Preparing for the Cliff: What brands need to know to survive and thrive in the e-commerce economy
The disruptive impact of e-commerce is making consumer behaviors far more challenging to predict. Brands must understand the crucial differences in online behavior across demographics to remain competitive and stay ahead of the curve.
Many brands have been slow to develop an e-commerce strategy because they feel there is plenty of time to adapt and the current ROI is insignificant. We think this approach is problematic. We believe that two major barriers to online shopping are eroding, and we are further along a highly disruptive e-commerce adoption curve than most brands assume.
First, delivery is becoming faster and more precise. One of the primary barriers to shopping online rather than in-store is waiting for shipping. Two hour delivery windows, drone delivery, and delivery services separate from UPS and FedEx are already in place for many categories. The speedier and more accurate delivery that consumers crave for all products is just around the corner.
Second, consumers are becoming more open to technological innovations that enhance the online experience. Another barrier to online shopping is the lack of tactility in the online shopping experience compared to in-store shopping. Companies are utilizing advancements like alternative delivery, “try before you buy”, and virtual and augmented reality as a means to match the in-store experience.
To support Collage Group members, we conducted a nationally-representative survey of 2,758 respondents. With your input, we designed a series of questions testing key hypotheses on how consumers engage with e-commerce, with a focus on behavioral and attitudinal differences among multicultural segments.
Takeaways and action steps implied by our research include:
- Hispanics, especially unacculturated, are most likely to shop online: Play up uncertainty avoidance and the comfort of shopping at home when catering to these online shoppers
- Consumers who avoid shopping online do so due to wariness and distrust: Build trust and transparency with hesitant consumers by highlighting customer reviews and providing detailed product descriptions and images
- Many barriers to shopping online will be eliminated with developing tech: Be in front of the curve by anticipating consumers adapting to delivery options that will eliminate the need to go to the store
- Specific timing of delivery is particularly important to multicultural consumers: Offer detailed tracking ability of packages to allow for transparency when time slotted deliveries aren’t possible
- All segments highly value product transparency when shopping online: Ensure your site – both desktop and mobile – has descriptions, images, and customer reviews to best inform the consumer