Report: We’ll Shop For Books & Electronics Online, But Groceries Stay Firmly Instore

Report: We’ll Shop For Books & Electronics Online, But Groceries Stay Firmly Instore
SHARE
THIS



The third annual WalkerSands Future of Retail Study finds that the big consumer behavioural shifts have stalled, but significant changes are still happening below the radar.

Not surprisingly, consumers prefer to go online for books and electronics but groceries — and to a lesser extent consumer packaged goods — remain firmly wedged in the analogue world.

For some context, online takes about 14 per cent of the total US retail pie — similar to the UK experience — whereas in a market like Australia the figure is closer to seven per cent, according to organisations like Australia Post.

Meanwhile, according to the authors of the WalkerSands report, “It’s been a whirlwind couple of years in retail technology.”

The shifts aren’t quite as dramatic this year, they concede. However, they say that doesn’t make them any less important.

“Instead of consumer fascination with the latest headline-grabbing technology, we discovered much more subtle shifts in consumer opinion and behaviour with equally large implications. On the surface, it might feel like the future of retail has stalled. For example, this year’s study shows that e-commerce has reached a saturation point in many ways, and consumer excitement has waned for some of the sexiest emerging tech.”

Unlike recent years, the release cycle from vendors like Apple Pay, Amazon Prime Air and Alibaba has been more subdued. “But digging deeper into the data, we see that the retail technology space is still undergoing a major transformation — it’s just happening mostly behind the scenes.”

The study suggests four areas for future innovation:

  • Growing importance of the supply chain Seamless shipping, delivery and returns have become more and more important to consumers in recent years, making them primary future drivers of e-commerce growth. Fulfillment has become a top investment area for retailers, with 29 per cent of capital expenditures last year going toward solutions like transportation and logistics, delivery options, order management, inventory visibility and returns management.
  • Integration of in-store and online experiences Consumers maintain a clear preference for in-store shopping for most product categories, but they are receptive to blending their online and brick-and mortar experiences. While beacon technology implementations are limited, consumers are mostly relaxed about the implications with seven in ten consumers saying they would be willing to opt in to in-store tracking and mobile push notifications, assuming the right incentives are put in place. Although beacons have been slow to take off, this area seems ripe for adoption as retailers like Macy’s, Target and Lord & Taylor roll out their beta beacon programs to the masses. And, in a case of bringing the in-store experience online, virtual reality e-commerce — or v-commerce — seems to be entering the early-adoption phase and could represent the next big integration area for the in-store and online shopping experiences.
  • The rise of luxury e-commerce The luxury goods category saw a dramatic spike this year, with the number of consumers who have purchased a luxury item like high-end jewellery in the past year more than quadrupling from 2014. This finding lines up with analyst predictions that online sales of luxury goods will triple to around $US80 billion by 2025, making it one of the fastest-growing areas of e-commerce.
  •  Slow mobile payments adoption Privacy and security concerns remain the primary reasons that consumers are hesitant to use mobile payment applications. This could explain why adoption has essentially remained flat year over year, with about a third of consumers having used these applications. Still, US mobile payment transactions are expected triple in 2016 to $27 billion, a sign that a few eager early adopters and the growth of Apple Pay could eventually force more widespread changes in consumer behaviour.

The study argues that retailers are in an investment and adoption phase and that business practices and consumer behaviour are yet to catch up with technology.

Free shipping

Think of it as the cost of doing business. Free shipping is identified that the thing that would most likely drive shoppers to do more online, with same-day shipping growing in importance.

free shipping

Other issues such as returns policies are also emerging as a key influences. According to the study, “While nearly half of consumers (49 per cent) say same-day shipping would make them shop more online, it appears that relatively few are being given the option. Fewer than one in ten consumers (nine per cent) have used same-day shipping in the past year, compared to 29 per cent for one-day shipping, 70 per cent for two-day shipping and 86 per cent for regular shipping. More than half (51 per cent) say they have placed an order online and picked it up in store, which speaks to the rising popularity of click and collect.”

This article originally appeared on B&T’s sister business site www.which-50.com

Latest News

Dan Gregory’s Five Tips For Effective Collaboration
  • Opinion

Dan Gregory’s Five Tips For Effective Collaboration

In this guest post, CEO of The Impossible Institute, Dan Gregory (main photo), says if you’re lost for inspiration then two heads – even 100 heads – are always better than one… The implementation of effective collaboration leading the generation of results has been well documented, but there is one example that comes to mind – this […]

Opinion

by B&T Magazine

B&T Magazine
Poll Reveals What Journalists Fear the Most
  • Media

Poll Reveals What Journalists Fear the Most

A global poll of journalists from 52 countries has identified declining ad revenues as the profession’s number one concern. Staff cuts came second and the dreaded “fake news” came in at third. The poll was conducted by German press organisation Impressum and asked respondents the three questions below: In one word, what defines journalism in your […]

by B&T Magazine

B&T Magazine
Aussie Adland’s Brightest Come Together To Crystal-Ball Trends In Creative & Marketing
  • Advertising
  • Marketing

Aussie Adland’s Brightest Come Together To Crystal-Ball Trends In Creative & Marketing

A new Aussie study – based on the views of some of adland’s brightest – has concluded that data and technology is bringing agency creatives and marketers far closer together. The study, titled Joining The Dots: The Future Of Creativity, was conducted by PwC and Google and included the opinions of 15 industry thought leaders […]

by B&T Magazine

B&T Magazine
Aussie Study: Brands With An Excellent Reputation Can Charge Almost 10% More
  • Marketing

Aussie Study: Brands With An Excellent Reputation Can Charge Almost 10% More

Consumers are willing to pay more for products that not only have the features they want but also are delivered by businesses with a good reputation, a new Australian study has found. The study (which you can read in full here) was done by researchers at the University of Technology Sydney (UTS), puts a price on reputation […]

by B&T Magazine

B&T Magazine
P2P Transport Limited Becomes Australia’s Largest Taxi Advertising Network
  • Media

P2P Transport Limited Becomes Australia’s Largest Taxi Advertising Network

The acquisition of Nonstop Media by ASX-listed P2P Transport Limited will create Australia’s largest taxi advertising network. Adflow, P2P Transport’s advertising division, will take control of all acquired media assets to complement its growing fleet of digital rooftop signage, vehicle wraps and in-vehicle entertainment products across Australia. The acquisition grows Adflow’s footprint substantially by adding […]

UNSW Partners With Adobe To Transform Its Digital Ecosystem
  • Marketing
  • Technology

UNSW Partners With Adobe To Transform Its Digital Ecosystem

Computer software giant Adobe has announced a partnership with UNSW Sydney that will see Adobe Experience Cloud implemented across the university’s global digital ecosystem. The partnership with Adobe is part of a five-year overhaul of UNSW’s digital ecosystem designed to boost its reputation as a top 50 global university through improved integrated marketing capabilities and […]