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eCommerce

Consumers in emerging markets more open to sharing data

Countries like China, Brazil and South Africa are much more open to sharing their personal data with companies than consumers in Western countries, like the UK, France and the US, according to new research from emlyon business school.

The findings come from a global study of over 22,000 online shoppers, which looked into their willingness to share their personal information, like identification and financial data, with companies when purchasing products.

The researchers; Monica Grosso, Associate Professor of Marketing at emlyon, alongside colleagues from Bocconi School of Management, KU Leuven, CEFAM International School of Business and Management and the Center for Service Intelligence, wanted to understand what factors had an impact on the willingness of consumers to share personal data with companies.

The factors they reviewed were: whether the type of product had an impact, whether the country consumers were from had an impact, and whether and how customers could be incentivised to provide further data even if they weren’t willing to in the first place.

Through the survey, the researchers gathered data on over 22,000 shoppers, who were buying products from seven different categories; identification, medical, financial, locational, demographic, lifestyle, and media usage data.

The research also focused on the privacy concerns and willingness of participants in fourteen different countries, ranging from highly individualistic, such as the UK, France, the United States, Canada and Australia, to collectivist nations, including China, Brazil and South Africa.

The researchers also reviewed whether customers were more likely to share their personal data and information if there was some form of compensation for doing so.

Professor Grosso said: “Given sharing personal data online is often on a voluntary basis, it is difficult for companies to persuade customer’s to do so. Not only this, but in the wake of high-profile privacy scandals, customers have become increasingly worried about how organizations store and exploit their personal data. Consumers have therefore become more cautious about sharing such data with retail companies. Therefore understanding the market, and having a full-proof strategy to maximise data sharing of customers is vital for marketing departments”.

The researchers also found that once offered compensation and incentives for sharing their personal data, consumers in all contexts were more likely to provide their data to companies. This compensation and incentives included a tangible benefit for the customers, such as discount coupons or small free gifts, showing that there are clear, effective methods for companies to use to garner more data from their consumers.

Grosso added: “Companies are always keen to secure as much data as they can from their customers in order to inform increase future sales tailor marketing efforts to their needs, and boost customer brand loyalty, but often customers are reluctant and unwilling to provide such data. These results show trust can differ across contexts, and customers can be further encouraged to provide personal data through a number of tailored methods.”

For companies, the research shows that the willingness of consumers to share varies greatly over different countries. Therefore, if companies are looking to collect vital data from their customers in different country contexts, they should adopt different privacy strategies based on the information type, country, and product category.

Ecommerce revenues remain buoyed as bricks-and-mortar reopens

As the UK High Street experienced a boost in the first week of non-essential retail re-opening, the digital High Street also remained buoyed, with revenues up +2.5% week-on-week.

That’s according to data from Wunderkind‘s Marketing Pulse report, which says as consumers hit the shops after months of closure, traffic on the High Street increased +178%, and an estimated £1.6billion was spent in-store on the first weekend of trading.

Web traffic also saw a rise, increasing by +2.4% over the same period (w/c 12.04 vs w/c 5.04) – which the behavioural marketing specialist says illustrates sustained digital demand.

This, Wunderkind suggests, is not only indicative of the seismic – and permanent – shift to digital, but of the importance in understanding and connecting more closely with shoppers to drive long-term brand advocacy and increased customer lifetime value. 

Wulfric Light-Wilkinson, GM EMEA at Wunderkind, said: “There’s been much debate as to whether the boom in online could successfully be sustained once retail reopened.  And, from what we’ve seen so far, even pent-up demand for real-life shopping experiences in the first week of opening hasn’t deterred consumers from the ease and convenience of shopping online, suggesting the shift to digital is here to stay.  But the real test now comes in how brands and retailers connect and engage with their customers moving forwards, to turn the new cohorts who have come online into repeat shoppers and those existing shoppers into long-term brand advocates.” 

While web revenues and traffic increased on the week before, email performance dipped slightly with revenue down a marginal -1.6% week-on-week. 

“This slight drop in UK email revenue retail could be down to a number of factors;” Light-Wilkinson suggested.  “Non-essential retail opened on the same day as outside hospitality, which also coincided with the last week of the Easter holidays – this may have prompted many to step away from their desks and take time off to enjoy new freedoms, perhaps explaining the slight dip in email performance during the week.”

