Internet vs Store-based Shopping:The Global
Move Towards
Omnichannel Retailing
EXECUTIVE SUMMARY
Growth drivers
Internet retailing trends
CHART 1 Global Internet Sales by Category 2013
Behaviour and characteristics of online shoppers
Retailer strategies
Outlook
SUMMARY 1 Opportunities and Threats to Retailers
INTRODUCTION
A new way of shopping
Definitions
KEY GROWTH DRIVERS
Expansion of the internet
Global user base expands
China and India drive growth
Improving access in remote areas
TABLE 1 Internet Users as % Population by Country 2008/2013
Technological progress
Growth in mobile internet subscriptions
CHART 2 Global Mobile Internet Subscriptions 2008-2013
The US and China almost neck and neck
CHART 3 Mobile Internet Subscriptions in Key Markets 2013
Higher network speeds
Expanding access to Wi-Fi
Online payment and security issues
Personal data at risk
Alternative payment systems
Mobile wallets
Regulatory issues
Consumer rights
US e-commerce tax on hold
Some states already impose internet sales taxes
Russia abandons plans to tax e-commerce imports
The search for value
Economic prospects remain uncertain
CHART 4 Global GDP Growth 2008-2013
Thrift embedded in consumer mindset
Getting the best prices
Group buying websites
Flash sales websites – the survival of the fittest
Price comparison websites
One-off sales events
INTERNET RETAILING SALES
Internet versus total retail sales
Internet retailing share doubles over the review period
CHART 5 Global Internet Sales Versus Total Sales 2008-2013
TABLE 2 Global Retail Sales and Internet Retailing 2008/2013
China makes up for lost time
CHART 6 Internet Sales in Leading Countries 2008/2013
CHART 7 Per Household Internet Sales In Leading Countries 2013
CHART 8 Internet Sales Versus Total Sales In Leading Countries 2013
Broad sector trends
Internet sales still minor
Online grocery driven by convenience factor
CHART 9 Global Internet Sales as a % Total Sales by Category 2008/2013
Apparel and footwear accounts for a fifth of online sales
Consumers turn to online health and beauty for repeat purchases
Home care benefits from subscription services
Internet growth affects specialist retailers
TABLE 3 Global Internet Sales by Category 2008/2013
Distribution trends in apparel and footwear
Specialist retailers and mail order lose share to online sales
CHART 10 Apparel and Footwear: Global Retail Sales by Channel 2008/2013
US most developed market
Pure-play e-tailer strategies
Physical retailer strategies
Clothing retailers target mobile market
CHART 11 Specialist Retailer Versus Online Sales of Apparel and Footwear, Global 2008-2013
Distribution trends in the electronics and appliances market
Specialist retailers still favoured
CHART 12 Consumer Electronics: Global Retail Sales by Channel 2008/2013
CHART 13 Consumer Appliances: Global Retail Sales by Channel 2008/2013
Online sales enjoy triple-digit growth
CHART 14 Specialist Retailer Versus Online Sales of Electronics/Appliances, Global 2008-2013
Distribution trends in food and drink
Internet sales still undeveloped
CHART 15 Packaged Food and Drink: Global Retail Sales by Channel 2008/2013
Online food and drink forms part of multi-channel strategy
UK leads the way
CHART 16 Grocery Retailer Versus Online Sales of Food and Drink, Global 2008-2013
Distribution trends in health and beauty
Grocery retailers claim largest share of sales
CHART 17 Beauty and Personal Care: Global Retail Sales by Channel 2008/2013
CHART 18 Consumer Health: Global Retail Sales by Channel 2008/2013
China drives online growth
E-tailers become innovative
Online OTC regulations relaxed in some markets
Physical retailers fight back
CHART 19 Specialist Retailer Versus Online Sales of Health and Beauty Products, Global 2008-2013
Distribution trends in media products
The struggle against digital content
Video streaming benefits from faster network speeds
Free-to-play mobile games become more sophisticated
The success of e-books
Media stores focus on experience
CHART 20 Physical Versus Online Sales of Media Products, Global 2008-2013
Distribution trends in traditional toys and games
Toy stores face tough competition
Toys “R” Us gets creative
CHART 21 Physical Versus Online Sales of Traditional Toys and Games, Global 2008-2013
Home and garden products
Specialists remain the preferred channel
CHART 22 Home and Garden Products: Global Retail Sales by Channel 2008/2013
Augmented reality addresses visualisation issues
Providing expert advice
CHART 23 Specialist Retailer Versus Online Sales of Home and Garden Products, Global 2008-2013
Mobile internet retailing
The shift towards m-commerce
Augmented reality
QR codes
M-commerce remains niche
CHART 24 Mobile as a % Total Internet Sales by Country 2011/2012/2013
ONLINE SHOPPER BEHAVIOUR AND CHARACTERISTICS
In-store versus online shopping preferences
Online shoppers are still in the minority
Internet offers variety
Delivery most appealing to older shoppers
CHART 25 In-store Versus Online Shopping for Non-essentials, by Country 2012
Motivations for internet shopping
TABLE 4 Online Shopping Motivations by Country 2012
Use of mobile phones in stores
Technology plays a greater role in shopping
Apps replace salespeople
The influence of reviews
CHART 26 Frequency of Mobile Phone Activity in Stores 2012
Characteristics of online shoppers
Downloadable items still the most common online purchases
Young people most likely to buy online
