Despite reports of unprecedented growth in 2009, the online retail market is expected to struggle in 2010 from a combination of factors. Post election tax increases and public sector deficit pose a threat to consumer recovery with rising unemployment lowering consumer spending, concentrating the consumer focus on value. Multichannel retailing is therefore a must to re-build consumer confidence. Bargain hungry customers increasingly research and shop both online and in store. In a recent study by Yahoo, cross-channel journeys showed that 60% of sales moved from online to a final purchase in store, with 37% moving from store to completing online.
The reason many purchases are being made in store rather than online is that consumers want to see the product before they buy it. This is especially true for clothing. In the other direction, the main driver from store to online is that the original intention was always to buy online, the store was simply acting as a showroom.
Below, the term ‘online fashion’ has grown considerably over the last 3 years, particularly in 2009. This is an important indication of the change in consumer attitudes towards purchasing clothing online. Online shopping satisfies the consumer desire for quick, easy purchases that fit into their lifestyle and the growth of shopping around for bargains.
It is important to understand the multichannel sensitivities within the retail model: Any web acquisition strategy needs to consider the wider impact on other channels. For example display activity will improve brand awareness online, and thus may drive visits to store.
Therefore now is the time for retailers to make sure they have an effective tracking solution in place. If you cannot track online activity in terms of journeys (PPC through SEO organic listings through shopping results), with relation to high street footfall, you cannot really know if any strategy is working. If looked at in isolation, online and store success can appear very different.
The online retail market is going to become ever more competitive in 2010, with a core strategic approach and tight campaign measurement being the ultimate maker of online success.