There has been a marked change in the way that the world now shops and the way that our goods and services are found, priced and supplied.
The internet and e-commerce have arguably been at the forefront of these changes, and as such, it is both interesting and important to look at the main effects that e-commerce has had on retail. This article examines some of the main ways that e-commerce has affected and changed retail for the foreseeable future.
Retail is regarded as the provision of merchandise and services to consumers and is both in individual units as well as massive amounts to the general public.
It is an ever-changing sector that has begun to develop incredibly large retailers who sell pretty much everything. With the advancement of the internet, this has moved online, and once online, this mass retail is referred to herein as e-commerce.
There has been so much written recently as to the death of the physical store. It is now recognized as a proven fact.
The combination of high rents and increasing business taxes, as well as the rise of online shopping, has seen so many main or high street stores close. The main argument for most of these retail store closures is the reduction in revenue as customers simply no longer need to come into the store to buy what they need. Instead, they are doing all their shopping online.
So, unless your retail store has an online version to compensate, e-commerce has sounded the death knell for many a main street or high street retailer.
2. Improved customer data allowing targeted marketing and personalized offers
E-commerce has arguably been as successful as it has (the global e-commerce market was at US$13 trillion in 2021) because professional online retailers are able to gather and analyze so much more customer information, likes and dislikes.
The rise of big data to build a wealth of customer information makes it possible for online retailers to build genuine relationships with their clients and customers. There are massive amounts of data that customers now provide to online retailers, be it when they register to use the e-commerce site or as they use and share on social media.
This increased digital information on your customers or clients is then able to be used to provide personalized marketing, which has proven to elicit increased sales. Such personalized and targeted marketing has added a personal touch not seen in mass retail before e-commerce.
3. More demand for next-day delivery
E-commerce and internet shopping are still growing since they are so convenient. You don’t have to leave the comfort of your home to purchase what you want. And with this convenience has come the additional need for items to be delivered as quickly as possible.
Internet shoppers have shown that they value convenience and speed more than anything else, and it is those retailers who offer a 24/7 service and next-day delivery for valued customers that are building online retail empires; it’s what the masses want.
Same or next-day delivery is now a serious business, and most customers will look to secure this as a first option when shopping online. E-commerce has changed how retail fulfilment, inventory tracking, and to-the-door logistics are now expected to operate to meet these customer needs.
4. Increased use of third-party logistics
One of the most widespread changes to retail caused by e-commerce has been the rise of the third-party logistics firm or order fulfillment company. They have become responsible for the part of e-commerce that is the most pressurized bit, the storage of finished goods (warehousing) and delivery to the customer.
It is all about speed and the customer experience and as a retail concern, you must be sure that the firm you trust to be the face of your delivery service is able to get the goods you sell to the customers who’ve ordered and paid for them on time.
5. Still possibilities for interaction and immersive shopping
E-commerce was argued to be a form of anti-social shopping when it first came onto the retail scene.
The idea focused on people sitting alone in their rooms, buying all manner of items online, and the notion that we would soon be buying everything from groceries to bespoke fashion and even houses online. This viewpoint has changed dramatically, and e-commerce is now recognized as one of the most interactive, immersive and social means of purchasing anything from a fridge to fashion.
There are now chat rooms to discuss and review the possible purchase, recommendations and experiences written by others who have also purchased from the specific retailer that you are considering.
And more recently, the technology exists to provide for virtual fitting rooms and social media influencers and channels dedicated to the retail items that you are considering purchasing (especially with regard to fashion). E-commerce is thus as social as any trip to the grocery store will be and this is a trend that is only growing and affecting most online shopping experiences.
6. Flexibility and speed of change
E-commerce has made retail one of the fastest sectors respond to customer and client needs. Shopping online is expected to be flexible and fast; consumers and customers want to be able to purchase exactly what they want, in specific sizes, colours and styles, which must all be available.
The e-commerce platform must additionally be reliable and efficient if it is going to be used extensively. It must thus be able to change and adapt to meet the ever-changing needs of the clients and customers. Thus, the feedback loop involved in good online shopping companies is incredibly speedy, with changes being made based on customer suggestions and interactions.
7. E-shopping assistants and help
E-commerce is shopping that is available 24/7/365, and as such, so too must the support and help that is related to the e-commerce site being used. If customers have issues when shopping that are not dealt with immediately, they will be unlikely to return to the site.
There are now chatbots and automated shopping assistants to see to this need. Furthermore, the frequently asked questions (FAQs) and queries that can be answered and responded to at all times must be updated and current to allow an easy response to any of the questions that possible shoppers need answering.
No one wants to send an inquiry email or text and wait days for a response; it must be immediate, and it must be a genuine solution. This is what e-commerce has brought to the realm of customer service.
8. Increased collaboration and partnerships
The rise of e-commerce has seen an increase in some very interesting partnerships in retail and the online space.
Amazon, for example, has partnered with many businesses, and in doing so, they have offered an entirely unique experience to the customers of these businesses. The increase in collaborations and online partnerships are used online to provide a professional shopping experience in those instances where the retailer may not have a proficient online store and presence.
The idea is that the retailer/producers and manufacturers are able to focus on what they do best, as they partner with those that are able to promote your brand online and provide an online shopping experience that
drives revenue generation.
9. Influencer marketing
The use of social media for marketing and, in fact, as a shopping platform has grown exponentially, and part of this growth has seen the rise of influencer marketing on social media.
It has become one of the top ways of marketing anything from fashion to music and more. We all want to see what our social heroes and heroines are wearing, buying, eating, driving and so much more, and then we want to know how to emulate this and where we can buy the same items.
10. Increased customer and consumer power
Yes, it has been true forever that the customer or client is always right. However, the internet, e-commerce and all the associated trappings and additions online, such as reviews, recommendations, online trust platforms and reputation, have given the customer a great deal more power in the retailer-buyer relationship.
Any issues that are experienced by the customer or client are now shared as widely as possible, and such bad reviews have been known to damage reputation and cause irreparable damage to the online brand. This is the new level of consumer power, and the retailers who move online have to be aware and prepared for this level of feedback.
One of the main aspects of all these changes is the fact that businesses will now need to adapt quite quickly to this new normal in retail. The customer experience has become paramount, and the name of the game is speed and efficiency.
Shoppers expect the delivery and procurement process to be fast and seamless, just as it is now to shop. E-commerce is here to stay, and unless your retail concern joins this movement online, then your business will not be here to stay.
I am Adeyemi Adetilewa, a media consultant, entrepreneur, husband, and father. Founder and Editor-In-Chief of Ideas Plus Business Magazine, online business resources for entrepreneurs. I help brands share unique and impactful stories through the use of public relations, advertising, and online marketing. My work has been featured on the Huffington Post, Thrive Global, Addicted2Success, Hackernoon, The Good Men Project, and other publications.