Gone are the days when consumer products were sold under a brick-and-mortar system. Leveraging the technology, retailers are increasingly using Omni channels to sell their products. Post the pandemic, retail sales only continue to grow especially in the US and European markets. There is a jump of 40% in retail sales among Americans in the last year.
With the recent slowing of economic activity and opening up of stores, the real question is will the industry continue to grow. The answer lies in some detailed analysis of the market. A recent Mckinsey report observed not just growth in but also an evolution in the coming years. There are a plethora of opportunities for retail online businesses especially in the food & beverage, personal care, and consumer electronics sectors to grow. This offers both advantages and challenges to retail digital brands. While the demand for products is bouncing back post-pandemic so does the competition.
The share of the UK in online sales is on the uptrend and will continue to grow. So how big is the market we are looking at? In 2021, the online purchase rate grew to the tune of 74% in the US and 81% in the UK. Developed countries are witnessing cut-throat competition as brands are left with limited opportunity to use cost advantage.
Despite all the struggle, the market is huge, and constructing an effective strategy will undoubtedly drive small retailers’ growth as well. The US market presents opportunities for B2C business.
The revenue from retail is $875.2 billion in 2022 and is expected to climb up to $1329.7 billion by 2025. The numbers are expected to grow in the UK market as they record $117.7 billion making it the fourth largest market in the world.
As per a recent survey, the majority of respondents are either planning to increase their data collecting budgets (52 percent) or keep the same budgets (45 percent) for the next 12 months. This shows that Ecommerce companies are aware of the increasing need for data to make better business decisions.
What contributes to the Growth?
Internet Penetration
The global numbers are moving up over the next few years and are propelled by the growing middle-class from East and Southeast Asia. Trends indicate that the internet users rate will grow at an annual rate of 4%. The US and the UK have maintained their internet penetration of over 90%. This is the primary driver for the push in the sector. As more and more people gain access to the internet, the customer segment for online retail businesses grow as well. Increasing smartphone users are the primary contributor to the increase in online shopping, especially in the food and beverage industry
Pandemic with stores closing down
After the pandemic, consumers have switched to digital purchases of their consumables. According to Cowen’s Report with a survey of 2500 consumers, they had doubled their online purchases as compared to the previous year. Based on a recent survey, 75% of US consumers have tried different stores and brands during the covid crisis. With the limited in store options, more consumers preferred shopping online.
Wide variety of Options
The Internet offers way more variety than a traditional store. With increased awareness of products with high end features, customers are more likely to settle for platforms where they can find a plethora of options.
Better User Experience
With UI/UX advancements, the user interface is only getting better. Customers prefer to shop using mobile devices over physical ones. Now brands are increasingly listening to their audience and users to provide a seamless interface.
Now to answer the most important question. What is the next BIG thing in the ecommerce business that will make your brand stand out?
Well, the answer might not be very simple. But the brands that prove to be dynamic usually reap the benefits of being profitable firms. From supply chain management, sourcing, and pricing to website, customer service, branding, etc, a company has multiple ways to improve its revenue.
From the pricing side, first mover advantage can be taken by companies that focus on tracking competitors’ prices. In short, companies can survive the upcoming competition by cutting costs or driving revenue using innovative methods. When it comes to competitor price tracking and monitoring, pricechecker has been the market leader. Integrate price tracking software and win you customers in the long run.
