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Ecommerce is … Growing?

Dec 4, 2008
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According to the US Department of Commerce estimates, ecommerce grew by 4.6% in the third quarter of 2008 over third quarter 2007. Further, eMarketer predicts that ecommerce will grow by another 4% in November and December of this year. Of course, these numbers are significantly less than the 2007 totals according to the same eMarketer report, when online spending growth was in the double digits. However, these days, beggars cannot be choosers – and growth is still growth. In turn, it is important for businesses to take advantage of this growth – however modest the growth.

Where Are Consumers Spending Their Money Online?

Well, it turns out that this question is not as easy to answer as you may think. According to a September 2008 Piper Jaffray study, Americans prefer to shop at Amazon and eBay and comparison shopping sites that include Shopping.com, Shopzilla.com, and MySimon.com.

However, while no one online website dominates, the study did reveal that consumers did prefer to shop at fixed-priced third party websites. Why? Well, these types of websites offer a plethora of different products with a competitive pricing strategy. Thus, without a doubt, these types of websites provide the ultimate affordable one-stop-shopping destination. The runner-ups consisted of going directly to retail websites, search engines, auction websites, and lastly comparison shopping websites.

Other Influential Online Media

Surprisingly … or not so surprisingly, blogs are extremely influential when it comes to making a purchasing decision. According to a study conducted by JupiterResearch for BuzzLogic, fully over one half of surveyed American blog readers believed that blogs were useful for obtaining information about potential purchases.

Rob Crumpler, the CEO of BuzzLogic believes that blogs now rival search engines as a navigation tool for some blog readers. In turn, he believes that this newfound situation will have “interesting implications for advertisers.”

Further, as blog readership increases in the coming years, the number of consumers who will be influenced by blogs will only continue to increase.

What Does All of This Info Mean?

Well, since ecommerce is increasing in numbers albeit more slowly than research previously expected, it is extremely important for businesses to promote their online stores. Further, since consumers do not shop at any one online platform over another, businesses should ensure that their products are well represented on all of these platforms – when possible. Along similar lines, since blogs are becoming more and more influential when it comes to purchasing products, companies should work with bloggers to ensure that their products are well represented in the blogosphere as well.

Filed under: eCommerce + Offline Marketing + Online Advertising
  • http://www.rhinofish.com Pat Grady

    Nice article. I'm thinking your article shows that e-commerce isn't just growing, but is widening. I think I'd have titled it "Ecommerce is still gaining weight, Junk in the trunk."

    Anyhow, I like the breakdown of order for consumers, the third party site, retail, search, auction, comparison pecking order. Makes me think about volume and margin and where I want to be (and how I want to be in more than one place).

    I understand the "fixed price third party" attraction – like at Amazon – I often start my shopping there. But the term "fixed price" seems a little weird to me in this context, I don't fully understand what it means entirely here. Care to expound on this teeny point for me please?

  • http://stephanielichtenstein.com Stephanie Lichtenste

    Blogs are good tools, consumers also love sites that offer reviews both good and bad. It influences many shoppers when making purchasing decisions like the Amazon lovers. So having reviews up on your site and testimonials is helpful for increasing conversions as well as complimentary blogs.

    To quote you, "grow is still growth," and that alone makes me happy to be in this industry. Thank you for sharing!

  • Larisa Redins

    Pat:

    Thanks for the note! With respect to your inquiry, I was referencing Emarketer.com and Piper Jaffray when I referred to Amazon.com as a "fixed price third party" online property.

  • Larisa Redins

    Stephanie – good point! Yes consumers do appreciate "user reviews" as well.

  • http://www.ebranchoffice.com eBranchOffice.com

    I was a little worried when the gas prices came down because I thought the $4.00 a gallon gas prices would have really boosted the online shopping holiday season.

    I think online shopping still has a long way to go. I think people like comparison shopping sites because it allows a "one stop shop" opportunity. This is way better compared to driving around from store to store to check prices.

  • http://stephanielichtenstein.com Stephanie Lichtenste

    That's an interesting point. Now I will begin to view gas prices from a different point of view!

  • http://www.rhinofish.com Pat Grady

    Anybody else know what "fixed price" means?

  • Larisa Redins

    eBranchOffice.com – that's an interesting point as well.

    Pat – I assume the market research companies are referring to items sold at a specific price vs. items sold through an auction format. Of course, we would have to get in touch with those two market research companies to verify that info.

  • http://www.rhinofish.com Pat Grady

    you may be correct there, but it seems strange to me that "auction" is one category and everyone else is "fixed price", so it seems a little strange to use his as a distinction… like calling my car a "not-solar powered" automobile… but i suspect you're correct still though. but not being mister retail, i wondered if it had something more to it than that. all good here. thanks.

  • http://www.linkosolutions.com/ecommerce/ ecommerce

    E-commerce is the use of Internet and the web to transact business but when we focus on digitally enabled commercial transactions between and among organizations and individuals involving information systems under the control of the firm it takes the form of e-business.