E-commerce: The new “E” in success

From 2016 to 2020, e-commerce is expected to grow by 12%. By 2020, it will likely represent around 39% of retail sales gained through promotional offers, and 78% of all sales after sales numbers are adjusted for seasonal variations and holiday influences. Non-store companies, like Amazon, continue to gain share – estimated at 58% of total e-commerce in 2016.

The main driver of this growth continues to be mobile commerce. In the United States, it increased 47% in 2016, representing 16% of e-commerce sales. In fact, 82% of smartphone users use their phones when making purchase decisions inside a store. With useful camera features – like searching by photo and product scanning – and better integration of payment and shipping, mobile shopping is expected to rise.


In a 2017 report, ComScore showed mobile gobbled up a greater share of internet minutes compared to desktop – 71% in the United States, greater than 60% in Canada and the UK, with a high of 91% in Indonesia. Consumers browse on smartphones and tablets – during coffee breaks, at home and while traveling, which means the mobile experience must be equal in quality to that of a desktop. A responsive site adapts to fit the screen of a user’s device so a website’s copy, images and ordering functions don’t get cut off and are easy to view on a mobile device. If a site does not respond, a visitor is likely to leave rather than spend time struggling to use a site not optimized for mobile interaction.


With Amazon driving 50% of incremental e-commerce sales in the U.S., the biggest concern for many is the ability to compete against the large players. Amazon’s price and selection, as well as order innovation like using Alexa or Echo, contribute to the use of Prime in more than 50% of U.S. households. However, companies can compete by going deeper and providing richer shopping experiences in specific categories. In home goods, Wayfair’s strong brand and curated content provide an arguably better shopping experience than Amazon’s. By dominating a smaller niche market, companies like Fanatics, with its focus on sports apparel and fan gear, can carve out a niche as the leader. Other areas that can set smaller companies apart include building a strong direct-to-consumer brand, leveraging private label goods, providing better customer service/access to experts and leveraging omni-channel capabilities to provide a seamless experience for your customers.


According to a study, social networks guide e-commerce purchases for 74% of consumers, and 60% of retailers who used social commerce reported new customers from different social networks. Social commerce provides ultimate convenience by enabling customers to purchase directly from their preferred social media channels rather than having to exit to a separate shopping cart. Shopify is one such company that helps companies implement social commerce and mobile shopping strategies. It hosts over 325,000 active online shops with a platform that continues to evolve to meet the growing requirements of online stores. It also has a built-in payment system. Other easy-to-setup-and-use services – i.e., no technical experience required – include BigCommerce, Magneto, YoKart and Big Cartel. 


Though traditional TV advertising still works, Google, Facebook and Amazon are the biggest beneficiaries of mobile and social advertising, with potential for emerging companies like Pinterest and Snapchat to be used in a company’s advertising mix. To drive the highest brand awareness, companies should focus on a multi-channel strategy.


Whether shoppers walk into a storefront or buy online, when companies put the customer first they create loyalty – increasing the lifetime value of the customer. The customer experience always is, and always will be, at the heart of any company’s success. By integrating practices that respond to how consumers want to shop, e-commerce companies will continue to shape the shopping landscape.


Changes in tax laws or regulations may occur at any time and could substantially impact your situation. Raymond James financial advisors do not render advice on tax or legal matters. You should discuss any tax or legal matters with the appropriate professional.
Material created by Raymond James for use by its advisors. The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Raymond James is not affiliated with any other entity listed herein.

What’s New at AEGIS Financial

Forbes 2023! We are excited to announce that AEGIS Financial has been named a Best-In-State Wealth Advisor by Forbes Magazine for 2023! This is the […]

AEGIS Cares | AEGIScoop

Q2 2023 Giving Plan – Comfort4Kids For AEGIS’s Quarter 2 Giving Plan, we will be donating to the Fox Valley Children’s Hospital in Neenah! We […]

One Plan. One Elite Team

We have continued to enhance the depth of the services we provide and add Team members to support each of our client relationships.  As a […]