Comparison Shopping, Mobile Shopping, Online 2007 Holiday Sales, and The Bright Future For ECommerce and MCommerce Online Merchants

Some thoughts for you all as I ponder the holiday season and 2008.  Grab a cup of coffee, or better yet a nice glass of Shiraz, and I hope the following commentary helps. :-)

Many online retailers have asked the eTaildTail community and me, if shopping online is here to stay? Is it growing? Should they make an investment for 2008 to use shopping comparison sites, mobile commerce sites (such as mPoria.com, mShopper.com and iSave.com), marketplaces (such as Amazon.com, Shop.com, JellyFish.com, and Underbid.com), coupon sites (such as MyCoupons.com and CouponMountain.com), review sites (such as PowerReviews.com, Buzzillions.com) and other unqiue marketing channels?

I am bullish about online commerce and mobile commerce because I look into the future and observe the behaviour patterns of young people and people in other countries.  So I say a categorical "yes" to all of the above questions for a myriad of reasons. But here are my two main reasons:

1. Any online merchant can afford to use marketing channels to grow online sales for as little as $500 per month. What is even better is that these marketing campaigns come with no long-term contracts locking you in -- so you can stop whenvever you want, i.e. how can you not afford to try it?

2. As I travel the world and the USA, non-US folks and young people have shown me that online and mobile shopping are not only here to stay, but with the advent of better devices, navigational methods to shop, and new technologies, ecommerce and mcommerce will continue to grow...and grow big. The main reasons are:

1. need for instant gratification/stimulation by the "next generations"

2. expectation to be able to do anything you want, when you want and not be constrained by technology

3. the rest of the world shops using ecommerce and mcommerce at a steadily increasing rate = the USA will catch up as we are usally followers in adoption of new technologies

4. new devices and technologies are making shopping online as fun as walking into a store, and maybe more so, as a consumer can now get reviews, advice, buy products as a group to lower prices (see www.GroupGain.com) and comparison shop at a touch of a button without being pestered by a salesperson in a store

5. credit card security issues are being addressed better and better each year and, when fraud happens, the credit card companies are better at refunding the consumer and staying ahead of the fraud and....

6. Google is getting into mobile and ecommerce to help grow their core business of online advertising.

Many folks have asked me why the Wall Street analysts are not as bullish on online commerce and mobile commerce as I am.  First off, may I remind folks that just a year ago, while I was at Shop.org in New York City, Wall Street analysts categorically stated that online shopping growth would continue to grow between 9-15% per year and then level off in 2013.  Let me state for the record that I did not agree with them, and they were wrong, and I do not agree with their less than bullish estimates now.  Online shopping for 2007 is up over 22% from 2006, with some estimates stating that overall it will be up 30% from 2006 -- and this is with us all being worried about a recession.  So why were these analysts so wrong?  Some reasons may include:

1. conflict of interest = they represent, as analysts, more traditional brick and mortar businesses who are often slow to catch on to online commerce, so any reports they can come out with that shows slow online sales growth might keep people in the brick and mortar store and offline, so these businesses have time to catch up with the smaller player. And frankly they don't have access to smaller retailers' data and sales growth as I do (okay that is the negative viewpoint)

2. they underestimated the power of new technologies (iPhone, new fun navigational online shopping methods, the power of reviews, and online communication with friends to buy products)

3. they underestimated how our youth use their computer and mobile devices

4. they underestimated the results of rising gas prices and the effect of terrorism on the mental state of our population.  Save gas money and don't risk being bombed at the mall = stay at home and shop online and finally....

5. they underestimated power of Google to move markets.

Regardless of the reasons for the low ball "expert" Wall Street estimates, we are all witnessing and are involved in a booming industry.

It is fun to be a thought leader, with all of you, on what we can collectively do to make online and mobile shopping more fun, interactive and easy for consumers.  When we collectively come together and better understand how we can all make the consumer experience with online shopping and mobile shopping fun, easy, and cost effective, our industry will continue to grow. Period. 

So continue to be creative in how we communicate wth the consumer and have fun with them!

I leave you with some great early news on trends from four of the largest established online shopping sites. I believe these early indicators show that the online holiday season will be a good one for everyone.

"The comparison shopping site Yahoo! Shopping reported a 50% increase in page views over the weekend compared with last year."

"PriceGrabber.com(R), a part ofExperian, today announced that the shopping comparison site saw a 56% increase in traffic it sent to merchants year over year with more than 1 million referrals to merchants on Cyber Monday. Overall holiday weekend statistics from Black Friday through Cyber Monday were up 46 percent year over year on PriceGrabber.com.

'Cyber Monday was the biggest traffic day yet this holiday season," said Ron LaPierre, president of PriceGrabber.com. "We expect the peak for online shopping still to come, with a strong surge in consumer visits and merchant referrals on the first two Mondays in December.'

Holiday shopping wasn't confined to the malls, as consumers went online to make many purchases. Sales for November 26 -- dubbed Cyber Monday, when retailers offer online deals to attract consumers shopping from work -- jumped to $700 million, a 15 percent increase and a record, according to comScore.

According to a recent survey from PriceGrabber.com of 1,959 shoppers, 61 percent of online shoppers expect to shop and buy more online this year than last year."

  "EBay was buzzing throughout the opening holiday weekend.  According to Nielson/NetRatings, eBay (nasdaq: EBAY - news - people ) was the most visited e-commerce site on the Friday after Thanksgiving for the second year in row, a day that typically accounts for 10% of holiday shopping. The firm saw 5.4 million unique visitors in that one day causing investors to flock to buy its shares. Following close behind was Interactive Corp with 5.3 million visitors, Amazon.com (nasdaq: AMZN - news - people ) with 3.3 million and Wal-Mart Stores (nyse: WMT - news - people ) with 1.4 million visitors to its site.

The company's subsidiaries PayPal and Shopping.com saw stellar success over Thanksgiving weekend as well. Last Friday, PayPal showed a 33.0% increase from 2006 in online payment value."

"Shopping.com's traffic climbed 28% on Monday, versus the same day in 2006, as more shoppers sought to compare prices to find the best deals. Traffic through the holiday weekend, Friday through Monday, was up 30.0% year-over-year."

So do think you should be using shopping destination sites for 2008?  I do.

-- Chip

PS And if you need any help understanding what marketing channels are available to you, stop by MerchantAdvantage to get some advice.