Social mentions for the words ‘hairdresser’, ‘shops’ and ‘pub’ all saw significant spikes on the first day of restrictions easing, according to social agency, the tree, up 277%, 276% and 272% respectively on the day prior.

Additional $900 Billion Spent Online at Retailers Globally in 2020

As Covid-19 kept consumers around the world at home, nearly everything from groceries to gardening supplies was purchased online.

According to Mastercard’s latest Recovery Insights report, this amounted to an additional $900 billion being spent in retail online around the world in 2020.

Put another way: in 2020, e-commerce made up roughly £1.50 out of every £5 spent on retail, up from about £1 out of every £5 spent in 2019.

For retailers, restaurants and other businesses large and small, being able to sell online provided a much-needed lifeline as in-person consumer spending was disrupted.

Roughly 20-30% of the Covid-related shift to digital globally is expected to be permanent, according to Mastercard’s Recovery Insights: Commerce E-volution. The report draws on anonymized and aggregated sales activity in the Mastercard network and proprietary analysis by the Mastercard Economics Institute. The analysis dives into what this means by country and by sector, for goods and services, and within countries and across borders. 

“While consumers were stuck at home, their dollars travelled far and wide thanks to e-commerce,” says Bricklin Dwyer, Mastercard chief economist and head of the Mastercard Economics Institute. “This has significant implications, with the countries and companies that have prioritized digital continuing to reap the benefits. Our analysis shows that even the smallest businesses see gains when they shift to digital.”

While the digital transformation has been neither universal nor consistent – due to geographical, economic, and household differences – the report uncovers several key overarching trends: 

  • Early digital adopters go into overdrive: Economies that were more digital before the crisis—such as the UK and US —saw larger gains in the domestic shift to digital that look more permanent than the countries that had a smaller share of e-commerce before the crisis. In the UK, the e-commerce share of retail sales pre-crisis was 22%, rising to 31% at the peak of the crisis. The current level stands at 24% and we expect this shift of 2 percentage points to be permanent. 
  • Grocery and discount store digital gains look sticky: Essential retail sectors, which had the smallest digital share before the crisis, saw some of the biggest gains as consumers adapted. With new consumer habits forming and given the low pre-Covid user base, we anticipate 70-80% of the grocery e-commerce surge to stick around for good. As an example, as a result of the lockdowns in the UK, roughly one-fifth of all grocery shopping is now done online.
  • Consumers increase their e-commerce footprints, buying from up to 30% more online retailers:Reflecting expanded consumer choice, our analysis shows that consumers worldwide are making purchases at a greater number of websites and online marketplaces than before. In the UK, people are buying from 22% more online stores, on average. 
  • International e-commerce rose 25-30% during the pandemic: International e-commerce got a boost both in sales volume and the number of different countries where shoppers placed orders. With infinitely more choices at their fingertips, consumer spending on international e-commerce grew around 25-30% year over year from March 2020 through February 2021. 

Storfund set to offer $1bn to eCommerce SMEs

Storfund has raised $36.5 million of capital through the Private Debt team of Swiss bank Union Bancaire Privée (UBP) and private investors to expand its global operations and ‘help marketplace merchants access working capital and unlock liquidity’.

In its initial 18 months of operations, Storfund has become one of Europe’s leading eCommerce funders – This year, Storfund aims to provide $1 billion of cash advances to eCommerce merchants selling on Amazon and other European, American, and Asian marketplaces.

The only European Amazon approved funding provider, Storfund has a presence in 17 out of Amazon’s 20 marketplaces. It is also integrated into other leading European eCommerce sites and is due to be rolled out onto several other marketplaces during 2021. 

Storfund says its API driven propriety technology brings innovation and efficiency to the receivables finance industry which has been unable to serve e-commerce merchants due to its traditional approach. Technology streamlines processes and lowers costs, which is ultimately passed on the e-commerce merchants. Storfund’s bespoke underwriting standards based on marketplace microstructure indicators rather than traditional credit metrics allow Storfund to onboard e-commerce merchants within 24 hours and manage risk on a dynamic basis. 

By combining access to working capital and international cross-border payments in over 50 currencies, London-based Storfund provides eCommerce sellers around the world with an end-to-end solution for stabilising cash flow, accelerating growth and increasing profitability from their local and international sales.

eCommerce is now an indispensable part of the global retail framework. Like many other industries the pandemic has reshaped the retail landscape and accelerated its exponential transformation. 2020 saw global eCommerce surpass $3.5 trillion in sales, accounting for 22% of the entire global retail market.

