Global retail e-commerce market is expected to witness a high growth on account of favorable attitude towards new shopping channels. The overall market is projected to grow at an approximate CAGR of 10% from 2016 to 2024.
Retail e-commerce allows consumers to buy goods from the seller over the internet. Customers can find their interested products by visiting the website. Most online retailers use shopping cart software.
Payment and delivery information are collected using a check out process. Convenience is the major factor driving the overall online shopping market growth. It is easier to navigate through various product categories with the help of search system.
Consumers are finding it difficult to visit retail stores during their hectic schedule. E-commerce shopping allows consumers to shop sitting in an office or at home and operate for 24 hours. Also, product delivery is made door-step which eradicates the transportation trouble.
Trends have shown that products available online are low in price as compared to retail stores. Moreover, customers are given discounts and bundling offers which propel the product sales. These features have attracted huge consumers group towards online shopping.
The other main reasons expected to drive the online purchase is discounts, offers and cash-on-delivery facility provided by the online retailers. Online retail has made viewers more aware of the product.
Customers can see product specifications and compare them with their alternatives. The increase in computer speeds helps in navigation through various catalogs with ease. Rise in mobile phone usage has fostered the global industry growth in recent years.
Another factor which has seemed to be useful in market growth is the review system. Retail e-commerce has the provision to write reviews on the product which helps in decision making for other consumers.
Some manufacturers are launching their products only through the online retail medium. This sales channel type is effective in reducing operational costs. It also helps in avoiding inventory to avoid stock out as in the case of a retail store.
Such strategies are probing the customers to buy products over the internet on account of the physical retail market absence. The traditional purchase pattern existence is expected to establish as a barrier to the global industry growth over the forecast period. Some consumers believe in product purchase after having its touch and feel.
Retail e-commerce industry has been witnessing fraud through the counterfeit goods delivery. In addition, online monetary transactions have given an opportunity to hackers to break into the website and get consumer information.
Such factors are expected to restrain the global market demand in near future. After sales service is a challenge for this sales channel type. Physical stores are capable of providing spare parts and conduct repairs in case of product malfunctioning.
Indian market offers great opportunities for overall market growth. In spite of large Indian population, very few people buy products through this sale channel. An increase in the mobile phone and internet banking use is expected to provide bright prospects to overall industry growth.
Urbanization and smart cities development have contributed to changing lifestyle. Consumers in such regions are changing their shopping pattern from traditional type to the online base.
Segmentation is done on the basis of products purchased which include groceries, apparels, footwear, jewellery, furniture, and electronic goods. Cellular devices consumption has taken an exponential rise on account of exclusive sales through these channels.
Asian manufacturers including Lenovo, Motorola, Xiaomi, and One Plus have been selling their products exclusively over the internet. North America dominated the global market, and the trend is expected to remain the same over the forecast period.
This growth is on account of purchase pattern change, secured internet transactions and increasing consumer awareness. Regional demand was followed by Europe owing to high-speed internet facilities coupled with the well-established supply chain for goods delivery.
Asia-Pacific is expected to witness a rapid growth over the forecast period on account of increasing mobile internet usage and tendency to adopt Western culture. India is projected to show steady growth, however well spread physical store presence provides a huge challenge.
South America and Africa are expected to show a slow growth owing to lack of internet facilities and developing internet banking service. Key players in the global market include eBay, Amazon, Alibaba, and Flipkart.
Companies have started services catering to niche products only including the Blue Nile offering jewellery products. Strengthening the value chain is of vital importance for efficient goods delivery to the customer.
Major players have collaborated with third party vendors for logistic services. Leading organizations have partnered closely with their suppliers for continuous development in work conditions.
Merger and acquisition are another common trends observed in this industry. As of 2014, eBay had acquired around 40 companies. Most of the organizations concentrate on after-sales services by establishing customer support in emerging economy such as India, and the Philippines.
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