Contents in this Page
Introduction
Changing the Behaviour of Customers about Purchasing has been analysed in this report. Ecommerce refers to the process of purchasing or selling goods and amenities through the internet, including the transfer of money and information in order to operate the transactions (VanHoose, 2011). The demand for eCommerce has increased, and it is expected to increase more in the coming years. In this report, the facts, figures, trends, forecast, why the eCommerce boom in the UK and the challenges eCommerce face in the country has been evaluated. Research methodology has been also added to the report to prove the validity of the research that has been conducted to make this report. The reasons for creating this report have been also demonstrated in the last part of the report.
The report is based on the form “Creating a performance and reporting how and why you created it”
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Facts and figures of online shopping in the UK:
The UK is the third-largest e-commerce market in the world and the largest eCommerce in Europe (Statista, 2020). UK eCommerce accounts for a 16.5% share of the entire business turnover of the country (Statista, 2020). The country attained revenue of a total of 200 billion euros in 2019 from the e-commerce sector (Growcode, 2019). The eCommerce sector contributes 7.94% of the total GDP of the country, which refers to the outstanding contribution of eCommerce to the country’s economy (Growcode, 2019). UK people prefer online shopping as an alternative to shopping from physical stores. People are becoming more online shopping freak day by day in the UK because it saves time which could be wasted on going to stores. 38% of UK people do online shopping at least once a week, which is more than the people in the US, Australia, Germany and Sweden (Internet Retailing, 2019). It is estimated that about 93% of internet users will do online shopping by 2021 (Statista, 2020). The biggest online shops in the UK are Amazon UK, eBay UK, Asos, Argos, Asda, Tesco, Marks & Spencer, John Lewis etcetera. Among all the online shops, Amazon UK is the highest seller with 31% eCommerce sales and has monthly visitors of about 444.5 million (Growcode, 2019). The average conversation rate of UK eCommerce websites is 1.88%, which is a higher conversation rate than Asian and South American markets (Growcode, 2019).
Trends and forecast of e-commerce in the UK:
Using different kinds of technology in online shopping has become a key trend of e-commerce in the UK. A survey on customers has been conducted to find out the most used technology trend of online shopping, and it is found that 34% of customers do online shopping through smartphone, 12% make shopping through home assistant and 11% purchase through smart watches (Internet Retailing, 2019). It seems that people shop through mobile the most, and the percentage of eCommerce sales through mobiles is 58.9% which is forecasted to grow to about 71.2% within 2023 (Growcode, 2019). Therefore, all brands in the UK make sure that they have a durable presence in web content and be more responsive. Another technology trend in UK e-commerce is using virtual reality, which makes customers’ purchasing decisions easier (UNLEASHED, 2018). For example, one customer can virtually color their home through this technology and it helps them to finalize their order to the home paint service provider. Paying by Debit and Credit Bank card is another key trend of UK and 52% shoppers pay through these cards (Growcode, 2019).
It is forecast that online shopping will make its share more than double of the retail market by 2028 because everyone among 10 people will shop online in the coming years (The Guardian, 2019). It refers to the vast opportunity for UK eCommerce in the coming years.
Why e-commerce boom in the UK:
Key reasons for the UK eCommerce boom have been evaluated below:
Greater delivery options: One of the key reasons for the UK eCommerce boom is the generous delivery options provided by online shops (Iddris, 2012). Customers can choose suitable delivery options from the available and it attracts more customers toward online shopping. They can choose heavily discounted delivery, free delivery on particular days, handover delivery and same-day delivery. As a result, customers are satisfied with different delivery options and make more purchases.
Using proper technology: Online shops in the UK use proper technologies to increase sales such as virtual reality, artificial intelligence, sales through smartphone apps and smartwatch devices etcetera (Alqahtani, Al‐Badi, and Mayhew, 2012). All these technologies enhance customers’ purchase experience, boost e-commerce in the UK and make customers weaker toward eCommerce.
Hiring the right people: Online companies appoint eligible IT specialists who are capable of boosting sales through implementing online logistics (Lawrence, and Tar, 2010). These specialists utilize their talent and experience that fosters the growth of UK eCommerce.