CHART 27 Online Purchases by Age Group 2013
CHART 28 Online Purchases by Gender 2013
Online purchases by country
CHART 29 Frequency of Online Purchases by Type and by Country 2013
Mobile shoppers
CHART 30 Frequency of Using Mobile Phone for Purchases, by Country 2011/2013
CHART 31 Global Use of Mobile Phone for Purchases, by Age 2013
KEY MARKET TRENDS
Brazil
Shoppers prefer to pay in instalments
Online clothing overcomes barriers
M-commerce is emerging
TABLE 5 Brazil: Internet Shopping in Leading Categories 2008/2013
Competitive environment
CHART 32 Brazil: Internet Retailing – Top 10 Brands by Value Share 2013
China
A burgeoning market
Apparel and footwear becomes largest category
Mobile purchases gaining pace
TABLE 6 China: Internet Shopping in Leading Categories 2008/2013
Alibaba dominates online
Bricks-and-clicks retailers make progress
Amazon slow to adapt
CHART 33 China: Internet Retailing – Top 10 Brands by Value Share 2013
France
Number of e-tailers continues to grow
Clothing retailers have more flexibility online
Electronics retailers struggle to compete with online players
Free’s cheap mobile plan fuels the m-commerce market
TABLE 7 France: Internet Shopping in Leading Categories 2008/2013
Competitive environment
CHART 34 France: Internet Retailing – Top 10 Brands by Value Share 2013
Germany
Price and convenience are key
Apparel and footwear is the largest category
Grocery retailing remains underdeveloped
Consumers remain wary of mobile payment
TABLE 8 Germany: Internet Shopping in Leading Categories 2008/2013
Competitive environment
CHART 35 Germany: Internet Retailing – Top 10 Brands by Value Share 2013
Japan
Japan leads in m-commerce
Growth of mobile fashion
Launch of Net Super fuels online grocery sales
Showrooming common in electronics sector
TABLE 9 Japan: Internet Shopping in Leading Categories 2008/2013
Competitive environment
CHART 36 Japan: Internet Retailing – Top 10 Brands by Value Share 2013
Russia
Market held back by logistics and online payment issues
CyberMonday provides a boost to sales
Online grocery still embryonic
TABLE 10 Russia: Internet Shopping in Leading Categories 2008/2013
Competitive environment
International players have only a small presence
CHART 37 Russia: Internet Retailing – Top 10 Brands by Value Share 2013
UK
A highly developed market
Online clothing makes strides
UK has the most sophisticated online grocery market
Media downloads affect specialist retailers
Rise of m-commerce
TABLE 11 UK: Internet Shopping in Leading Categories 2008/2013
Competitive environment
Asos makes great strides
CHART 38 UK: Internet Retailing – Top 10 Brands by Value Share 2013
US
Leading global e-commerce sales
Consumer appliances makes the most progress
Online grocery slow to take off
Home Depot promotes click-and-collect concept
The move to m-commerce
TABLE 12 US: Internet Shopping in Leading Categories 2008/2013
Competitive environment
CHART 39 US: Internet Retailing – Top 10 Brands by Value Share 2013
RETAILER STRATEGY
Consolidation and globalisation
Amazon rules the roost
Tmall dominates Chinese market
eBay maintains third position
Apple focuses on digital channels
Ongoing consolidation
TABLE 13 Internet Retailing – Top 10 Global Brands by Value Share 2008/2013
Adopting multi-channel strategies
SUMMARY 2 Recent Acquisitions of Online Retailers by Store-based Retailers
Omnichannel retailing
Digitalising physical stores
Mobile technology
The growth of shopping apps
Geolocation
Couponing
Virtual shopping shelves
The move to digital channels
Amazon at the forefront of-book delivery
Improving the user experience
Providing more information
Improving website design
Simplifying the checkout process
The offer of return shipping
Virtual reality tools
Improving delivery options
Speeding up the shipping process
Subscription delivery services
Building fulfilment centres
Collaboration with courier services
Store-based click-and-collect
Click-and-collect locker services
Combating the showrooming trend
Bringing customers back to stores
Price matching
Retailtainment
Online to offline
Subscription based services
Creating excitement
Beauty boxes take off in Asia
Appealing to new parents
FUTURE OUTLOOK
Trends to watch
Internet to play an ever greater role in the shopping experience
The continuing shift towards mobile
Shopping apps will become more sophisticated
The future is hands free
In-store technology will enhance the shopper experience
Shopping malls to become major entertainment hubs
A wider range of delivery solutions
The industry will become more tightly regulated
Globalisation and internationalisation will be ongoing
Chinese market holds potential for Western players
Recommendations to marketers
Offer an omnichannel experience
Work on improving delivery options
Improving website functionality
Keep customers coming to stores
Include mobile in the equation
Forecasts by sector
Apparel and footwear, appliances and grocery offer most potential
E-tailers will continue to facilitate media content delivery
Online beauty: Consumers need convincing
TABLE 14 Forecast Global Internet Sales 2013/2018
Growth markets
China to see dramatic growth, but average sales will remain low
E-commerce to expand to the regions in Russia
CHART 40 Forecast Internet Sales In Leading Countries 2013/2018
CHART 41 Forecast Internet Share of Total Retail Sales In Leading Countries 2013/2018
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