Category: ‘eCommerce’





Back-to-School Shopping and eCommerce 2016

Posted on July 21, 2016 at 2:37 pm

 

The long days of dusty summer baseball scrimmages and pavement football games are winding to a close as the later weeks of August draw closer. In the U.S., the back-to-school shopping season is becoming quite the shopping holiday, second in total retail spending only to the winter holidays, such as Cyber Monday and Black Friday. In 2015, digital shoppers spent over $56 billion online in preparation for the school year, a figure expected to increase to $65 billion this year.

A handful of eCommerce trends have been characterized in recent research for the 2016 school-ready shopping season…

 

    • Five product areas will likely see popularity in digital sales rise during the back-to-school season: apparel & accessories, books & music, computers & consumer electronics, office equipment & supplies, and toys & hobbies (including sporting goods). These online categories are expected to grow approximately 17% this year, the fastest growth rate since 2011. Retail eCommerce sales of furniture are also projected to increase by roughly 16% this year with the implementation of dorm delivery shipping for back-to-college students, which brings another interesting point…

 

    • Back-to-school versus back-to-college shopping presents an interesting difference in retail sales. Those shopping online for back-to-school spent over $13 billion on apparel & accessories, or significantly more than half of their budget. Digital shoppers purchasing for back-to-college spent considerably less on apparel (roughly $10 billion) and more on electronics and college-specific categories, such as dorm supplies. Back-to-college purchases are also more likely to take place online, as more retailers experiment with convenient fulfillment options geared towards the traveling college student, such as holding items at a local store or future-date shipping.

 

    • Mobile has become a more significant means of purchasing than years previous. In 2015, approximately 13% of U.S. retail eCommerce sales and 37% of online shopping traffic came from smartphone shoppers. The shift towards mobile traffic and sales is expected to continue this season, with a projected mobile commerce growth of nearly 47% (eMarketer). A 2016 Bizrate Insights survey found that 48% of digital buyers planned to purchase back-to-school items using a mobile device while 69% of respondents planned to research products via a mobile device.

 

    • Students turn to social media to inform their shopping decisions. Though parents and their pocketbooks remain essential to picking and purchasing items, students of all ranges (including college kids) have increasingly become key decision makers when shopping, and rely heavily on image- and video-driven social platforms to stay current with the latest trends. According to a Deloitte survey, teens (defined as age 14 to 18) have the highest rate of visual based app selection, with 41% of app downloaders choosing predominantly photo and video apps (think Instagram, Snapchat, and YouTube, to name a few). For shoppers between the age of 14 and 25, over 68% reported that their purchases were influenced by social media buzz (recommendations or mentions), and 52% claimed to be influenced by social media advertisements. Pinterest reported that 7 million people saved 23 million back-to-school pins in 2015, a trend expected to continue growth this year.

 

As teachers and school districts distribute back-to-school lists and shoppers bustle through stores, the ease of online shopping can alleviate stressful crammed-shelf in-store shopping ventures. Product categories such as apparel, books, and electronics will garner the most purchases, with an interesting buyer delineation forming between back-to-school shoppers and back-to-college shoppers. Mobile commerce continues to rise, with more customers researching and purchasing with their smartphones. Students’ purchases are greatly influenced by visual social platforms and peruse blogs or image-heavy look books for school-ready fashion advice. The back-to-school season continues to drive sales, and retailers should keep a close watch on developing trends to take advantage of this budding eCommerce holiday.

 

Emerging Trends in Middle East eCommerce

Posted on January 22, 2016 at 10:03 am





A hot Arabic sun glistens along the canal as Italian-inspired black gondolas languidly weave past one another, stopping at luxury store entrances, the passengers hopping out in long, maxi-length fashions. It’s a mall in Qatar, the Villaggio, and its surprising transplant-esque appearance transcends the recent booming wealth struck throughout segments of the Middle East, largely from big oil exports and the associated labor.

Commonly viewed as a slowly growing market located within an arguably unstable political climate and nested alongside Africa’s gradually developing economy, retailers have generally been slow to launch eCommerce initiatives within the Middle East. However, as the rapidly growing markets and wealthy pockets within the Gulf States have become noticed by retailers, luxury brands like Burberry, Dolce & Gabbana, and jewelry retailer Blue Nile have launched Arabic-language sites aimed at experiential shoppers in wealthier countries such as the United Arab Emirates (UAE).

