Just in case you’ve been in a cave for the past two months, the festive shopping season is now almost here with the UK’s first big seasonal spike in online shopping fast approaching. So-called Cyber Monday traditionally falls on the first Monday of December.
And this year’s online landmark lands on December3.
Retailers are in absolutely no doubt about its value. Last year, the day’s total online sales were estimated at nearly £500 million, with a notable peak between 1pm and 2pm as office-bound internet shoppers logged on. In fact Amazon’s sales alone were reported to have topped 3 million items on Cyber Monday – 5 December 2011, while December as a whole proved to be a bumper time for the online retailers after an estimated £8 billion was spent on line during the final four weeks of the year.
The broad consensus among retailers is that confidence is returning to online sales following the distractions of our sports-mad summer, which saw e-commerce gather momentum ahead of Christmas after £6.4 billion was spent online during September 2012 – marking a year-on-year growth of 16%. As a result, retail analysts now predict a 15% growth forecast for Q4.
But it’s also a very competitive marketplace and online retailers will be under enormous pressure to ensure their sites perform.
On the one hand they will be mindful that fraudsters will look to exploit any openings they can. Consider the impact of just a five per cent loss of revenue – around one in 20 transactions – to fraud and cost of losses start to mount up.
At the same time more visits are being made to retail websites every year – but the average visit time per visit is actually falling. Compared to Christmas 2010, last year people spent an average of 41 seconds less per retail visit.
It reflects another trend with savvy-online shoppers quickly and more frequently switching between different retail websites. As average time onsite decreases, it’s clear shoppers want the right content in front them – otherwise they simply go elsewhere to buy what they’re after. Online shoppers simply won’t tolerate delays and want as ‘friction-free’ an experience as possible.
Experian research revealed that identity impatience costs UK online retailers nearly £10 billion a year. Online shoppers are willing to spend an average of just four minutes undergoing identity verification and other security checks, before abandoning a transaction. Nearly half of the respondents we spoke to had abandoned an online shopping transaction simply because ID checks were taking too long. And unsurprisingly it’s the web-savvy, younger demographics who are the most impatient.
Investing in fast automated anti-fraud, card validation, document verification, ID verification and risk management systems to ensure that only genuine customers are accepted is clearly worth every penny. The alternative is lightweight, overly stringent checks for low-risk / low-value purchases, which simply turn customers away.
Ensuring online shoppers are safeguarded and cash flow is protected means the virtual tills will be jingling all the way.