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Friday 11th April 2014 Will "Click and Collect" be the New Hero of E-Commerce?

Fulfilment has always been the last hurdle of the e-commerce world. Shipping products to individual residences can be extremely expensive, and naturally that cost gets passed on to the consumer, which is one of the highest causes of shopping cart abandonment in online retail. Even worse, delivery times rarely seem to coincide with the customer's actual availability, creating a general hassle that pushes many people away from the online shopping world.

Several ideas have been floated and tested to solve this problem, but the most promising possibility so far seems to be the concept of centralized distribution centres. Essentially, companies ship purchased products to centralized locations scattered throughout major metropolitan areas which act as pick up points for customers to visit whenever is convenient for them.

At first glance, of course, this sounds quite a lot like the 'big box' retail store model that has been the latest rage in brick and mortar retail, but there are a few key differences. First of all, overhead is extremely low for the distribution centre, as they don't need to keep a large area open for customer usage. Second of all, for the customers, there's no need to hunt around through a store area, as their package is already catalogued and marked, ready for pickup. No hassles about stock, or price comparisons, or any of the hassles that make retail shopping in a big box store frustrating.

In fact, Planet Retail, an industry analysis firm, recently released a report entitled "UK Click & Collect: retail fad or future of the high street?" forecasts that the number of shoppers in the UK who use these types of distribution centres to complete online purchases will more than double from the current 35% to 76% by the year 2017 - quite a strong recommendation. Currently, the United Kingdom leads the world in the use of these types of services, with only 13% of customers in the United States using similar services, and less than 5% in Germany.

To add even more weight to the phenomenon, online retail giant Amazon is currently experimenting with similar delivery centre options, although they're going to have their work cut out for them, as most of the 66% of UK retailers who currently offer click and collect services already have brick and mortar store locations that can be doubled up for use as distribution centres. However, considering Amazon has a staggering amount of warehouse space already carefully centrally located in major metropolitan areas - not to mention nearly unlimited capital - the competitive advantage may swing back in their direction quite rapidly.
 
To keep a close eye on your own business advantages, check out the competitor tracking services offered here at Competitor Monitor.

Posted on April 11th 2014 at 07:59pm by James
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Tuesday 08th April 2014 UK m-Commerce Booming in 2014

Mobile commerce, or m-commerce as it is commonly known in the industry, is changing the shape of the online retail market. In order to maintain a competitive advantage, the retailers who adapt the most quickly to coming trends typically have the most to gain - but gambling on the wrong trends, or trends
that fail to emerge into the mainstream, can have disastrous consequences. There has been some speculation in the past that the time of m-commerce hasn't yet come, or that it's never going to materialize into a properly viable channel, but recent reports seem to be finally quieting the naysayers and putting the matter to rest once and for all.

A recent study commissioned by online coupon giant RetailMeNot indicates that at least in the United Kingdom, mobile shopping is here to stay. The study forecasts that over the course of 2014, customers in the United Kingdom will spend nearly £8 billion online using their mobile devices (smartphones and tablets). This is quite high even by the standards of the rest of Europe, which as a whole is forecasted to spend nearly £20 billion in 2014.

Interestingly, Europe's overall m-commerce spending is growing at a slightly slower rate than that of the United Kingdom, as in 2013 the m-commerce spend was just shy of £11 billion, making for an increase of nearly double. In the United Kingdom in 2013, the m-commerce spending stats showed sales of £3 billion pounds less, roughly £5 billion.

This is in large part driven by the fact that smartphone adoption is much higher in the United Kingdom than in the rest of Europe, making it a perfect testing ground for companies looking to experiment with m-commerce solutions among a large population who are comfortable making such purchases. 28% of all smartphone users in the United Kingdom made an online purchase with their mobile device in 2013, the highest in all of Europe, just above Germany who placed second with 27%, and well in advance of third placed Sweden, who measured in at 21%.

