Keeping on top of ecommerce stats and trends is a necessity for anyone who sells online. The ecommerce industry changes fast, especially when world transforming events and phenomena occur, such as Brexit or the coronavirus pandemic.
The following ecommerce stats and data examine the impact of COVID-19 on ecommerce, changing online buying habits, ecommerce advertising and cross-border online purchases.
The bottom line: Not everything that worked in ecommerce in 2020 will bring more sales in the future. Some tactics, however, may work even better in 2021.
1. COVID-19's Impact on Ecommerce
The coronavirus outbreak has fueled the growth of ecommerce and order value. Moving shopping in many categories to online is likely to continue in 2021. Further, more shoppers are purchasing products from previously unheard of brands and have grown more comfortable with digital technology.
- The average items per order increased by 60% during COVID-19 (Contact Pigeon).
- 44% of consumers tried new brands during the pandemic (Arlington Research).
- 43% of shoppers now feel more positive about shopping online. Almost 40% of consumers report they’re more comfortable with digital technology than before lockdown (Wunderman Thompson Commerce).
- In August, online gift stores saw over 490% YOY growth in gross merchandise value (Wix).
- Despite COVID-19, almost 90% of worldwide shoppers will still be shopping for Christmas and other seasonal holidays (Rakuten).
Now is a good time to widen your audience and potentially your product offerings. Look for opportunities to generate extra sales, especially around big dates and holidays. Consider upselling, cross-selling and product bundling. For instance, instead of offering coffee mugs only, offer to personalize them and/or offer a bundle that includes coffee and gift wrap with a X% discount.
Related Article: Design Ecommerce Experiences to Handle Increasing Demand
2. Ecommerce Advertising
Ranking first in organic results on popular marketplaces, such as eBay or Amazon, may not bring the best results today. Due to the prominence of paid ads, the first organic result may not appear until the middle of the page, or sometimes even closer to the bottom.
For instance, in popular categories on eBay over 50% of the first page of search results can be sponsored products. This includes the first five search results that are getting the most clicks.
As a result, ecommerce advertising is on the rise.
- Digital will represent 51.3% of total US ad spending by 2021 (eMarketer).
- Ecommerce ad spend rose 115% (Q3 2019 vs. Q3 2018) and Amazon was a key player (Marin Software).
Ecommerce advertising is not only about costs, but also benefits. Ads on marketplaces positively impact product page views, transactions and revenue. In general, they’re very effective for a short-term boost in sales. However, an effective long-term advertising strategy is a completely different thing. Sometimes sellers must put in more advertising effort, another time products can sell relatively easily with no (excessive) ad spend. Advertising, as always, comes down to finding the elusive balance between investing resources and seeing results.
3. Changing Online Buyer Demographics
The time when the majority of ecommerce shoppers were relatively young is a thing of the past. Online shoppers today represent many age groups, which online sellers should keep in mind as they plan campaigns, communications and promotions.
- In the UK, those in the 25-34 age group had the highest online purchasing penetration in 2020. The over 65 age group purchased the least (Statista).
- The amount of regular online shoppers over 55 has tripled in 2020 according to Waitrose’s report.
- The largest group of digital buyers in the US were millennials aged 25 to 34 years in 2020. The second-largest group were 35 to 44 year olds (Statista).
- Five percent of US consumers aged 65 years and older bought a product online for the first time due to physical distancing and self-quarantining practices (Statista).
Even though the majority of ecommece shoppers may be aged between 25 and 34, older customers are feeling more and more comfortable shopping online due to necessity and improvements in ease of use.
Related Article: The Demographic Your Digital Practices Can't Ignore
4. Social Ecommerce Habits
The early bird gets the sale. Buyers shop early and are more likely to purchase via Facebook over other social channels. Keep this in mind when deciding when and where to showcase your product.
- 8 am to 9 am (adjusted for time zones) is the peak time for online sales (Salecycle).
- 40% of consumers have made a purchase via Facebook, 13% via Instagram and 12% via Pinterest (Avionos).
Plan your large promotions and marketing campaigns during peak times, but know they may need to be specific for each platform. And of course consider other factors in your strategy, such as demographics or locations.
To better connect with your customer base, consider investing in an omnichannel social media sales strategy. In other words, optimize each platform to best serve its users and integrate all of your platforms into a single, seamless approach. For example, if your followers use your Facebook Page to learn more about your business, focus more on educational and engaging content. If people tend to purchase your products on Instagram, optimize your Instagram business profile to sell.
5. Cross-Border Purchases
International ecommerce also saw a period of growth this year, with a 21% increase in worldwide sales between January and June as compared with the same period in 2019, according to research by ecommerce vendor Global-e. Consumers had already shown an interest in shopping internationally, with 34% of US shoppers stating in 2018 that they had purchased from vendors outside of the US.
- US cross-border ecommerce grew 42% in May (Global-e).
- 96% of small businesses using eBay in the US export to an average of 17 countries (eBay).
International ecommerce expansion is especially effective when paid marketing campaigns reach a plateau in the seller’s domestic/current market. Increasing CPCs further to grow traffic can decrease campaign clicks, sales and the overall profitability. In such situations less competitive markets can offer lower CPCs and better return on advertising spend.
Additionally, selling on international markets often allows sellers to balance the sales between markets, spread their risk and make the most of diversification. One challenge for international merchants is to minimize potential shipping delays. Keeping clients informed is critical here. Reliable parcel tracking tools and simple return options should also help to reassure international buyers.
Related Article: International Ecommerce: What Customers Expect From Your Store
6. Payment Methods
Online shoppers expect speed and convenience when making a purchase, which means vendors should make it possible to pay with their preferred payment method. Credit cards remain the most popular method of payment, in spite of the growing number of alternatives, so clearly display the logos of popular card providers at checkout.
- Americans have four credit cards on average (Experian).
- Visa and Mastercard are the two most popular credit card companies (Statista).
- PayPal is the preferred payment method among online shoppers worldwide. Over 40% of online shoppers report using this method (Statista).
- The PayPal badge got the most attention out of all social proof buttons (CXL Institute).
- Digital and mobile wallet payments account for almost 42% of online transaction volume worldwide. Only 29% of online merchants accept mobile wallets (Statista).
7. Free Shipping
Free shipping can be the ultimate sales maker during the final stages of the online purchase decision. “Free” is a powerful notion: people tend to overvalue things that come for free, congratulating themselves on getting a good deal.
- 85% of consumers prefer free shipping over fast shipping (Deloitte).
- The average shopping cart abandonment rate approximates 70%. Shipping fees and other extra costs are the main reason why shoppers decide not to finalize the purchase online (Baymard Institute).
However, not all sellers can afford to offer free shipping, especially if they sell internationally. For this reason, international online sellers may be better off having local fulfillment centers to serve buyers.
Ecommerce Opportunities Await
With 2021 just round the corner, new opportunities await ecommerce sellers. Multiple surveys have found the trend of online shopping will continue apace in the year ahead. So while we may not know what 2021 holds, online sellers would do well to ready their strategies now for the days ahead.
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