Storfund was conceived by former investment bankers George Brintalos and Akbar Ahsan. Brintalos said: “Storfund bridges the gap between eCommerce and capital, which is under served by traditional banks which are either too rigid to adapt or are withdrawing from the SME sector. We are here to address the capital needs of this new category of entrepreneurs, providing them with the liquidity they need to naturally grow their business, without adding unnecessary debt on their balance sheet or diluting their share capital base.”

Ahsan added: “Storfund uniquely understands the cashflow challenges of eCommerce merchants and offers a frictionless liquidity solution for the digital age. We are pleased that investors saw the value of Storfund’s tech-first approach which combined with our real time risk management puts us at the forefront of our industry. This investment round will accelerate our scale up and help us in our mission to alleviate the pain of long payment terms and provide growth capital to eCommerce merchants.”

Half of consumers will turn to Amazon for their Christmas shopping this year

Just under a half of UK shoppers (44%) plan to complete their Christmas shopping online this year — with a majority (42%) looking to turn to Amazon first.

That’s according to findings from the Episerver report “An Interview with The Couch Shopper: The Episerver Holiday Ecommerce Report 2020,” for which the firm surveyed 4,050 online shoppers across the world and performed 1.6 billion website sessions to uncover the behaviors and trends shaping the future of e-commerce.

The survey revealed that 42% of UK shoppers plan to buy most of their Christmas presents on Amazon this year, and 8% say they plan to buy all of their gifts on Amazon.

The study found that in general, 37% of UK online shoppers visit Amazon first when they have a specific product they’re looking to purchase, and 35% begin their shopping journey on Amazon even when they do not have a specific product in mind. 

Whether it’s with Amazon or another retailer, there will be an exponential increase in online Christmas shopping this year, amid the ongoing pandemic, and a majority of which will occur through mobile devices. In its analysis of web traffic, Episerver found that 2020 e-commerce traffic overall spiked 18% year-over-year, and mobile traffic specifically ticked up 5% year-over-year — now accounting for 59% of all traffic to retail websites. 

Episerver’s survey of consumers revealed the most active shoppers are also the most likely to use their smartphones: 53% of consumers who said they shop online every day primarily rely on their smartphones to do so. When viewed as a whole, the report’s findings indicate the need for retailers to tailor their content to consumers across all types of channels and to deliver a mobile-first shopping experience this Christmas and beyond.

“As Amazon claims an increasingly larger share of the market, retailers and brands can no longer compete by using broad promotions to stand out or catch consumers’ eyes,” said Josh Schoonmaker, senior director of strategy, commerce, at Episerver. “Instead, retailers must draw consumers in with intuitive online shopping experiences, compelling content, and personalised recommendations or offers.”

You can download “An Interview with The Couch Shopper: The Episerver Holiday Ecommerce Report 2020” here.

82% won’t buy from outdated websites

Three in four Americans agree that how a company presents themselves online is more important now than ever before.

In fact, the average American abandons 24 online purchases per year because a company’s website looks unprofessional, according to new research.

A new survey of 2,000 Americans and 500 American small business owners found that how a company portrays themselves online is becoming increasingly important.

Just in the past month, the average American hasn’t gone through with $61 worth of purchases due to a brand’s website giving them pause.

The study, conducted by OnePoll on behalf of GoDaddy, went on to show that 82% of Americans say they’re less likely to buy something from a company if their online presence is unprofessional or dated.

Six in ten Americans go so far as to say they are “disappointed” when they go to shop with a company and they don’t have a sleek, modern website.

But it’s not just official websites. Half of those polled say they’re “disappointed” when a brand they want to shop with has no social media presence.

And two in three say they would think twice about shopping with a company if they had an unprofessional or dated social media presence.

Nearly three in four (72%) say they are much more conscious of a brand’s online image now than they were just five years ago.

One in three say they enjoy a brand that has a “quirky” online presence, with 58% saying they’ve shopped with a brand specifically because one of their social media posts grabbed their attention.

With the world shifting more online, are small business owners aware that their bottom line is affected by how their website and social media presence looks?

According to the results, they’re highly aware.

Nearly every SBO polled (92%) said they felt like their website appearance affected their sales, with nearly the same amount saying the same about their social media presence.

But they could maybe use a hand when it comes to their own online presence.

Typical online purchases involve seven steps taking three hours

Shoppers work through several stages before making a significant buy via the internet, which includes spending at least 35 minutes deciding whether a purchase is absolutely necessary.