Naturally, m-commerce adoption is an uphill battle as retailers experiment with solutions that respond to the evolving needs and desires of consumers who are still themselves discovering just how it is they want to use their mobile devices. Any retailer who hopes to maintain a competitive advantage had better pay close attention to evolutions in the market space, because whoever picks up on the best new trends will be far ahead of the pack.

Posted on April 08th 2014 at 06:00pm by James
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Friday 04th April 2014 The Crucial New E-Commerce Tactic

It's an almost unavoidable fact that the e-commerce world moves at the speed of light - thanks to fiberoptic global communications, this is literally true. But even figuratively, the e-commerce world is a constantly shifting landscape of innovation as retailers large and small move to counter the advantages gained by others, while increasing their own competitive ability and marketing position. Competitor tracking is one of the most essential elements of the online retail world, and allows even the smallest businesses to stay abreast of the latest retail tactics.

The latest concept that's taking the retail world by storm is presented as a solution to the competition between online and offline markets: omnichannel retailing. Channels, as most retailers are aware, is simply another way of describing ways of interacting with customers, whether it be via email, websites, mobile browsing, or brick and mortar store foot traffic. In a world that was struggling to adapt to the sudden rise of e-commerce, channels were becoming increasingly fragmented, with the left hand not knowing what the right was doing, so to speak, more often than not, as websites and stores offered different deals, different prices, and in some cases even different products. Needless to say, this was a growing hassle for both retailers and customers alike.

Omnichannel retail solves all those discrepancies by stressing the essential nature of a consistent experience for customers, no matter how they choose to interact with a business. Unlike many buzzwords, this one appears to have gained real traction in the business community, as evidenced by the recent "First Annual Symposium on Omni Retailing", held in New York City at the Fashion Institute of Technology.

While the focus of the symposium was on fashion retail and how it can be enhanced by using omnichannel retail strategies, it makes perfect sense that fashion retailers would be at the forefront of a distributed but consistent retail experience, as many shoppers who browse fashion online are still unwilling to purchase without actually trying the final product. Lending some serious weight to the event was the speaker list, which included representatives from Microsoft, Birchbox, and The Boston Consulting Group, as well as a keynote address by Peter Nordstrom, from the retailer of the same name, a real coup for the event organizers as he rarely speaks at any sort of event.

In a world dominated by multiple channels, the true competitive advantage will be held by those who can deliver consistently excellent experiences to customers, no matter how they choose to interact. Getting in on the ground floor can ensure your business stays ahead of the curve, instead of behind the eight ball.

Posted on April 04th 2014 at 05:29pm by James
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Tuesday 01st April 2014 China Leading the World in Online Retail Adoption

Much comment has been made about the recently booming Chinese online retail market, which is forecasted to double in size each year for all the years that projections have currently been made. The potential of the market is truly incredible, and it shows every sign of meeting or exceeding the forecasts that treat it so glowingly. It should come as no surprise, then, that Chinese consumers are embracing the e-commerce experience with such open arms, as they're an integral part of the engine that's driving the retail boom.

According to a recent report that was released by the Shanghai branch of PricewaterhouseCoopers, the Chinese consumer turns to online shopping at a much higher rate than the average global consumer does. One in seven people buy something online every single day, and 60% of the population buys something online at least once a week.

While this is quite impressive in and of itself, there are some other habits of the Chinese consumer that differ somewhat from the Western perspective we've come to have on e-commerce. For instance, their near-ubiquitous adoption of mobile devices is on par with the West, but they use their devices for shopping at a far greater rate than the rest of the world, with nearly 25% of all those polled shopping using their mobile device to shop at least once a week, more than double the global average which clocked in just shy of 9%.

The typical Chinese consumer also seems far more likely to use a social network or company-hosted review site to leave feedback and reviews of their purchases than the global average, whether positive or negative, which creates a much more complete perspective for other potential customers on which to base their purchasing decisions. More than 90% of the polled Chinese customers in the PwC study indicated that they leave feedback online about their purchases, compared to the global average of just 55%.

