eCommerce spending continues to rise, says Visa
Visa reported a 3.2% rise in eCommerce spending in February 2017. However, while eCommerce spending grew, face-to-face purchases decreased by 3%.
It is clear that the rapid rise of eCommerce is starting to affect high street stores, but what is driving this shift to online shopping?
eCommerce spending and face-to-face purchases
At the beginning of 2017, eCommerce spending accounted for 10% of total retail sales worldwide. It is predicted to rise to 14.6% in 2020.
While this is a significant rise for the eCommerce sector, the majority of sales still lie within face-to-face purchasing. It is only within certain industries that eCommerce spending is beginning to threaten offline stores.
As you can see from the infographic below, provided by BigCommerce, consumers tend to buy items online from three key areas:
- Books, movies and music
- Clothes, shoes and accessories
- Computers and electronics
These are the areas where online retailers are beginning to disrupt traditional stores. With 51% of Americans already preferring online shopping to offline, this trend is set to continue further.
However, it’s evident that while many consumers conduct product research online, they still choose to purchase the item in an offline setting.
These negative factors are holding back the eCommerce industry. As time goes on, and technology improves, online retailers will overcome these issues and eCommerce may become the main option for purchasing products, therefore making the traditional high street store obsolete.
Why is eCommerce becoming more popular?
eCommerce is a relatively new venture, but is rapidly becoming the go-to method for most consumers. In fact, it’s estimated that eCommerce sales will exceed $27 trillion by 2020.
There are several influencing factors driving the growth of the eCommerce sector.
Most services are moving towards an ‘on-demand’ model. Movies, groceries and even drivers can be sent directly to the consumer at the tap of an app. eCommerce is perpetuating this by creating click-and-collect, buy-now-collect-in-store, one-click checkout and other features that create a smooth omnichannel experience, as well as simplifying and speeding up the purchase process.
eCommerce allows consumers to compare prices and special offers easily, from almost anywhere. Consumers can even use their smartphones in a store to ensure they’re getting the best price.
Rise of mobile
The eCommerce industry is evolving at almost the same pace as mobile technology – this is no coincidence. As it becomes easier for consumers to research and purchase products on their phones, the eCommerce industry benefits.
Demand for niche products
The Internet gives consumers access to products that their local supermarket would not have. As the demand for unique or niche products grows, the eCommerce industry will continue to thrive.
Improved customer experience
The rise of eCommerce comes down to consumers wanting a better shopping experience. This is predicted to be the key differentiator between products by 2020. eCommerce streamlines the purchasing process, making it quick, easy and trackable.
As technology and businesses evolve and incorporate the customer experience concept, the eCommerce sector as a whole will also improve significantly.