Greater variety: UK eCommerce have a greater variety of products which fulfils most of the demands of people in their daily life which is one of the key reason for the UK eCommerce boom (Yaseen, Dingley, K. and Adams, 2016). They can purchase beauty products, sports goods, home accessories, furniture, footwear, clothes and many things online with every price range and quality. Therefore, customers do not need to go out in order to purchase the things they need regular.
Challenges of eCommerce in the UK:
The challenges UK ecommerce faces are demonstrated below:
Achieving customers’ trust: Though 38% of customers make at least one online shopping in a week there are many customers who worry before making an online purchase (Internet Retailing, 2019). Online security is strict in the UK, but fraud online selling has increased by about 5.5% which is the key reason for customers’ worry (Retail Gazette, 2018). Therefore, it is difficult for companies to achieve customers’ trust and convince them to do online shopping.
Conducting innovative ways: Companies have to find out more innovative ways in order to make the customers engaged with online services which make spot purchase. But small retailers are unable to conduct innovative ways because of their limited capital (Alter, 2013). Therefore they cannot experiment in an innovative way such as shoppable video.
Facing the dominance of Amazon: Amazon is the key online shop which possesses 31% ecommerce sale of the entire UK ecommerce sale, and it is difficult for other shops to compete with them (Growcode, 2019). Other companies should provide offers that Amazon will fail to provide and it will help the companies to get customers through ecommerce.
Facing tough competition: In the UK, thousands of ecommerce companies exist therefore companies face tough competition (Vecchi, Peng, and Al-Sayegh, 2015). They have to consider the offers of competitors to deliver more attractive offers in order to get more customers than competitors.
Methodology of creating the report:
Introduction
Research methodology refers to the specific procedures or methods that are used to choose, detect, process and examine all information about a topic which helps readers to critically evaluate the validity and reliability of a research paper (Taherdoost, 2016). Though it shows the validity and reliability of a research paper, research methodology is a significant part of a research paper (Tong et al., 2012). The purpose of this research, methods and strategies of the research, data collection process and presentation process are evaluated in this section.
Research purpose: Analytical
Mackey, and Gass, (2015) have defined that the research proposal reveals the purpose of the research: will it explore the issue of explaining the issue? Exploratory research purpose, explanatory research purpose, and analytical are the main research purposes. Analytical research purpose has been used in this research in order to make the research analytically. Analytical research purpose indicates the research purpose which has been used if the researcher knows the research problem and variables (Flick, 2015). The problem of this research is e-commerce, and the variables of the research are an internet connection, delivery process, infrastructure, devices like an as smart watches, smart mobiles etcetera. Both the problem and variables are critically evaluated in this research which will help to bring development in the process of ecommerce process in the UK.
Research Method: Hybrid
Kumar (2019) has revealed that research method indicates the way research follows, such as: qualitative, quantitative and hybrid. Research methods should be adopted after evaluating the effectiveness and drawbacks of all ways. The effectiveness of the qualitative method is researcher can make a detailed analysis of statistics and results furthermore, respondents can observe the research easily (Ledford, and Gast, 2018). The drawback of the method is results are not presented through quantifiable terms. Whilst, the qualitative method presents outcomes with quantifiable terms which is a great advantage, and the drawback is respondents are not allowed to respond outside the specific response sheet (Larsson, 2010). The hybrid method presents data in both quantitative and qualitative terms (Jonker, and Pennink, 2010). It is the appropriate research method because it helps to get an effective outcome from the research therefore Hybrid research method has been used in this research.
Research Strategy:
There are different research strategies. For this specific research, secondary sources of data have been compiled and analyzed through internet browsing. A wide range of internet sources has been used to collect information and data. It was ensured that the sources were authentic.
Data collection strategy and presentation:
There are two ways of collecting data such as: primary and secondary (Mangal, and Mangal, 2013). Primary data are collected from people through observation, case studies, questionnaire surveys and interviews (Mohajan, 2018). And secondary data are collected through companies’ websites, e-books, journals, articles, magazines and newspapers (Cecez-Kecmanovic, 2011). In this research secondary data collection strategy has been used due to the short time and limited budget. Researchers get authentic information through searching on search engines. Therefore, they do not need to observe more. Microsoft has been used in this research to present data because it is easy to use and does not require additional training to use it.
