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Panel Discussion The Future of Online Retailing
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Panel Discussion The Future of Online Retailing

Consumers are discovering the ease of online shopping thanks to the increasing number of connected devices in the home, growing broadband penetration, and increasingly time-starved households.

With that in mind,  Adam Lashinsky, Senior Editor at Large at Fortune Magazine moderated a panel discussion at Nielsen’s Consumer 360 with Mike Brennan, COO Peapod; Anne Jones, VP, Business Development, Kimberly-Clark and Steve Nave, SVP and GM, Walmart.com.

“For a CPG marketer, it’s a fascinating time because the way the consumer is shopping is so different,” said Anne Jones, Vice President of Business Development for Kimberly-Clark.

Jones identifies three trends in e-commerce that she coins the “digital ecosystem,” which include mobile commerce, social commerce and cloud commerce.

Mobile commerce is growing across all demographics, and most notably, among the Hispanic populations. The industry, which currently represents $2.4 billion annually, gives consumers access to on-demand information, including promotions and coupons.

“Mobile is an accelerator of e-commerce, not a challenger,” said Jones.

“Mobile is an access point because it provides one more arena for consumers to interact with a brand,” said Steve Nave, SVP and GM of Walmart.com.

The conversation around social commerce, which Jones defines as the fusion between social media and e-commerce, was largely dominated by the notion of F-commerce, or “Facebook commerce.” Jones argues that brands who have a lot of Facebook fans maintain a strategic advantage, and it seems the growing consensus is that F-commerce is more than just a fad. Research shows that younger consumers are more likely to engage with a brand on Facebook than a direct website created by the same brand. As Facebook continues to dominate consumer interest, it gives consumers the option to learn about brands and products from friends and family and rely less on retailers directly for information. As such, brands need to be involved and engaged in the conversations taking place and leverage the information garnered from Facebook to better customize the online buying experience for their consumers.

Despite a growing awareness of the importance of platforms like Facebook for e-commerce, Steve Nave points out the need for further understanding of these platforms among brand marketers before full advantage can be taken. “A lot of retailers know they need to have a presence on Facebook and engage with their customers there, but most are still figuring out the best and most effective ways to engage. We still don’t really know how this is going to play out,” he said.

“F-commerce has a unique ability to create intent to purchase among consumers because it gets people excited about brands,” said Mike Brennan, COO of Peapod.

Amidst a conversation dominated by trends in e-commerce and the growing influence of online commerce, the importance of traditional brick-and-mortar retail was echoed on numerous occasions. Jones reminded brand marketers that Facebook and other e-commerce platforms are channels that markers need to consider, but as brick-and-mortar retailers continue to diversify and become multi-channel themselves, brick-and-mortar retailers provide improved and still dominant channels for consumer consumption.

Many online retailers, including Walmart.com, are on a quest to move away from thinking about e-commerce and traditional retail channels separately. Steve Nave coins this concept the “continuous channel,” emphasizing the need to elevate the focus onto the consumer and brand directly and away from the various channels where people shop. “It’s all about letting the customer interact with the brand in the way he or she wants to,” he said.

Online Grocery Shopping

One of the fastest growing areas of e-commerce is grocery shopping online. While a number of companies failed in their attempts to deliver things like fresh produce to consumers in the late 90’s dot com boom/bust, a number of brands, including Peapod, have validated this business model in recent years. Recognizing this, more and more e-tailers, including Walmart, are looking to monetize this trend.

It’s up for debate why online grocery shopping seems to be a promising model today, as opposed to the tribulations witnessed in years past, but it seems consumer acceptance of the notion of buying groceries online – arguably a more intimate shopping experience – is fueling this growth.

Daily Deals & Online Coupons

Daily deal sites and online coupons are arguably the hottest topic in e-commerce these days. Whether or not this is a sustainable business model for the Groupons of the world, a viable long-term marketing tool for brands or simply a fad are all questions yet to be answered.

Anne Jones argues that this is not a fad and she sees sites like Groupon as a natural evolution from personalized daily deals, which have been around for some time, to personalized and localized deals as a result of improved technology.

“Groupon creates a sense of urgency for the consumer and that’s an interesting appeal to marketers,” said Brennan.

Fast Facts:

  • Mobile commerce represents 2.7% of web revenue and $2.4 billion annually
  • Mobile commerce has doubled in size since 2009 alone
  • Moms with young kids are becoming one of the most important demographic drivers of e-commerce, with 20% of purchases from this demo falling coming from diapers and infant care