Mobility and customer experience will determine the e-commerce trends in 2012

Munich, January 30, 2012 - Few markets can match the speed of growth and the excitement of the e-commerce sector. All forecasts indicate that the boom will continue unchecked over the coming years and the EU is even expecting the current volume of online sales in Europe to double by 2015. But online retailers still have a lot to do still between now and then. Experts from business and IT solution provider SHS VIVEON AG have helped shine a light on which topics are on the agenda for 2012.

"The developments in e-commerce have primarily been driven by both technical leaps and growing customer expectations" explained Dr Matthias Meyer, senior manager and Head of Customer & Business Analytics at SHS VIVEON AG. "Many shops have additionally grown very quickly in the last year. As a result, a whole new set of challenges awaits online retailers in 2012, such as how to process data volumes that have grown exponentially alongside the growth of the business."

Overall, the developments can be summarized as five core trends:

1. Anytime, anywhere – mobile shopping continues to develop.

Over the past year, smartphones have become a significant purchasing tool with almost half of all smartphone owners already making regular mobile purchases. Because of this, many retailers have already geared themselves up for the medium by adapting their shops for smartphone usability and developing convenient apps. Typically mobile services such as location-based marketing have not as yet become mainstream offerings. However the number of Facebook Places and Foursquare users is growing significantly in German-speaking countries, meaning that companies will soon have to take action if they don't want to be left behind.

2. Right to the heart – using emotions to drive sales

Over the past year, online shops have invested heavily in more emotional forms of expression such as video clips and multi-media or three-dimensional presentations. This trend will continue to grow in 2012 and will result in retailers spending increasing amounts of money on online presentations. Studies have shown that a positive customer experience has a favorable impact on the company's success. This is because an emotional connection between the customer and company lasts much longer and is much more crisis-proof than a purely contractual or technically functional relationship. This means, however, that retailers need to use customers' decision chains to plan and steer their experiences. A prerequisite for this is a profound knowledge of customers' needs and desires as well as a flexible campaign management system allowing the automated implementation of targeted measures. SHS VIVEON's expert Dr Meyer commented in this respect that: "CRM technologies have decidedly come of age in the past few years and offer a range of convenient options for capturing, analyzing and evaluating customer data. There are additional major challenges for this year however, with regard to the real-time availability of the information and the capacity of systems to deal with large data volumes. Businesses that manage, on the basis of the information available, to create an emotional experience for their customers and to implement appropriate customer interfaces, will guarantee themselves a crucial competitive advantage."

3. Individuality matters – and it matters for the entire customer journey.

In recent years, customers have become considerably more demanding and, now more than ever, expect an individually-tailored range of products that meets their needs. As Dr Meyer remarked: "Experience shows that online shops can often be overtaxed by the huge amount of possible information, such as customer click-throughs and ordering behavior, payment experiences and information on creditworthiness. In most cases, too much data – not all of which is relevant – is collected." Above all, fast-growing companies must construct at short notice an efficient, meaningful data management system that is geared to their business model. This is the only way of ensuring that customer approaches, either via campaigns or as part of a conversion marketing strategy, are truly customized as well as efficient. "Considerable skill is involved in reaching each customer via his/her preferred marketing channel; in sending out the appropriate cross-media message at the right time, and in maintaining this continuously for every point of contact the customer has with the firm over the entire customer life cycle", added the SHS VIVEON expert.

4. Limited offers, coupons and deals: special promotions can stimulate business.

Limited sales campaigns led to higher levels of impulse buying in 2011 and 2012 should also see a considerable growth in such tactics. Explicitly limiting sales offers (something that has worked very well in TV shopping for years) enables new, live-shopping customer groups to be accessed. The use of coupons as a sales incentive has also continued to grow in recent years. However, coupons on their own will no longer be enough to stimulate repeat sales to customers. "Low prices on their own do not guarantee loyalty. This is an area where online retailers need to come up with alternative measures for developing and retaining their customers in the long-term. On the whole, all of these measures need to prove in 2012 that they are having a clear impact and are generating a veritable ROI" predicted Dr Matthias Meyer.

5. Building trust

One of the biggest and most important tasks for online retailers is the creation of customer trust. Consumers are still deterred from transacting online due to problems and uncertainties, meaning that a lot of sales potential remains unused. This is because a large number of customers still do not trust electronic commerce and online services. In addition, uncertainties often exist because offers are not transparent or are difficult to compare with each other. "Open, transparent communication with customers, particularly with regard to 'critical issues' such as data protection, terms of payment and the service concept are, and remain essential components of a long-term e-commerce strategy", summarized SHS VIVEON's Head of Customer & Business Analytics.

Business and IT solution provider SHS VIVEON is currently carrying out a study into which factors within the entire online purchasing process influence a firm's sales performance. Director of the study Muna Hassaballah confirmed the trends: "Initial assessments show that shops that are geared towards their customers and have customized measures perform significantly better. This makes it even more important for online retailers to show an interest in the needs of their target groups if they want to maintain a presence in what is an extremely competitive market."