Even as omnichannel shopping is growing as a common phrase in boardrooms and planning offices in Europe and North America, so too does is it become crucial in China, as the traditional brick and mortar store is forced to adapt to the incredible pace of the online markets. Considering the incredible success of m-commerce in China, it will be very interesting to see how offline retailers deal with the problems of showrooming and omnichannel solutions, and may provide a testing ground for successful strategies to be implemented elsewhere around the world.

Posted on April 01st 2014 at 04:47pm by Ade
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Wednesday 26th March 2014 Walmart Launches Price Comparison Tool

In the heated battle currently underway between brick and mortar and online-only retailers, it's not hard to guess which way the tide is going: the ease and convenience of online shopping simply overpowers the traditional model of actually having to visit a physical store. Well, that's true in certain areas, at least. Despite recent expansions into the traditionally elusive markets of fashion and apparel, some sectors seem to struggle with offering online solutions that compete effectively with their offline counterparts. One of the most elusive of these sectors is the grocery and produce market, for relatively obvious reasons.
 
Walmart, the series of mega-stores first launched in the United States, has always been aggressively conscious about its pricing systems, even to the point of driving smaller local retailers out of business simply by underbidding them, on everything from household items to groceries. Over the past several years, unsurprisingly, they have been losing sales to the online world as many people grow to accept that the convenience of online shopping trumps whatever discount Walmart might be able to offer - although increasingly, online price comparison tools have been able to find better deals for customers than they can keep up with.
 
As a result, Walmart has taken the unusual step of launching its own price comparison tool, called the "Savings Catcher". It operates something like an expanded version of a customer loyalty program, and in that sense differs greatly from most price comparison solutions. Instead of having customers search out each item they want to buy and find the lowest price, customers who have ALREADY shopped at Walmart enter their receipt number into the website's system, and it will find the lowest prices and credit the difference between lowest prices and what the customer has already payed onto a Walmart gift card.

From an economic perspective, it's an intelligent solution. Walmart is now sitting on your money in advance, which it can do what it wants with while the customer is awaiting their next purchase. However, it fails in comparison to the reliability and flexibility of more traditionally-designed price comparison tools in that it works best on volume purchases - like groceries. Most customers don't buy a huge number of household items all at once, so it's easy to use a more common price comparison tool online to do the job properly. For groceries, however, it would take hours to search out the best prices for a week's worth of family shopping. In this case, and this case alone, Walmart is likely to find success with this tool.

Posted on March 26th 2014 at 01:41pm by James
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Monday 24th March 2014 Reaching Emerging E-commerce Markets

The e-commerce world has always been a rapidly changing one. As little as 10 years ago, it was still a relatively new thing to many people in the Western world, and not necessarily entirely trusted by many who were yet to adapt to the technology. But as the ease of use and availability of items increased, so too did the general public's desire to embrace the new phenomenon, and naturally retailers followed suit. Fortunately, the entire backbone of internet access was well-established in the West by this point, and when coupled with the credit card systems that had been in use for decades, the stage was set for e-commerce to take the retail world by storm. But what about the rest of the world?
 
As the idea of globalized e-commerce begins to become a viable reality, any number of hiccups are being encountered by retailers hoping to reach emerging markets. Global logistics and supply chain issues have been dramatically improved over the last decade, but they're still not guaranteed, and the same type of issue often applies to payment processors. In many nations around the world with comparatively wealthy populations such as Russia, credit cards are still not widely embraced (though with the sheer amount of credit card fraud going on in the world, it's not too difficult to understand why).
 
This presents a fairly serious problem to retailers, however. Some have worked out clever ways around this problem, including the Russian competitor to Amazon's localized shipping depots where customers can pick up items and pay cash, or in some African nations, cash-on-delivery systems have been implemented. Both of these put all the risk in the hands of the retailer, however, and while that may reassure the customers somewhat, it doesn't always encourage foreign investment in online merchants.

