20 Percent Online, Mobile Shopping Growth Drive Up Dept. Store, Home Goods Sales in First Quarter, Reports IBMApril 25, 2013 No Comments
First quarter 2013 online shopping grew more than 20 percent over 1Q 2012, more than five times in-store sales growth, helping drive up department store and home goods purchases, according to the IBM Online Retail Index. The IBM Index comes on the heels of the U.S. Department of Commerce’s Census Bureau report which announced in-store sales for the January through March 2013 period were up 3.7 percent.
Key findings of the IBM Online Retail Index include:
- Online shopping growth outpaces in-store by five times, 20 percent to 3.7 percent
- Mobile sales growth of 31 percent due to improved customer experience, iPad, tablet use
- Department Stores respond to showrooming trend with 32 growth in mobile sales and 34 percent growth in average order value from aggressive omnichannel strategies
- Home Improvement mobile sales grow 80 percent as summer approaches
Mobile commerce continues to dominate first quarter 2013 growth, driven most extensively by tablets. Mobile sales for 1Q 2013 increased 31 percent over 2012 with mobile site traffic increasing close to 40 percent. These numbers are fueled by tablet usage, as couch commerce continues to be the preferred method of shopping for the multichannel customer, with 1Q 2013 iPad traffic increasing close to 80 percent over Q1 2012. This trend reflects marketers’
ability to create a positive customer experience for consumers shopping on their iPads and Kindles, by designing for the finger and making it easier for customers to browse via their mobile devices.
Known as a mobile commerce pioneer, Moosejaw Mountaineering’s digital shopping results coincide with the findings of IBM’s Online Retail Index.
More than 30 percent of Moosejaw customers are shopping on the company’s mobile site with about 16 percent of sales coming from mobile devices and tablets, up from 25 percent in mobile commerce visits a year ago.
Specific highlights from IBM’s Q1 2013 analysis include:
- Department Stores Make Online Shopping Easy: Instead of fighting showrooming, department stores have embraced digital shopping, by providing customers added value and a more efficient buying experience with the ability to scan QR codes for additional product information, in-depth online reviews and free shipping to the store. As a result, consumers are making larger purchases and spending less time doing so, with the average order value increasing 34 percent as compared to Q1 2012 and the average session length decreasing more than 10 percent over the same period. Overall, department store mobile sales continue to grow, increasing close to 32 percent as compared to Q1 2012.
- Customers Prepare for Summer with Home Improvement Purchases: With warmer weather comes the need for customers to make home improvements or purchase outdoor furniture and online home sales reflected that trend, with 1Q 2013 mobile sales up 80 percent from Q1 2012. iOS-enabled devices continue to be the mobile shopping tool of choice for consumers who crave simplicity and the ability to seamlessly transition between devices. As a result, both iPhone and iPad traffic was up 162 percent and 135 percent respectively over the same period last year.
The IBM Retail Online Index integrates factual marketplace data from the IBM Data Analytics Benchmark with insights from the IBM Social Sentiment Index. The combination of these two provides the most accurate and immediate snap shot on the state of the online retail market. Some additional findings from IBM’s Retail Online Index for the fourth quarter include:
- Retailers Offer Customers Cost-Saving Mobile Solutions: Customers took to their social networks to speak positively about pricing in the first quarter of 2013, with positive sentiment about pricing at 60.5 percent, almost seven times that of the negative sentiment. As marketers and retailers offer more digital shopping solutions, customers were most positive about price comparison applications, when discussing pricing. In fact, positive ratio of sentiment around price comparison was up 20 percent as compared to Q1 2012, with positive sentiment almost ten times that of the negative.
- Item Availability Spurs Positive Sentiment: Customers were particularly happy with product availability in the first quarter of 2013, with positive ratio of sentiment around availability up more than six percent over Q1 2012. As customers took to Twitter and Facebook among other social media sites, to discuss product availability, 70 percent spoke positively about items being “in-stock.” This trend can be attributed to marketers and retailers offering customers the ability to search for available items via mobile applications and mobile websites.
These are just a few highlights from the IBM 1Q 2013 Online Retail Index. To discuss the findings in more depth and the strategies both retailers and marketers are employing to improve the online customer experience, I’d be happy to arrange an interview with an IBM executive.