FINANCE

IBM: Mobile drives growth in August online sales

BY Dan Berthiaume

Armonk, N.Y. — Online U.S. retail sales for August 2014 were up more than 11% as compared to the same period the prior year. According to new IBM Digital Analytics Benchmark data, mobile traffic accounted for 41.5% of all online traffic, up 34% compared to the same period the previous year.

Mobile sales saw strong growth, up nearly 39%, reaching 7.8% of all online sales. Smartphones drove 27% of all online traffic compared to tablets at 13.8%, making the smartphone the browsing device of choice. When it comes to making the sale, tablets drove 11.5% of all online sales while smartphones accounted for nearly half of that at 6.2%. Tablet users also averaged $110.93 per order, more than smartphone users, who averaged $95.65 per order.

As a percentage of total online sales, iOS was more than four-times higher than Android, driving 14.2% compared to 3.5% for Android. On average, iOS users spent $108.81 per order compared to $77.66 for Android users, a difference of 40%. iOS also led as a component of overall traffic with 27.4% compared to 13.7% for Android.

Looking at socially influenced sales, IBM found that Shoppers referred from Facebook averaged $113.20 per order, compared to Pinterest referrals, which drove $142.76 per order. However, Facebook referrals converted sales at a rate more than three times that of Pinterest referrals, perhaps indicating stronger confidence in network recommendations.

Supporting these overall trends, the IBM Digital Analytics Benchmark also reported trends across three of the hottest retail categories for back-to-school purchases. With shoppers stocking up on new fall clothing and back-to-school supplies, the department stores, office supply and electronics and apparel categories all saw boosts in sales in August:

1. Department Stores: August total online sales grew by more than 16% from the same period last year, with mobile sales growing by 24% year-over-year.

2. Office Supply/Electronics: August total online sales grew by more than 3% from the same period the prior year, with mobile sales growing by nearly 32%.

3. Apparel: August total online sales grew by more than 17% from the same period the previous year, with mobile sales growing by 31% year-over-year.

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MARKETING/SOCIAL MEDIA

Study: Only 5% of Americans have made purchase on a social media site

BY Marianne Wilson

New York — With U.S. social commerce sales expected to reach $14 billion by 2015 and social networks like Twitter and Facebook ramping up their commerce capabilities, a survey by global marketing and technology agency DigitasLBi, and conducted online by Harris Poll, shows that while only 5% of Americans have made a purchase on a social media site, 20% would consider doing so.

"Our study reveals tremendous untapped potential for growth in social commerce, especially among younger consumers," says Tony Weisman, CEO, DigitasLBi North America. "The 5% of Americans who have made a purchase on a social media site equates to around $14 billion in online retail revenue. If we can reach 20%, that figure scales to $56 billion. To activate that potential, brands and social networks need to provide social shopping experiences that meet the needs of consumers, including security around financial data, privacy, and a seamless buying process."

The survey reveals would make social media users more likely to make a purchase on a social network:

• Knowing their credit card information was secure (42%).

• Knowing their purchase wouldn’t be shared (38%).

• A total purchase price under $25 (33%).

• A "click to buy" feature that would allow users to complete their transaction without leaving the social network (26%).

• The ability to save payment information within the site, so users wouldn’t have to reenter it each time they make a purchase (24%).

When looking at who has made purchases on social media, the 2014 study shows that age and region play a role:

• Those ages 18-34 are more than three times as likely as those ages 35 or older to have made a purchase on a social media site (11% vs. 3%, respectively).

• Nearly one-in-10 parents with a child under age 18 has made a purchase on a social media site (9%).

• Those in the South are more likely than those in the Northeast to consider making a purchase on a social media site (24% vs. 15%).

• Over a third (35%) of social media users would use a hashtag when purchasing on a social media site if it offered a discount on a purchase.

Among social media users, a strong majority (85%) still report they would rather make purchases from an online retailer (e.g., Amazon.com, Walmart.com) where sharing is not a central function of the site. Despite these findings, a deeper look reveals that those ages 18-44 (33%) are more than twice as likely as those ages 45 or older (18%) to say they would consider making a purchase on a social network.

Additional results from the study include:

• 79% of Americans use social media.

• Women are more likely to be social media users than men (84% vs. 75%, respectively); that figure rises to 91% for those ages 18-34.

• Women are more likely than men to use social media on a daily basis (58% vs. 39%).

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FINANCE

eMarketer: Back-to-school drives $50 billion in summer e-commerce sales

BY Dan Berthiaume

New York – Shoppers spent $50.17 billion online during the 2014 back-to-school shopping season, which represents a 16% gain from $43.26 billion in the year-ago period, according to eMarketer. Online commerce during the months of July and August — the main months for back-to-school shopping — accounted for approximately one-sixth of retail ecommerce sales for the year, according to eMarketer estimates, as well as 70.5% of retail ecommerce sales in third quarter 2014.

Combined with the holiday shopping season, which in past years has accounted for nearly 25% of the year’s retail ecommerce sales, eMarketer estimates, these two nationwide shopping sprees will provide a much-needed boost to U.S. retailers, totaling more than 40% of the year’s ecommerce sales during just one-third of the calendar months.

In the core product categories most commonly purchased for back-to-school, including apparel and accessories, books/music/video, computers and consumer electronics, office equipment and supplies, and toy and hobby purchases, EMarketer estimates a 16.5% increase in retail ecommerce sales to $27.38 billion from $23.51 billion in 2013.

Some of the fastest-growing US-based e-commerce retailers in apparel, electronics, discount retailers and department stores also benefit from back-to-school sales. For example, stores like Wal-Mart and Target that sell products across the board for back-to-school have seen well over 20% growth in ecommerce revenues during the trailing 12 months, while electronics stores like Best Buy and Hhgregg, as well as mass-market department stores such as Belk, Macy’s and J.C. Penney, are also increasing their e-commerce revenues at a healthy clip year-over-year.

Apple is by far the most productive among core back-to-school product category retailers, selling on average $4,472 worth of merchandise per square foot in the past 12 months, according to EMarketer. However, Lululemon Athletica came in second by this metric, with sales per square foot significantly lower (but still significant) at $1,778, while membership warehouses PriceSmart and Costco were the only other two companies in these categories to clear an average of $1,000 in sales per square foot across their portfolios in the past 12 months.

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