How Consumers Drive the Rise of Online Shopping

My observations on some of the key reasons why online shopping has taken off with a bang over the last few years and what retail companies can learn from it to innovate and be successful.

It’s no secret that e-commerce especially online shopping has grown rapidly over the last decade. On the retailers side, there are numerous solutions needed in terms of inventory, logistics, stores, websites, apps, delivery, customer service and so on. But in the end, it’s the customers who define the success of the whole ecosystem.

Best part of my job is that I get to interact a lot with customers both offline and online, vendors, delivery folks and sellers. Here are some of the interesting observations and generalisations that I have made along the way regarding online shopping.

Window shopping

Who doesn’t love window shopping :-) A lot of customers love window shopping and they end up buying the product only if they really love it. Online retail has enabled such customers to window shop every day, anytime of the day … isn’t that awesome? And this is the reason retailers spend a considerable amount of time and research in designing the best possible product catalog and filter experience on websites and apps.

Online retail has enabled such customers to window shop every day, anytime of the day … isn’t that awesome?

No more fitting rooms!

I know many who hate the concept of fitting rooms; most of whom are e-commerce converts just for this reason. It is surprising that stores have not innovated in addressing the fitting room related issues even after the e-commerce onslaught! Waiting in line, changing in claustrophobic rooms and doing this over and over … hmmm thank goodness we are now in an era of tap to buy.

Ease of checkout and returns

Checkout is one in-store challenge which retailers all over the world have attempted to innovate for years but failed miserably to come up with a practically viable solution. Increasing the number of counters, app based checkout assistance and ideas such as these have just been promising pilot implementations. Such a challenge does not even arise in the case of online retail. Customers look at product images to understand the fit and look, add products to shopping bag, checkout in a jiffy on the web or on their smartphones!

This coupled with easy returns as offered by most of the online retailers leads to an even better shopping experience for the customers.

Product availability

Online retail allows for a wider inventory without the constraints of the physical store space. Marketplace models and new age distibution processes make it even easier to make all the product variants available to the shoppers. For example, having all the colours and sizes for the whole collection displayed is a huge ask for a physical store where as online retail can handle this with ease via efficient online cataloging and order fulfilment.

Online retail allows for a wider inventory without the constraints of the physical store space.

Shop and ship to anywhere in the world

Another value that customers get from online retail is the ability to buy from or get the product delivered to any address in the world. Now there are some places which are really famous for their handicrafts, a specific kind of jewellery, or even fruits. For example, the very fact that one can get tasty Queensland mangoes delivered to Melbourne is satisfying :-D

Another use case appreciated by a small but high value customer base is cross geographical gifting. Instances like gifting your loved one who is currently out of the country or buying electronics for parents who are abroad. This reduces the dependency on dimensions of place and time.

Shop for the house; from the house!

Visualising a product such as furniture, electronics and home decor in one’s home environment has always been a challenge in the traditional in-store retail model. For example, for shoppers looking to buy say a sofa, rather than having to go to a handful of stores to shop, they can now just compare the different models, brands, styles and designs as to how the different sofas would suit their house / room in terms of dimensions, colour, finish, etc. This helps shoppers better visualise how the product would suit their needs — all from the comfort of their home.

Data driven customer experience

One of the biggest advantages of online retail is the availability of rich data. Retailers can cut through data from website and apps to tailor shopping experiences. For instance, stats on demographics, groups, time of the day, time spent, gender, bounce rates, etc. can provide exciting insights on the current model and opportunities for immediate improvements. One specific case that has caught my attention is the data comparison for men and women. Men and women shop completely differently. It’s a fact that not many appreciate. The consumer behaviour parameters such as product browsing styles, preferences, emotions, attention span, research, patience are all totally different between men and women.

Retailers can cut through data from website and apps to tailor shopping experiences.

What do all these mean to retailers?

In short, most of the enablers for the success of online retail stem from customer needs and pain points. For the next round of innovation and to take online retail to the next higher level of operational efficiency, retailers should listen really really closely to their customers, prospective customers and user feedback. Gaps in the customer expectations are opportunities for innovation. It is a continuous process but for sure a rewarding journey.