By: Catherine Perry
Ecommerce continues to grow by leaps and bounds!
There are many statistics substantiating the fact that ecommerce is gaining momentum quickly in being the preferred shopping method in the U.S. and globally. Through the internet you can find statistics for ecommerce by retail sectors, demographics, digital methods, and countries—each giving you specific information on everything ecommerce. But the statistic we believe is the most important of all is the one that shows the strength and growth, both current and projected, of the ecommerce market as a whole. Our research tells us that online sales growth is projected to increase annually 9.32% over the next five years.
An increase in online sales growth annually of 9.32% is a very strong number. Regardless of the benefits of owning your own business, being able to work from virtually anywhere on the planet, being your own boss, calling the shots, having flexibility—the benefit of being in an industry that is growing is the biggest benefit of them all! No one wants to be in a dying industry. Before becoming ecommerce owners, many of our clients had worked in industries that ended, like manufacturing. So, when embarking on their next chapter our clients were all looking for something that was on an upswing and projected to keep going up! And, guess what…ecommerce is that industry.
According to Forrester Research in their report titled “U.S. Cross-Channel Retail Forecast, 2015 To 2020,” online sales are predicted to grow by an average annual rate of 9.32% over the next five years. The report goes on to say that online sales in the United States are expected to reach $523 billion in the next five years, which will be an increase of 56% from $335 billion in 2015! These statistics should excite anyone who is currently a part of the ecommerce retail industry, as well as, entice anyone who is thinking about this industry as their next career.
Based on data released this past February, 2016 from the U.S. Commerce Department, InternetRetail.com showed online sales accounted for more than a third of total retail sales growth in 2015. Below is a chart showing the growth of web sales for the last 10 years (2005 – 2015).
Within this umbrella of tremendous growth of the ecommerce retail industry, there are other statistics that are important for ecommerce owners to note as you grow your business.
Increase in the Use of Mobile Devices for Shopping
According to PFS Web, in their blog article on the 5 key trends in ecommerce for 2016 (http://www.pfsweb.com/blog/5-key-2016-ecommerce-trends/), “In 2016 an estimated 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.” Moreover, the technology research firm 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.”
The Importance of the Customer Experience
All shoppers are focusing on their experience right now, including the online shopper. Just as a shopper expects good, if not great, service in a brick-and-mortar store, the online shopper demands the same and even more so. Because digital shopping does not have the benefit of seeing the product up close and touching it, the entire experience is more heightened in whether it is good, mediocre, or bad.
In the marketing firm Invesp’s blog article “The Importance of Providing a Great Customer Experience,” we found these statistics that provide an insight into the importance of the online shopping experience:
55% of consumers would pay more for a better customer experience
A customer is 4 times more likely to buy from a competitor after experiencing a service-related issue, as opposed to a price or product-related issue.
A 10% increase in customer retention levels results in a 30% increase in perceived company value
Social Media Draws Traffic
There is no doubt that today’s digital world has embraced social media. Social media is an integral part of life. And, ecommerce must engage in this form of communication to grow and thrive. In an article written in 2013 by Jill Schmidt for InfoTrust titled “The Importance of Social Media in Ecommerce,” she cites Hubspot’s research that “social media use in the United States has increased 356% in the last seven years.” Additionally, she quotes from Hubspot that “as of 2012, 52% of businesses had acquired a customer via Facebook and 44% had acquired a customer via Twitter. Nielson “reported that nearly 70% of adults who partake in social media buy products or services digitally.” These statistics were from 2013! The numbers have only gotten larger in the last 3 years. So, it is extremely important for ecommerce retailers to have a voice in social media for branding, relationship-building, driving traffic, and increasing sales.
By the year 2016, TrueShip says, “Online sales driven from social media will grow 93% per year.” In your social media platforms, it’s okay to promote your brand once in a while, but it’s better to connect with your customers all the time. Consumers aged 18 to 29 use a brand’s social media site for customer service interactions (43%) than for marketing (23%). (J.D. Power and Associates Social Media Benchmark Study). Social media should make a customer’s experience better, but it is not the core of their shopping experience. Keep this in mind as you want to provide easy access to support and information on your website while offering exceptional customer service with a friendly shopping experience!
We hope this article, with all of its facts and figures, has given you some specific data to show that the ecommerce industry is strong now and only gaining strength in the foreseeable future, as well as 3 important areas that need to be at the top of your priority list. It is truly an exciting time to be in ecommerce!