Technology has wholly disrupted the retail industry. Consumers are like moving targets; they no longer stay loyal to a single brand or type of shopping. Some of the biggest retail news came out of last week’s Internet Retailer Conference. BigCommerce and UPS shared insights on the state of ecommerce, evolving customer behavior, and how tech-savvy shoppers are transforming retail.
The takeaway from BigCommerce and UPS is that cost and convenience largely drive purchase decisions, and retailers need to keep up with ever-changing technology and customer expectations.
Conversion Drivers: What Influences a Purchase?
Price is still the main driver for online purchases, but a new study by BigCommerce shows that American shoppers aren’t just looking at the price - they’re also searching for the greatest value for their time and money.
The study identified the top influencing factors on online purchases. These include:
- Price, 87%
- Shipping cost and speed, 80%
- Discount offers, 71%
- Variety of options in stock, 71%
- Trustworthy reviews, 68%
- Flexible or free returns, 68%
- Brand reputation, 67%
- Simple site navigation, 64%
- Tailored selection of products, 53%
- Mobile-friendly pages, 46%
Convenience and overall price are the strongest drivers of conversions. Shoppers are also looking for timely deliveries, product diversity, good return policies, and a number of other elements that represent value.
The study also identified deterrents to conversions: what shoppers disliked when it came to online shopping.
What is stopping consumers from buying online?
- Shipping cost, 58%
- Not being able to touch or feel a product before buying, 49%
- Waiting for delivery, 34%
- Difficult return process, 34%
- Privacy concerns, 29%
Retailers need to build trust and confidence when it comes to selling online. In addition to fair price and delivery speed, customers are expecting more product information before deciding on a purchase.
The BigCommerce survey determined several types of product information customers desire. These include:
- Images of products, 78%
- Product reviews, 69%
- Side-by-side product comparisons, 46%
- Customer testimonials, 42%
- Video product demonstrations, 30%
As digital natives, younger consumers are accustomed to having information before making decisions. This applies to retail as well. Customers today use knowledge to determine a brand’s credibility or product’s quality. Images, reviews and comparisons aid in the research process, saves them time and ultimately adds value to the experience.
In essence, most shoppers make purchase decisions based on the overall experience. Value is a combination of many factors, including the total cost, convenience, shipping speed, quality information and confidence in that brand. Today’s retailers need to keep up with ever-evolving technologies and customer expectations in this new age of shopping.
Apple Pay to Facilitate Faster Checkouts on Websites
Apple Pay is coming to Safari, Apple announced this week during their annual Worldwide Developers Conference (WWDC). This enhancement simplifies the checkout process and expedites digital and mobile commerce.
When you shop on a website, you typically have to fill out your name, address and credit card information. Then, you’ll have to fumble for your credit card and enter the digits on the webpage.
But starting this fall, Apple Pay will enable rapid checkouts from retailer websites. Without needing your credit card, Mac, iPhone and iPad users can simply put their thumb on the Touch ID sensor to authenticate purchases. Authentication can also be done using an Apple Watch.
This thumbprint verification system is an advantage in fighting fraud online. This can help Apple gain traction with brands and ecommerce retailers. Target, United Airlines, Lululemon Athletica and Etsy are among the businesses that have opted in. By increasing convenience and checkout speed, Apple Pay could help reduce abandoned shopping carts and drive more conversions.
With this announcement, Apple aims to become a leader in the emerging and already competitive e-payments market, directly competing against PayPal’s core business. It’s another proof that commerce is shifting towards online and mobile channels, and companies need to continually develop solutions that drive mobile purchases and reward mobile spending.
What It Means to Be a “Ready Retailer”
In partnership with comScore, UPS released their fifth annual UPS Pulse of the Online Shopper, a study that surveyed 5,330 consumers on their shopping preferences. Their findings prove that consumers are becoming smarter, empowered shoppers who choose retailers offering the best customer experience at the best price.
Today’s consumers expect a seamless experience across all channels. Tech-savvy shoppers readily shift from channel to channel to make purchasing decisions. What’s more, they are becoming more adept at finding the best deals and products they want.
Consider these stats on consumer behavior:
- 45% of shoppers said that they love the thrill of hunting for and finding great deals in stores.
- 61% of shoppers say they would rather shop at smaller retailers if they offered “unique products.”
- 56% of shoppers abandoned a cart when shipping fees made the total purchase cost more than expected.
- 44% of shoppers abandoned a cart because they wanted to compare total costs (including shipping fees) before buying.
- 38% of purchases are cross channel, combining physical and digital store activities.
- 53% of shoppers are likely to use discounts offered in an email.
- 65% of shoppers are influenced by marketplace reviews and posts.
The demands of empowered shoppers provide retailers new opportunities to shine. Customer experience has never been more crucial in driving purchases. Retailers need to know what customers expect and position themselves to service these empowered shoppers. This means investing in a technological solution that can manage all these pieces effectively.
Total costs, convenience, delivery time and having the right products wherever and whenever the customer wants it - all contribute to the experience and value customers expect from today’s retailers. As a result, retailers need to prioritize inventory transparency, logistics and warehouse efficiencies, mobile experience and other operational factors that can execute an optimal shopping experience for their customers.
As defined by UPS, a “ready retailer” means understanding drivers of change and taking action to address what consumers want now and in the future. From simpler checkout processes and faster deliveries to overall costs and return policies, retailers must always be ready to stay ahead of evolving customer expectations.