E-Commerce Trends & Innovations: The Rise of Omni-Channel Retail
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The document discusses the evolution of e-commerce, highlighting the rise of omni-channel retail as both digital and physical stores converge to offer seamless shopping experiences. It outlines trends such as increasing mobile commerce, the influence of AI and smart home devices, as well as consumer preferences shifting towards online purchasing, especially in categories like fashion. It also emphasizes the significant growth potential in e-commerce, particularly driven by technological advancements and changing consumer habits, with projections of increasing online retail sales worldwide.
E-Commerce Trends & Innovations: The Rise of Omni-Channel Retail
- 1. E-Commerce Trends: The Rise of Omni-Channel Retail Hamutal Schieber, Ruth Lewin-Chen | November 2017
- 2. Introduction: Omni-Channel Commerce • “Don’t think of e-commerce as a channel. It’s a way for consumers to research, to buy, to experience brands and then, ultimately, to have them have fulfilled”. These words, by Coca-Cola North America EVP Sandy Douglas, manifest the implementation of e-commerce as a purchase enabler rather than destination. • E-commerce, therefore, is becoming a component of omni-channel commerce, as brick & mortar competitors establish digital presence, and previously pure-play digital competitors establish a physical presence. Online, mobile, physical – all integrate into a seamless shopping experience, with channels blurring, and pureplay competitors entering brick and mortar through acquisitions – and vice versa (e.g., Amazon’s acquisition of Whole Foods Market, and Walmart’s acquisition of Jet.com and Bonobos). • In addition, growth in methods such as auto replenishment, subscriptions and meal kits; smart home device penetration; and new delivery and payment technologies, may boost e-commerce at a faster rate despite recent slowdown. eMarketer, Worldwide retail ecommerce sales: eMarketer’s updated estimates and forecast through 2015-2020
- 3. Market Trends Map BestBetterGoodTrend / Strategy Stylists at hand, omni-channel service, curation + leveraging data, samples with purchase Personalized couponing, chatbots Recommendations based on previous searches/ orders, Wish Lists, loyalty schemes, social log-in Personal Touch AR / VR / photo analysis for fitting, social integration, try before you buy “real people” demonstrations, creating communities, chatbots, intelligent assistants Ratings and reviews, videos, guides, price comparisons Better Decisions IoT and wearables, auto- replenishment, click and collect, smart devices, voice omni-channel, Mobile Commerce, social commerce Bundling & item pairing, m- commerce, product comparison Hyper Convenience same-day delivery, 1-hour delivery, “pre dawn” arrival Click & collect, lockers, track shipment, free shipping 2 day delivery, free shipping over a specific sum, package tracking Delivery & Shipment New business models (e.g., rent it, sell it, swap it), surprise boxes, pop up stores Free trial / sampling, promotions/ cashback Convenient cancellation & return policies, omnichannel service, chats Call to Action Source: Schieber Research, 2016 - 2017
- 4. Online Retail Share of Total Retail • Global retail e-commerce sales, including products and services (barring travel, restaurant and event ticket sales) ordered via the internet over any device, reached $1.9 trillion in 2016, accounting for 8.7% of total retail spending worldwide (source: eMarketer). • According to eMarketer, e-commerce sales growth worldwide has slowed from 27% in 2014, to 24% in 2017, and eMarketer predicts that this trend will continue, reaching 16% growth in 2021. Schieber Research believes, however, that due to the gap between low penetration rate and high potential of e-commerce, as well as the influx of new (enabling) technology for ordering, delivery and payment, growth will accelerate. 1,336 1,548 1,859 2,290 2,774 3,305 3,879 4,479 0 500 1000 1500 2000 2500 3000 3500 4000 4500 5000 SALESINBILLIONU.S.DOLLARS Retail e-commerce sales worldwide 2014 - 2021 (in USD Bn)
- 5. Online Retail Share of Total Retail • Brick & mortar competitors enter the e-commerce world by acquiring companies that are digitally savvy, and have the data and experience that can leverage a company’s physical business, by investing in them, or by investing in own platforms. Recent examples include: – PetSmart’s huge acquisition of Chewy.com for $3.35bn – Walmart’s acquisitions of Jet.com for $3.3bn, Bonobos for $315mn, Shoebuy for $70mn, and delivery company Parcel and fashion retailer Modcloth for an undisclosed amount (lower than the above acquisitions) – Unilever's acquisition of Dollar Shave Club for $1bn – Wal-Mart ‘Store No. 8’ tech incubator in Silicon Valley Biggest e-commerce deals of all time Target (acquirer, year) Source: Recode, April 2017