Ethical issues:
Researchers should ensure that their research has been done by maintaining all the ethical issues in order to maintain the integrity of the work (Dumay, and Cai, 2015). The research has been conducted by maintaining decency and truthfulness. Data has been collected from the internet after studying e-books and magazines, and furthermore, as the surveys published by world-recognized publishers. All this information will be kept safely in order to avoid the misuse of the information by others for any bad intentions. Any content has not been used without citing properly and all the statistics have been presented with proper citations. Rules and regulations of the institute have been followed in order to ensure integrity.
Reasons for creating the report:
Knowing the changing purchasing patterns of mass customers: One of the key reasons for making this report is to show the changing pattern in customers’ choices and they are doing more shopping from ecommerce. As a social science researcher, it is my responsibility to know about the changing behaviour of customers and help readers to know about the fact (Yaseen, Dingley and Adams, 2016).
Providing valuable message to the retail business in the UK: This report will show UK ecommerce the vast opportunity which will encourage them to be more successful and attract the businesses that are not part of UK ecommerce. As a result, the companies will ensure their presence in ecommerce and become able to capture outstanding growth in the sector.
Making e-commerce more user-friendly: The negative facts and challenges of UK ecommerce has been discussed in this report. This discussion will help the companies to identify the challenges and take necessary steps to prevent them. As a result, customers will have a better experience with ecommerce purchases, and the sector will grow more.
Providing the customer’s information about ecommerce: Customers who are far away from ecommerce will be capable of knowing the factors of ecommerce. This report will inform customers about the facilities of e-commerce, such as delivery options, online payment options, etcetera. Therefore the customers who make spot purchase will be attracted toward e-commerce, and it will increase ecommerce sales in UK more.
Conclusion
UK ecommerce has the potential to grow more by attracting customers who make spot purchase. To increase sales through ecommerce, the country should minimize the number of fraud online companies because these companies break customers’ trust. As a result, the customers who have faced fraud online purchases, do not have an interest in buying online again. If the UK becomes able to solve the problem, it will increase ecommerce sales enormously. Therefore, ecommerce sector of the UK will be able to contribute more to its GDP and the economy of the country will be stronger.
References
Alter, S., 2013. Work system theory: an overview of core concepts, extensions, and challenges for the future. Journal of the Association for Information Systems.
Growcode, 2019. Ecommerce in the United Kingdom (UK) – Trends, Forecasts and Statistics. Retrieved from: https://www.growcode.com/blog/ecommerce-uk/. [Assessed on: 1 March 2020]
Internet Retailing, 2019. UK ‘leads the world’ in online shopping, with over a third of consumers buying online multiple times a week. Retrieved from: https://internetretailing.net/industry/industry/uk-leads-the-world-in-online-shopping-with-over-a-third-of-consumers-buying-online-multiple-times-a-week-20060. [Assessed on: 1 March 2020]
Retail Gazette, 2018. COMMENT: Ecommerce challenges in 2018 & beyond. Retrieved from: https://www.retailgazette.co.uk/blog/2018/11/comment-the-ecommerce-challenges-of-2018-beyond/. [Assessed on: 3 March 2020]
Shopify, 2020. Ecommerce. Retrieved from: https://www.shopify.com/encyclopedia/what-is-ecommerce. [Assessed on: 1 March 2020]
Statista, 2020. E-commerce in the United Kingdom (UK) – Statistics & Facts. Retrieved from: https://www.statista.com/topics/2333/e-commerce-in-the-united-kingdom/. [Assessed on: 1 March 2020]
The Guardian, 2019. Half of UK retail sales will be online within 10 years, report predicts. Retrieved from: https://www.theguardian.com/business/2019/jul/09/half-of-uk-retail-sales-will-be-online-within-10-years-report-predicts. [Assessed on: 2 March 2020]
UNLEASHED, 2018. 3 Emerging Trends in UK E-Commerce. Retrieved from: https://www.unleashedsoftware.com/blog/3-emerging-trends-uk-e-commerce. [Assessed on: 2 March 2020]
Wiek, A. and Lang, D.J., 2016. Transformational sustainability research methodology. In Sustainability science. Springer, Dordrecht.