The United States of America is one of the most advanced nations in the world with the largest economy of all. It is a technologically advanced market with a high percentage of internet users and smartphone penetration. This makes the country a perfect place for the growth of the modern way of shopping – e-commerce.
The growth of the smartphone industry and easy access to the internet allowed the American population to explore the corridors of online shopping way before much of the world was even aware of its existence. Being a developed economy, the adoption rate was very fast. Within only a few years, the e-commerce industry was booming.
The rapid growth gave birth to the giants such as Amazon. The Seattle based company was founded in 1994 by Jeff Bezoz. Currently, it is the world’s largest internet based company in terms of revenue. Other major players in the US are Qurate, Wayfair, Newegg, Zappos, Overstock etc.
According to the MarketResearch’s report, Euromonitor International claims that e-commerce is expected to become the largest retailers channel in the world by 2021. Supermarkets, grocery stores, apparel and footwear shops etc. will be small in comparison to the e-commerce players.
The Eastern world has caught up with the Western phenomenon very well since the advent of the internet. In the region of Asia Pacific, countries such as South Korea and China have developed pretty well in the e-commerce industry. South Korea became the first country in the region to top the adoption rate by achieving 13%. Whereas, a region such as Eastern Europe might not reach this position in the next 5 years.
Talking of the US market, the total value of e-commerce in the country is north of $1 trillion according to Absolutenet. In the American e-commerce market, 40% is controlled by the giant, Amazon. The huge market share of such huge market gives them an edge over the other players globally. The US e-commerce market grew at around 16% year on year to reach a valuation of $453.46 billion.
As a whole, the region of North America has around 15% of its retail business through e-commerce platforms whereas this number soars past 23% in China. Other Asian powerhouses such as South Korea Japan, India, Thailand, Malaysia and Singapore are rising rapidly in the adoption rate of e-commerce websites.
Various factors will influence the way e-commerce platforms function in the coming times. New features such as shopping on the go through in-car e-commerce. Cab hailing service providers such as Uber have started providing options to purchase some products especially FMCG goods through their in-car shops/refrigerators. The US has proved to be a breeding ground for such ideas and they will spread out to the global stage soon enough.
It is not just the products and the buyers that have a huge impact; the technology that brings them together also plays a crucial role. Artificial Intelligence and Virtual Reality are some of the new age technologies that are bending the rules and how we perceived e-commerce. Artificial Intelligence is being used by most of the platforms to keep a track of what the users are searching, surfing, liking, sharing and keeping their wishlists or carts. Then, with the help of such huge amounts of data, they target each consumer with personalized strategies to influence them to make a positive decision and lure them into buying the products offered by the company.
In an interview with the Digit.in in India, a new method of marketing was revealed by Amazon India – QR codes marketing. Digit.in is a technology magazine, which often reviews new gadgets in the market such as smartphones and laptops. During one of the interviews, they showed the QR code-based marketing done through their magazines. In the pages where the product reviews were done, the photo of that product was placed beside its name and a QR code. The QR swiftly took the reader to the product page on Amazon.in. This way, the user did not go to other platforms while searching for the device on Google. Amazon, an American e-commerce platform has been applying such techniques to grab hold of a significant market share.
Applications have eased our lives in the 2nd decade of the 21st century. With the advent of smartphones and application stores, applications flooded the marketplace. There is an app for almost every activity in the world and online shopping is no different. The beautifully laid out User interface offered superb user experience and helped the users to go through uncountable products to finally decide the products to purchase.
However, with the development of smartphones and the e-commerce platforms in general, they started to launch heavier applications with added features such as 3D try-on and Augmented Reality product displays. These features were good for the high specs smartphones but the entry-level smartphones and patchy network connections could not handle well. This compelled the users to launch lite apps. This is a lighter version of the original apps that do not have HD pictures or high-end features; instead, they just fulfilled the purpose of showing a product and making the user buy. These are soon going to be taken over by an even newer version known as the Progressive Web Apps or PWAs. These applications are just the doorways to the website. The servers are getting faster by the day and now they can handle users directly instead of on an application. We have seen applications such as RedBus use this technique. This method reduces the space taken by an app and makes the process of surfing easier and smoother.
The US market is rapidly adopting the innovations as their customers are pouring their money on online platforms. The amount of $453 billion spent on e-commerce in the US shows the people’s eager interest to spend online. With the high amount of purchases, the returns have increased significantly as well. These have concerned the retailers and have forced to take measures such as banning the serial returners or charging the customer for the logistics and tax.
All in all, the digital way to shop have emerged well in the past decade. People are now confident to shop online, pay online and also return if not satisfied with the order only to purchase again. The US market specifically has been growing rapidly with new technologies coming to the market more often than not. Products are coming in from all over the world through their cross-border e-commerce channels as well. The market will be growing even further in the coming years. Newer players will be battling it hard to reach the top making it difficult for the existing leaders to hold their positions.