- 6. Digital Commerce: Penetration Rates • For some product categories, such as furniture, or homeware and household appliances, consumers prefer to go to a store to see and try the products. • For this reason, more retailers are adopting a “showroom” model: a store which constitutes a hub for trial and consultancy, with mobile payment and direct to home delivery. • Nielsen reports that, globally, 58% of respondents in a 2016 survey said that they have made a purchase online in the fashion category, and just 21% reported making a purchase in fresh grocery. Indeed, according to data from PwC, the grand majority of consumers still prefer to shop for groceries in brick and mortar stores, but with the influx of food and beverage direct to consumer offerings, including the expansion of Amazon Fresh and Jet.com in the US, and rise in meal kit penetration, Schieber Research believes online grocery will grow significantly. 58% 55% 50% 43% 41% 40% 29% 27% 38% 27% 24% 23% 23% 21% 18% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% Fashion-related products Travel products or services Books/music/stationery IT & mobile Event tickets Consumer electronics Furniture, decor, tools Video game-related products Beauty & personal care Restaurant & meal kits Packaged grocery food Medicine or health care Household cleaning Fresh groceries Flowers, gift sets Source: Nielsen, Worldwide; October 31 to November 18, 2016; total survey n = 30,000 Share of internet users who have ever purchased products online as of November 2016, by category
- 7. Online Retail Share of Total Retail • eMarketer expects retail e-commerce sales to increase to $4.058 trillion in 2020, making up 14.6% of total retail spending that year. eMarketer, Worldwide retail ecommerce sales: eMarketer’s updated estimates and forecast through 2015-2020 7.4% 8.7% 10.1% 11.6% 13.1% 14.6% 15.5% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 2015 2016 2017* 2018* 2019* 2020* 2021* Shareofe-retailsales E-commerce share of total global retail sales from 2015 to 2021 58.3% 60.2% 61.6% 63% 64.6% 65.2% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 2016 2017 2018* 2019* 2020* 2021* Shareofinternetusers Digital buyer penetration worldwide 2016-2021 In 2017, 60.2% of global internet users had purchased products online (1.66 billion internet users), and this figure is expected to reach 64.6% in 2020 (over 2 billion). Growth potential is huge, due to this increase in penetration – as well as through increasing frequency and basket size of existing shoppers.
- 8. E-Commerce by Market • The Asia Pacific region registered the highest penetration rate of e-commerce sales, with 12.1% in 2016. • In fact, China has been the growth engine of global e-commerce, with sales of $ 975 billion in 2016 according to Euromonitor, and surpassing $ 1 trillion in 2017 according to eMarketer. 12.1% 8.3% 8.1% 3.4% 1.9% 1.8% 0.0% 2.0% 4.0% 6.0% 8.0%10.0%12.0%14.0% Asia Pacific Western Europe North America Central & Eastern Europe Latin America Middle East & Africa Share of total retail sales Source: eMarketer 975 648.6 192.5 124.4 79.1 74.1 71.3 43.5 44.7 24 766.5 595.1 174.2 114.4 71.9 66.2 64.8 35.7 25.5 22.8 0 200 400 600 800 1000 1200 China United States United Kingdom Japan France Germany South Korea Canada India Russia Market size in billion U.S. dollars Market 2016* 2015 Worldwide largest B2C e-commerce markets in 2015-2016 Source: Euromonitor
- 9. China: The World’s E-Commerce Growth Engine • Centralization is one of the contributing factors for China’s e- commerce boom: whereas in the US leading retailers operate independently through their own websites, China’s Alibaba is responsible for over 75% of e-commerce transactions, with websites including tmall.com, Taobao, and Alibaba.com. • Alibaba is an extremely innovative competitor, fine-tuning all elements in the consumer’s journey, including the store fronts (in collaboration with brands and through social media), the shopping process (including VR), delivery and payment technology (mobile apps). • The single-login element of China’s e-commerce is something we also see in the US – through Facebook, rather than Amazon. Combined with Facebook’s “store front” position, and the strides it is taking on the content-commerce front with Instagram, the company’s e-commerce future seems bright.
