With continuing U.S. economic concerns expectations were that eCommerce sales would remain flat or even decrease in 2010. Instead, total U.S eCommerce spending increased by 9 percent from 2009, reaching 227.6 billion last year. So, despite a struggling economy, how can this dramatic rise be explained? Some would hypothesize that the growth can be attributed to a rise in participation and spending in social media, search engine optimization, and search engine marketing.
Much of the growth in eCommerce spending can be attributed to the holiday season and eCommerce’s version of Black Friday, Cyber Monday . The Monday after Thanksgiving accounted for over one billion spent in online shopping, the highest online shopping day of the year. Combined, online shoppers spent 32.6 billion in November and December, a growth of 12 percent from the previous year . Shopping sites used search marketing and social media to promote their unique Cyber Monday deals (typically free shipping) and drive record traffic numbers to countless eCommerce sites .
Social Media's Role
Staggering Facebook numbers are a major factor in many businesses turning to the social network to connect with potential customers. The U.S. audience of Facebook grew to 153.9 million users when last note in Decemeber, an 38 percent increase from the same date in 2009 . With increased adoption of social media, eCommerce companies were able to promote their products and deals to consumers on a frequent who opted-in to hearing from them. Additionally, user’s easy ability to share this information with their networks put these messages in front of even more interested consumers. Look for eCommerce integration with social networks, most notably Amazon’s recent announcement that users can connect their Facebook account to their Amazon account , to create an even bigger splash in social media related purchases.
Beyond using social media outlets to promote eCommerce store offerings many business ramped up their online advertising efforts to bring more visitors to their websites. eCommerce giant, eBay, had the 5 th highest amount of display ads among all advertises with just under 39 million in 2010 . Search engines provided stores an even bigger opportunity to get found in 2010 as the core search market grew 12 percent with a 4 percent increase in unique search engine users .
A Focus on Search
Search engines provide smaller eCommerce stores their biggest opportunity to draw in prospective shoppers. With an increased understanding that blogging and long-tail focused keyword strategies can bring in very qualified visitors from searches that more directly match their product offerings. By ditching manufacturers descriptions and labeling of products smaller eCommerce websites can avoid being engulfed by giants like eBay and Amazon by competing on longer, more specific keyword phrases i.e. “white clay court tennis shoes” as opposed to “tennis shoes”.
Furthermore, eCommerce websites can frequently collect visitor data from non-transactional shoppers by promoting their various deals and discounts to take advantage of later. By collecting email address and other relevant information from visitors, eCommerce websites can use email marketing to reach out to potential customers and provide them direct access to their site and even specific product pages once they’re ready to buy.
By implementing inbound marketing tactics small to mid-sized eCommerce companies can attract more qualified visitors to their websites and increase sales. Learn more about how your eCommerce store can benefit from investing in inbound marketing through our “eCommerce and Inbound Marketing Webinar” .
All data from this article can be found in comScore’s report “2010 U.S. Digital Year in Review” .
Photo credit: sync
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Horace Moning 11:09 PM on February 14, 2011
Hi i need information on getting customers.
Paul 6:01 PM on February 15, 2011
Lies, damn lies, and statistics. This article is very far-fetched in attributing the increase in ecommerce sales to inbound marketing (much as I'm a believer in the merits of this tactic) and/or social media.
If I only compared the 38% increase in people using Facebook to the 12% increase in shopping, I'd have to say that online shopping isn't keeping pace with the growth rates in social media. And what about Twitter – the number of Twitter users more than doubled in 2010. If social media is driving more buyers to spend money, how do you explain that? But if I then claimed that social media was failing to deliver shopping results because online shopping growth was 26% less than the growth of Facebook, I'd be just as guilty of drawing false conclusions as you are.
The fact is 12% growth in online sales, while welcome, is rather anemic, especially when compared with the halcyon days before the economic crisis in 2007, when online sales routinely grew by 25% or more annually, and is simply a reflection of natural organic growth in the channel. After an 8% drop in 2008, and recovery to 2007 total sales levels in 2009, 2010 is the first year of real (online sales) growth in 3 years. If online retail had only continued at 2007’s 18.6% growth rate (which at the time was the lowest-ever increase) over the last 3 years, we’d be 36% ahead of where we are now. Not that impressive when the numbers are presented in context.
The Comscore figures you report are more illustrative of the trend away from shopping in person at Christmas. Proof? The Office for National Statistics (Census Bureau) says that overall, there was no change in the total retail sales volumes year over year for December 2010, and that there was a .8% drop between November and December. In other words, total retail sales for the Christmas season fell and did not keep pace with inflation. Which means that the 12% increase can be accounted for entirely by people switching channels from offline to online, but since inflation must be accounted for, the reality is that overall, retail was lower in 2010 than 2009.
So, let’s not give credit to inbound marketing where it isn’t due. Especially when you have a great (and true) story to tell. What social media and inbound marketing does do is influence which sites get visited. They create preference and loyalty, and by creating higher ranking in search, attract more traffic. These tools can also provide incentives and conversion offers to the consumer to shop here now. In other words, because inbound marketing is an "intent-driven" tool, like search, it will have only minimal impact on the overall trend of increased online shopping. But it will have significant impact on which sites the consumer visits and where they spend their money.
Said differently, inbound marketing's effect is micro-economic, not macro-economic. The things that influence more shopping online include:
- trend away from offline shopping
- increasing availability of broadband connections in mass market
- increased comfort with safety of online shopping
- increased perception that there is lack of time to shop, especially at Christmas
- deals offered online vs offline
- health of the overall economy
And, inbound marketing is about capturing the maximum market share, not about increasing the total pie size.