In many parts of the world, however, an interesting march of technology has taken place. Throughout Africa and many parts of Asia, landlines and hardwired access has been leapfrogged by mobile phone technology. Enterprising payment processors, recognizing the possibilities of leveraging the already established mobile phone payment systems, have begun to partner with retailers to build an entirely different model of e-commerce that takes advantage of the ubiquity of mobile phones. As this trend expands and more and more customers grow comfortable with the safety and security of these methods, expect to see a sudden and rapid growth in the e-commerce markets of every nation around the globe.

Posted on March 24th 2014 at 08:06pm by James
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Friday 21st March 2014 Should Online Shopping Reviews Work Both Ways?

One of the most celebrated trends recent in online retail websites has been the functionality that allows customers to post reviews of the products being sold, as well as reviews of the retailer itself. All sorts of hassles and unexpected problems have been avoided just by allowing customers to post comment and interact with each other, and by allowing the retailer's customer service team into the conversation, customer confidence and satisfaction has skyrocketed. However, auction sites like the ubiquitous eBay that started so much of the online shopping revolution, coupled with the growing popularity of market-bazaar sites like Alibaba that simply act as platforms to connect merchants and customers, the question must be asked: should retailers be able to start reviewing customers?
 
At first, it may seem like a ludicrous idea - nearly impossible to keep track of and ensure there is no potential for abuse. But these same issues were raised during the introduction of the buyer's ability to rate sellers, and of the entire online customer review concept, and now those elements are staples of almost all e-commerce sites. eBay in particular has a problem with this, given the nature of the system. If a user wins an auction and then simply doesn't pay, the seller has absolutely no recourse when it comes to alerting other sellers to this problem customer. Curiously enough, sellers are able to leave positive feedback about transactions that went smoothly, but don't have the option to mention anything negative if the customer fails to send money or causes some other type of problem.

There is much to be said for the idea of protecting customers from the wrath of an angry merchant. At first glance, the power dynamic appears to automatically favour the merchant. After all, they have a business to run and seem to gain trust simply by virtue of the fact that they are merchants - but as the line between sellers and "trustworthy brands" continues to blur thanks to the digital empowerment of a single individual to run a fairly large business online, and as fraud and abuse seem like daily facts of life in the digital world, it only seems fair that protections for merchants evolve at the same time as protections for customers. This is especially true in the emerging online markets that often have higher instances of fraud and other dubious transactions, and that element is likely going to become more and more apparent as these markets mature.

Posted on March 21st 2014 at 06:15pm by Ade
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Tuesday 18th March 2014 Brick and Mortar Stores Closing Left and Right

When talking about online retail, the news is generally positive. After all, most markets around the world are posting incredible growth numbers that vastly outpace the statistics in comparable offline sectors, and in business news (unlike most news), the tendency is towards positive reports that keep everyone upbeat about the stability of the economy. It's impossible to ignore the fact that there is a bit of a dark side to all this growth - many brands are closing a huge number of brick and mortar stores, which throws a number of other connected markets (real estate, for example) for quite a loop.
 
The trend in brick and mortar closings isn't exactly new. Back at the beginning of the e-commerce era, when people still used the phrase 'dot coms', highly successful book shop Barnes & Noble was already beginning to feel the pressure from Amazon's initial forays into the book market. Eventually, Barnes & Noble got its act together and invested in a serious online presence, but not before they had closed an astonishing number of stores in a remarkably short time, including their New York City-based flagship location. The element that makes this continued phenomenon strange is now the types of stores that are closing.
 
24/7 Wall St. reports that of the brands closing the most stores in the United States, 3 of the 5 are clothing retailers, which perfectly highlights the growing success of fashion retailers who have moved towards online shopping in recent years. The retailer closing the second-highest number of stores is the aforementioned and beleaguered Barnes & Noble, and the other is Office Depot, although this last is largely due to a merger than any sudden shifts in online sales success.