- 10. China’s Mobile Commerce • Another interesting fact is that over 50% of China’s digital commerce stems from mobile commerce, with chat apps such as WeChat driving this trend. China, like many other developing markets, went straight from brick and mortar to mobile – many shoppers have never made a purchase using desktop. We might speculate that younger generations in America and Europe will go through the same process. Mobile wallet usage reach among mobile shoppers worldwide as of August 2016, by country 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% China Norway UK Japan Australia Colombia Country average United States Singapore Canada Austria France Ireland Brazil New Zealand SHARE OF RESPONDENTS Source: IAB
- 11. Device Trends in E-Commerce • Mobile is becoming more dominant in e-commerce shopping, as eMarketer expects 48.5% of e-commerce sales to stem from mobile commerce in 2020. • At the same time, artificial intelligence is becoming the growth engine for mobile commerce, with smart assistants, chatbots and smart appliances all changing how people buy digitally, converging mobile and social commerce. U.S. mobile retail commerce sales as percentage of retail e-commerce sales from 2015 to 2020 23.6% 29.1% 34% 39% 44% 48.5% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 2015 2016* 2017* 2018* 2019* 2020* SHAREOFE-COMMERCESALES Source: eMarketer • According to reports, Amazon is planning to launch its own Alexa-integrated messaging app, called “Anytime”, that will let users text, call, video chat, play games and send photos across a range of platforms including iPhone, Android and PC. Anytime will link with other key Amazon offerings including music, food delivery, shopping and interacting with businesses.
- 12. Device Trends: Connected Devices • Connected devices, including wearables, smart appliances and smart homes are expected to experience growth by 2021. • This affects how people buy everyday items, especially, since it creates a limited choice of retailers that are integrated with the device. Number of connected things/devices worldwide by vertical from 2015 to 2021 (in millions)* *Berg Insight, Worldwide; 2015 ** including appliances 0 1000 2000 3000 4000 5000 6000 7000 8000 9000 2015 2016 2017 2018 2019 2020 2021 Other Healthcare Wearables Smart homes Smart buildings Smart cities Automotive POS/Vendong/ATM Consumer electronics** Utilities
- 13. Mobile Commerce • The growth in M-Commerce stems from technological advancements in mobile image recognition (MIR), augmented reality and NFC-enabled payments – as well as the growth in mobile penetration, usage, and types of use (including accessing social networks and video content through mobile devices). Mobile popular mobile purchase channels of mobile shoppers worldwide as of August 2016 49% 32% 31% 25% 22% 17% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% A retailer's website or app An auction website or app A brand specific website or app An aggregator website or app A social media website or app A messaging app SHAREOFRESPONDENTS IAB, Worldwide; July 22 to August 17, 2016; 18 years and older; 3,800 Respondents; mobile users who have purchased a product or service on mobile in the past 6 months • Convenience is the number one reason for purchasing through mobile, on all regions but South America where the number one reason is “to save time”. 55% 45% 33% 25% 23% 21% 18% 12% 10% 39% 50% 35% 25% 22% 17% 23% 8% 12% 48% 44% 32% 24% 28% 22% 15% 11% 11% 52% 44% 35% 29% 23% 20% 16% 11% 10% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% It was convenient To save time To get the best price possible/to save money Couldn't find it in store To get something immediately/didn't want to wait For entertainment It's safer than carrying cash It's the only way for me to purchase items online Advertising prompted me Share of respondents Asia Pacific South America North America Europe Reasons for mobile shoppers to purchase products via smartphone or tablet as of August 2016, by region
