Two decades of e-commerce reveals that peer reviews and product recommendations are the industry standard
The US Department of Commerce reports that increasing consumer comfort with shopping online is today a $400bn industry with a recent report by Astound Commerce suggesting that over the past 20 years the online shopping experience has gone from a game of guesswork and order taking to a standardized industry.
The report analyzed two decades of change based on nearly 300 metrics studied across 100 top retailers. The research features trends that grew the most from market entry to today (50% or more growth).
The report suggests that inventory management, customer reviews and personalized product recommendations are today industry benchmarks. Further, with a better understanding of the industry, these benchmarks now see 90% of e-marketers utilizing these techniques on their websites.
“The current e-commerce experience is almost unrecognizable from that of 20 years ago. The e-commerce experience has undergone such a vast transformation as technology has advanced and retailers have made smart digital investments to improve their merchandising and customer service tactics,” said Lauren Freedman, senior vice president of Digital Strategy at Astound Commerce.
The report notes that the haphazard online shopping experiences of 20 years ago have evolved to include simple navigation, detailed product content, and fast delivery. Further, 20 years ago there was little variety on retail websites with views and colors changing only about 12% of the time, compared to 96% today. In the early days, product reviews by consumers were viewed by 32% of potential customers in 2005 but are today seen on 94% of sites, indicating the ever increasing importance of validation from peers. In 2001, the study notes that personalized product and recommendations were at 44% market penetration, while today they are provided on 99% of commerce sites.
Further, many features that were once game changers are now commonplace including alternative payment options like PayPal. When PayPal was first introduced to the survey in 2007 it was featured on less than a quarter (22%) of ecommerce sites. Today, 83% of the top 100 retailers offer PayPal. Additionally, in 1999, the study notes that product inventory was only available on 24% of retail sites while today 95% of retailers offer product availability information.
Notably, product recommendations related to a past purchase were initially offered on only 38% of sites in 2003, but are now offered on 90% of retailer sites, reflecting a larger focus on customer interaction and upselling after the initial purchase.
“With next-generation features such as chatbots, virtual reality, the digitization of brick-and-mortar, and the dominance of disruptors like Amazon and Alibaba we anticipate the commerce experience will continue to change dramatically over the next five years," Freedman said. "We’re excited to keep analyzing this space, and can’t wait to see the next ‘big things’ in the omnichannel customer experience emerge.”