Online Shopping Growth Rates Remain Strong
Thanks to the widespread availability of both Wi-Fi and cellular Internet service combined with the popularity of mobile devices like smartphones and tablet computers, consumers are flocking to e-commerce sites in record numbers. According to the Internet monitoring company comScore, during the 2012 holiday shopping season (November and December) American shoppers spent a record $42.3 billion at online retail stores, up 14 percent from 2011! Industry-watchers predict this double-digit growth trend will continue, estimating that online retail sales will increase from $226 billion annually in 2012 to $327 billion by 2016.
Why Online Shopping Is On The Rise
A major factor in the rise of online shopping is an overall increase in consumer confidence with digital banking and finance; shoppers now feel more comfortable with the security of online shopping sites and Internet-based payment methods than they did in the past. Another driving force behind the growth of e-commerce is convenience; online shopping allows consumers to browse and buy 24 hours a day, 7 days a week from anywhere, saving the time and hassle of traveling to a brick-and-mortar retail outlet.
Many retailers have also been able to lower prices and provide incentives to shoppers like free shipping and online-only discounts, thanks to the reduction in overhead costs. These Internet-based deals have helped boost online spending, particularly among savvy shoppers who are price-sensitive. Online shoppers also note that e-commerce sites provide them with a greater selection of merchandise than traditional outlets do, allowing them to buy hard-to-find products, sizes, and styles with a simple click of a mouse.
How Mobile Use Affects Online Spending
Mobile device use has been credited as a major factor in the rise of online shopping; as of November 2012, over half of all cell phone users in the U.S. owned a smartphone (Internet-enabled phone) and many of them use their phones to shop; between May 2011 and May 2012 mobile e-commerce grew by 89%. Smartphone use has also led to the rise of a consumer behavior known as “showrooming” – shoppers browse merchandise at a retail store then use their mobile device to comparison shop right from the showroom floor. This means that retailers need to offer a mobile-friendly site to capture a share of the growing mobile e-commerce market.
The Future of e-Commerce
Online shopping and spending has transformed the retail industry and the trend towards e-commerce is predicted to continue throughout the next decade. Advances in technology (such as SmartTVs and the widespread availability of low-cost mobile Internet devices, Wi-Fi, and 3G/4G cellular service) combined with increased consumer confidence in online payment methods means that retailers need to develop a strong Internet presence in order to thrive in the new digital retail environment. For some businesses, this means that their brick-and-mortar stores will be completely replaced by an online e-store; for others, their existing retail operations can be supplemented with a mobile-friendly e-commerce site that provides consumers access to their products 365 days a year, ensuring that customers can have instant access to the products and services they want on their own terms.
If you are considering developing an online store or need some help with an existing store, please don’t hesitate to drop us an Email to see how we can help!