3.1 B2C: North America

Webcredible {1} identified four important trends for 2011. First was the focus on internal analytics. 41% of companies surveyed proposed to increase their web analytics budget in 2011, and devote more resources to website optimization, using web analytics, voice-of-customer and testing to improve Key Performance Indicator targets. The second picks up the growing popularity of mobile phones and applications: large retailers are expected to invest heavily in dedicated mobile platforms in 2011. The sales of Samsung's Android tablet device and the Apple iPad will — thirdly — challenge ecommerce retailers to modify their websites to catch these important revenue streams. Fourthly, 2011 should see an increase in the tie-up between ecommerce marketers and their Customer Service counterparts, with Social Media becoming an important part of Internet marketing. SmartInsight {11}, however, found that engaging in social media channel was of concern to only 5% of companies surveyed. More important were: attracting new customers (40%), improving online marketing competence (38%), retaining existing customers (31%), finding the right staff (25%), managing technological innovation (16%), web analytics (13%), and planning an international strategy (7%).
Gartner's January 2012 report on IT spending {2} trimmed its earlier estimate of 6% growth globally in 2012 to 3.7%, a figure representing total expenditures of $3.8 trillion. All four major sectors — computing hardware, enterprise software, IT services and telecommunications equipment and services — would be affected. Europe would bear the brunt of these cutbacks, and spending in the Americas be split equally between the USA and Latin America.
An Internet Retailer report {3} predicted slower ecommerce growth for the next three years: falling from 14.8% in 2010 to 8.1% in 2015, but still sufficient to reach sales of $270 million in 2015. Yearly growth predictions were 11.3% in 2012, 9.7% in 2013, and 8.7% in 2014. The 4.3% of US retail sales enjoyed by ecommerce (excluding auto sales, fuel, travel, digital downloads and ticketing) would increase to 5.8% by 2015, and some 170 million Americans would be buying online by that year. Purchases by mobile and daily deals were areas to watch.

Increasing mobile ecommerce was also stressed in a 2012 Digital Outlook by Chad Coleman. {4} Consumers would buy $10 billion worth of goods on mobile devices in 2012, according to the Internet Retailer Mobile Commerce Top 300 Guide. Apple had expected to sell almost 20 million iPads in 2011, and sales of cheaper tablets were fast increasing, although many sites were not yet mobile-friendly. Of the 53 chain stores in the Internet Retailer Top 500, 48 saw online sales growth exceed that of offline sales. Over 50% of Americans viewed online videos, and eMarketer predict online video ad spending to grow by a compound annual rate of 38% over the 2011 to 2015 period, the fastest rising category of online spending. 86% of web users currently use a mobile device while watching TV.

Also important were social media sites, where ad spending was expected to reach $8 billion in 2013. Successful companies would be extracting more customer data from their traffic statistics, probably assisted by one of the many services becoming available. Content marketing has always been king in B2B, and that is now spreading to B2C. A shakeout in daily deal companies was to be expected as site visitors became more astute in tracking down bargains.

m-Commerce was also an important theme of MCM's outlook for the 2012-3 period. {7} Some 29.5% of respondents had a dedicated m-commerce site, a 211% gain on the 2011 figure. Another 13.4% had sites optimized for mobile use. 15.2% were using mobile search ads, aimed at the iPhone (24.8%), iPad (13.8%), android (16.5%), and Blackberry (4.6%) platforms. Social media were also important and 89.2% maintained a Facebook presence, with others as follows: Twitter 74.8%, YouTube 36.9%, Pinterest 34.2%, LinkedIn 33.3%. Only 12% were 'extremely satisfied' with the effectiveness of their social media efforts, however. 33.3% also had a company blog. Regarding content on their company sites, 63.4% included customer reviews, 44.6% testimonials, 35.7% photos, 21.4% surveys and 15.2% videos. 38% were also using live chat, and 65.1% of ecommerce sites include a trustmark of approval. Analytics was receiving sustained scrutiny, and 37.4% offered cart abandoners a special offer via email.

