This study presents various managerial implications for practitioners in emerging online social networks, media and commerce platforms. Since the introduction of e- commerce, consumers and retailers have evolved as a result of the development of technology, adjusting one’s lifestyle according to the convenience functions provided. E-commerce has multiple subset platforms that contribute to overall online sales growth, the main streams of which are considered m-commerce and s-commerce. The growth in online retail sales is significant and has yet to reach its peak. In the UK, online sales in 2013, 2014, and 2015 reached £33.4 billion, £37.9 billion and £42.6
173 billion, respectively, each a new record (Mintel report, 2016b). The significance of this growth is supported by the finding that 95% of Internet users have made purchases online, as consumers’ perception is that online shopping is cheaper than shopping in offline stores (Mintel report, 2016b). Online sales in Europe grew by 86% between 2011 and 2015 and areexpected grow continuously. Online sales across the European market are forecast to reach approximately 286 billion Euros in 2021 (Mintel, 2016a). Asia, China and South Korea (PwC, 2016; Statistics of Korea, 2016) have also shown significant growth in online sales, gaining greater shares of total retail sales; thus, the rise of online shopping and e-commerce is universal. As online sales increase, consumers have more options and opportunities to search, compare and contrast products to find suitable ones for their needs and better alternatives or cheaper options of either the same product or suggested alternative products.
Consumers now have a greater freedom of choice from a wide range of selections in the online environment, with no extra switching costs, and better, easy-to-find options for the same product or suitable alternatives. Smart consumers now prefer to read about other consumers’ experiences with the product or service prior to making any purchase decisions. This point is illustrated in Pete Blackshaw’s (2008) book titled, ―Satisfied customers tell three friends, angry customers tell 3,000‖. Some consumers
deliberately seek negative experience reviews because they think these reviews are authentic feedback.
Consumers’ demand for convenience created an ―on-demand‖ economy that operates mainly through online and mobile applications and provides a variety of services, such as private drivers, food delivery, cleaners, handy men and taxi services. Mobile platforms such as Deliveroo, Uber, and Handy attract consumers because they are easy to use and allow consumers to hire people to do jobs for them, from delivering food to cleaning houses and offices (Khakeeli, 2016). These newly established companies are outperforming traditional companies in the service industry. Consumers feel that these new services are easy to use, fast responses are guaranteed, and payment is hassle free, as no cash transactions are made. After using services, consumers are asked to rate their post-purchase experience, which can influence potential consumers, who will not use service providers with bad ratings. Cashless transactions play an important role in mobile applications because they it is a much easier payment option and no hidden charges can be requested from providers, as the
174 application approves all necessary payment.
This study’s empirical results highlight the importance of social media, networks and e-commerce. Consumers are now equipped with knowledge and relatively high bargaining power because they can purchase from various online and offline channels. Consumers are becoming smarter and more price sensitive, only trying on sizes or checking products offline and then purchasing them online, as some retailers have different online and offline systems. Smartphones or tablet PCs can contain an enormous amount of personal data, enabling access to Internet browsing, e-mail accounts, and more complicated and sophisticated online banking. With just one click on a mobile device, userscan search and browse almost any kind of information they seek. At the same time, consumers can multi-task by browsing chatting apps, accessing online social networks, watching and listening to social media news. This study’s results suggest that consumers seek information and knowledge through online environments, such as the online communities in which they participate, trusted forums and/or blogs they follow.
To attract more users, retailers must carefully consider elements such as subjective norms, costs, risks, and enjoyment, which attract individuals, from both the social and the consumer perspectives.
First, the findings of this study can be applied to any online environment anywhere in the world. Online sales are increasing worldwide. Because the online environment offers universal settings, it can be applied to any consumer anywhere on the globe. Despite the evolution of e-commerce and multiple functions that consumers use to search for products, services, and information, consumers’ first priority has proven to be price. Different regions, continents, countries, and even websites within the same country may offer different prices and promotions. Therefore, to maintain and attract potential consumers, managers should be aware of promotions from competitors.
Second, online retailers must aim to secure loyalty among existing consumers and attract potential consumers. As much as price is the primary concern for online shoppers, loyalty schemes generate leverage for managers and retailers by providing benefits to consumers. Separate from promotions, loyalty programs provide member- only promotions, discounts, extra days of discounts, private sales, and, more
175 commonly, the collection of points that can be used as a payment method.
The typical loyalty scheme involves collecting points through a membership card, a number, an application or even through stamps. Most online shoppers participate in some kind of loyalty scheme: a report found that 91% of a global survey sample wasmembers of a loyalty or reward scheme (PwC, 2016). The most popular reason to participate in a loyalty scheme is to receive member-only discounts or offers. However, current loyalty schemes are considered too general and offer benefits that consumers do not appreciate, except reward points. As this study’s findings suggest, managers and retailers should create communities through loyalty schemes and listen and respond to identify what their consumers want and need in order to provide more tailored benefits.
Third, managers and retailers can offer click-and-collect programs to online community members as an extra members-only benefit. In the UK, 83% of online shoppers said that they usually select the cheapest delivery option; hence, as many as 69% of online shoppers use click-and-collect (Mintel, 2016b). Price-sensitive online shoppers’ priority isto save on delivery costs, and some retailers offer free delivery for transactions over a certain amount, such as Nike and Adidas in sporting goods and Waitrose and Ocado in grocery.
Additionally, Amazon offers free delivery options for Prime members. Managers and retailers can improve and match their delivery strategies to achieve higher customer satisfaction, which will encourage re-purchase intention for existing consumers and create positive recognition in the online community, thereby attracting potential consumers.
Finally, many retailers offer ―online only‖ promotions on their mobile applications or websites that provide extra discounts for online purchases. However, some retailers do not accept returns of these purchases to offline stores, charge for delivery or include other complications. The findings of this study suggest that it is important for managers and retailers to achieve consumer satisfaction; satisfied consumers will share their positive post-purchase experience through the online community to encourage potential consumers to purchase. Omnichannel retailing can fulfil the needs of both retailers and consumers. The omnichannel strategy is simply unified prices,
176 promotions and other activities between online and offline retailers. Many major retailers still have separate databases for online and offline purchases, thereby using different strategies throughout a promotional period.
The study by Sopadjieva et al. (2017) published in the Harvard Business Review supports this suggestion: customers who engaged in omnichannel shopping spent an average of 4% more than single-channel customersduring every shopping trip to the offline store and 10% more in an online store(Sopadjieva et al., 2017). Consumers are now demanding innovation from retailers because they prefer to have an omnichannel experience that provides mobile applications or a webpage to compare to traditional stores (PwC, 2016).
Consumers are now using online social networks, media and commerce platforms to share and gain information through smart mobile devices. Mintel (2016a) found that in the UK, 42% of young adults (aged between 16 and 24) access social media or networksonly via their smartphones (Mintel report, 2016a). Therefore, retailers can adjust the benefits of mobile applications, web promotions and offline promotions into a larger coherent strategy that can increase sales, customer loyalty, recognition and profit.
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