Interestingly enough, across the Atlantic in the United Kingdom, it appears that this American trend isn't holding true. In 2012, nearly 1800 shops closed on high streets throughout the UK, which is a staggering 20 closings per day. Last year's numbers, however, had shrunk so dramatically as to be considered 'normal', down 80% to only 371 closings for the whole year. However, this is still the third year straight that has posted decreases in the number of brick and mortar stores overall, which indicates that even though the initial shock of the online retail switch may have passed, it's not likely reverse itself unless retailers can come up with better reasons for customers to visit brick and mortar locations.

Posted on March 18th 2014 at 07:43pm by Ade
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Saturday 15th March 2014 M-Commerce Dominates Traditional Online Sales in Some Markets

Mobile commerce, or 'm-commerce', has long been a sort of holy grail for e-commerce retailers - tantalizing, but nearly impossible to find successfully. A number of different approaches have been tested to solve the problem, but there haven't been many runaway successes as of yet. However, as the market begins to mature, we are finally reaching a point where there is actually enough data to begin a data-driven analysis of what is working and what isn't, over larger product areas than a single company can provide.
 
A recently released Experian Marketing Services analysis report took a look at the online purchasing trends among Americans in 2013, but subdivided this fairly typical question by the specific type of device those customers used to make their purchase, and the results were fairly interesting. Perhaps unsurprisingly, over 50% of Americans bought books, clothing, or electronics online last year - although on reflection, perhaps that is a bit surprising after all, simply for being somewhat lower than one might expect in such a hyper-connected era.
 
Among the most interesting tidbits was the fact that nearly the same number of users (roughly half of those polled) purchased clothing and fashion accessories on a tablet as those who did their shopping computers, compared to just over a quarter of those who owned smartphones. This is likely a testament to the much larger screen sizes afforded by tables, but the intuitive possibilities of gesture and swipe controls for creating interactive catalogs that just feel clunky on a computer can't be ignored. Tablets haven't quite caught up to desktop computers when it comes to purchasing electronics, with only 41% of tablet owners making such purchases via their tablets. Naturally, books are one of the areas that tablets completely dominate the market, thanks to devices such as the Kindle Fire and the iPad. The same is true of music, games and other apps that have long been the province of the mobile market.

The most interesting thing about tablets and their emerging popularity is the way they start to blur the lines between mobile devices and traditional computers. As tablets grow more and more powerful, the lines will blur even further - except in one major respect. Many customers bring their smartphones with them everywhere, and frequently use them to find store locations and use price comparison tools in store, which is a difficult thing to do easily with a tablet, as they tend not to fit comfortably into pockets. Fortunately, brick and mortar retailers aren't likely to ever have to worry about tablet showrooming - but who knows what the future may bring?

Posted on March 15th 2014 at 03:28pm by James
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Thursday 13th March 2014 2014 Online Retail Estimates for the UK

The dramatically rising online retail numbers from countries all around the world are setting the online world afire lately.  From Brazil to China and everywhere in between, developing economies are driving massive growth numbers that have investors salivating and business owners eager to expand. Perhaps surprisingly to some, back here on the home front, e-commerce markets are also still growing quite well. The percentage increases aren't quite as staggering as those posted abroad, but the e-commerce market is also quite a bit more mature, which inevitably leads to slightly lower gains year to year.
 
RetailMeNot, one of the largest providers of digital coupons, commissioned a study from industry analysis firm the Centre for Retail Research about the emerging trends for 2014 and 2015, and the numbers were very respectable. Across the European Union, e-commerce sales growth is vastly outperforming brick and mortar sales growth, racing ahead at a rate nearly 12 times that of their physical counterparts. In the UK, that differential isn't quite as high, with online sales growth for 2014 projected at 15.8%, compared to a paltry 2.4% for offline sales. Customers are forecast to spend over £1,000 each in online sales this year, bringing the size of the UK online retail market to over £45 billion.
 
