Online retail is forecasted to see strong growth as a direct result of social commerce, with sales expected to be up 17 percent on last year’s total.
New data from Juniper Research has revealed that global online sales are expected to reach US$1.7 trillion this year, up by more than 17 percent on 2014’s total. It argued that while recent growth had been buoyed by factors such as public Wi-Fi deployments and 4G rollout, as with Telstra here locally, in the medium term sales would receive a strong boost from the trend of social media companies acting as direct sales platforms, as with Instagram’s Shop Now buttons and Pinterest’s Buyable Pins.
The new research, Mobile & Online Purchases: Cards, Carrier Billing & Third Party Payment Platforms 2015-2020, observed that players such as Twitter, Facebook, Pinterest and Instagram had already begun the foray into social commerce with ‘buy’ buttons from their mobile apps. It claimed that such players are also likely to enhance their sales prospects through strategic retailer partnerships, with Twitter already enabling users to link their accounts to Amazon.
In-store and Online Integration ‘Critical’
The research also argued that online retailers were increasingly seeking to reduce time-to-consumer by launching same-day delivery, while bricks-and-mortar stores now widely offered next-day in-store collection – often charging a premium for this option.
However, the research cautioned that retailers need to deliver a consistency of message, branding and shopping experience across all channels. It argued that integration between in-store and online is also critical if the retailers want to maximise the extent to which that can identify a unique individual’s omnichannel shopping habits.
According to research author Dr Windsor Holden: ‘The key is to ensure that consumers are allowed to choose their own path to purchase rather than have it effectively mandated by channel limitations.’
Other findings from the research include:
- Smartphones will account for more than 40 percent of online transactions by 2020
- While carrier billing should provide content providers with a key mechanism for monetising digital content, its use for physical goods purchase is likely to be limited by comparatively higher share of revenues demanded by network operators and billing platforms
The whitepaper, Buying Into Online Shopping, is also available to download from the Juniper Research website together with further details of the new research and interactive dataset.