This is easily the most fun blog I’ve ever written, as I’m talking about my favorite professional development activity: online shopping.
Working in a company with the best commerce platform in the world, we do have the pressure to be fully proficient when it comes to digital commerce, or in the layman term: online shopping.
But first things first, speaking about digital commerce, I am still taken aback from time to time when I come across businesses that have no online presence, especially since digital commerce is not new; it is as old as forty years, and to this day, thousands of businesses have entered the online market each year since its inception in the 70s.
Today, the digital commerce market continues to expand across the globe. According to Statista, in 2017, retail e-commerce sales worldwide amounted to 2.3 trillion US dollars, and the revenues are projected to grow to 4.88 trillion US dollars in 2021. Asia is quickly taking over as the largest e-commerce market; China represents 42% of global e-commerce market share in 2016, twice the size of the United States’ share at 24%.
Digital commerce is here to stay.
Digital commerce continues to evolve
The digital commerce market has not only been growing, but it has also been evolving, with customers in control of their own customer journey – especially so in the past decade. Just as the internet has grown into the desired channel for marketing, digital commerce has grown to rival traditional shopping in many ways, influencing up to 56% of in-store purchases – what worked in the past no longer does today.
That’s why we commissioned SAP Consumer Propensity Study earlier this year: to better understand consumers’ online shopping behaviors and their motivation to complete purchases. The results have been culminated to help retailers deliver exceptional digital commerce experience to their customers.
Participants were asked questions regarding the kind of products or services they would buy online, as well as the reasons they abandon their shopping carts. At a high level, results confirmed that shipping cost was the top reason for abandoned carts across the markets, except China and Korea that was more concerned with a lack of discount and for price comparison respectively.
Price sensitivity seems to be an important factor across all markets, followed by stock and logistics for cart abandonment; a third of Thai consumers abandoned carts due to longer-than-expected delivery times. This calls for a superb supply chain management, beyond the exceptional user experience, to ensure stock availability and speedy delivery integrated into the e-commerce systems to give customers visibility of if and when they will receive the products.
www (what we want) out of online shopping
The data confirms what we already know: Consumers are seeking more than just buying something on a website, they are price-savvy, well-informed, and they expect brands to know what they want as they browse the online store.
Let’s take a closer look at what customers are searching for when it comes to online shopping.
It’s not all about discounts: I said “not all;” discounts are, of course, still important and could be the primary pull factor. But it takes other things like low shipping cost, fast delivery time, and sufficient stock to make me hit the purchase button. This is where the demand chain needs to meet the supply chain.
Stock availability and physical deliveries are crucial in e-commerce. Retailers need to be conscious of the supply chain and logistics decisions they make that impact availability and delivery.
Make efforts to know me: In the past, personalised experience was a given in a setting of brick-and-mortar shop, especially if I’m a regular customer. The owner or the staff would know what I like and don’t like, and would reserve items that they think I would be pleased with, and then buy. Why should that go away today just because the experience is moved to the digital environment, especially since we are much more advanced in technology? Customers will go back when there’s a relationship established.
Today, customers are not just asking for more engagement channels, they want individualisation. In other words, relevant offers and promotions. Gone are the days of hoping that marketing tactics work. Marketers must deliver contextual marketing, which works by capturing both implicit and explicit customer signals to understand both the historical information and the future propensities, leveraging advanced analytics like AI and machine learning algorithm to constantly anticipate customer’s behaviours and understand their real-time intent.
Give me a 21st century online shopping experience: When it comes to fashion, I love vintage – not so much when it comes to my digital commerce experience. User experience is critical for a great online shopping experience, and contrary to what you might think, this is not just the façade.
A great user experience – one that is modern, smooth, and smart – is a by-product of a complete, end-to-end commerce solution. It includes product content management, web content management, and order management, which powers personalised experiences on all channels; hence avoiding cost and complexity.
Speaking of a modern online shopping experience – do bring in new technology. Augmented and virtual reality features are no longer novelties, and customers are eager to embrace them. Chatbots can give the fast service customers want 24/7. Advanced data management and analytics tools allow retailers to gain insight from data on consumer behaviours, economic factors, weather patterns, cultural trends, and so on, to make decisions in the moment about pricing, stock decisions, promotional offers, marketing campaigns, and more.
As a closing, it’s really simple (I said simple, not easy): Make it a seamless and pleasant online shopping experience for me and I will key in my credit card details.
Get the detailed findings of the SAP Consumer Propensity Study! Download the full report here.