The 5 Consumer Trends Retailers Need to Know About (And How You Can Take Action)

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2 The 5 Consumer Trends Retailers Need to Know About The 5 Consumer Trends Retailers Need to Know About (And How You Can Take Action) What s Google doing? What s new with Amazon? Where is ebay expanding? If you re a retailer or brand, you probably ask questions like these a lot. At ChannelAdvisor, a big part of what we do is to examine the trends shaping the world of e-commerce. And this involves keeping tabs on the industry s major players. But while questions like these are extremely important things to ask yourself, a deeper layer of driving factors exists behind those surface changes. That deeper layer is consumer behaviour. Shifts in consumer behaviour often tend to drive many of the advancements we see from the titans of e-commerce. The world of technology is evolving rapidly, and these changes are sometimes hard to predict. However, knowing the underlying consumer behaviours that impact e-commerce innovation can give you insight into what may be around the corner. Currently, we see five consumer behaviours driving enormous change in the e-commerce landscape. They re related to the following areas: More Mobile Stronger Social Networking Zero-Friction Transactions Value-Driven Shopping Cross-Border Trade (CBT) In this ebook, we ll outline these changing behaviours and give you a checklist of ways in which you can take action both on marketplaces and in digital marketing.

3 The 5 Consumer Trends Retailers Need to Know About I. More Mobile Mobile has been a buzzword for many years, but m-commerce is finally starting to take hold in the industry. Google even says that there are more searches now on mobile devices than on desktops. 1 Consumers in the UK are set to spend 53.6bn a year using their smartphones and tablets by 2024, compared with the 9.7bn spent today. Mobile s real influence on spending expected to be more than double that, with 42% of all retail sales to involve a mobile device in some way or another. 2 In other words, retailers can t afford to ignore mobile any longer. Consumers are on their phones more often during the day, they re searching for products more often, and now they re attempting to purchase more often. A good indicator of this trend is the behaviour of millennials. Based on conversations we ve had with customers who specifically target this demographic, we ve learned that some of these retailers are starting to see mobile commerce make up more than half of their online sales. Millennials are fast becoming the most powerful consumer demographic, and their behaviour traditionally serves as a harbinger of trends that will ripple out to the rest of the buying public. Mobile may be on the rise, but remember that you still have many options available to meet the growing demand

4 The 5 Consumer Trends Retailers Need to Know About How You Can Take Action Marketplaces Don t bother with building your own mobile app. Apps are expensive, time consuming and a waste of company resources. You re better off piggybacking on the success of established (and popular!) apps from marketplaces like Amazon and ebay. The websites for both marketplaces make integrating with their mobile apps an easy solution. You ll benefit from the increased product exposure on the marketplaces, as well as position yourself for success in today s multi-device, anytime, anywhere shopping environment. On Amazon: üüinclude all relevant product identifiers (e.g., UPC, EAN), so your products match with the correct listings. üüuse programmes like Amazon Sponsored Products to highlight certain listings and increase visibility on both mobile devices and desktops. On ebay: üüassign Item Specifics (both those recommended by ebay and Custom Item Specifics, which you define) to help your products stand out. Item Specifics also give shoppers a clearer picture of what they re buying and therefore more confidence to convert. üüuse responsive design templates to provide an optimal viewing experience for the shopper no matter the device. Digital Marketing üüoptimise your Product Listing Ads (PLAs) on Google. Modify your mobile bid adjustments to make sure your ads appear on mobile devices. üütake advantage of product advertising programmes beyond Google like Bing. Start by cloning your current campaigns and ad groups from Google AdWords and then sending to other channels. üücreate an optimal user experience on mobile devices to help increase conversion rates. Develop an easy and trustworthy checkout experience by limiting the number of steps for the consumer and including proven, mobile-friendly payment options like Apple Pay, PayPal, etc. Bonus Tip: Don t have a website that s responsively designed for mobile devices? You should. But in the meantime, do the next best thing: Optimise your product landing pages and templates for mobile viewing with responsive design. You ll be creating a better shopping experience for mobile customers and will ultimately find fewer abandoned carts as a result.

5 The 5 Consumer Trends Retailers Need to Know About II. Stronger Social Networking One of the top activities on mobile devices is social networking. So naturally, with the proliferation of so many handheld devices, social media usage also continues to soar. For many years, however, retailers and even the social networks themselves couldn t quite figure out how to monetise the massive popularity of social media. That s finally begun to change. Facebook, for example, has gone from no e-commerce business model at all to the industry leader. The social media giant figured out how to monetise its popularity, and now mobile advertising has become nearly three-quarters of its total revenue. 3 Another factor we ve found driving e-commerce growth is the general shift from text sharing to image sharing on social networks. New channels such as Instagram and Pinterest have specifically tapped into this image-sharing trend. The most recent response from social media channels is the addition of Buy buttons directly within the sites and apps. Facebook, Twitter and Pinterest have all unveiled versions of a Buy button, allowing consumers to purchase products without leaving the site. Instagram, meanwhile, has introduced a Shop Now button that lets interested shoppers learn more about the product elsewhere. 3

6 The 5 Consumer Trends Retailers Need to Know About How You Can Take Action Marketplaces üükeep your eye on new opportunities through Buy buttons on social media and other channels. Digital Marketing üürecapture visitors and cart abandoners by taking advantage of Facebook Dynamic Product Ads. These ads can be served directly to the newsfeed of potential customers who viewed your products or website. III. Zero-Friction Transactions Technology has improved our lives in countless ways and, some could argue, quickly conditioned us to expect expediency and ease in everything we do. So it goes with the modern online consumer. A growing portion of modern consumers have an overwhelming desire for a quick and easy purchasing process. Or in other words, we re witnessing the rise of the convenience customer (the flipside to the value-oriented customer ). We ve found that these consumers become very brand loyal if they have a positive buying experience and are even willing to pay extra for the added benefit of convenience.