- 14. Social Commerce • Social media is an important vehicle for driving awareness and consideration along the path to purchase, less so a sales channel. • “Buy now” buttons on Facebook are in decline, but at the same time, social media is a major purchase driver for shoppers. • ,Facebook announced that users will be able to order from restaurants right on Facebook, thus mo Primary attitude toward shopping via social media sites or buy buttons according to internet users in the United States as of April 2016 7.3% 2.6% 18.7% 45% 26.4% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% Used it before and plan to use it again Used it before and won't be using it again Open to it but haven't used it yet Would not use it Never heard of it SHAREOFRESPONDENTS eMarketer; Sumo Heavy. United States; April 2016; 18 years and older; 1,029 Respondents
- 15. Social Commerce: Platforms Social media platforms used to shop for products among social media users in the United States as of May 2016 55% 12% 12% 9% 5% 3% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% SHAREOFUSERSOFEACH PLATFORM eMarketer; Cowen Group, United States; May 2016; 18 years and older Content and commerce are becoming interlaced, presenting a renewed opportunity for social commerce. In the USA, this is evident from the huge part Pinterest plays in online shopping. Alibaba’s Taobao as a social commerce platform: a hub based on data, mobile, content, personalization and a loyalty program.
- 16. Chatbots: Growing Social/Mobile Commerce • A recent enabler for social media shopping is Chatbots. Chatbots are automated dialog systems which trigger dialog with customers within a messaging app or intelligent personal assistants (IPA) that use voice recognition, such as smart home devices (Amazon’s Alexa, Google Home etc.). • This artificial intelligence (AI) technology has been increasingly available via instant messaging apps such as Facebook Messenger, WhatsApp etc., and is especially popular among younger shoppers. • Voice is trending: Digital assistants and voice search are becoming more prevalent. Thanks to digital assistants such as Amazon’s Alexa and Google Home, people can already book trips, order pizzas, order groceries and compare prices, without encountering a screen. The implication is that brands need to be able to offer quick purchase options, including purchase history. They should also take into account the nature of search queries – which are how people naturally speak, usually in the form of a question.
- 17. Chatbots: Consumer Attitudes • The number of Chatbots available on Facebook Messenger grew X3 within six months: from 11,000 in June, 2016, to 34,000 in November, 2016. • According to Statista, more chatbots are currently in development for messaging apps (e.g., Messenger and the rising star Slack), than for virtual assistants; and indeed, consumers prefer messenger over virtual assistants when it comes to chatbots 34% 27% 25% 20% 20% 15% 15% 10% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% SHAREOF RESPONDENTS • 34% of respondents stated they would be comfortable receiving customer service from artificial intelligence in online retail, compared to 20% in banking, 15% in insurance and 10% in government; which means that for complex decisions and information, shoppers are interested in speaking to an actual human. Pega, Worldwide; 2017; 18 years and older; 6000 Respondents Acceptance of artificial intelligence chatbots by customers worldwide, as of 2017, by service
- 18. Chatbots • Levi’s, one of our “best in class” companies of previous reports, recently launched an online feature available through Facebook Messenger – a ‘Virtual Stylist,’ which “takes all the wisdom of our in-store style experts and puts it at consumers’ fingertips 24 hours a day.” • The chatbot is powered by mode.ai and personalized fit data from True Fit (another best-in-class company, reviewed in another report). Beyond Messenger, apps such as Kik and Slack are offering brand chatbots. On Kik, Sephora provides users with make-up tips and reviews, channeling them to Sephora to make a purchase. The company sums up its experience with the US teen oriented app, here.
