The things we buy online today extend to any possible category: Products – food, beverage, non-food, beauty, household goods, appliance, etc.; services – health insurance premiums, telecommunications, financial services, consultancy, diet plans, fitness lessons; and content – subscriptions, information, video. Overall, electronics, fashion, services, books, and tickets are the top categories for e-commerce; groceries and household items are the least commonly purchased, according to A.T. Kearney.
Online commerce holds many advantages for shoppers: they are able to make decisions more wisely, gathering information and comparing prices. They are able to find the best available price for a product or service; the largest variety of products; and they can shop at any time and from any place.
For brands, online commerce presents a huge opportunity to sell direct to the consumer, establish loyalty, and define the entire shopping experience. Indeed, numerous brands have successfully established an online presence; and this, along with new e-commerce entrants, creates a fierce competition to established retailers, as well as a polished business model and brand new offerings.
Retailers are trying to continuously grow the market by addressing barriers, such as the need to touch the merchandise, the concern that the product wouldn’t fit, and the price / timing of delivery. They use a variety of new technologies and solutions, including AR / VR, and peer-to-peer delivery or click and collect, to maximize conversion rates.
Some of the most prominent growth strategies include:
- Omni-channel retailing, including setting up a store front for experimentation – aimed at driving digital commerce. This enables the shopper to try before they buy, and receive personal service.
- Developing mobile apps to support loyalty building; using content to drive informed – or impulse – purchasing (including reviews and videos). This supports immediate, ultra-convenient purchase, and drives repeat purchase.
- Using social media and messaging apps to build a personal connection with the shopper: social media is one of the most important platforms used by the shopper throughout the shopping journey. It affects shoppers’ decisions and also prompts purchase through re-targeting and ads.
- Using affiliate marketing, which has become an important source for driving sales. This includes a growth in collaborations between brands and other like-minded brands and retailers.
- Rewarding subscribers – subscriptions provide convenience and ease of mind for shoppers, and help retailers avoid constant competition. Therefore, we expect to see more compelling subscription propositions.
- Personalization and immediate offers (such as couponing). To really drive personalization in the future, we believe that an actual interaction will have to take place. However, this does not have to be led by a human being; “bots”, as well as other automated, big data and personal data based systems, can also be utilized.
- New business models include the empowerment of the consumer – turning the shopper into a seller through a swap / sell / buy tool, thus growing the merchandise sold on the platform.
To sum up, e-commerce has gone a long way from merely constituting as another sales channel. it calls for a deeper need analysis and new model creation, to leverage the added value that consumers gain from the digital platform, while considering the best tactics to overcome barriers.