No sooner have I spoken about the slowdown of digital commerce than a new report is contradicting this viewpoint entirely!
Despite my previous warning from Gartner that ecommerce will not continue to grow at the same rate we’ve enjoyed in recent years, a new report from OC&C, PayPal and Google has forecast that the global online shopping market will grow to £645 billion within the next three years.
What I found particularly interesting is the role that cross-border trading will play in this expansion. According to the study, today the UK enjoys just as much business from China as it does from domestic customers, and this trend will continue into other ecommerce markets as they mature.
However, before we talk about this brave new world of borderless retail that is waiting on our doorstep, I think it’s important that we remind ourselves of two things:
- Global ecommerce is still dominated by a few pure players, namely Amazon
- Most purchases still happen in stores
What we WILL start to see over the next 3-5 years is more retailers investing in their digital offering, narrowing the gap to Amazon and compatriots, but with a secret weapon up their sleeve: the store.
Amazon already knows how important the store is going to become – that’s why it’s experimenting with a bricks-and-mortar presence in the US. The challenge it and other retailers will face is trying to create irresistible online interactions not just through the direct ecommerce channel, but within the store environment as well.
The continued blending of digital and physical retail is going to raise the value of online purchases made in the store, but also create new consistency headaches for retailers. Many are still struggling to unite brand identity on their websites with their store persona, and being able to compare them side by side will elevate this need for a single brand experience.
Add to that the predicted growth in cross-border trading, and retail businesses are also going to need that consistency to extend across markets, despite differences in language, currency, payment and fulfilment methods and so forth.
This may seem too complex to contemplate right now, however there are a number of essential elements retailers can implement to start the merging process. For example, migrating loyalty schemes over to digital passbooks, to create a single view of customer value.
Another thing they can do is to bring technology into the store – introducing mobile POS, for example, to get customers accustomed to transacting through a screen, guided by a store associate.
Then there’s the behind-the-scenes developments that must be considered. The more we do away with set channels and borders, the trickier it becomes to get the right item to the customer in the manner they want, whilst remaining in budget.
There’s a lot of work to be done if retail is going to be exploiting the true value of ecommerce within the next 3 years, but with a long-term strategy, the right partner and a little investment, it’s not beyond the realms of possibility.
One day we’ll shop in a world where digital lies at the heart of every interaction, and the ease with which consumers move between each touch point will make turning down a purchase that little bit harder to resist.