- 19. Driving Conversion: Online Reviews • When researching about a certain product, 55% of shoppers search online for reviews and recommendations; 47% visit the company website; 26% visit physical stores to see or try the products; and 23% spoke with their friends of family about it. • The factors which drive final product decisions are: Price or promotions (27% of respondents); features (23%); brand reputation (22%). • However, the factors vary by category, whereas brand reputation is more important for fashion, food and luxury items while product features was more important for electronics. Most popular purchase influences according to Amazon buyers in the United States as of November 2016 49% 16% 11% 10% 7% 7% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% Product reviews Word of mouth Online ads Social media Gift guides Other SHARE OF RESPONDENTS Radial; Various sources (Finn Partners) Source: KPMG, 2017
- 20. Driving Conversion: Retailer Preferences • In online shopping, encouraging shoppers to purchase a product, does not ensure they’ll buy it from the same source. • After deciding to purchase a certain product, price is the most common consideration when consumers are deciding where to buy it. • Amazon’s foot-in-the-door approach with Alexa (the Amazon Echo devices, as well as the AI technology integration) helps the company turn more shoppers into Amazon customers. No wonder, then, that Amazon offered Echo devices under a major discount on its latest Prime Day. • Amazon's Prime program is expected to reach more than 50% of American homes in 2017, according to Cowen and Co..
- 21. Pricing Tactics • Loyalty programs, auto replenishment and subscriptions, are all tactics that take care of 2 important factors in e-commerce: time-saving/ convenience, and best price. Offering vouchers, cash back, and “subscribe and save” are widespread instruments for e-tailers today. • Coupon aggregators are also popular. • Cash back is a powerful loyalty/ payments tool, used by many retailers and payment companies. It provides a discount, or a voucher, for the purchase. • Buying in bulk and bundling (a tactic most used by e-tailer Boxed.com) also provide a way to lower prices. • Jet.com is committed to lower prices, and offers a “price drop as you shop” tactic, where the customer benefits from operational synergies for products that have been co-purchased.
- 22. Pricing Tactics • Ulta, the beauty retailer, is implementing pricing-based marketing tactics that move the shoppers to action, creating a sense of excitement and opportunity. • The company’s online sales climbed 71% in q1 2017 and are expected to register +50% growth for 2017.
- 23. Delivery • Delivery is the number 1 driver – and barrier – for e-tailers. Free delivery is very important to shoppers, and 63% of respondents in a q4, 2016 GlobalWebIndex survey said that the main reason for shopping on Amazon is – free delivery. • Delivery is a major challenge for e-commerce, and the costliest for e-tailers. As shoppers expect free, quick, and limited-slot deliveries, retailers turn to creative solutions to solve the “last mile” problem - the portion between a store / distribution center and the customer's home. This is the costliest part of the delivery element in the purchase, and as a result, many start ups and retailers opt to solve the problem. 9% 3% 6% 20% 20% 42% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% Ship to store or pick-up in store Same day from time of purchase to delivery Next day - 1 day from time of purchase to delivery 2-day - 2 days from time of purchase to delivery Ground - 3-5 days from time of purchase to delivery Economy ground - 5-7 days from time of purchase to delivery SHARE OF RESPONDENTS Most frequently utilized delivery options for digital purchases according to online shoppers in the United States as of February 2016 Source: Statista - UPS; eMarketer. United States; January 30 and February 9, 2016; U.S. n = 5,330; Digital buyers
- 24. “The Last Mile” • Autonomous cars, drones (piloted by Amazon), “click and collect” (buy digitally, collect from a store or locker), ride sharing such as Uber and Lyft, and alternative parcel companies, are all tactics used by retailers and brands to try and offer cost-efficient solutions for delivery. – In the US, Amazon has been the first to offer a 2-day delivery option for many items, with no additional charge to Prime members. Today, the company offers “Prime Now”, a 1-hour delivery service from local retailers and restaurants, in almost 30 cities in the US. – In June 2017, Walmart began testing home delivery of some orders by Walmart associates heading home for the day in their own cars, offering them extra pay and the ability to opt in our out at will. Following Walmart’s $3bn acquisition of Jet.com, Walmart lowered its minimum threshold for free two-day delivery to $35, leading Amazon to lower its own minimum. Walmart is currently testing a Jet.com one-hour delivery, offers “click and collect” options, and acquired Parcel, a “last mile” technology company in New York City. – In the UK, Tesco launched same-day delivery across most of the UK: Customers who order online by 1pm will be able to receive their groceries some time after 7pm on the same day. “Click and collect” is popular in Europe.
