By Christine Kern, contributing writer
New guide demonstrates how eCommerce marketplaces are impacting global online shopping trends.
The retail industry is experiencing a dramatic transformation and is not the same landscape it was just five years ago. From new channels for shopping to industry consolidation, store closings, and store openings, the shopping experience has changed substantially.
A new study from Radial, “The Retail Tactics Needed To Win Online Shoppers,” examines how brands and retailers can leverage customer expectations to ensure that they can maintain a competitive edge against rival ecommerce powers like Amazon and Walmart.
As a result of the innovation of these titans, independent brands face the need to meet higher expectations or lose sales. That has led these retailers to ask questions like these:
This new eBook examines the responses of more than 4,000 consumers across the U.S., U.K., Canada, and Australia to reveal what they value in their online experiences, where the opportunities lie, and how brands and what retailers can do to ensure their competitive edge as the industry continues to evolve.
The study found:
Amazon is the leading eCommerce marketplace, and the survey revealed some important ways they are setting the tone for customer expectations. First and foremost, the study found, for shoppers on these marketplaces, price is king. More than 60 percent of respondents said that the most important factor when shopping online is price. Knowing and trusting the brand behind the product came in at a distant second, (42.8 percent in the U.S.), demonstrating that retailers need to find ways to build brand loyalty to maintain name recognition and remain competitive.
Customers also say shipping times and easy returns are equal in importance when shopping online. In the U.S., shoppers are split between expecting two-day delivery (or faster) at 34.6 percent, and expecting delivery within a week (34.1 percent), demonstrating the opportunity for flexibility in retailer delivery windows. And easy returns produced similar figures.
But shoppers are also savvy, and say that free or inexpensive delivery is more important to them than expedited shipping. In fact, 60 percent of consumers say they do not expect to pay for shipping and 23.5 percent saying they will pay up to $10.00 for shipping costs. The survey concludes, “The correlation of cost and delivery time is inconsequential – as long as consumers don’t have to pay for their goods to ship, they are willing to wait for them to arrive.”
Research showed that Clothing and accessories is the top category consumers purchase online (55.5 percent), followed by electronics (43.2 percent), then health and beauty (28.7 percent). And while in most regions, grocery has not yet broken into the top three categories purchased online, it does present a real area of opportunity and growth for retailers. According to a global study conducted by consumer market research firm Euromonitor International, global online food and beverage sales will rise 80 percent over the next five years.
Thus, the study asserts, “The increase in online grocery is consistent with the survey finding that most online shoppers are purchasing lower cost items and generally spend less than $100 per month on goods. The UK reported the largest number of low spending shoppers, with 56.2 percent of respondents reporting that they spend under $100 per month online. US respondents exhibited a nearly even split between those that spend less than $100 per month (42.2 percent) and those that spend between $100-500 per month (42.3 percent).”
Ultimately, the findings reveal that consumers favor cost over brand loyalty, proving to be a wakeup call for brands that they need to invest in intelligent cost-cutting strategies while maintaining a superior customer experience. Radial states, “If cutting prices is not an option, then brands should aim to find other differentiators to ensure they are delivering the same (or more) value than brands offering value pricing. This can be accomplished through customer convenience, a seamless online experience, personalized product recommendations, various delivery options and secure shopping – all components that contribute to an unparalleled shopping experience.”