What is E-Commerce?
When trying to understand E-Commerce, it's important to look at
growth rates and statistics. Some noteworthy information to start with
is the growth of Canadian internet use, online shopping expansion and
who E-Commerce marketing targets.
Canada leads E-Commerce because of its high percentage of internet
usage per capita. According to Comscore Inc; an online data compiling
firm, Canadians spend an average of 2500 minutes or more online per
month totaling nearly 42 hours. ComScores research determined that with
68% per capita, Canada has the largest number of internet users in the
world. Isreal was a close second averaging around 2300 minutes.
It is interesting to see that Canadians spend most of their time on
social networking sites. ComScore reports that a whopping 71% of
Canadian online users visit YouTube every month. Chris O'Neil, Canada's
country director for Google states 'In Canada,YouTube per capita
consumption of video is No. 1 in the world.' Canadians are also heavy
Facebook users as 83% have accounts on The Social Network.
Compared to the US, growth rates of E-Commerce in Canada are slower
but are expected to increase over the next couple of years. Canadians
can expect E-Commerce to nearly double by 2015 reaching $30.9 billion
CAD. Recently, as of 2010, Canadians spend approximately $16.5 billion
CAD online. As consumers become more comfortable purchasing high
deliberation items online, E-Commerce activity is expected to increase.
Some examples of such purchases would be high-end electronics, trips and
E-Commerce growth rates are slow due to online buying reservations.
Many Canadians are wary of purchasing products they cannot touch or try
and are hesitant to pay high shipping rates. While current market
conditions have led many small retailers to avoid E- Commerce, some
niche businesses that offer unique products are succeeding online
because the geographic location of the store is not a concern. For
example, a baseball card that is rare in Toronto can be purchased from
the website of a store located in California where that card may not be
Now that we see how E-Commerce is growing, it's important to uncover
why consumers choose to purchase from one site over another. One way to
insure consumers buy from a particular site is to offer niche products.
This will bring specific clientele to the business. At times, buyers can
feel frustrated searching for their favorite product to purchase. Niche
business can retain these customers.
The article 'Exploring Why Consumers Leave Websites before Buying'
written by Chuleepor Changchit & Robert Cutshall provides facts as
to why consumers are more comfortable purchasing products from some
websites over others. Although limited to functionality, these examples
are important to understand.
The following are some reasons why consumers buy from particular websites and not others:
1. Consumers are not sure if a particular price is the best one.
Many shoppers will research competitive sites to find the best value for
the product they want to purchase.
2. Shoppers might be discouraged by shipping fees.
3. Many buyers do not want to spend time registering online to purchase products.
4. Fear of receiving the wrong product.
5. Lengthy checkout process.
6. Concern about whether the website will ship the purchase on time.
7. Many shoppers are not willing to provide personal credit card information.
8. Confusion when searching for a product can deter shoppers from the site.
9. Wait times for images and content can result in the loss of a sale.
10. The product the consumer is searching for may simply be unavailable online.
One of the biggest advantages of shopping on the internet is that
consumers can visit different online retailers in an effort to find the
best price for the same product. On the other hand, some shoppers are
not aware of competitive retailers and purchase from one particular
online retailer simply because it is the only one they know about.
Those are a few reasons why consumers buy from particular websites.
Another important factor relating to E-Commerce is looking at the
thought process that drives consumers to add an item to their cart and
purchase it. There are great sites like ecommercepartners.net to help influence consumer’s purchase decision by planning a business Ecommerce strategy and solution. When customers want to purchase a product, it is important
to uncover what drives them to purchase the product online and what
final thoughts influence their decision to click 'add to cart.' There
are many reasons why a consumer resolves to purchase a product online.
One of the main reasons is the product/service is limited and not
available locally. Quite often, consumers go online to purchase limited
or rare collectible items including entertainment tickets, travel
packages, clothing or memorabilia. Often small retailers will go online
to purchase bulk products at discounted rates. Others shop online to
receive discounts. For example, eBay enables the consumer to purchase
products through an auction allowing the shopper the chance to buy at a
reduced price. Online shopping also offers competitive pricing.
Consumers can track product prices to see when they are lowest and
compare them to other leading competitors.
When examining the consumers thought process during the final 'add to
cart' moment there are a couple different responses that can be
expected. The first response represents impulse buyers. These
buyers have not planned the purchase. The acquisition is spontaneous and
is influenced by what they are currently viewing online. This type of
buyer is drawn to online advertising, recent trends and the popularity
of the product. They are usually compulsive; only considering how they
are going to pay for the product after adding it to the cart.
The second response represents planned purchasers. These
buyers have weighed out the pros and cons of purchasing online. They are
aware of additional shipping rates and have reviewed consumer comments.
They have also compared prices with other online retailers and have
determined the most reasonable price for the product. They are
meticulous and organized in their purchasing methods and have invested
hours of research into the purchasing process. As you can see there are
two different types of buyers; the impulse buyer and the planned
purchaser. Each buyer examines the online purchasing experience
differently and companies must provide websites that appeal to both
types of buyers.
You now have a better understanding of various E-Commerce components
including statistics, current and expected growth rates, reasons why
consumers buy from one particular website over others and what actually
drives the consumer to click 'Add to Cart.' Understanding these
components will provide a new appreciation for E-Commerce and enhance
the online shopping experience.
Author: Michael / Posted: 14-05-2011