Following that, an online search for a product or service, including on social media sites, will take place over the next 33 minutes.

And the survey of 2,000 adults found an average of 30 minutes is then spent reading online reviews and recommendations, with the average shopper avoiding a purchase if something has less than 3.4 stars out of five.

While one in 10 wouldn’t buy something with 99 five-star ratings if it has just a single one-star review.

Half an hour will also be spent narrowing down the choices between brands by comparing to other similar products for price and quality.

Other steps include sharing potential purchases with friends or family, putting something into a virtual basket – then the final hurdle of completing the transaction.

The research was commissioned by Vision Direct, whose CMO, Ashley Mealor, said: “As purchasers are spending so long scouring reviews, it is so important for businesses, especially those operating online, to be accurately and fairly represented.

“We recognise there are some brands which have reviews that cannot be trusted, as those writing them have been incentivised to do so.

“Implemented for the main purpose of generating favourable online appraisals, the concept of proposing incentives or hosting competitions can be misleading and skew authenticity.

“It’s encouraging to see platforms such as Trustpilot, starting to take great steps to ensure it is a level playing field for all by revising regulations and stopping all consumer incentives – to address a controversial grey area.

“With the prevalence of dishonest reviews online, the seven stages of shopping feels like a sensible way of ensuring a purchase – particularly one of value – is made well.

“You are then not just relying on reviews, but also word of mouth, social media, customer service and brand comparisons.”

The research also found 62 per cent of respondents think of themselves as ‘considered’ purchasers – who don’t buy without thoroughly researching the item first.

However, 14 per cent are happy to describe themselves as an ‘impulse’ buyer, who shops first then asks questions later.

But Brits would not consider something to be a ‘significant’ purchase if it fell below the £163 price point – and the last time they spent more than £100, they deliberated for eight days.

And 31 per cent are more likely to make a significant buy online, while 25 per cent would rather do it face-to-face – with the remainder not caring either way.

Although consumers are more likely to be suckered by an impulse purchase in a real-life store, than by something they see online (30 per cent vs 23 per cent.)

It also emerged that in order to ‘fully trust’ a brand, Brits want to receive their goods in perfect condition (45 per cent), experience super-quick delivery (26 per cent) and be on the receiving end of exceptional customer service (41 per cent).

But while 78 per cent of shoppers leave online reviews after using a company, just under half are more likely to do so if they are offered an incentive like money off their next order, or a chance to win a prize.

However, a huge 83 per cent of those polled via OnePoll believe unscrupulous sites or brands often put up fake positive reviews to try and trick people into buying their goods.

Ashley Mealor added: “Our study found online reviews to be hugely important to lots of people – half say they are important, especially when considering eyewear or eye medication.

“It can be hard sometimes to know whether an online review can be trusted, particularly where your health is concerned.

“This is where the fifth stage of shopping – getting real-world feedback from people you know in real life – can be hugely beneficial.

“If somebody you know and trust is willing to recommend something that word-of-mouth review is worth its weight in gold to any manufacturer.”

THE SEVEN STAGES OF SHOPPING
1. Deciding on a need for something – 35 minutes
2. An online search for the product you want including social media sites – 33 minutes
3. Reading online reviews and going through recommendations – 29 minutes
4. Narrowing down between brands by comparing to other similar products for price and quality – 31 minutes
5. Share links with friends and family – 14 minutes
6. Getting something into your online or real-life basket – 19 minutes
7. Actually making the purchase – 24 minutes
TOTAL – 185 minutes – 3 hours and 5 minutes

Digital Insights: Tips to prepare for the Golden Quarter

By twentysix

The peak retail period of October to December (aka The Golden Quarter) isn’t far away and this year it’s going to be an interesting one. Following the “lockdown” disruption, 2020’s peak is going to be a vital sales opportunity for many retailers.

But how can marketers plan ahead when a global pandemic has turned everything upside down? How are consumers going to behave? Will they be in buying mode? Or will the impact of lockdown dampen demand as we’ve seen earlier in the year? Will there be a second wave and what will this mean?

Much of this depends on the course of the virus and as a digital agency, twentysix, we’re not going to attempt to predict that! But amongst the uncertainty, there are things we can still rely on: Christmas is still Christmas; people will still want to buy; and there will be pent up demand and a hunger for deals – all of which will open opportunities for your brand.