With a quickly expanding internet audience and the continued creation of logistics infrastructures from the ground up, the region is poised to become a larger player in the global eCommerce market as time progresses. As of now, the Middle East eCommerce market is valued at $4.9 billion and is expected to expand to $10 billion by 2018. In the UAE alone, the share of B2C eCommerce on total retail sales of goods is forecasted to triple between 2014 and 2019 (eMarketer). Mobile commerce also has extremely high potential in the area; for example, two-thirds of online shoppers in Saudi Arabia made their latest online purchases via smartphone (yStats).

With this growth in mobile purchases, it’s no surprise smartphone usage (and in conjunction the overall internet audience) within the Middle East is increasing. This growth is driven largely by consumers trading up from basic mobile phones to more modern technology as well as new subscribers (typically younger, affluent individuals) who are entering the mobile market at an affordable time. According to MasterCard, the percent of mobile and general internet users making online purchases ranges greatly, from 37% in Oman to a high of 95% in Kuwait. This disparity is predicted to level out in the near future as the availability of technology grows. For example, in 2015, 79% of Saudi Arabia’s entire population used a smartphone, and in the UAE, the corresponding figure was 91% (an increase of almost 20% from the year before). In Kuwait, smartphone penetration rose from 49% to 86% in two years.

From a regional perspective, the Middle East and Africa is a scattered continent of countries that boasts over 606 million mobile phone users, a figure expected to surpass 789 million by 2019. This total is only exceeded by the Asia-Pacific region, another emerging market also currently experiencing strong mobile growth. Combined, the two regions are forecasted to register nearly 80% of the world’s smartphone subscriptions by the end of the decade (Ericsson Mobility Report).

The fragmented nature of the smaller countries in the Middle East also decreases the hesitancy to participate in cross-border commerce. Regarding cross-border sales, 40% of purchases made by digital buyers in the UAE are on apparel, second only to travel and transportation (43%). Luxury items such as jewelry and watches are high in demand as well, with 33% of shoppers purchasing these goods. This should come to no surprise as high-end fashion is evolving into a booming market in the Middle East, with the sales of personal luxury goods reaching $8.7 billion in 2015, a $6.8 billion increase from the year before. In early 2016, Dolce & Gabanna launched their first line of hijabs and abayas in an attempt to capture the market demand, boasting bright prints, vibrant colors, and lace details. If the line is popular with shoppers, other comparable brands including Oscar de la Renta, Tommy Hilfiger, and DKNY are expected to follow suit (Vogue).

In conclusion, as the construction of fulfillment infrastructures is relatively new to the Middle East, eCommerce capabilities and expansion has and will almost certainly continue to be a unique and possibly thriving area in the coming years. Internet accessibility continues to increase throughout the region, especially through the availability of smartphones, and with this mobile commerce itself is naturally expanding. Over the next few years, the cultivation of a prosperous digital economy seems very likely and should prove to be an interesting evolution to come, especially for luxury and fashion retailers.

5 Key 2016 eCommerce Trends

Posted on January 8, 2016 at 12:26 pm

 

 

With a burst of silver confetti, glimmer of fireworks, and the annual drop of the crystal ball (or an oversized conch shell, peach, moon pie, 80 pound cheese wedge, or even a massive potato, if you’re lucky), 2015 came to a close. Retailers exhaled at the conclusion of the holiday peak season and are looking to the New Year with hopes of furthered growth and successes, likely with the help of targeted strategies and specialized technologies. After consulting the leading industry research companies and PFSweb subject matter experts, it is looking to be a big year for the following 2016 eCommerce trends…

 

Mobile (Smartphones & Tablets)

With the evolving platform of mobile wallets, payment behavior via digital devices is expected to shift and standardize, transforming mobile browsing into mobile purchasing. In 2016, eMarketer estimates that 37.5 million people in the U.S. (19% of smartphone users) will transact with their phones at the point of sale, which equates to an approximate 61% year-over-year increase. By the end of 2016, mobile payments are expected to exceed $27 billion. Gartner predicts that, by 2017, U.S. mobile commerce will have increased so much in popularity that it will account for 50% of U.S. total digital commerce revenue. This could largely be influenced by the introduction of larger screen sizes, as seen with the iPhone 6 and 6 Plus as well as the similar Android products, such as the HTC One and the Galaxy. Bigger screens and the popularization of simplified, one-touch check-out processes will supposedly assuage the hardship of thumbing ones transactional information into a device.

