A Complete Guide On Online Shopping Trends
The online shopping industry in Australia was worth $37.8 billion last year – and it continues to grow rapidly at a rate of around 40% annually. Online spending is increasing year upon year with no signs of slowing down anytime soon. In 2014, 15% of consumers made their most recent purchase online and this rose to 1 in 5 by 2015. By April this year, online retail turnover accounted for 3% of total retail turnover. Where is this turnover generated, and how are online shoppers spending their money? We take a look at some of 2016’s key online retail trends, and how companies are addressing those trends to improve the customer experience.
Unlike many countries which tend to favour national brands online, Australia’s population is most likely to buy from overseas retailers. 86% of shoppers purchase from US retailers, and 74% opt for UK stores. Another key difference in the Australian market is a preference for retailer’s own websites, with 4 in 5 shoppers buying direct. In contrast, over three quarters US citizens are more likely to use an online marketplace than a brand’s site. This could reflect a growing demand among the nation’s consumers for greater service and clarity when shopping online.
Why Customer Service Counts Online
Shopping in a physical store gives the consumer much more control over the purchase. They can see the item they want to buy, and even test it out or try it on. They have a physical location to return the product to in the event of a problem, and are protected by decades of legislation in the event of a problem. Online retail carries far greater risks for the consumer. They have to rely on the integrity of the seller, and should something go wrong it is much harder to take action. As a result, online shoppers are much more cautious about where they do business.
As well as choosing a brand they know and can trust, online shoppers want a retailer who is easy to contact and who offers plenty of product information so they can make a balanced decision about whether to buy. Customer service is fast becoming the most important part of online marketing, with many research analysts noting that service has overtaken customer acquisition for the modern business. Any company wanting to improve online conversions should take a look at the customer sales journey and try to enhance and improve that experience.
Key Brands & Product Trends In The Online Retail Industry
With international brands so popular, it is surely no surprise that vast marketplaces such as eBay, Amazon and Etsy feature highly in the top 50 online retailers. Woolworths, Target and other department stores also get a lot of business online. “When shopping online, customers prefer the brands they are familiar with,” said retail analyst John Baker from AGL Research Inc. “Trust matters when buying online, and buyers are more comfortable if they know the retailer well.”
The most common online purchase for 6.5% of consumers is tickets for entertainment and events, with travel and accommodation second at 6.4% Other frequent online buys include ladies’ clothing, music downloads and takeaway food. Books, videos and music account for 51% of all online purchases, while grocery shopping is still catching up.
Services obtained online are also growing in popularity. Many people now order fast food for delivery through their tablet or mobile phone, and around 4 in 10 mobile users find local stores and services via GPS geo-search features. Ridesharing applications such as Uber are popular with the younger generation, and are another way that consumers are engaging with services online.
Online Versus Store Shopping: Key Trends
One in six customers will buy an item online that they spotted in store, because consumers feel that better discounts and deals can be found via the internet. Those buyers also want to be better informed about the products they buy: consumers recognize the risks of buying online without first seeing the product, so will usually seek greater reassurance.
When shopping online, consumers seek out information before settling on a purchase. 62% will check out a retailer’s website for information before buying a product, and 40% take a look at the manufacturer’s site for details.
Mobile purchasing is on the rise. In 2014, 40% of global shoppers used mobile to order goods or services. In 2015, this had increased to 46% and estimates suggest by the end of 2016 mobile could account for half of all online sales. In response to the demand for mobile-ready retail, brands and marketplaces are turning to mobile applications to improve the customer experience.
Moving forward, we can expect a bigger push for online retail as consumers become even more tech-savvy and start demanding more integrative retail services. One thing is certain: online retail will soon overtake traditional shopping and change the way we look at the market forever.