- 25. Dealing with the Try-On Barrier • Feeling and trying on the merchandise is a barrier to growth for e-commerce, and we have covered technological and non- technological attempts to resolve the issue in previous reports, including receiving several sizes/ designs (e.g., “Rent the Runway”, Warby Parker), waiting for the customer to try on and decided, digital measuring, VR and plain old easy returns. • More retailers today use stores as display spaces that support the need to try out and try on prior to purchasing online. Warby Parker Bonobos: a “tailor made” ecommerce solution, acquired by Walmart for $310mn
- 26. Driving Convergence: Personalization • Personalization continues to be one of digital commerce’s main strengths relative to brick & mortar. • The availability of data from various sources on the shopper, including due to single-login (e.g., forming an account through Facebook), and using past browsing and purchases, creates a more engaging, convenient experience to consumers. Failure to offer a personalized experience will render a website irrelevant to the shopper. Furthermore, a huge opportunity exists in defining unique shopping parameters to help drive conversion rates up. • However, despite buzz regarding personalization, it seems that in 2017, e-tailers were more busy trying out chatbots, than investing in personalization. • Sampling, based on consumer preference, is a powerful tactic used by Boxed.com, L’oreal, and others. • Alibaba: using data to offer relevant offers and “anticipate needs” StitchFix: “change the way people find clothes they love by combining technology with the personal touch of seasoned style experts. “
- 27. Driving Convergence: Personalization • L’oreal uses a mobile app to let consumers “try”, and perhaps purchase, different looks. • L’oreal’s successful digital initiatives made e- commerce its “number 4 market”, according to the company’s CAGNY 2017 presentation.
- 28. Personal Touch: Trial and “Curation” • Subscription boxes are on the rise, as they reduce stress by creating ongoing replenishment, as well as the indulgent “surprise” element. • Beyond meal kits and “subscribe and save” options, boxes are offered in many industries, including fashion and beauty. 52% 35% 6% 4% 1% 1% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% Discovering new products Receiving high-quality products for a good price No need to go shopping anymore I don`t know Other I can`t imagine subscribing to a beauty box SHAREOFRESPONDENTS Most common reasons women in the United States would be interested in subscribing to a beauty box as of May 2017 Statista, United States; May 16 to 18, 2017; 18 years and older; 616 Respondents; who subscribed to a beauty box, used to subscribe to a beauty box or are interested in doing so Hitwise; MediaPost, United States; January 2013 and 2016 Monthly visits to subscription box sites in the United States in January 2013 and 2016 (in millions) 0.72 21.4 0 5 10 15 20 25 Jan '13 Jan '16 MONTHLYVISITSIN MILLIONS
- 29. Personal Touch: Trial and “Curation” • In June 2017, Amazon begun testing a new subscription service called Prime Wardrobe that lets customers try on clothes before they buy them and return them for free. • Amazon's Prime Wardrobe will be available to Prime members at no extra charge and gives customers one week to decide whether they like what they ordered. They pay only for what they choose to keep, a service similar to those offered by Trunk Club (owned by Nordstrom) and Stitch Fix. • Amazon also introduced “Echo Look”: Using just your voice, easily take full-length photos and short videos with a hands-free camera that includes built-in LED lighting, depth- sensing camera, and computer vision-based background blur; See yourself from every angle with the companion app. Build a personal lookbook and share your photos. • Get a second opinion on which outfit looks best with Style Check, a new service that combines machine learning algorithms with advice from fashion specialists
- 30. Personal Touch: Trial and “Curation” MM.Lalfleur’s “Bento” concept for a personal fashion stylist in a box Meal delivery: Plated, Chef’d are just 2 of the competitors in this arena Birchbox: a leader in beauty product subscription
- 31. Abandonment Issues • E-tailers deal with high rates of cart abandonment, usually by retargeting through social media and content websites, as well as through e-mail marketing. Online shopping cart abandonment rate in selected industries as of 4th quarter 2016 SaleCycle, Worldwide; 4th quarter 2016; 500 global brands 67.4% 71.2% 74.1% 76.8% 81.6% 82.1% 84.4% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% ABANDONMENTRATE
- 32. Payments VR Checkout Innovation • Swarovski has teamed up with Mastercard to launch a virtual reality shopping app for the brand's line of crystal home accessories, Atelier Swarovski. The app is designed to immerse consumers in a beautifully decorated home setting where they can virtually browse and purchase crystal artwork using Masterpass, Mastercard’s digital payment service, without ever leaving the VR experience. • Swarovski plans to have VR headsets at certain retail locations as well as different events. • In June 2017, Amazon has launched the Amazon Prime Reload program, offering Prime members a 2% cash back on purchases, even if they don’t use an Amazon cash back credit card, by reloading the gift card balance.
