China is one of more than 20 countries to which Newegg plans to expand its marketplace in 2017.
35% of e-commerce executives plan to invest in creating a “seamless shopping experience” across stores, web and mobile, a new survey from The E-tailing Group Inc. says.
E-commerce firms will invest significantly this year in such areas as mobile commerce, personalization, online merchandising and search marketing, according to a report from The E-tailing Group Inc. that draws upon survey responses from 108 e-commerce executives.
Those executives also hope to further link various sales channels, including stores, the web and mobile—35% of respondents say they expect to offer a “seamless shopping experience” in 2014 or 2015.
Social media, though, comes across as the kid who talks a big game on the playground but never manages to land even the easiest of baskets: 47% of respondents report receiving no more than 2% of e-commerce site traffic from social networks. A further 18% report winning between 2% and 4.9% of site traffic from social networks; 9% report getting 5% to 10% of site traffic from social networks; 2% report more than 10% of site traffic coming from social; and 24% didn’t know.
The report makes clear a few points, says Lauren Freedman, president of the Chicago-based consultancy. “Amazon is nipping at the heels of every retailer. Mobile has materialized as a revenue-producing force and customer expectations have peaked, once again altering retailer investment strategies,” she says. “Choice and prioritization are paramount in the context of this chaotic environment for survival and growth.”
The report barely mentions Amazon.com Inc. but the shadow of the e-retailer—the champ of not only the brand new Internet Retailer 2014 Top 500 Guide but of the Europe 500 guide too—certainly exists in the everyday world of the surveyed executives. That’s partly because, as the report points out, Amazon added some 1 million members to its $99-per-year Prime two-day shipping program during the 2013 holiday season. Prime now has more than 20 million paid memberships, and many more consumers use Prime as everyone in a family can use a Prime membership.
That puts the head on other e-retailers to offer free shipping. Conditional free shipping—requiring a minimum purchase—is considered very or somewhat important for 89% of respondents. That compares with 82% who said the same thing about unconditional free shipping, that is, offering free shipping on all orders, regardless of amount ordered.
Perhaps in part because of Amazon’s continued growth—in 2013, its web sales increased 20.3% year over year, according to the 2014 Top 500 Guide—many survey respondents have a somewhat pessimistic view of their prospects for 2014. 31% of those respondents say they expect no more than 5% year-over-year web revenue growth in 2014. That compares to 53% who expect 6% to 25% revenue growth, and about 15% who expect more than 26% growth.
Retailers also plan to beef up their mobile commerce efforts. 37% of respondents report they will spend more than $100,000 this year on tablet and smartphone initiatives this year. That compares with 32% who said the same in the same survey in 2013.
Personalization also will win budgetary attention, the report suggests. Personalization, whether through tailored recommendations on e-commerce sites or ads based on web browsing or shopping cart activity, represents “investment strongholds” for at least 27% of respondents.
The findings represent the views of a broad range of online retailers. The E-tailing Group Inc. says that 28% of survey respondents come from companies with no more than $20 million in annual sales; 23% with $20 million to $100 million; 27% with $100 million to $1 billion; and 22% with $1 billion to $5 billion. All of the respondents’ companies sell online, with 82% selling to consumers via their mobile devices; other respondents also sell through TV, catalogs, stores and social media. 33% of respondents report selling clothes; 31% shoes, accessories, jewelry or luggage; and 26% home and garden supplies. Smaller percentages come from a host of other retail categories.
35% of all respondents report that web sales account for at least 70% of overall business.
Some other findings in the 77-page report include:
• 64% of respondents sell globally, compared with 51% who said the same last year. 19% of this year’s respondents have no plans to take their business international, compared with 18% last year.
• “E-mail stands its ground” as a merchandising tool, with 92% of respondents deeming it a valuable return on investment, beating out such other tactics as cross-selling (90%), exclusives (87%), up-sells (81%), what’s new (79%) and top-rated products (78%).
• PayPal and other so-called alternative payments are cited by 85% of respondents as providing valuable ROI, compared with 74% last year, perhaps due to more mobile shopping, the report says. Live chat stands at 69% (67% last year), with in-store returns at 60% (no data from last year) and in-store pickup at 57% (59% last year).