Top 5 Reasons why eCommerce is Booming in 2020
“Amazon.com gets around 2 billion visits a month and eBay gets about 1 billion visits a month.” — Similarweb
The eCommerce industry is on the rise like never before! E-Commerce companies like Amazon and eBay are growing at an unprecedented rate all over the globe. People of all age groups are inclining towards online shopping as they buy a variety of products from different websites.
This shift in consumer behaviour has opened the door to limitless possibilities and opportunities for aspiring entrepreneurs. E-commerce is probably the most lucrative investment option for angel investors and venture capitalists.
Let’s unleash the various factors responsible for the vigorous growth in the eCommerce industry,
Mobile Driven World
Imagine a day without your mobile phone. It seems impossible, right! Ever wondered why? Because out of all the activities you do in 24hrs, more than half of it has something to do with your mobile phone.
From setting up an alarm to checking social media feed before sleeping, our days start with the phone and end with it only. Listening to music, watching your favourite shows, attending online classes, shopping online, communicating with your friends and family — is there anything left that cannot be done using a mobile phone? Not really!
According to some sources, 55% of smartphone users admit they get anxious when they don’t have their phone on them. There’s even a name for the affliction — nomophobia, or “no mobile phone phobia.”
Now let’s talk about the role of mobile phones in eCommerce,
People often get confused between eCommerce and mobile commerce. But is mobile commerce actually different from eCommerce?
The answer is Yes and No!
Mobile commerce is the advancement in eCommerce. At some levels, they are nearly identical, but at times, there are prominent differences between the two. Mobile commerce is often considered as a more convenient way of online shopping.
Here are some stats describing the current state of mobile commerce (source — Pixel Union):
- Roughly four out of five Americans are now online shoppers, with more than half having made purchases using a mobile device.
- 55% of consumers have bought something online after discovering it on social media. This is a great motivator to tag your products on Instagram.
- Users who have a negative experience in your mobile store are 62% less likely to purchase from you in the future.
- 90% of consumers say they use multiple devices to complete everyday tasks, while 40% say they use their mobile device to conduct research prior to making a purchase.
- Mobile commerce sales broke records on both Black Friday (US$ 2.9B) and Cyber Monday (US$ 3.1B) 2019.
- Mobile dominated BFCM 2019 on Shopify, accounting for 69% of sales. The work Shopify has done to cater to mobile shoppers is a huge advantage for merchants moving forward.
Factors like location-based offerings, push notifications, one-touch shopping, social media log in, etc., are the driving forces of mobile commerce. Considering all the stats about the usage of mobile phones, no wonder people would always prefer to shop online instead of spending their precious time, money, and efforts for shopping offline. It’s all about convenience!
Omnichannel Retail
Omnichannel retailing is an integrated approach to commerce. It helps to provide buyers with a perfect blend of shopping experience across all the different channels or touchpoints. Businesses, in this case, interact with their customers through their websites, email, social media, as well as physical stores.
Options like Click and Collect (BOPIS) make it possible for the buyers to make the purchases online and collect the order from the store as per their convenience. The integration of the brick and mortar stores with the online marketplace drives more sales. This is another reason why eCommerce is gaining more popularity in the retail industry.
People often confuse omnichannel retailing with multichannel retailing. The following image clearly depicts the difference between these two concepts:
Convenience
eCommerce provides convenience to shoppers in various forms. The accessibility of the store is merely a matter of concern now. Online shopping provides 24x7 accessibility to your favourite stores, for the whole year, without any holiday. The buyer can literally do shopping anytime and anywhere!
The consumer gets hundreds of options to choose from. They can easily check the reviews of the products, compare prices, and determine which offer has the best value. Additionally, they can make payments without any hassle by using their credit/debit card, digital wallet, PayPal, etc.
In simple words, eCommerce has made shopping very seamless and effortless. They don’t need to take time out of their day to purchase something for themselves or their loved ones.
Unlimited Products
eCommerce dramatically reduced the cost of operations for retailers as well. They can easily outsource their administrative and backend operations to experts from any part of the world.
The saved cost is further used to offer products at affordable prices to price-sensitive buyers. It also encourages retailers to add more variety of products on their website as the location of the warehouse is no more an issue for the retailers. They can easily deliver the products from one corner to another corner of the world due to advancements in logistics. This gives retailers a chance to focus on their core competencies and grow their business.
So, the buyer is not limited to a few brands now. With the help of online marketplaces, they get access to thousands of well established as well as local brands.
Personalized Experience
The buyer is more comfortable when they sense any sort of personal connection with the sellers. Remember? When you were little, your parents would take you more often to the shops/store where they were familiar with the staff. It’s basic human behaviour.
When it comes to online shopping, the buyer cannot interact with the sellers in person. So, online marketplaces have created their own ways to provide personalized experiences to their customers. For instance, many brands offer special discounts and rewards on your birthday or any other special occasion. This is their own way to make you feel special!
Research by Experian revealed that compared with promotional emails, birthday messages/offers perform better. Check how!
A multilingual website helps the buyers check the product details in their native language and features like multi-currency functionality allows them to make the payment in their regional currency. Also, personalized recommendations based on user behaviour is a great approach to provide personalized experiences to the user.
Wrapping Up
Consumer behaviour is evolving, especially amid the crisis COVID-19. If you are an entrepreneur who is planning to launch an online business, 2020 is the right time.
You need to carefully research the various niches and choose one to start their eCommerce business. There is always an option to launch a marketplace like Amazon where you can sell ’n’ number of products from unlimited categories.
Understand what the consumer needs, address their pain points, and launch a profitable eCommerce business!
