New consumer behaviour is encouraging new business solutions. However, while the future of online retail and e-commerce looks bright, the importance of brick and mortar presence for brands is not disappearing anytime soon.
Changes in consumer behaviour are driving new business models. According to PwC’s annually published Global Consumer Insights Survey, some trends can be identified, which are driving innovation at retailers and consumer companies right now.
According to the survey, 59% of the global respondents shopped this year at Amazon or its Chinese equivalents, online retailers JD and Alibaba’s TMALL. The percentage of the sample who claimed to buy only at Amazon increased from 10% to 14% during the year. On top of that, over the six years of conducting the annual consumer research, the number of the respondents who shop via smartphone has grown by 133%. Long story short: Figures show that people like shopping online, and the percentage of goods that were purchased online is increasing steadily each year.
It’s true that the big names in e-commerce are dominating the market for efficiency and convenience. However, manufacturers and retailers alike have plenty of room to develop business models around personalization and differentiation. Many manufacturers are now reserving their hottest new products, not for their retail partners, but for their direct-to-consumer channels.
The opportunity for new entrants is clear. E-commerce still represents less than 15% of B2C commerce globally, which means that opportunities are available for new entrants and innovators.
Notwithstanding the digital disruption that is reshaping the retail industry, people are still shopping at bricks-and-mortar stores. According to this year’s survey, the percentage of shoppers who reported to have visited a physical store at least weekly was 42% back in 2012 and 44% this year. That said, one way for retailers to compete with new business models is by captivating the consumers that are visiting their physical locations.
Although the big names in e-commerce are dominating the market for their efficiently sold, good-quality, commodity products, both manufacturers, and retailers have plenty of room for developing business models around personalization and differentiation, such as unique and quality—not just convenient—buying experience.
Cornfield & Partners can help you with market opportunities related to e-commerce and direct-to-consumer retail. To find out more about potential business opportunities, contact firstname.lastname@example.org or you can call us on +44 (0) 20 7692 0873