The most influential Megatrends set to shape the world through 2030, identified by Euromonitor International, help businesses better anticipate market developments and lead change for their industries.Learn More
Technological advances continue to alter the way consumers browse and buy all types of products and services. As the global populace becomes more digitally connected, new technology is opening the doors to brands being able to better target their end-consumer and to offer new ways of conducting commerce. There are three trends that will shape the global digital consumer in 2017:
For purchases like travel, which can be more easily researched and purchased for lower prices online, consumers turn to digital channels more often than other categories, according to Euromonitor International’s 2016 Global Consumer Trends Survey. Such service-oriented purchases are helping to propel digital commerce growth and will continue to do so in 2017.
Global consumers in the same survey reported that more service-oriented purchases, including media downloads, online tickets and foodservice online orders, as their most frequent mobile purchases. In particular, the variance between devices used, for a foodservice online order was the narrowest of all categories with 26% of global consumers reporting having made such a purchase on a computer as compared with 20% on a mobile.
Digital has enabled new forms of commerce, including digital streaming services, the sharing economy and subscription services. These services would have not been possible before the widespread adoption of digital devices and will be important drivers to digital commerce expansion.
A decade ago there was scepticism at the idea of selling clothes online. Today apparel is one of the biggest growth stories on the product-based side of the digital commerce universe. Euromonitor International estimates that US$1.3 trillion in goods will be purchased over the internet in 2017, representing 9.6% of all goods sold. Of all product-based digital purchases, the apparel and footwear category will contribute the most in terms of absolute value sales with an estimated $31.4 billion expected to be added in 2017.
Western European and North American consumers are comfortable with the multi-channel strategy by key players and the continual integration of physical and digital operations. As a result, services like click-and-collect, store pick-ups and store returns are the “new normal”. That being said, Asia Pacific with its rising middle-class and mobile-first mindset is a key region driving this category’s digital expansion. While online sales in this category represent only a small percentage of total sales in many Asian nations, about one-fifth of apparel and footwear sales in China and South Korea are now made in digital channels. In particular, China has grown rapidly and sales are now higher than the US.
Although third-party apps like Apple Pay have garnered the proximity mobile payments headlines that does not mean banks plan to sit on the sidelines. Banks have had success with mobile banking, but far fewer offer in-person mobile payments. Not more than three years ago, such a feat would be a long-shot. Like all aspiring providers, banks would have had to negotiate with mobile operators to gain access to the phone’s secure element to execute tap-and-go Near Field Communications payments. That all changed in 2013 with the arrival of Host Card Emulation, a tech that enabled these details to be stored in the cloud.
Banks are well positioned to compete. They know how to send money safely and efficiently and have had success in this mobile-first world. Nearly three-fourths of consumers in Euromonitor’s 2016 Global Consumers Trends Survey reported using a mobile to access a banking service with 39% doing so weekly. As much as consumers have a love-hate relationship with banks, banks have a future in this space. Already there are a handful of banks enabling consumers to pay for in-person purchases with an issuer mobile wallet. More are expected to do so in 2017.