The Continued Challenges of Online Retail in 2020
When you think of the online retail industry, the growth it experienced in the last few years has become more than notable. In 2018, online sales reached $501 billion in the United States, with a predicted growth of $604 billion in the region by 2020. In countries like the Philippines, the online retail industry saw an annual growth rate of 101.4% starting in 2016, well into 2020.
These may seem like lofty numbers from the outset, but it is also indicative of where the industry is heading. With more customers using the internet for all their shopping needs, online retail continues to show both promise and more opportunities to connect with a larger audience with a global reach. At the same time however, this also means facing new, often consistent challenges for retailers to reach their desired audience, how they can stand out from the rest and leveraging the tools they have to the best of their abilities.
With 2020 on the horizon, it’s worth looking at the challenges the industry will face.
Shaping Personalized Experiences
Many online retailers will tell you that providing quality customer service is no longer enough for them to be successful. To stay ahead of the game, retailers must now provide them with unique customer experiences. It’s a level of engagement with customers – new or returning – that feels more personal, sincere and effective. A retailer’s website or online platform will always be the first introduction to their products or service. Right from the get-go, customers that visit retailers online should have robust communication options––whether through chatbots, a live spokesperson or via email.
A personalized shopping experience does not just mean a better product selection than most. It is about providing a seamless browsing and purchasing platform that customers can quickly navigate and adapt to. It’s about being able to shop from any device they have and with any platform while providing the same level of service for each.
Sebastian Siemiatkowski, CEO of Klarna, a global e-commerce payment provider says that “Experience is the new loyalty.” By continuing to deliver personalized experiences through convenience, customer loyalty is certain to follow. Strong, consistent engagement continues to be a challenge for retailers but ensuring it means more repeat visitors.
A Multichannel Presence
Today’s online shopper is likely to be signed up to at least one of the major social media platforms. While this sounds obvious on paper, it’s also something that online retailers should be aware of and how to take advantage of it. Nearly every visitor to an online retailer is signed up to either Facebook, Instagram, Twitter or a host of other social networking sites. It stands to reason, therefore, that building a presence in just one of these channels hinders an online retailer’s full potential.
According to the Harvard Business Review, 73% of online retail customers use multiple channels. Called Omnichannel customers, it was found that they spend 9% more in a store that can be found across different channels compared to just one.
A Multichannel presence and engagement must be part of any online retailer’s strategy. Not just for 2020 but in the years to come. As more consumers look for different purchasing options and platforms, it’s a good rule of thumb for retailers to strengthen their presence where they are most visible.
Mobile Matters Most
Among these channels, a retailer’s mobile presence should be the most sought after. By now, anyone in online retail should know how significant a mobile-friendly site is to their business. With more consumers are browsing the internet and purchasing products through their handheld devices, being mobile-friendly is an absolute must.
Defining a site as “mobile-friendly” means more than just having the right display on smaller screens and quick access to essential links. With more consumers making purchases online, mobile payments need to also be more secure and have a range of options. Part of the user experience in mobile is feeling safer and at ease when buying items through mobile devices.
By 2020, mobile online retail is expected to have a market of share of 70.4%. By 2021, that number will rise to 72.9%. With mobile sales on a consistent upswing, it is now imperative for online retailers to optimize and boost their mobile presences.
Looking Beyond 2020
As a global industry, online retail predicted to make more than $4 trillion by next year. This is thanks in part to advancing technology, changing consumer habits and wider purchasing options. It is believed that these trends will continue to shape the industry beyond 2020, which should serve as a great starting point for retailers wanting to rethink their strategies.
Forward-thinking online retailers see the value of unique customer experiences and the importance of maintaining a multichannel presence. Coupled with a stronger mobile presence, there’s plenty to be excited for in the industry as the times continue to change.