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Don't Close Your Brick-and-Mortar Stores Yet

Thumbnail image for 2014-14-august-cracking-nuts.jpgCracking the e-commerce nut isn't as easy as people who actually crack nuts for a living clearly understand.

In fact, two new studies demonstrate that brands and marketers still face significant obstacles to adoption, especially on mobile. But the biggest challenge may be behavioral. As we recently explained, more than 90 percent of retail sales still occur in physical stores.

Why are so many consumers reluctant to buy online, despite the rapid growth of e-commerce? Ripen eCommerce, a Princeton, N.J.-based agency providing marketing, creative, development and technology services to e-commerce clients, thinks understanding consumers' path to purchase is the first step online retailers should take to capture a greater portion of the $3.2 trillion US retail industry.

Touch Me, Feel Me

Just recently, the research team at Ripen asked more than 1,000 American shoppers why they still prefer to buy in brick-and-mortar stores. The findings:

  • 30.8 percent prefer to see or feel the item in person
  • 29.9 percent want to buy item(s) right now
  • 16.9 percent believe it protects their privacy
  • 14.4 percent shop in-store to save on shipping costs
  • 6.5 percent want to ensure easier/cheaper returns
  • 1.5 percent said “other”

According to Ripen’s marketing director, David Rekuc, online retailers can encourage e-commerce by implementing several easy and low-cost changes to their websites, marketing strategies, and shipping and return policies.  While the survey found the largest portion of users "want to see or feel item in person" or "want an item right away," these issues are surmountable.

"Online retailers can offer free samples to get their products in consumers' hands and, while most small e-retailers can’t offer same-day delivery nationally, there’s no reason they can’t consider it for their local shoppers," he said.

Immobility Problem?

The second challenge for e-commerce sites focuses on the highly touted mobile space. According to Yesmail’s second quarter benchmark report, while mobile orders from email increased by 40 percent this past year, the average order value has decreased by 30 percent. The study, which analyzed data spanning five quarters — from the second quarter of 2013 through the second quarter this year — found consumers are reluctant to spend over a certain threshold on smartphones and tablets, threatening lost revenue this holiday season, Yesmail maintains. 

Yesmail, the email marketing solutions provider of Yes Lifecycle Marketing, found mobile orders made up 22 percent of all orders in the second quarter of 2014, up from 16 percent one year ago. But despite the 39 percent jump, revenue from mobile purchases increased by a comparatively modest 10 percent.

Yesmail found that the average order value for mobile devices has declined 30 percent since last year – from $79 to $55 — and has now 33 percent lower than desktops. At the same time, average order value for desktop purchases has dropped only slightly, from $88 to $83.

 
 
 
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