According to a recent online survey conducted by First Data Corp-ICICI Merchant Service, 65 percent of smart phone owners have used their device to make an online purchase, while a whopping 81 percent regularly use their phones to read online reviews and opinions before making in-store purchases.
With such a rapid increase in the number of consumers worldwide using their mobile devices or social media networks for online shopping, it stands to reason that there’s also a huge demand from retailers for effective e-commerce software that can be used in online, mobile, or social commerce shopping platforms. As such, The Global E-commerce Software market is forecast to grow at a CAGR of 11.73 percent which will bring it to a value of almost US $ 5 billion by 2016. It’s also important to keep in mind that these large figures represent only a fraction of the Global E-Tail Market as a whole, which is sized at approximately US$590 billion.
If vendors in the e-commerce market want to capitalize on this profit potential however, they’re going to have to iron out a few potential problems with their e-tail software first—starting with:
- Security and Privacy
One of the major challenges in the Global E-tail and E-commerce Software markets, is the concern of consumer data security. In the recent past, there have been several cases of identity theft and hacking of personal banking accounts. Obviously news of these incidents has the potential to make would-be users nervous about sharing their personal and financial data over e-commerce platforms—especially the SaaS and cloud based solutions used in mobile e-tailing.
Then, there’s also the wide array of infrastructural barriers to e-tail and e-commerce software implementation especially in SMEs outlined below:
- Technical Barriers
Lack of IT infrastructure including high-speed broadband connection, lack of knowledge on models and methodologies of e-commerce, and lack of full measures for internet security present some major technical barriers to the market.
- Financial Barriers
E-commerce and e-tail software suites have a very high cost of installation and implementation. Yes, these costs are easily offset by the revenue generated by such systems, but the initial capital investment is enough to scare off some SMEs with limited budget flexibility.
- Organizational Barriers
Several enterprises, especially SMEs or family-owned businesses are still deploying traditional retail infrastructure and reluctant to change their methods and adopting something as “new-wave” as today’s e-commerce strategies. And what’s more, even of the businesses who are already embracing the technology, many are apprehensive of taking one step further into the realm of mobile e-tail which limits the growth of the e-commerce software market as a whole.
So, with all these challenges, how are such optimistic forecasts for the Global E-Commerce Software and E-Tail Software Markets possible?
Well firstly, online shopping platforms are already evolving at such a rate that the above concerns become closer and closer to being obsolete every day.
Secondly, when it comes down to it—the key to success for any retail-base business is customer satisfaction. As we’ve already covered, the majority of today’s customers are demanding multi-device friendly options for online purchases leaving retailers with little choice but to either adopt these technologies or risk being left in the dust. We bet that most will opt for the former over the latter, leaving the E-Commerce Software and E-Tail Markets with nowhere to go but up!
For more information, view our 2012-2016 Market Research Report on the Global E-Commerce Software Market.
