Easy Growth For Online “May Be Over”
by Doug Gollan“The easy growth days for e-commerce may be over,” says a new study of more than 3,300 Americans completed last month.
The sample, evenly split between men and women, included consumers with incomes from $25,000 to $500,000. Undertaken by Boston Consulting Group, the research showed that while 75% of Americans have purchased something from Amazon.com in the past year, growth in online shopping is markedly slowing.
More than twice as many people say they’ll spend less online over the next three years than those who say they’ll spend more—across 41 categories, including food, fine jewelry, watches, cars and packaged goods. Most troubling for online sellers, BCG reported the intention to slowdown online buying was “identical” among Millennials, Gen-Xers and Baby Boomers.
“The findings from this research certainly pour cold water on everyone’s expectations for a continuously rising e-commerce world. E-commerce winners will have to earn new dollars and new spending by providing new value. That means me-too players will suffer—and leaders will need to provide more user-friendly websites, lower prices and offers tailored to individuals customers,” wrote Michael Silverstein, a BCG partner. “Right now, online shopping growth is similar to the growth experienced in the 1970s and 1980s by catalog merchants…but consumers right now are saying, ‘I’m happy with my current options.’ “
Travel is one of the few categories in which consumers said they plan to spend more online over the next three years, driven by “experiential consumption as opposed to products.”
However, numerous travel-specific surveys continue to show that consumers are flocking back to professional travel agents, burned by poor customer service of OTAs, increasingly complex fare rules from suppliers, megaships with more categories and accommodations types, and the desire to have a pro on call during disruptions ranging from terrorism to storms and strikes. An annual survey of Americans who travel by MMGY Global showed growth in demand for retail travel agents for a fifth straight year.
Research by Google last year directed to travel suppliers urged them to make the online experience more user friendly. The study showed it takes consumers 32 visits to 10 different websites to book a simple airline ticket.
