Retail spends on social media as e-commerce growth slows

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Retail spends on social media as e-commerce growth slows

Karl Flinders

The explosive growth of e-commerce sales in retail will slow over the next few years but nearly a third of European retailers will invest in social media tools to support customers’ online buying habits, according to IDC Retail Insights.

The specialist retail arm of analyst firm IDC said the number of people shopping online and high-speed internet penetration will approach saturation point in the near future. This will inevitably slow e-commerce growth rates and force retailers to focus on strategies to increase their share of online sales as well as increase international presence.

Social media is a means of improving customer experiences, which will increase the rate at which visits to websites convert to sales.

Christine Bardwell, research manager EMEA at IDC Retail Insights, said 30% of European retailers plan to introduce social media tools in the next two years. 

"Even in the more mature online markets, retailers today can expect online retail sales to outgrow store sales growth two or three times over. However, as the number of online shoppers and high-speed internet penetration nears saturation, online growth will slow significantly and retailers will be required to build a two-pronged strategy — internationalisation and improving conversion rates by focusing on the online customer experience."

"It is clear from our recent discussions that retailers are keen to learn more about e-commerce with the growing importance of accessibility, fully integrated user experience, and ease of use in the online sales channel.”

According to the findings of an IMRG Capgemini e-retail Sales Index, all retail growth in the UK now comes through digital channels. It found the UK to be the second largest global market for e-commerce after the US with 30% of the European market share.

Businesses can use social media already available or use software to give them more control of it. Indian IT service provider Infosys, for example, has introduced a platform which aims to industrialise social media.

The iEngage Digital Consumer Platform, as it is known, offers businesses sectors including and retail a means of interacting with and managing customers.


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