E-commerce has experienced a significant growth over the past ten years, surpassing the high street. Thanks to app-only banks such as Revolut, we no longer need to visit a physical bank, and the introduction of food delivery services such as Just Eat allow us to get food from the commodity of our home. So, then why is e-commerce in continuous growth?
In this article, together with Lookers, who sell Ford transit custom cars, we discuss the expansion of e-commerce and evaluate the upcoming of this sector.
When e-commerce started becoming prominent
To assist the demand of shoppers, e-commerce has become the pillar of the industry. In 2019, Nasdaq predicted that 18% of UK purchases would be made online, while 77% of consumers were likely to make online purchases. Millennials use e-commerce services the most, with 54% of their goods and services being bought online.
A number of big brands have chosen e-commerce because of its cost-efficiency and thanks to the variety of options offered by the internet, helping an increasing growth for businesses. Consumers are also taking advantage of the lower prices offered online compared to the traditional way of shopping.
E-commerce has doubled its value since 2015 and is set to keep growing.
In the world of e-commerce, there are no international limitations, and this has enabled us to browse through the internet on a daily basis in search for products, although we may not always make a purchase. Businesses are opting for e-commerce to work within markets they hadn’t been able to enter before. In order to do so, strategic sales and marketing plans need to be put in place with the aim to help and convert international buyers. Additionally, social media campaigns are one of the key strategies used for the development of e-commerce.
Consumer expectations vary with online shopping— we want good customer service and loyalty extras. Data from an Alix Partners reveal that three quarters of Americans are influenced by the offer of free shipping, which determines their final decision to purchase a product. Meanwhile, delivery times are getting shorter. Back in 2012, consumers were willing to wait more than five and a half days to receive their products on free delivery, while by 2017 this had gone down to four and a half.
E-commerce businesses improve their delivery services, with many companies offering next-day delivery options, in the aim to respond to the growing pressure from consumers. Consumers also value flexibility in the delivery time frames as well as reliability. For this reason, companies such as Amazon, who provide ‘free’ next day delivery to their Amazon Prime customers, have also introduced the flexibility to choose a specific slot that best suits the customer’s needs.
Research revealed that 52% of customers won’t go back to a product following a bad experience, which is why providing excellent customer service has been the way through which e-commerce has gained the firm position as retail leader.
The future of shopping
Considering that the world is made up of roughly 7.7 million people, e-commerce has an impressive 1.92 billion digital buyers, expected to reach 2.14 billion by 2021. The number of online shoppers is expected to also grow significantly. Research revealed that by 2040, up to 95% of purchases will occur using e-commerce.
As the number of users rises, e-commerce businesses around the world are continually investing and introducing innovative strategies, with Amazon’s in-home delivery strategy as an example. This consists in potentially allowing the consumer to use their smartphone to remotely unlock their door at the exact of moment of the parcel delivery, with a real-time camera connection in place to guarantee security.
Despite Amazon’s willingness to experiment this idea, the general public seems to have doubts. 68% of US adults admit that they wouldn’t feel comfortable granting access to their home to a delivery driver, but perhaps consumers need more time to adjust to such innovative ideas.
With a number of car companies and tech firms investing in the development of driver-less cars, the issue raised by US consumers might not be valid anyway, as after all, there wouldn’t be a driver delivering to the door at all! Takeaway companies are also ready to implement this concept. The recipient uses a simple code to open the compartment of the vehicle where the food is stored. This new strategy is currently being tested in the US and could potentially be introduced in the UK soon.
Looking at recent developments, it’s clear that e-commerce can advance rapidly, meaning we shouldn’t limit our expectations.