Emma Herrod highlights some of the recent research from around the ecommerce world including the global growth of m-commerce, the winners of YouTube advertising and how innovations such as virtual reality are impacting on retail strategies.
Mobile now accounts for 6% of total retail sales globally and nearly 60% of ecommerce, following a yearly rise of 40% in 2017. According to eMarketer’s most recent retail and ecommerce sales figures study, global m-commerce sales rose 40.3% last year to $1.357 trillion. China alone made up 67.1% of m-commerce sales worldwide in 2017, driven by its mobile-first internet audience. Sales are expected to nearly triple from $909.93bn to $2.595 trillion between 2017 and 2021. Other markets with significant mobile spending include Japan, South Korea, the UK and the US. Growth has been helped along by consumers feeling more comfortable making purchases on their smartphones and, in some regions, a greater selection of low-cost items such as apparel, which encourages impulse buying. “A greater dependence on mobile devices, namely smartphones, is having a positive effect on retail m-commerce sales globally,” says Monica Peart, eMarketer’s Senior Forecasting Director. “This trend is evident in more frequent mobile shopping sessions and higher spends per session, both hallmarks of a growing expectation for mobile devices to satisfy a variety of consumer shopping needs.” The figures come against a backdrop of growing global ecommerce. The report estimates that retail ecommerce sales worldwide will reach $2.842 trillion this year, a 23.3% increase over 2017. Ecommerce will make up close to 12% of total retail sales worldwide, up from 10.2% in 2017. This share is largely influenced by Asia-Pacific, where 17.6% of total retail spending will go toward ecommerce. In 2017, retail ecommerce sales worldwide reached $2.304 trillion, a 24.8% increase over the previous year, eMarketer estimates. Mobile was a key factor, as m-commerce accounted for 58.9% of digital sales.
Meanwhile, Google Pixel has topped the chart of the most viewed adverts on YouTube in the UK in 2017. Christmas adverts though feature prominently in the top ten with John Lewis and Marks & Spencer taking the next top spots, and Sainsbury’s featuring in the top ten at number six. Three UK and giffgaff have also made waves as the two telecoms companies with the top ads of 2017 on YouTube – interestingly, both using water diving to make a splash, followed by a trip to outer space. Meanwhile, the #PowerToDecide ad encouraging youth to register to vote in the general election featured at number five in the year that had the biggest youth turnout in 25 years in the UK. Hyundai’s epic production also made the cut, as Sir Ernest Shackleton’s great-grandson tackled his unfinished dream of crossing the Antarctica. The top ten of 2017 are ranked using an algorithm that that factors in organic and paid views, watch time and audience retention.
While 46% of UK consumers believe Augmented Reality (AR) will positively impact retail, with Virtual Reality (VR) close behind at 22%, only 50% of retailers have a digital strategy to implement these technologies according to Fujitsu’s Tech in a Transforming Britain Report. Seven in ten consumers say retail has already been dramatically transformed by technology; a change many view as positive as almost half (45%) feel technology can indeed improve the convenience and ease at which they access products and services. Yet, despite consumer demand, almost three quarters of retail leaders say they have no plans to implement VR (73%) in the next twelve months, a statistic significantly higher than any other sector. 72% also said they have no plans to implement one of the most talked about technologies at the moment, Artificial Intelligence (AI).
“Consumers have a clear appetite for technology and innovation and are ready and wanting more,” says Rupal Karia, MD, of the Commercial Sector, Fujitsu UK & Ireland. “When it comes to retail, consumers already say that they would be happy to be served by a robot in a supermarket or to have an automated machine to deliver their goods. This presents an exciting opportunity for retailers, who may have thought such futuristic technologies would have scared customers away, when actually it will entice consumers towards them more.”
Despite consumer positivity, retail leaders appear disillusioned with technology’s role in their sector. Retail leaders are the least positive about the changes technology is driving in their business today, a quarter (25%) are disappointed by the return on investment technology has bought them and say it has made it harder to connect to customers in person.
“There’s a clear disconnect between how retailers view themselves in this wave of technological change we are undergoing right now. Instead of focusing on how technology can improve their offering and further loyalty amongst their customers, many are focused on the increased competitions and the disruption to their sector.”
Retailers who have embraced technology, however, are positive about the changes. Increased productivity (35%), improved operational efficiency (37%) and business growth (44%) were all listed as benefits.
Karia continues: “Part of retailers’ reluctance to invest in technology could be down to feeling disappointed by their return on investment which is understandable. However, UK retailers cannot bury their heads in the sand when it comes to what is going to fundamentally change their business – technology. Two of the top three jobs that both consumers and businesses believe won’t exist in a decade’s time are shop assistants and shelf stackers which will once again dramatically change the retail landscape. Retailers need to ensure they are evolving with the technology that is ultimately going to change their business models, and have an agile vision and strategy in place that can adapt with the changing landscape, or they too may not exist in the next decade.”