Understanding and keeping pace with what drives people to shop and buy online is critical to succeeding in the digital world.
This is according to a recent KPMG report: The truth about online consumers, which surveyed the online shopping preferences and behaviours of more than 18 000 consumers in 51 countries.
Advances in technology, logistics, payments and trust - coupled with increasing Internet and mobile access and consumer demand for convenience - have created a $1.9 trillion global online shopping arena, where millions of consumers no longer 'go' shopping, but literally 'are' shopping - at every moment and everywhere, says the study. For consumer businesses, this trend poses both challenges and significant opportunities, it adds.
The report says consumer demand for richer experiences and greater convenience means that retailers need to rethink their strategy, both online and in stores. Having the right product mix is no longer sufficient to attract the new wave of consumers, it adds. The study notes finding the 'right' strategy starts with one question: Given your brand promise, where do you want to compete? Only once a company understands its goals, customers and those customers' needs can an appropriate strategy be designed, it adds.
In many countries, the tendency to buy internationally is highest among millennials. This could indicate potential growth for cross-border online shopping as consumers increasingly seek unique or specialised products from other countries, it adds.
"Today's consumer no longer goes shopping, but is shopping all the time and everywhere. And in a truly global online marketplace, competition is no longer limited to local shops during regular business hours, says Dean Wallace, industry leader for consumer markets and technology at KPMG SA. "Consumers can easily buy from retailers and manufacturers located anywhere in the world or from those with no physical retail locations at all."
Wallace points out the increased competition, combined with consumer demand for richer experiences, means that retailers need to rethink their online strategy. For many retailers, creating an online shopping experience enhanced by technology such as augmented and virtual reality or 3D is becoming at least as important as providing convenient and personalised ordering, payment and delivery options, he adds.
Paul Martin, UK head of retail at KPMG, says companies should be channel agnostic, meaning it does not matter if they start with online or offline, what matters is that all channels are interlinked to give consumers the convenience they need.
"Online plays a major part in the customer journey or research online, purchase offline. The most successful multi-channel companies established their online channels as early as the late nineties, went on to establish 'click and collect', eradicated silos across the entire organisation and established a channel agnostic incentive programme so retail staff do not consider online as a separate business."
Martin also notes big data is important - retailers should understand what individual consumers buy and what they do and cater to consumers as individuals. "Consumers are firmly in charge today and they are looking at personalisation of services. Today's consumer is more similar to the 1920's consumer with a personal relationship with shopkeepers."
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