As most entrepreneurs know, running and growing a successful business requires you to always be on top of your game. When it comes to eCommerce, the internet has given us access to a lot of studies and statistics that can help drive decision making.
Of course, with the speed at which the online world moves, having stats from 2 or more years ago doesn’t do any of us any good. In order to grow your business this year, you’ve got to be up-to-date with what’s going on right now.
Over the holiday break, I took a fair amount of time to sit down and put together a strategy for some of my own ecommerce businesses. As part of my research and data collection, I wanted to pull a lot of what I was seeing and learning into a post for our blog. I hope that this helps you as much as it helped me. Here’s to a strong 2020 for all ecommerce companies!
#1: The number of global online shoppers has almost hit 2 billion. To put some things in perspective, there are roughly 7.7 billion people on the planet. That means over 25% of the global population buys online—and that over 5 billion people have yet to experience the joyful ease of shopping right from their phone, tablet, or computer.
Growth has been fairly steady over the last six years, with the number of online shoppers expected to hit 2.14 billion by the end of 2020. But these projections based on steady growth do not take into account the fact that 5G networks may roll out around the world, even in rising mobile markets like Africa, where European and Asian companies have invested tons in digital infrastructure. That means the number of online shoppers could easily surpass our expectations within the next few years.
#2: Ecommerce accounts for almost 14% of worldwide retail. Moreover, it’s projected that it will account for over 17% by the end of 2020. While certain brick-and-mortar giants have closed their doors for good within the last few years (rest in peace to the American arm of Toys R Us and SEARS), other venues like Target and Walmart have hopped on the digital bandwagon with full force. Then of course, there’s also Amazon (cue the Imperial March from Star Wars). So while the increase in global online shopping means tons of opportunity for startups, don’t be lulled into complacency by this stat. You’ll have big competition from big companies, so you’ll need to play it smart and engage in effective marketing strategies such as retargeting with ads.
#3: Almost half of American businesses do not have an online presence. This stat really blows my mind—and one reason why ecommerce platforms like Shopify exist. If stat #2 had a caveat of competition with big business, then stat #3 should make you feel a little better. As brick-and-mortar stores and services ignore the online sphere, that means more room for your to snatch some market share. Alternatively, if your online store is selling website design services, this stat is your golden ticket to a prosperous 2020. Hit the streets with some business cards and run a Google Ad Campaign to let those Mom-and-Pop venues know what you can build them!
#4: Consumers LOVE the ease of online shopping. This one is probably like…duh…but you might be interested to get a more nuanced breakdown of what they love. Ability to shop 24/7 tops the list at 58% (as of 2019), closely followed by the ability to compare prices and the lower prices. Greater variety, saving time, and the convenience of not having to go somewhere and fight crowds were also some pro-points on the list.
Your key takeaway here should be that consumers love the ease that online shopping offers them. That said, you want to make sure their shopping experience on your site is seamless and enjoyable, which you can achieve with good site design and architecture; do not underestimate the power of User Experience!
#5: Consumers are checking out your prices…while they’re in a store. Well, to be more precise, 65% of shoppers are not necessarily checking out your online store, but they are looking up price comparisons on a venue like Google. This is great news for vendors who don’t have the overhead of maintaining a physical space and paying some workers to reshelve the inventory. Make sure your items are reasonably priced and that they’re displayed on the Google Shopping Search Results and other comparison shopping engines. This is also a good reason to list your items on marketplaces like Amazon, Wish, and perhaps even eBay, so that in-store browsers can find them if they look there.
#6: Consumers are doing their research before they buy. In fact, a whopping 85% of consumers are doing research before they buy. In fact, the ability to research products and compare prices is one of the biggest reasons people like shopping online. This means you need to have tons of relevant information about your products on your website, such as sizes, materials, and several types of quality photos (including action shots). Excellent product descriptions will also go a long way, as they build a sense of trust around what you’re offering. Remember that customers are checking out their options, and the better yours appears in terms of quality, the more likely it will be to bump competitors off the shopping list.
#7: Word of mouth still matters…a lot. In fact, as of 2019, 81% of consumers trusted friends and family more than they trusted a business. In light of the proliferation of knock-off products on Amazon, some of which have even been shown (in a recent WSJ study) to be dangerous, it’s only reasonable that consumers have lost some trust.
That said, even if you’ve optimized your site for consumer research (per our last point) you’ve got to foster a positive reputation about your brand online. This can be done with reviews and user-generated content on social media, such as people posing with your products. There are a number of strategies you can use to build positive brand awareness, such as working with influencers, giveaways, and including in-product notes that call for posting a picture on Instagram with your branded hashtag.
#8: Customers stop shopping at places with bad customer service. As of 2019, a whopping 80% of online consumers stopped shopping somewhere because they felt that they were subjected to poor customer care experience. This could include everything from getting a faulty product to not being able to reach a live person when they call a customer care number. Whatever you can do to foster a positive shopping experience from start to finish and beyond, do it.
