zia widger, forrester research

© 2011 Forrester Research, Inc. Reproduction Prohibited2 © 2009 Forrester Research, Inc. Reproduction Prohibited

Five Things eBusinesses Must Do Well In Order to Succeed

Zia Daniell Wigder

Principal Analyst, Research DirectorAugust 2011


The Internet is changing the lives of everyone around the globe


The biggest online user growth over the next few years will come from developing markets

Source: Forrester Research World Online Population Forecast, 2010 To 2014 (Global)


Brazilian online retail revenues are forecasted to increase by $2 billion

US China Japan UK Germany France Brazil Spain Mexico

$197.0

$72.2

$50.9 $47.6

$31.6

$18.1$9.8

$4.2 $1.4

2011 Online Retail Revenues(in billions)$197


eCommerce growth is outpacing traditional retail revenues

Source: Forrester Research Online Retail Forecast, 2009 To 2014 (US)

Web Growth Has Outpaced Non-Web GrowthForYears

-5%

0%

5%

10%

15%

20%

25%

30%

2006 2007 2008 2009 2010

Annual eCommercegrowthover prioryear

Annual non-eCommercegrowthover prioryear

30%

4%

18%

4%

12%

-2%

11%

-4%

13%

3%


Leading eBusinesses are tackling the following five issues head-on


Issue #1We have structured our eBusiness

organization to succeed


eBusiness professionals should ask themselves a list of questions


Source: December 2009 Global eBusiness & Channel Strategy Professional Online Panel Survey;

April 2010 “Trends 2010: eBusiness Teams Reorganize”

eBusinesses rate themselves high on teamwork…

Base: 95 global eBusiness & channel strategy professionals


…but need more resources and IT support

Source: December 2009 Global eBusiness & Channel Strategy Professionals Online Panel Survey



Senior management support of eBusiness is lacking

Source: December 2009 Global eBusiness & Channel Strategy Professionals Online Panel Survey



Issue #2We’re building out multichannel options


It’s no longer enough to think only multichannel – it’s now about touchpoints


The Web’s profitability and growth have made it a top priority for companies

Source: Forrester’s November 2010 Global eBusiness & Channel Strategy Professional Online Survey*Please note that the statistics in this figure have been reconfigured to remove those respondents who answered “N/A.”


Those companies with multiple channels are taking advantage of them


However, consistent brand experiences remain a challenge

Source: Forrester’s November 2010 Global eBusiness & Channel Strategy Professional Online Survey


CRM and analytics top the list of technology challenges for cross-channel retailers

Source: Forrester’s November 2010 Global eBusiness & Channel Strategy Professional Online Survey


Issue #3We’re taking advantage of the social

phenomenon in multiple ways


Social networks are incredibly popular globally – just not for shopping at this point

Just 7% of US online retailers said social networks were one of their top customer

acquisition sources


REI offers a helpful snapshot of all reviews on a product

Ratings and reviews are mainstream, but few eBusinesses are using them to their fullest advantage


TripAdvisor uses detailed traveler profiles to help visitors identify with

reviewers

More companies are moving toward characterizations of reviewers


TripAdvisor uses detailed traveler profiles to help visitors identify with reviewers

Manufacturers and retailers alike are enabling community discussion boards


Issue #4We’re prioritizing mobile


Five percent of all Internet sessions globally now involve a mobile device*

Source: *NetMarketShare, Forrester Research US Mobile Commerce Forecast, Forrester Research Asia-Pacific

Consumer Technographics Survey, Q2 2010

The iPad is now responsible for 1% of

all global Internet traffic (some 2% in the US)*

Mobile commerce in the US alone is

expected to reach $25B by 2015, or 6%

of all online sales

In Brazil, almost one-quarter of mobile device

owners access the Internet on their phone

at least once a day


For many, mobile marketing is a precursor to mobile commerce

Awareness

Acquisition

Retention

Loyalty


Ralph Lauren shows how marketing-focused applications can co-exist with retail-oriented mobile websites

iPhone application:

Delivers engaging content

Mobile websites:

E-commerce focus


Tablet commerce must also be taken into consideration

Example OnlineRetailerMobileTrafficReport; Nearly Half From iPads

Source: Anonymous retailer data on Site Catalyst


Issue #5As manufacturers, we’re prioritizing online sales – and as retailers, we’re optimizing opportunities for

our manufacturer partners.


The proportion of consumers who buy directly from manufacturers is growing

Source: Channel Intelligence 2010 Referral Site Survey; Channel Intelligence 2010 Referral Site Follow-Up Survey*Source: Channel Intelligence 2008 Referral Site Survey †Source: Channel Intelligence 2006 Referral Site Survey


Manufacturers selling direct span a wide variety of categories


The online store-within-a-store model is becoming popular


Some brands have tight integrations with channel partners


Additionally, manufacturers are taking advantage of the growing number of online marketplaces

Amazon’sMarketplace HasProvenToBe A Successful Profit Driver

•34% of Amazon.com’s units are sold through other merchants.•Amazonreceives a 15%commission(plus other fees) on transactionscompleted in categories such as homeappliances.

Whilefeatured on Amazon’s site, this productis sold through another merchant.

Source: Amazon.comwebsite

Source: Amazon.com website


In summary

eBusiness professionals must ensure their organization is staffed to

support the growth of the online channel

Companies are prioritizing multichannel options and thinking about

the new customer experience based on touchpoints

Social is a huge phenomenon – but don’t make selling through

social networks too much of a priority

“Like social, love mobile.” This channel requires attention today, not

tomorrow

The trend of manufacturers selling direct online opens up new

opportunities not just for manufacturers, but for retailers, as well


Zia Daniell Wigder

+1 212.857.0792

[email protected]

www.forrester.com

Thank you

mailto:[email protected]

zia widger, forrester research

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