With lockdown accelerating online behaviours there is one thing that is certain; digital is going to be an enormous part of the mix for all advertisers. You need to make sure you have the right mix of channels with a solid foundation in search, affiliates and user experience to capture demand, alongside upper funnel activity such as display and social to help create it. But it’s not just about having the channels in place: success will also be about building the agility to adapt to conditions as they unfold – a must in this uncertain environment.

So whether it’s scenario planning, solidifying your technology and tracking foundations, assessing your SEO trajectory, or reviewing your website to ensure your UX is up to scratch, now is the time to start getting ready.

Download twentysix’s guide to the Golden Quarter to unlock 6 key principles to help you create competitive advantage, along with tips from the agency’s digital channel specialists to help you prepare for the most significant quarter of trading we’ll experience for some time.

Download the full guide here

URLs cited as most important credibility factor for eCommerce sites

Online shopping ​accounts​ for almost 10% of total retail sales. With ​1% of websites infected​ by malware during any given week, these purchasing sites can post a threat to consumers.

A ​study​ by ​Panda Security​ surveyed 1,000 Americans, asking them what the most important credibility factor is when making a purchase online.

The survey found that:

●  29.3% of respondents cited a ​secure URL (https)​ as the most important factor

●  18% of respondents cited a ​testimonials and reviews​ as the most important factor

●  8.6% of respondents cited ​familiar methods of payment ​as the most important factor

●  7.3 % of respondents cited ​trust badges​ as the most important factor

●  4.9% of respondents cited ​available contact info​ as the most important factor

●  4.4 % of respondents cited ​website design​ as the most important factor

Panda says that while an ecommerce site should have all of these credibility factors to keep it secure, it’s also important to note which ones consumer’s value. The top two factors were a secure URL (https) and testimonials and reviews, so be sure you have both on your site.

For more information on these credibility factors, read the full study ​here​.

Poor marketing to blame for eCommerce business failures

The majority of eCommerce startups are set to fail within their first 120 days of operation, with marketing deficiencies among the most common causes, new research has revealed.

A survey of 1,253 owners of failed startups in the UK, carried out by Marketingsignals.com, revealed the top ten reasons why e-commerce start-up businesses are failing.

According to sources (including Forbes and Huff Post), 90% of e-commerce startup businesses end in failure within the first 120 days. The Marketingsignals research found that the two main reasons for failure are poor online marketing performance coupled with an overall lack of search engine visibility.

Of those companies who were surveyed, a staggering 37% said that their failure could be attributed to an inability to compete or deliver online marketing, with 35% saying a lack of online visibility was the main factor.

Further research found that the same proportion of respondents (35%) felt failure was down to them being too small to compete or there being no market for their products/services, whilst 32% reported that it was due to them running out of cash.

Completing the top five reasons for failure were price and costing issues, with 29% of failed startup owners claiming this was the reason why they folded.

When further quizzed on the reasons why their online startup business failed, 23% said that it was due to being outcompeted, whilst 19% blamed retail giants such as Amazon for dominating a large share of the consumer online retail market.

16% felt that their business collapsed due to their lack of customer service, whilst 14% felt it was due to the poor team they’d built around themselves.

Completing the top ten reasons why e-commerce startups fail was product mistiming, with 11% of startup owners claiming that the reason why their business failed was due to ‘right product, wrong time’.

Gareth Hoyle, managing director at Marketingsignals, said: “It’s clear to see that having an online presence and being visible on search engines is a key area e-commerce startups need to focus on to ensure they succeed.

“As nine in ten online startups fail within their first 120 days of businesses, it’s incredibly important that business owners put provisions firmly in place well before launching – this must include a bulletproof search visibility and online marketing strategy, as well as ensuring there is a market for their product offering.

“A targeted, strategic approach to digital marketing is vital to the success of any online business in this day and age, only more so for small businesses who are just starting out. Many tools can be used to increase their brand awareness and search visibility in their first few days and weeks, where consumer trust and loyalty hasn’t yet been established.”

The top ten reasons why e-commerce startups end in failure:

  1. Poor online marketing – 37%
  1. Lack of online search visibility – 35%
  1. Little to no market for their products or services – 35%
  1. Running out of cash – 32%
  1. Price and costing issues – 29%
  1. Got outcompeted – 23%
  1. Retail giants dominating a large share of the market – 19%
  1. Lack customer service – 16%
  1. Poor team around them – 14%
  1. Product mistiming – 11%

Image by StockSnap from Pixabay

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