The truly encouraging thing for retailers, however, can be found in the study's forecasts for 2015. Not because there is a sudden unexpected upswing in the UK sales growth percentage, but rather because it is forecast to hold relatively steady, even increasing by a tiny fraction to 16%. This is a testament to the maturity of the market, and the continued confidence that customers are displaying in transitioning towards online shopping.

These numbers may not seem like much when compared to the massive growth figures put out by huge markets like China and India, which are experiencing nearly unprecedented expansions often as high as 50% year to year, but when compared to the current economic juggernaut that is the United States of America, it all comes into perspective - US e-commerce market is only expected to grow by 13% in 2015. While all eyes are on the BRIC for rapid expansion, it remains to be seen whether or not the shakiness of such dramatic expansion will be able to withstand the rigors of a globalized market. It's almost inevitable that there will be some major issues to be tackled by online retailers who pin all their hopes on these markets, issues that have already been dealt with in more mature markets.

Posted on March 13th 2014 at 03:24pm by Ade
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Labels: , e-commerce, eu, growth, markets, uk

Thursday 06th March 2014 Are Online Retailers Going the Wrong Way with Returns?

One of the most interesting things to watch as the e-commerce revolution begins to come home to roost is how the various companies involved cope with and adapt to issues that many brick and mortar retailers don't have to deal with. The primary problem, of course, with buying something online is actually getting the product into the hands of the customer. When e-commerce was just starting to take off, this was a frequently dodgy process, and was a leading cause of customer dissatisfaction. As retailers are beginning to discover, the problem of logistics has now begun to manifest in a different direction, as industries such as clothing and fashion accessories that were initially unable to find a foothold online are becoming more popular: the dreaded return policy.
 
As these industries broke into the e-commerce arena, one of the marketing tactics that most effectively swayed hesitant customers into a purchase was the prospect of easy and hassle-free returns. Customers embraced the idea, and for a while all was well - until online retailers discovered that a huge number of their customers were taking advantage of the policy to use their own living rooms as change rooms to model their purchases and then returning a huge portion of them, all on the company's dime.
 
Complaining that these chronic returners were costing the industry billions of dollars every year, various strategies were floated to combat the problem, but of course they were all rooted in big data, the wealth of customer information available to online retailers. Some retailers began to only include free shipping on certain products which are less likely to be returned, and some were simply revoking free shipping for customers who returned too often, and some have floated the idea of restocking fees on returned items to cover the cost of returns.

But like most solutions involving customers, it's a better choice to reward the actions that you want them to take rather than adopting punitive measures against the customers who abuse store policies. Instead of revoking access to the juicy deals and helpful policies and risk driving away customers or creating negative perceptions, it's better to adopt new strategies to reward customers with low return rates, or at least those with a desirable purchase-to-return ratio. After all, if a customer returns 10 things but buys 50, the costs of processing the 10 returns pale in comparison to the profit generated overall. Big data, that most fantastic tool of the online retail world, tends to offer the answer in the online world - the challenge lies in combining its findings with more conventional marketing wisdom.

Posted on March 06th 2014 at 05:56pm by James
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Monday 03rd March 2014 Russian Competition for Amazon Unfazed

In the discussions we've been having recently about the BRIC economic bloc and its incredible rise through the ranks of global e-commerce, we've yet to mention the 'R' - Russia. Russia's economy hasn't been immune to the global financial calamities of the last 5 or 6 years, and their economy is still in a general slowdown phase, but in spite of that, online shopping increased by an impressive 26% last year, reaching a respectable $14 billion US dollars - 510 billion rubles. The truly incredible thing, however, is that the Moscow-based e-commerce analysis firm Data Insight projects that figure may double in size by next year, which beats most other growth figures hands down (with the possible exception of China).
 
