If you’ve listened to your customers – or attended a retail industry conference – over the past five years, then you know that cross-channel retailing continues to be a hot topic. Not only are more and more Americans going online, but a growing percent of them use the internet to research and purchase products. Retailers can no longer fudge their online experience; customer expectations for online customer service levels are also rising.
1. More Consumers are Going Online
In the late 1990’s, the era of irrational exuberance was in full form. Internet companies of all kinds promised to change the world with their planos iptv. latest e-product, e-exchange, or e-service. You may recall that stock prices for just about any e-Business climbed to unprecedented (and apparently unfounded) heights. It all came crashing down as the now infamous dot-com bubble burst.
Although many investors turned their backs on dot-com companies as a result, consumers did not; the number of people surfing and shopping online has continued to climb. Today, an impressive 73% of adult Americans use the internet, according to the Pew Internet Project. Not only is the total number of on-line surfers steady and growing, but the amount of time they spend online is also increasing. Those numbers will only continue to increase as today’s well-connected teenagers grow into tomorrow’s prospective customers. Today’s teenagers age 12-17 are even more connected than their adult counterparts, with 87% of teenagers going online according to the Pew Internet Project.
The importance of the Internet in everyday life also continues to climb. From product research to social networking or from news & entertainment to health care research, today’s consumers are increasingly looking to the online channel. It’s becoming hard to avoid it. In 2007, 47% of adult Americans have a broadband Internet connection at home, according to the Pew Internet Project. Most working adults have a computer on their desk that can access the internet, and many mobile telephones now have web access on their tiny screens. Furthermore, Wi-Fi connections are becoming as common as your local Starbuck’s store and cable operators continue to look for ways to integrate Internet access with traditional television service.
Any business that turned their back on the internet as a result of the dot-com collapse in 2001 has in effect, turned their back on their customers. Although many early dot-com businesses collapsed, some in spectacular fashion, it has not dissuaded the lure of the online experience. As more potential customers are going online, businesses should take note. Without a viable Internet presence, your business is missing out.
2. More Are Using the internet to research and Shop
As more and more adults are going online, a growing percent of them use the internet to research and purchase products. Over 70% of all online consumers use the internet to research products, according to Forrester Research. That translates into $400 Billion of store sales – or 16% of total retail sales – that are directly influenced by the web as consumers research online and buy offline; a trend that is forecast to grow at a compounded annual rate of 17% through 2012 according to Forrester Research.
The Fortune 500(tm) rankings are further proof that the Internet should be a strategic channel for any retailer. Pure Internet companies Amazon and ebay have passed some well known traditional retailers in the rankings. According to Fortune’s 2007 rankings, Amazon has passed notables Barnes & Noble, Borders, and Limited in total revenues. ebay has passed other well-known brands including Bed Bath & Beyond, Molson Coors, and Ross Stores.
Key Trend: Consumers are increasingly using the internet channel to research and purchase products. Over 70% of all online consumers use the internet to research products. By 2009, 41% of all U. S. retail transactions will be influenced by online experiences.
3. Expectations are Rising
As adults become more comfortable with the internet, their expectations for their online experience are increasing. In fact, 85% of adults expect their online service levels to be the same as offline, an increase of 3% from the prior year, according to a survey conducted by Tealeaf. If those service level expectations aren’t met, 40% of online consumers will abandon their transactions entirely or turn to a competitor according to the Tealeaf survey.
The online world has also become a key influencer in purchasing decisions. An impressive 43% of American adults identified online information as the most powerful influencer of their purchase decisions according to a report published by Accenture.
The large majority of adults now expect to be able to choose from a multiple shopping channels. In fact, 80% of consumers feel that it is important to have a choice of shopping in multiple channels when choosing a retailer, according to a Sterling Commerce survey. The survey also found that 90% said it was important to be able to return an item purchased online in a physical store; underlying the importance of cross-channel integration to the consumer.
While the retail industry seems to have embraced the internet with online catalogs, promotions, and interactive product selectors, other industries should take note. The impact of the Internet on buying decisions is here to stay. Cross-channel integration is becoming an increasingly important requirement for meeting buyer expectations in nearly every industry. The highly fragmented health care industry – for example – will likely see an increasing demand for integrated online and offline services including scheduling, diagnosis, insurance claims, and the holy grail of health care: medical records.