Increased use of smart devices, favorable trends in content consumption and growing access to digital media were noted in an eMarketer report of December 2011, {5} creating opportunities for marketers, media companies, technology firms and end users. Smartphones were outselling feature phones, and tablets and ereaders were on a steep upward trajectory. These devices in turn create demand for apps, streaming video and audio, games, ebooks and periodicals, social networking and other marketer-supported activities. Viewers view content on every available screen size, and expect the experience to be seamless across devices and platforms. Digital music was evolving from an ownership model to an access model provided by such services such as Pandora, Spotify, Apple's iCloud and Amazon's Cloud Drive, these services reaching audiences through their own apps and portals, and lately through partnerships with Facebook.

Zacks Equity Research provided a breakdown of US prospects by key drivers, strategy, retail, travel, payment systems, security, advertising and share purchase recommendations. {8} While noting eMarketer's prediction that the online advertising market would grow 23.3% in 2012 to $33.8 billion, growth rates they expected to fall: to 17.7% in 2013, 13.5% in 2014, 8.9% in 2015 and 7.8% in 2015. Alternative payment systems were gaining popularity, with Google's digital wallet and the FIS Mobile Wallet joining the well-established Paypal.

Based on online interviews with over 180 global commerce executives from December 2012 to February 2013, Oracle reported that user experience was seen as investment area to drive future revenue. 41% of respondents said they plan to invest in a Commerce platform when asked for their top 3 investment areas, 38% of respondents cited digital customer experience as a planned investment, with social media (37%) and mobile (37%) ranking third and fourth, respectively, as investment areas in 2013. 29% of respondents cited shopping cart abandonment, conversion rate, and determining return-oninvestment (ROI) as top 'pain points', and found that web sites (89%) drove most interest, after email (68%) and social media marketing (63%). {11} US online spending grew 15% year on year in Q2 2013, compared to 4.6% in stores, reported the Internet Retailer. {12}

Ebooks were increasing in popularity, and the number of US adult ereader users was expected to reach 53.9 million by 2014, up from 33.3 million in 2011. {10} Smartphones would be used by 45.6% of the US population by 2015.

At $43.15 billion, US ecommerce sales were strong in the second quarter of 2012, up 15% on the previous quarter. On a quarter-over-quarter basis, however, ecommerce sales dropped by about 2.5% from $44.3 billion, in line with expectations of a maturing market. The best-performing categories were digital content and subscriptions, consumer electronics, flowers, greetings and gifts, computer hardware, and apparel and accessories. {6}

Congress is trying to help states collect sales taxes. The Marketplace Fairness Act legislation applies to retailers with more than $500,000 in annual out-of-state sales, and comes in response to brick and mortar companies wanting a more level playing field. International sales are being facilitated by improved ecommerce platforms. {9}

Sources and Further Reading

1. Webcredible ecommerce prediction — trends for 2011. October 2010. Webcredible. (Not now available.)
2. Gartner Dims Growth Expectations for Global IT Spending in 2012 by Erika Morphy. E-Commerce Times. January 2012.
3. Four-year outlook for e-commerce projects by Allison Enright. Internet retailer. March 2011.
4. Barkley 2012 Digital Outlook by Chad Coleman. BarkleyUS Blog. January 2012.

5. Top Digital Trends for 2012. eMarketer. December 2011.
6. Retail E-Commerce Spending Up 15% Y-O-Y in Q2. Marketing Charts. August 2012.
7. 2012-13 Ecommerce Outlook Report by Tim Parry. MCM. 2012.
8. eCommerce Stock Outlook by By Zacks Equity Research. Yahoo Finance. July 2012.
9. What is the Marketplace Fairness Act? MarketFairness.Org. Accessed October 2012.
10. IResearch Perspective: 2014 adult users of the electronic reader will reach 53.9 million. VentureData. February 2012.
11. B2c Ecommerce Trends for 2013. Oracle. April 2013.
12. Online spending swells 15% in Q2. Internet Retailer. August 2013.