7 The 5 Consumer Trends Retailers Need to Know About Whether the rise of Amazon Prime and its free, one-day shipping model helped condition shoppers to expect fast and easy buying experiences, or Amazon and its customer-first mindset was simply responding early to a perceived niche, it s an irrelevant chicken or egg question now. A growing swath of the consumer public now expects and demands speed and lack of friction in their e-commerce transactions. As such, fulfilment is the new battleground for many retailers. The number of fulfilment centres are growing, and Amazon is leading the way. 4 How You Can Take Action Marketplaces üüestablish quick and easy shipping policies and processes. Help make your popular items Prime eligible by using Fulfilment by Amazon (FBA) for those products. Hire additional employees to process items more quickly, especially during peak times such as Christmas. üübeef up your return policies. During the festive season, extend your returns policy until the new year to give customers time to make a return. Consider offering free returns shipping year round. üümake sure orders are convenient for customers. Expect for all marketplaces to request more accommodating returns policies in exchange for greater visibility and badging (e.g., Top Rated Sellers) 4

8 The 5 Consumer Trends Retailers Need to Know About Digital Marketing üüadvertise with PLAs. Optimise your PLAs for broad exposure. Drive shoppers to the one place where you can control the quality of their experience: your website. üüoptimise your customer s mobile shopping experience. Minimise the number of steps shoppers encounter during the purchase process. (check the old OPer here) üüprovide payment options with a proven track record of success and customer satisfaction. IV. Value-Driven Shopping Surprise, surprise: Consumers love a good value. And from the rise of daily deal sites to monthly membership clubs, good deals are now plentiful. The value-oriented shopper is, in many ways, the inverse of the convenience-oriented shopper. These consumers aren t brand loyal and will invest much more of their time in order to find a deal. Daily deal sites, flash sale sites and subscription models have all seen increased popularity as a result.

9 The 5 Consumer Trends Retailers Need to Know About How You Can Take Action Marketplaces: üüexpand your reach by listing products on emerging, value-focused marketplaces. üüexplore additional advertising opportunities on other third-party marketplaces (e.g., Tesco, Rakuten, etc.) where you can potentially run promotional deals such as deals of the day. Digital Marketing: üüuse Google Merchant Promotions to advertise the great value to consumers via PLAs. üüsend a feed to all comparison shopping engines (CSEs), because price conscious consumers will be scanning those sites. Try to send your updated feed to each CSE at least once a day.

10 The 5 Consumer Trends Retailers Need to Know About V. Cross-Border Trade (CBT) E-commerce is now a global game, and cross-border trade (CBT) should be on the roadmap of any retailer looking to grow their business. With new marketplaces, new devices and new shipping methods and fulfilment centres, CBT grows in popularity each year. Paypal even anticipates that there will be 130 million cross-border online shoppers by And that s just between six key markets: the US, UK, Germany, Australia, China and Brazil. 5 The rise in cross-border shoppers naturally leads to the growth of international fulfilment programmes like ebay s Global Shipping Programme (GSP) and Fulfilment by Amazon (FBA) Global Export. Last year, ebay s GSP saw a year-over-year growth of 53% and the number of orders increase by 125%. 6 New marketplaces, as well as popular fulfilment programmes, have given retailers new options for addressing global demand. Consumers crave options, and the rise of CBT increasingly gives them as many as they want. How You Can Take Action Marketplaces üülist your popular items on international marketplaces. Research international markets and test items that are relevant

11 The 5 Consumer Trends Retailers Need to Know About üüuse the fulfilment programmes of marketplaces to ease international logistics. ebay s Global Shipping Programme (GSP) Amazon FBA Global Export»» Access to customers in more than 60 countries and lower fulfilment costs. 7 üüutilise Amazon Unified Accounts to make sharing inventory across Europe easier. Digital Marketing üüuse PLAs and text ads to reach global consumers. üütake advantage of global comparison shopping engines (CSEs). 7

12 The 5 Consumer Trends Retailers Need to Know About Prepping for the Future As an e-commerce retailer, you already know the old maxim: The only constant in e-commerce is change. While most of the consumer trends above aren t necessarily shocking, we believe each of them have broad implications for retailers and branded manufacturers as the industry continues to evolve and change. The retailers who understand these changes in consumer behaviour and adapt to them will position themselves well for the future. And those retailers who ignore them and the subsequent innovations are doomed to be left behind. Want to talk more about changing consumer behaviour and e-commerce trends? Or wish to discuss the ways ChannelAdvisor can prepare you for any industry changes lie ahead? Call us at or us at And for the latest e-commerce news and updates delivered straight to your inbox, subscribe to our monthly e-newsletter, ECOMmunicator. Trust us. Be Seen. To learn more: Call US AU DE +49 (0) FR Visit The global standard for e-commerce leaders. Copyright 2015 ChannelAdvisor Corporation. All rights reserved.

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