Report: Online sales to reach $508 billion by 2020
West Palm Beach, Fla. — U.S. online retail sales will reach $508 billion by 2020, representing a market share of nearly 14% (or 17%, if food retailing is excluded), compared to expected online sales of $260 billion in 2013. According to a new report from FTI Consulting, this represents a compound annual growth rate (CAGR) of nearly 11% from 2012 through 2020.
FTI Consulting raised its previous online sales forecast by approximately 10% to reflect stronger than anticipated online sales beginning in late 2012. FTI Consulting attributes much of the amplified pace of online sales to the proliferation of tablet computers, which have facilitated online commerce for millions of users.
FTI Consulting analyzed the portion of adjusted General Merchandise, Apparel and Accessories, Furniture and Other Sales ("GAFO") sales that were attributable to the non-store channel, including both online and catalog/call center sales, during the past two decades. The online channel’s increasing influence on holiday shopping began in 2009, when the percentage of GAFO category sales attributable to the non-store channel began to accelerate during the holiday season relative to the rest of the year. This trend has continued unabated for the last three holiday seasons, with year-over-year sales growth in the online channel averaging 17% during the last three holiday seasons.
"The influence of the online channel has increasingly become a central component of the holiday shopping season, and our upward revisions reflect the fact that online sales in 2013 have exceeded our previous expectations," said Steve Coulombe, senior managing director in the corporate finance/restructuring segment and the firm’s retail & consumer products practice. "Tablet-enabled mobile commerce is indisputably responsible for much of this growth. The tablet has been groundbreaking for the retail industry as we know it, knocking down barriers in mobile transacting that the smartphone couldn’t."
Top five brand experience trends for 2014
Boston – The top five brand experience trends for 2014 include retail relevancy and “small data,” according to brand experience agency Jack Morton. The company predicts the following five trends will prove dominant in brand experience during the upcoming year.
1. Relevant Retail: Last year there was a lot of talk about showrooming and other presumably negative consumer behaviors that were seriously troubling to retailers. This year, the brands that are growing are the ones that embrace consumer needs, for example promoting their in-store experience as mobile-friendly. According to research released by Jack Morton in 2013, consumers are looking for differentiated retail experiences, but less than half (46%) think retail brands are doing enough to stand out.
2. The Rise of the CXO: A big opportunity for brands is elevating brand experience within the organizational structure. Jack Morton advises clients to appoint someone to champion excellence in brand experience, whether they’re called a Chief Experience Officer or a Chief Customer Officer, their role is to centralize and lead experience. Elevating experience represents a growth opportunity for brands: according to research by Jack Morton, nine-out-of-10 consumers worldwide say that they choose brands on the basis of experience; six-out-of-10 say they’ll pay more for a brand that offers a better experience.
3. User Experience Writ Large: The user experience trend is reflective of the higher standards that consumers have for brands: almost six-in-10 (57%) consumers surveyed worldwide say they hold brands today to a higher standard, according to agency research conducted in 2013.
4. Owned Media Strategies for Content Marketing: In 2014 brands will invest in owned media strategies that give consumers experiences that create intrigue, fuel conversations and foster engagement. Research indicates that experience fuels consumer word of mouth, still one of the most trusted ways people learn about brands and products.
5. Big Data Gets Small: In 2014, the big opportunity for brands is using information to enhance customer experience, to ‘get small’ with big data. Also relevant are consumers’ shifting allegiances to and behaviors on social platforms, from the growth of Twitter to the decreased value of a "like" evident in 2013 agency research.
"As marketers continue to respond to increasingly empowered customers, a laser focus on brand experience trends is vital to success. We hear all the time from clients that one of their biggest challenges is staying on top of what really matters, separating out signal from noise,” said Josh McCall, chairman and CEO of Jack Morton. “At Jack Morton, we think that the trends that matter have a few things in common: they’re about elevating brand experience thinking, they’re about integrating experience with new technologies and media channels, and they’re about experience fuelling business results, especially at retail."
West Elm opens U.K. store Dec. 5
San Francisco – West Elm is scheduled to open the company’s first U.K. store in London on Dec. 5. The 12,000-sq.-ft. store will feature furniture, textiles, accessories and gifts, as well as a West Elm Market shop-in-shop and coffee shop. The store will employ 30 full- and part-time sales associates.
The London store will include a Local Gallery Wall featuring art from U.K. artists sourced through Etsy, the online marketplace for handmade or vintage items. The wall is curated by Will Taylor of the blog Bright.Bazaar.
"The city of London has such vibrant communities centered around design and innovation. I couldn’t think of a better location for our first West Elm store in Europe," said Jim Brett, president of West Elm. "We are confident the broad assortment, globally-inspired aesthetic and engaging in-store experience of West Elm will appeal to customers in the U.K."