 

Flash Sales

Online sales are projected to account for 9% of all U.S. retail sales in 2016 and, according to Forrester, the increase in total spend per person is expected to jump from $1,207 to $1,738 from 2015 to 2016. With this perceived growth, it’s likely that retailers will want to employ more flash sales, which can prove challenging from an operations perspective. Billy Malady, PFSweb’s Area Vice President of Distribution, weighed in on the trend and spoke on the operational shifts that must be made in preparation for the order spikes associated with flash sales. Traditionally, eCommerce order volumes are higher on Monday due to the popularity of weekend ordering, and as the week progresses volumes decrease. However, flash sales disrupt this pattern by making any day of the week a high volume day. The distribution centers (DCs) must prepare, sometimes quickly, for an increase of the necessary packing materials, a larger headcount of employees, and an identification of SKUs that will be affected by the sale. “Flash sales add a level of volatility to an already unpredictable business,” commented Billy, “the DCs will require more involvement in order to stay in front of these sales; know the dates, know the volume, know the SKUs, know the expectations, and plan, plan, plan.”

 

Beacon Technology

Beacons are pieces of hardware that can be attached to walls or countertops within brick and mortar stores that use low-energy Bluetooth connections to transmit messages or prompts directly to a nearby smartphone or tablet. They also have the ability to pinpoint a customer’s location within a store. According to Retail TouchPoints, approximately 29% of retailers worldwide have already deployed beacon technology. In addition, over 54% of top retailers (defined as those with above average growth) believe that beacon technology will drastically change the way companies do business in the next three years (Retail Systems Research). Since beacon technology can enable proximity-based marketing to collect in-store feedback in real-time, retailers should be able to leverage sales of specific items that are close in proximity to a customer. For example, if a customer is looking through the jeans section, the in-store beacon could send him or her a discount on a specific brand of jeans with the hopes of persuading the consumer to make the purchase. These retailers should also be able to design store layouts that are more conducive for the needs of their shoppers by recording and compiling the most common walking paths as they enter the store, thereby improving the overall customer experience. In fact, Business Insider expects beacons to directly influence over $40 billion worth of U.S. retail sales in 2016 alone.

 

Real-Time Analytics

The data gathered from real-time analytics allows digital teams to personalize user experiences more than ever before. Randy Culpepper, the Digital Analytics and Data Science Senior Manager of LiveArea, The PFSweb Agency, offered his knowledge on the growing trend. As a shopper browses, real-time analytics can make predictive recommendations early in the engagement journey rather than waiting for preset logic triggers to respond. As the real-time data is collected, a content management system can deliver product information and recommendations based upon a user’s browser behavior, which, according to Randy, will ultimately “save a lot of ‘lost’ sales due to a user’s inability to locate a product within the site”. However, if a company doesn’t have the resources or time available to monitor the information in real-time, the valued data that could have been gained is forfeited. Those adopting the practice early on are also able to see benefits through the ability to provide immediate responses to social media activity.

 

Messaging Apps

With WhatsApp and Facebook Messenger growing closer to 1 billion monthly active users worldwide, it’s easy to see how the trend will be substantially important in 2016. Facebook has plans to add more services and marketing opportunities for brands in both Messenger and WhatsApp. In 2016, messaging will likely no longer be a way of communicating with friends, but also a way to talk to a computer system that can arrange restaurant reservations, order an Uber ride, send a gift to a friend for their birthday, book a flight back home for the holidays, or assist with virtually any task one could want. As the average smartphone user spends about 84% of their time in five apps or less, retailers want to engage potential customers within apps like Facebook because that’s typically where more time is spent and where an increasing number of purchases are occurring. Therefore, the transactional experience for the user will likely resemble texting or messaging a friend. Currently, Google and Facebook are the two giants squaring off to create the best and most widely used chat service (USA Today).

 

2016 is looking like a considerably important year for new developments and implementations of technologies that benefit consumers with convenience, ease of use, and discounted prices to entice sales. It appears as though it may be a year where automation and personalization will officially begin to reach the forefront of the customer shopping experience, simplifying the process and increasing the level of comfort while shopping online.