Leading the charge of this trend towards e-commerce and online retail is an retail giant completely unknown in the West named Ulmart. Originally making its name as an online computer parts and consumer electronics retailer, it has recently dramatically expanded its offerings into most other sectors of the home-oriented market, including appliances, textiles and general purpose hardware and tools.
 
However, this burgeoning market is naturally attracting the same sort of speculative interest from the current world giants Amazon, eBay and Alibaba, who have a considering competitive advantage in the marketplace - or so it may initial seem. The chairman of Ulmart, Dmitry Kostygin, is completely unworried by the prospect of competition with Amazon, saying "In this market, Amazon has no chance." He may well be on to something, considering that the majority of Russians still tend to want to pay for things in cash instead of relying on credit cards - the number of fraud schemes in the West that originate in Russia and Eastern Europe may have contributed to this wariness.
 
This highlights the strength of the Ulmart distribution model, which has already implemented from the ground up a number of features that Amazon has only recently been exploring. Ulmart operates its own fleet of delivery trucks, for example, which Amazon only started experimenting with in a few limited pilot projects in late 2013. Ulmart also focuses on allowing customers to shop online, but then typically has orders delivered to one of three major urban warehouses, or one of over 250 more locally distributed locations where customers can pick up their purchases in-person, obviating the need for use of a credit card.

It's very difficult to ignore the power of the juggernaut that Amazon's online retail business has become, however, and Amazon may simply be willing to outspend Ulmart for domination of the available marketshare. The
price comparison algorithms that have made Amazon such a success also have yet to be tested against the convenience of the Ulmart distribution model, and Amazon may view Russia as the perfect testing site for their own similarly competing system.

Posted on March 03rd 2014 at 04:55pm by Ade
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Thursday 27th February 2014 UK Retailer John Lewis Pushes Online Shopping Innovation

Most of us see technology and innovation as going hand in hand - but in the retail world, innovation can sometimes be hard to come by, as many companies operating in low-margin sectors often have little time or money expensive development projects that aren't guaranteed to succeed. If there's one thing innovation needs, it's the room to explore and expand, and occasionally to fail, as the safest options are rarely innovative. In the online retail world, we're seeing a number of competing possibilities emerge to solve the current dichotomy between online retail and brick and mortar stores.
 
As the ubiquity of mobile phones starts to blur the line between the digital world and the physical one, many retailers are struggling to create innovative solutions that actually solve problems and create communication opportunities for customers that they'll actually use. Long gone, thankfully, are the days when companies can simply roll out a cheap, hurriedly-developed mobile app and simply expect users to engage meaningfully with it. In order to bring a fresh sense of innovation and inspiration to this dilemma, UK-based department retailer John Lewis is taking the new approach of investing in a brand new project with the goal of fostering new methods of omni-channel integration and general online innovation.
 
The digital workshop, dubbed "JLab", is set to kick off in June in partnership with well-known tech entrepreneur Stuart Marks, and is open to all technology developers who are interested in tackling the project. After the initial development phase ends, the best ideas will be sorted through, and a winner picked to receive an investment of £50,000 from JLab to continue to develop the chosen project. If the final development is a success, the technology will be deployed across John Lewis's 40 stores as as well as it's digital storefronts.
 
JLab is the brainchild of John Lewis's retail director Andrew Murphy, who said of the project, "We know customers value being able to shop with John Lewis by phone, in shops and online and anything which enhances or simplifies that experience is of interest to us." He went on, "What I'm looking for from the successful JLab applicants is deliverable but stretching innovation which offers real benefit for customers in both our bricks and clicks businesses."

It goes without saying that other major players in the online retail sector will be watching JLab closely. If the venture winds up producing successful ideas that can be leveraged to boost sales and customer satisfaction, we'll be sure to see more of this type of technological incubation project in the future.

