eCommerce will continue to be a driving component of the retail industry. Although the frequency of online shopping has decreased somewhat from 2022, 4 in 10 consumers are shopping at least once a week, and most consumers (96%) still conduct research online before making purchases. This trend highlights the growing reliance on digital platforms throughout the shopping journey.
The ecommerce sector is a significant growth driver, showing faster growth rates than the total retail market. This rapid expansion emphasizes ecommerce’s crucial role in shaping the future of retail, as consumers utilize digital channels for their shopping needs.
A key opportunity lies in the rising demand for convenience and personalization. Consumers value ease when shopping online, making it essential for retailers to enhance their online platforms, optimize their communication strategies, and streamline fulfillment and return processes.
However, data privacy concerns challenge online shopping. Nearly two-thirds of consumers (65%) worry about how brands manage their personal information. This situation requires retailers to take a proactive stance by implementing strong data protection measures to foster consumer trust and ensure that privacy issues do not impede the potential of the ecommerce industry.
This report looks at the following areas:
- Market factors impacting ecommerce
- Online shoppers profile
- Sources of discovery
- Sites where consumers begin their shopping journey
- Amazon’s role and influence online
- Online shopping behaviors
- Influential factors in the decision-making
- Attitudes toward online shopping
The online shopping journey is rapidly evolving, as consumers seek more convenience and seamlessness. Tech is crucial to increase efficiency and satisfaction.
Marisa Ortega, Analyst – Retail & eCommerce
Market Definitions
This report examines a consumer’s journey from an unknown and known need to buying a product, as well as the multiple phases involved: awareness, consideration, intent, and purchase.
While any path to purchase likely involves physical and digital retail regardless of category, this Report focuses on the online steps that lead to purchasing on the same channel.
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Executive Summary
- What you need to know
- eCommerce Market size & forecast
- What consumers want & why
- Opportunities
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Market Dynamics
- Market context
- Market drivers
- The US expanded by 3% in Q2 2024
- Graph 1: quarterly real GDP growth, 2020-24
- Annual inflation sits at 2.5% as of August, the lowest it has been since March 2021
- Graph 2: headline CPI and core CPI, 2021-24
- Consumer sentiment rebounds after a number of months on the slide
- Graph 3: consumer sentiment index, 2022-24
- Households' outlooks on their personal finances remain bullish
- Graph 4: opinions on financial future, 2024
- Global supply chain disruptions can lead to shortages in goods and increased shipping costs
- Technology facilitates and enhances the online shopping journey
- eCommerce growth, challenges and integration
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Consumer Insights
- Online consumer fast facts
- Online consumer fast facts (continuation)
- Online shoppers profiles
- Consumers are shopping less frequently online
- While everyone can shop online, understanding the demographics of those who do it more frequently is critical for brands and retailers
- Sources of Discovery
- Discovery is omnichannel
- Graph 5: sources of discovery, 2024
- Target uses personalization to tie together the online and in-store experience
- Social media is integral to discovery for younger audiences
- Graph 6: sources of discovery, by age, 2024
- Digital channels are paramount to drive discovery among heavy online shoppers
- Graph 7: sources of discovery, by online shopping frequency, 2024
- Sponsored ads on social media can help DTC brands increase awareness
- Social Media Discovery Sources
- Widely used social media platforms are prime to drive awareness
- Graph 8: social media discovery sources, 2024
- Interest and purchasing on social remains consistent
- Meet heavy online shoppers where they are
- Graph 9: social media discovery sources, by online shopping frequency, 2024
- Brands make it easy to discover and shop by promoting their offerings on Pinterest
- Video content can get the attention of consumers across generations
- Graph 10: social media discovery sources, by generation, 2024
- Online Shopping Starting Point
- Amazon sets expectations for the online shopping experience
- Graph 11: online shopping starting point, 2024
- Prime hits "prime" time levels
- Loyalty programs can play a significant influence on the purchase journey
- Mejuri drives loyalty through value in tandem with other benefits
- Paid and organic search remain crucial for brands
- Graph 12: online shopping starting point, by gender and age, 2024
- Online Shopping Behaviors
- Reviews play a significant role in the shopping journey
- Graph 13: online shopping behaviors, 2024
- Brands leverage product reviews to boost conversion rates
- Heavy online shoppers are discerning beyond the product itself
- Graph 14: online shopping behaviors by shopping frequency, 2024
- Fulfillment and returns are critical to keep consumers coming back
- Influential Factors
- Shoppers prioritize affordability to stretch their budgets
- Graph 15: influential factors, 2024
- Resonate with Millennial online shoppers through values and ethics
- eBay appeals to eco-conscious and nostalgic online shoppers
- Appeal to Asian consumers with tangible benefits
- Graph 16: influential factors – select responses, by race and Hispanic origin, 2024
- Relevant Attributes Online
- Convenience is paramount in influencing purchasing decisions in the digital landscape
- Graph 17: relevant attributes online, 2024
- Consumers want convenient shopping experiences
- Younger online shoppers expect more than basics from their online shopping experience
- Graph 18: relevant attributes – 1st ranked, by generation, 2024
- Attitudes Toward Shopping Online
- Online shopping empowers consumers
- Graph 19: attitudes toward shopping online – select responses – NET – Any Agree, by parental status, 2024
- Consumers shop with a clear intention online
- Graph 20: attitudes toward shopping online – select responses – NET – Agree, by generation, 2024
- Unexpected costs impact conversion rates
- Graph 21: attitudes toward online shopping – select responses – NET – Agree, by race and Hispanic Origin, 2024
- Retailers should strive to provide clear and upfront cost details
- Nurture stronger relationships with consumers by providing meaningful and individualized interactions
- Graph 22: attitudes toward online shopping – select responses – NET – Agree, by generation, 2024
- The RealReal adds relevance to its communication
- Consumers are increasingly vigilant about how brands handle their personal information online
- Graph 23: attitudes toward shopping online – select responses – NET – Agree, by generation, 2024
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Innovation and Marketing strategies
- Amazon introduces Rufus, a generative AI-powered shopping assistant
- Hungryroot launches an AI assistant
- Etsy empowers its sellers to enhance the shopping experience
- Google Chrome launches tab compare
- IKEA opens a new store on Roblox
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Appendix
- Market definition
- Consumer research methodology
- Consumer research questions
- Generations
- Abbreviations and terms
- Online shopping frequency has decreased
- Graph 24: "On average, how often have you shopped online in the past 12 months?", 2022 and 2024
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