"As consumers become more experienced with online shopping, they're shifting more of their holiday spend online and expecting better and better service from retailers," said Lila Snyder, Executive Vice President and President, Global Ecommerce and Presort Services, Pitney Bowes. "Online shoppers have an entire global marketplace at their fingertips. They expect that there is always a way to get the product they want, shipped where they want, when they want it. This creates both opportunities and challenges for retailers."Snyder continued, "With even more purchases expected to be online this year, retailers need to double-down on the elements of the consumer experience that matter most - delivery, returns, tracking and world-class customer care." A more experienced, demanding, frequent and global online shopper
- Online shopping is ubiquitous in major global markets. 94% of consumers have made a domestic online purchase - flat year-over-year.
- Consumers are shopping online more frequently. More than one-third of global consumers make online purchases at least once per week (up 4 pp from the prior year).
- 70% of online shoppers have made a cross-border purchase (up 6 pp from the previous year). Asia Pacific saw the biggest year-over-year increases, led by India (18 pp), China (12 pp) and South Korea (8 pp).
- Online shoppers are exercising a wider range of options when it comes to shipping, collecting, or returning their items:
- Consumers prefer free shipping with longer delivery times (75%) over paying for expedited parcel shipments (25%).
- 67% of online shoppers turn to marketplaces like Amazon, eBay, Flipkart, Rakuten, Tmall and JD.com to search for products. This compares with search engines (46%), retail websites (40%), social media (24%), and mobile apps (23%).
- Online shoppers report that 62% of their cross-border purchases and 59% of their domestic purchases take place on online marketplaces, versus retailer websites. These trends have increased year-over-year and are most prevalent in China, Germany, India and Japan.
- Product assortment, better deals and easy checkout are the top three reasons consumers choose online marketplaces.
- 62% of retailers have a cross-border ecommerce business today, and the vast majority of retailers who don't offer cross-border, plan to in the next 12 months. If all of these retailers execute against their business plans, 93% will offer cross-border shopping by this time next year - that equates to a 50% increase in cross-border retailers in just one year.
- One-third of retailers rate "international selling" as a top growth lever for their business - equal to the value ascribed to domestic ecommerce growth.
- The average order value (AOV) of a cross-border purchase is 17% higher than a domestic AOV. But, cross-border retailers must balance the opportunity for higher AOV against consumer demand for lower prices. 50% of consumers who shop cross-border do so because of price.
- Credit cards (like Visa and MasterCard) and e-wallets (like PayPal and Alipay) have been locked in a battle for payment option supremacy for several years. When asked what type of payment option they prefer when making a purchase outside of their home country, 41% of consumers chose e-wallets and 39% chose credit cards - the exact inverse of the results from the year prior.
- Preferred payment options vary by market. For example, US consumers prefer credit cards (40%) over e-wallets (32%), while German and Australian shoppers prefer e-wallets (Germany 61%:26%; Australia 64%:23%). Credit cards are most popular in Japan (74%) and South Korea (65%).
Three strategies for online retailers:1. Take a cue (or two) from marketplaces. a. Learn to love shipping. Low cost, fast, flexible and accurate shipping is key to attracting and retaining customers. b. Personalize to convert: Implement customer information management solutions that aggregate a single view of the customer. c. Expand your product assortment, offer timely promotions, and simplify checkout. 2. Go cross-border, but don't rely on brand alone. a. Localized marketing is essential because marketing channel preferences among consumers vary significantly by country. b. Operational prowess separates the winners from the losers. This is particularly true in neighboring countries. The expectation is low cost and high visibility of delivery, localized customer care, and minimized duties and taxes. 3. Have the courage to go where the customers are. a. When retailers implement cross-border strategies, they tend to start where the transition is easiest - neighboring countries with similar regulatory environments where people speak the same language. But, more often than not, the greatest opportunity for cross-border growth and success is further from home. Pitney Bowes' analysis has found that the prioritization of near-border markets has come at the expense of underserving consumers in countries more apt to shop cross-border. Entering new markets with different cultures, languages and laws is complex, but the rewards can far outweigh the investment and challenges. The 2017 Global Ecommerce Study is the latest industry research report from Pitney Bowes. Earlier this year, Pitney Bowes released its annual Parcel Shipping Index, which tracks international growth rates of parcel shipping volumes and related expenditures. The index forecasts a 20% increase in global parcel volumes in 2018. About Pitney Bowes Pitney Bowes (NYSE:PBI) is a global technology company powering billions of transactions - physical and digital - in the connected and borderless world of commerce. Clients around the world, including 90 percent of the Fortune 500, rely on products, solutions, services and data from Pitney Bowes in the areas of customer information management, location intelligence, customer engagement, shipping, mailing, and global ecommerce. And with the innovative Pitney Bowes Commerce Cloud, clients can access the broad range of Pitney Bowes solutions, analytics, and APIs to drive commerce. For additional information visit Pitney Bowes, the Craftsmen of Commerce, at www.pitneybowes.com.