The e-commerce world is enormous. In fact, according to eMarketer, it is the only trillion-dollar market (1.6T USD in 2015) in existence that is projected to grow over 20 percent this year and continue to increase at double-digit rates. It is still relatively early in the shift from traditional brick-and-mortar retail to e-commerce spending-- with e-commerce only comprising 6.6 percent of the $24T total in worldwide retail sales-- but the e-commerce boom is changing the way traditional stores do business.
Technology, smartphones, and wireless connection nearly everywhere have no doubt coincided with the growth of the e-commerce sector. This industry is meeting the need of today's consumers and shoppers-- instant gratification. Not only are consumers looking for fast interfaces and quick transactions, but are hoping to capitalize on comparison shopping, digital coupons, discount codes through text, coupons in apps, and getting cash back from instant rebate apps (like Ibotta and Checkout 51).
Most of the new and popular direct-to-consumer retail brands online are not even necessarily well-known names, but they present themselves with a very distinct look and feel. The 'niche branding' is appealing to customers who have an eye for style through the use of catchy names, slick websites, hip-looking design. Michael Priyev, a manager at web design company Toggle Web Media, says, "We've seen a considerable number of new venture-backed e-commerce startups popping up."
So, how have traditional retailers been impacted, and how are they changing to stay competitive amidst booming e-commerce brands such as Amazon and eBay? Most have started shifting towards something called "omnichannel retail"-- a cross-channel business model that increases customer experience. This retail style may mean evaluating all processes, logistics, distribution, admin, and supply chains while developing and evolving each of these. It could also require bringing in an omnichannel fulfillment to decrease warehouse distribution time. to decrease warehouse distribution time. For some of the nation's premier omnichannel retailers, such as Macy's and Sears, this has meant pouring resources into creating innovative website back-end systems and supply chain protocols.
Differentiating your brand and rising to the top in the e-commerce boom also means crunching numbers and data available online to determine what your consumers want. Using social media to connect and talk to customers to get their opinions and feedback. Even just simple posts on social media can give companies insights into their shoppers.
The boom in e-commerce is astounding, and it is shaping the way traditional stores are doing business. Approximately 6.5 percent of US retail sales are expected to come from internet transactions this year, increasing to 8.9 percent by 2018. The good news for traditional retailers is that this will result in a greater presence of brands using an omnichannel approach. Brick-and-mortar businesses are not going anywhere, as more than $10 out of every $11 is still spent in retail shops.