You definitely want to make yourself (or your care team) as accessible as possible to handle customer care issues. This is a good reason to build follow-up campaigns with previous customers and create an ongoing relationship that can be the foundation of future happily-made purchases. You do not want to be a faceless, totally unreachable business like certain venues named after large jungles.
#9: Less than 3% of online traffic converts into a purchase. Note, however, that conversion rates do vary slightly based on device used, traffic source, and other factors. This is a great statistic to encourage those who feel sales numbers are low. Remember that if 100 people visit your site, you should expect less than 3 sales. If a 1,000 people visit your site, you might get 20-something sales. But the key takeaway here is that you want to do everything you can do to increase your conversion rate.
2.85% (the official percentage of 2018) is pretty low. If you need some motivation, consider the fact that conversion rates in a brick-and-mortar store are almost seven times higher. It makes sense; customers in a store have gone out of their way to go there, with a focused intent to buy something that said, you’ll want to look at techniques and tips that can help you close more sales—because settling for the status quo in business is never good…especially when it’s less than 3%.
#10: Almost 70% of online shopping carts are abandoned. Why is that? As we all know quite well, the internet is full of distractions and competition. Your key takeaway here should be optimizing the checkout process here to reduce the number of abandoned carts and building a retargeting strategy to follow up with those who have left your site in search of greener grass on the other side of the fence. Between retargeting ads that can offer sweet coupons to a weekly (or daily) email, there are plenty of ways to bring back the love.
#11: Extra costs are killing your sales. Have you ever had an experience where you’ve gone to buy something, and the price you thought you were getting isn’t exactly what you thought it was? This can only have one of two outcomes: extreme customer frustration, or a changed mind. Unfortunately, customers who are online are not locked into completing a transaction, and extra costs (like shipping) are the number one reason why they abandon their carts.
Other reasons include the need to create an account, or a complicated checkout process—but these next two biggest factors account for less than 40% of abandoned carts, while extra costs account for as much as 53%. Keep it simple and keep your pricing upfront. Can you offer free shipping or build shipping into the price? The customer doesn’t have to know the breakdown of shipping costs, and it will look a whole lot better on their end if shipping is included or free.
#12: People are opening up your abandoned cart emails. If you’re sending emails to customers who have abandoned their cart, you might get around 45% of those consumers to open the email, which is extremely high. By comparison, general emails (such as a weekly newsletter) from an ecommerce store have an open rate of around 15% according to MailChimp (which also isn’t too bad). This means that just because someone has said “no” doesn’t mean they’ve said “no” twice…and there’s still a chance they might say “yes.” Makes sure your store is optimized to be sending follow-up emails to shoppers who have abandoned their cart. With an open rate in the mid-forties, you won’t regret it.
#13: Shoppers go to the largest marketplaces first. Go figure! You know what they say…if you want to sell vegetables, go to the farmer’s market—and if that isn’t really a colloquialism, it should be. Almost half of online shoppers (48% to be exact) just head to Amazon, Ebay, Etsy, or any of the other big-name marketplaces. This stat should really make you consider getting your products on these venues, at least for the purpose of getting some attention that can then be redirected back to your website (where there are more offerings). Rather than fight the competition, you can join in and leverage some simple strategies to get attention to your products in the right place.
#14: People are shopping with their phones…and they want it to be seamless. Within the past six months, almost 80% of smartphone users have made a purchase using their phone or tablet. As phones gain more and more functionality, they become the primary place for online social interactions, browsing for information, and shopping. When designing your site, it might be a good practice to consider the mobile layout first and then the desktop layout.
Statistics are definitely indicating that more than half of your visitors are entering your digital store with their phone and not their computer. Keep in mind that mobile layouts need to be simpler; sites that take 1-3 seconds to load on mobile see a 32% increase in bounces all the way up to a 123% increase in bounces if a site takes more than ten seconds. And if mobile shoppers have a bad experience on mobile, they’ll be 62% less likely to shop at your store.
#15: Younger people spend more time shopping online. You might have figured as much already, but it’s good to know the breakdown. Millennials spend around six hours weekly shopping online. Baby boomers spend around four hours weekly. Seniors spend around two hours. Whatever you’re selling, you’ve got to know exactly who you’re selling it to.
The key takeaway here is that different groups of people have extremely different behaviors when it comes to shopping. This is a good reason to make your business a multichannel enterprise. Facebook, Instagram, and your email list are all different places to market your business, and perhaps market it in a different way—not to mention that within these venues, you’ll want to segment your marketing efforts.
A Final Word
Working in ecommerce for the last few years, many of these stats resonated with me, while others were pretty eye-opening/startling. I hope that this post will help you know what moves you should be making in 2020. Mobile is trending up; consumers love the ease of online shopping; customer care cannot be overstated. Take these 15 stats to heart as you’re putting together your 2020 strategy and make a resolution to act on them in!
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