure this offers possibilities for online retailers, at least if your audience is on Facebook. Enabling them to “like” or “recommend” your product can generate buzz and traffic to your website. You can stimulate this even further with Facebook Ads.
A day before Miki Balin of WinBuyer tempered the Facebook expectations. Research shows that the question “When you are interested in making an online purchase of some kind, what is your first step most often?” is being answered mostly in favor of Google (38%). Just about 2% answered they were checking their Facebook friends’ opinion first.
You will have to go mobile
In the UK about 25% of adults is using a smartphone. For teenagers this is already around 46%, as Nick Pratt of Sitemakers showed. In 2010 around 6% of the online commerce turnover was generated through mobile and this continues to grow.
As mentioned earlier, consumers are heavily using the Internet to learn about the products they are looking for. Often they use their smartphone or tablet, probably even when they are at your shop. And they won’t consider you when your web shop doesn’t look good on a mobile device.
The shocking thing is that your web shop is most probably not mobile enabled. Research proved that most of the online shops are not mobile ready and that their owners are even not aware of that. Examples like ASOS, BestBuy.com and M&S show that it is possible.
The function of the high street shop will change
Knowing the problems of the high street shops and the potential of online commerce you should ask yourself whether your offline shop is still needed? For sure the role of the high street shop will change, they will become experience centers. The Apple Store is the best example of this future development. You don’t necessarily go there to buy something. You can visit the Apple Store to test things, attend a seminar or listen to a concert. Apple just wants to give you the Apple experience.
But how to become personal?
As discussed above, social engagement is one way to become personal. By answering consumers’ questions and reacting on their (both positive and critical) online feedback you build a relationship with them.
Additionally, you should consider giving them a personalized experience when visiting your web shop. Users do not longer mind that you use the information you gathered about them. If you use this information in the correct way you can show them more relevant content.
The same is applicable to “search” as well. It’s important that you do the best you can to generate as relevant content as possible towards the consumers based on the keywords he used and his buying history you might know.
E-mail marketing can stimulate the buying decision. But again, these e-mails will have to be personalized! Spam is no longer appreciated.
eCommerce Expo 2011 was worth the visit
It was really worth visiting the eCommerce Expo 2011. In two days time you were able to gather a lot of information and to extend your network. The above is just a high level summary of all items discussed, but we believe the conclusion of the Expo is clear. Online commerce has a prosperous future when you dare to become personal through social media and by offering good mobile access to your store.
We are looking forward to your feedback and/or experiences with eCommerce Expo 2011 as well. Feel free to ask additional questions that might have been triggered by this post. You can get in touch with us by commenting below, following us on Twitter: @21webmerce or by sending an inquiry through our contact form which you can find by clicking here.