Posted on February 27th 2014 at 05:16am by James
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Tuesday 25th February 2014 Automating the Logistics Behind Online Retail

Logistics has always been the largest stumbling block when it comes to a smooth online shopping experience. No matter how well crafted a website is, and how minimal its shopping cart abandonment rates are, if the supply chain that actually gets the product into the customer's hands is flawed, the customer is going to come away feeling like the process was flawed on the whole. Increasingly, major online retailers like Amazon, and their growing competition from Google in the online shopping world, are removing as many human links from the logistics supply line as possible.
 
Ever since Amazon pulled a flashy publicity stunt right before Cyber Monday by announcing a long-term plan to employ automated drones as a delivery system, there has been an increased focus on the role of automation in the logistics back end. Robotics, on the whole, generally doesn't have much traction with the average consumer. Consumer robotics are clunky, over-priced and generally not up to scratch when it comes to doing things by hand. However, in a highly controlled and consistently cataloged environment such as a warehouse, seemingly clunky algorithms suddenly blossom into incredibly useful tools for models of efficiency.
 
Nothing highlights this better than Amazon's recent acquisition of Kiva Systems, a manufacturer of industrial robots designed specifically for warehouse conditions. Amazon previously operated as a customer of Kiva Systems, but decided to simply buy the entire company outright for $775 million USD in cash - their second-largest acquisition in the history of the company (second only to the Zappos.com buyout in 2009, at $847 million USD). Kiva's robots are found in the warehouses of other major retailers as well, such as Staples and Saks, but there's no word as to whether or not they're going to have to go elsewhere for their robotics solutions.

There has long been some trepidation among the general workforce about the idea that robots are replacing humans in manufacturing and logistics positions, but it's a simple economic fact that most consumers are going to prefer a product with a lower price - or failing that, companies are going to prefer the highest profit margin - and there's no denying the increase in productivity that automation provides. In the highly competitive world of online retail, every competitive advantage must be implemented in order to stay ahead of a never ending line of competitors hoping to gain market share, and even since long before Henry Ford's assembly line, automation has always been the key to staying ahead of the game.

Posted on February 25th 2014 at 03:35am by James
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Friday 21st February 2014 Indian E-Commerce Ramping Up

They're everywhere in the financial news nowadays - the growing strength of the BRIC economic bloc, the rapidly expanding economies of Brazil, Russia, India and China. China's growth is the stuff of legend, but no more so than in their e-commerce sector. At last, the latest forecasts on the Indian e-commerce sector are starting to show similar gains. Despite the fact that the Indian economy is at a bit of a standstill at the moment overall, individual sectors show some astonishing growth potential, and no more so than online retail. As more and more of the country's over 1 billion inhabitants comes online, the consumer appetite for shopping is transitioning at the same time.
 
The latest research and forecasts from Crisil Research Ltd, an industry analysis firm based in Mumbai, has projected growth that rivals the astonishing growth numbers that China has been displaying, estimating that online shopping revenues in India could triple over the next three years to over $8 billion USD. Since 2007, e-commerce revenues have been growing at an average rate of 56% each year, and there's no reason to expect that to slow any time soon.
 
Current estimates place the number of internet connected citizens at around 200 million, and consulting firm McKinsey & Co. estimates that number is set to rise sharply to nearly 500 million in by the year 2015. This surge in connected citizens and its corresponding e-commerce potential has attracted a number of companies to the growing sector, both from within India and without. Jabong.com, one of the largest e-commerce general retailers in India, recently raised $100 million USD in equity funding from a private equity group backed by the government of the United Kingdom, CDC Group PLC, which explores growth potential in emerging markets such as those found in the BRIC.
 
These incredible numbers haven't been ignored by the major players in the global e-commerce industry, with retail giant Amazon launching it's first foray into the Indian market in June of 2013. Expect to see sudden expansions from other major companies in the coming months as well, as large online retailers around the globe start embracing the global potentials of high degrees of connectivity and ease of shipping across long distances. Amazon may be the first to test the e-commerce waters in India, but Chinese rival Alibaba.com are doubtless already planning strategies to leverage the same burgeoning markets.

Posted on February 21st 2014 at 02:18am by Ade
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