I’ll admit that I was a little slow in coming around to online shopping. I felt like I needed to go to a store and see the product or try it on before I bought it. But I wasn’t the only one thinking that way. Ten years ago, the “big box stores” soared and ecommerce sites struggled.
However, over the past decade there’s been a huge transformation in online shopping. Now e-commerce sites are successful and the box stores are having a tough time competing. Consumers have noticed that online stores have cheaper prices, especially with electronics, toys, children’s items, and high-end clothing and jewelry. Why go to the store when you can find the same product online at a cheaper price?
But don’t take my word for it, just look at the numbers. The e-commerce companies made $38.7 billion in sales, a 16% increase. One report showed that overall retail sales grew 0.7% in November, the slowest growth since 2008. But U.S. e-commerce sales exploded. The sales jumped 18.7%, much higher than the 15.7% in October and the 13.6% growth in September. It seems that the tables have turned and now the online sites are the ones raking in the cash.
However, e-commerce can only do well for so long. So what do the e-commerce companies do? They go mobile. 2012 was a breakthrough year for mobile, and there were huge jumps in sales from purchases by smartphones.
eBay (NASDAQ:EBAY) and Amazon (NASDAQ:AMZN), the e-commerce winners, know that they need to stay ahead of the curve, and have already jumped into mobile commerce. Bloomberg recently reported that EBAY is now partnering up with Macy’s (NYSE:M) through mobile apps. The Macy’s app senses when shoppers enter a store and then sends the shopper a mobile coupon. Steve Yankovich, EBAY’s vice president of mobile, says “We’re going from a several-billion-dollar market in ecommerce, and in connecting through mobile to the actual physical store, we then have EBAY Inc. playing in the trillion-dollar ocean.” By working with physical retailers, EBAY will be on target to dominate the consumer market.
AMZN, trailing behind EBAY, is also breaking into mobile. This company certainly isn’t going to sit back and let EBAY continue to beat them. The company is fighting back through tech. AMZN’s Kindle and Kindle Fire brought in huge profits for them. So, AMZN took the tech from the kindle and put it into a smartphone.
Yes, AMZN will be coming out with a smartphone, and you don’t have too much longer to wait. It is expected to be released in early 2013. The phone would use Kindle Fire HD as its basis and make shopping easier for Amazon.com customers. This company is a growth machine and will do whatever it takes to knock out its competition.
Shopping in the new millennium is nowhere close to how we shop today. And now with mobile commerce making a play to become the new “e-commerce,” I have a strong feeling that retailers, both in-store and online, are all going to have to come up with applications to keep consumers coming back. EBAY and AMZN have gotten a head-start, and I cannot wait to see what the other stores create to try and stay in the retail game.