- 33. Opportunities, Barriers & Retailers Strategies Marketer StrategiesOpportunity / Barrier • Mobile commerce and social commerce • QR-Codes and Virtual Stores enable shoppers to shop on the go • Pure-play online retailers have been opening physical stores • Leveraging showrooming – retailers trim stores for in store digital purchase • While online retailing assures hyper convenience, consumers seek anytime/anywhere experiences where online-only may not suffice. Pure-Play / Omnichannel • Consumer reviews and recommendations provide assurance, as well as “real life” people demonstrations and influencer reviews • New tactics such as trials and rentals are taking advantage of the digital platform, surpassing physical retailers • Consumers prefer to touch the products and try them before they buy them. This is a main barrier to online-only retailing. Product Experience • Chatbots and multi-channel assistance (via phone as well as web and video) • To replace store representatives, advisors and stylists are made available, as well as bundling completing products • Using VR and AR for demonstration • A flesh and blood person may answer shoppers’ questions more easily, thus eliminating frustration and leading to a bigger sale. Live Assistance Source: Schieber Research, 2016-2017
- 34. Opportunities, Barriers & Retailers Strategies Marketer StrategiesOpportunity / Barrier • Utilizing virtual wallets, mobile payments, bank transfers • new payment technologies are becoming more established • Consumers in many countries do not own a credit card / are reluctant to provide card details Payments • Communicating the security technology / level to the shopper • Utilizing social identities to tailor personal offers and enjoy word of mouth • Emphasizing trial, flexible return policies • Consumers do not trust information and payment data sharing • However, younger consumers do share vast amounts of information with friends and brands to enjoy personal offers Trust • Utilizing virtual wallets, mobile payments, bank transfers • new payment technologies are becoming more established • Consumers in many countries do not own a credit card • Reluctance to provide card details Payments Source: Schieber Research, 2016 - 2017
- 35. In Conclusion… • Offering a great price (using tactics such as subscribe & save / coupons / cashback / loyalty); displaying customer reviews; and free / fast delivery options (including: 1- hour/ next day; “click and collect”) are a “must have” for e-tail success. • Understanding mobile & social commerce, integrating bots and AI into both, and personalizing offers are “good to have” and can create a competitive advantage (increasingly, they will become a “must have”). • Combining additional devices and formats (intelligent assistants; voice; video and content commerce) are trending, and will gain importance as customers adopt these technologies for commerce. • But above all, remember that the customer’s journey is not comprised of channels; rather, customers are looking for a seamless shopping experience, trying something in-store and purchasing online, using AR/VR to learn about a product and picking it up in-store, etc.
- 36. Thank You! The research was conducted by: Ruth Lewin Chen, Hamutal Schieber Schieber Research | Market Research & Competitive Intelligence www.researchci.com | [email protected] More articles and researches on Carmelon Digital Marketing website: http://www.carmelon-digital.com