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New research shows online consumers expect more options than what's available today

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Use these key takeaways from the 2014 UPS Pulse of the Online ShopperTM study to increase revenue.

During 2013, consumers turned to e-commerce in record numbers. Online sales were 14 percent higher than the previous year, with a whopping 23 percent year-over-year gain in mobile sales, according to the latest numbers from comScore.

Despite continued e-commerce growth, consumers list several areas as "needing improvement."

Despite continued e-commerce growth, consumers list several areas as "needing improvement," according to the third-annual UPS Pulse of the Online Shopper™ study, conducted by comScore and sponsored by UPS.

"Today's online shopper expects more from retailers, including a positive experience from start to finish," says Bala Ganesh, UPS retail segment marketing director. This new "flex shopper" wants to control the shopping experience and choose channels and devices based on convenience and efficiency.

Ganesh shares critical takeaways for e-tailers, based on the study findings:

1. The path to purchase is no longer linear. Multiple factors influence online buying, ranging from the type of device used to the degree of convenience. For example, 43 percent of online buyers begin prepurchase research at a retailer's site, brick-and-mortar store or direct-mail catalog, while 28 percent use Amazon.com and 19 percent use a search engine.

Despite the growth of mobile e-commerce, desktops and laptops still dominate and are used for 61 percent of prepurchase research and 44 percent of online purchases. "Customers will often use handheld smartphones and tablets for research but go to their desktop to make the actual purchase," Ganesh says.

"Social media is an important ingredient," Ganesh says, "although it is difficult to make a direct link to actual sales." In the study, one-third of all shoppers and 50 percent of Millennials say social media influences their purchases. Notably, when deciding to make an online purchase, 61 percent find reviews and ratings by other consumers most helpful in making a buy/don't buy decision.

2. The future is omnichannel – meaning people expect the ability to shop online and in a store in a seamless way. "Participants in the study were avid online shoppers, but even among them, 53 percent purchase some things in-store, so the store still plays a big role that can be leveraged," Ganesh says.

Some 54 percent of consumers who purchase online have opted to ship to a nearby store for pickup, and of those, 40 percent have purchased additional merchandise while in the store. "People do like the personal touch in-store, the ability to ask questions and actually see the merchandise – that's why stores are still viable," Ganesh says.

Having a purchase shipped to a nearby store or from a nearby store are key aspects of the omnichannel strategy, Ganesh says. "Using physical stores as virtual distribution centers is no longer a novelty – it's become a top-level strategy that cuts inventory and shipping costs and improves customer service."

3. Logistics plays a critical role in a positive customer experience. "Buyers want what they want when they want it," Ganesh says, and being out of stock can be deadly. For example, 62 percent of buyers say they will go to a competitor's website or store to find the same or a similar product.

"The ability to pick, pack and ship across store and distribution centers is important, and the ‘endless aisle' approach comes into play here," Ganesh says. That is the ability to look across all your locations and know exactly what you have on hand to avoid stock-outs.

"Delivery options, convenience and control are key factors in customer satisfaction. More than half of consumers surveyed want to know the exact expected delivery date," Ganesh says, not just a range of days. Eighty percent of consumers say they want both proactive notification about their deliveries and an ability to authorize deliveries beforehand – without having to be home to sign for their packages.

"Retailers can recommend solutions like UPS My Choice® to give buyers greater control, since customers can make changes or redirect a shipment so it's more convenient for them," he says.

Free shipping continues to rank high among online buyers – 93 percent have taken action to qualify for free shipping. Some 58 percent have added to a cart to qualify for free shipping, and 35 percent say that they have opted for "ship to store" to get free shipping.

"Retailers might want to rethink their policy around free shipping and be willing to experiment with raising the cart threshold," Ganesh says. "It's a good tactic to increase the basket size."

For a more in-depth look at the 2014 Pulse of the Online Shopper, download the study.

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