Ecommerce will continue to outstrip brick and mortar in 2012

Consumers are expected to shop online more in 2012, preferring the peace and quiet of their own living room to the hustle and bustle of brick-and-mortar stores.

According to a survey of 94 retail brands, 63 percent of multichannel merchants anticipate a sharp increase in online sales through 2015. Conversely, fewer than 10 percent predict their online sales will decline during the same time frame.

"We find the number of retailers committed to stores as a major growth strategy declining and the need to do a good job integrating the customer experience across all channels more and more of an imperative," notes the report, which was conducted by Retail Systems Research.

By 2015, nearly half of retailers – 41 percent – will be earning between 10 and 24 percent of their sales through ecommerce, up from 19 percent as of 2011. The number of businesses earning between 25 and 74 percent of their sales online will undergo similar growth, jumping from 3 to 22 percent.

Conversely, retail merchants earning less than 10 percent of their sales online will decline from 68 percent in 2011 to 26 percent in 2015. It's clear that many retailers no longer perceive ecommerce as an added benefit – it's a necessity to maximize sales.

Simply shifting online isn't enough, either. The respondents that Retail Systems Research noted as being "winners" explained that keeping up with advances in technology is crucial to broadening sales reach. Over the next few years, that means going online, but there are always relevant technologies being developed. Through 2015 and beyond, retailers must consider how new platforms such as social networks and mobile commerce will affect their operations.

Other challenges will affect retailers as they shift gears from physical stores to online shops, including managing internet inventories, dealing with the ease of comparison shopping, cart abandonment and planning for uncertain customer demand.

Whatever the challenge, the future looks bright for the retail industry. The past two years have seen many merchants recover from the 2008 recession and according to the National Retail Federation, sales are positioned to continue to improve throughout this year.

Online retailers are quick to ship, but returns aren’t as fast

The worldwide web has changed how many companies do business, not the least of which is the retail sector. Now, it is seldom good enough to simply have a brick-and-mortar store – today's merchants need to also have a website shoppers can use to make purchases. If they are really progressive, they will even have a mobile site or app.

For the most part, the online shopping experience is a positive one, regardless of whether consumers go online or in store. People shopping online are enjoying a smooth purchasing process – products are being shipped promptly and arriving on time in good condition. It's the return procedure that is plaguing many online retailers, according to new data from Innotrac.

The fulfillment vendor places a number of orders with more than 120 different internet retailers and graded the shopping experience on a scale of 44 points. The company looked at key indicators, such as customer service availability, order confirmation communication, shipping options and the quality of their goods upon arrival. Big-name retailers, such as Target, Best Buy and Sears, were among some of the brands analyzed.

Innotrac's research found that 66 percent of orders placed arrived within three days, 22 percent were delivered in four and only 2 percent came after day seven, suggesting many retailers have a well-planned shipping solution in place.

However, when products were returned, merchants were not as quick to respond. While nearly one-fifth (19 percent) did issue refunds within five days of receiving the returned product, many took even longer. In fact, nearly the same number (16 percent) took 20 days or longer to issue a full refund.

"The fact that 16 percent of retailers take more than 20 days to issue a credit shows that there are still some issues and that that process is not as expedient as it should be," says Jon Eggleton, vice president of marketing and ecommerce for Innotrac.

Because January is typically a slow month for retailers, now is the perfect time to hash out a better return policy if business owners don't have one. While many merchants are focused on making the sale, it's equally important to have a process in place for handling returns if retailers want to ensure the customer comes back to make future purchases.

Online retailers need to do a better job with returns and exchanges

Despite more customers buying products online, many retail merchants still have archaic and inaccessible return policies for internet purchasers.

Management consultancy Kurt Salmon recently analyzed the return processes of the 50 top retailers across the nation. While a number of ecommerce sites ranked well in terms of checkout experience, presentation and shipping, few excelled when it came to returns and exchanges.

"We found that many retailers got high marks in shopping and shipping, but fell short on returns," said Kurt Salmon retail strategist Megan Donadio. "Some retailers required the customer to fill out tiresome paperwork and wait in line at the post office, while others failed to provide any type of tracking method or took weeks to process refunds.”

Only three brands – Amazon, Sephora and Saks Fifth Avenue – achieved the agency's top ratings.

It's crucial that retail merchants provide a satisfactory shopping experience through the process, from initial log on to exchange. Not doing this gives a business' competitors a means to leapfrog it in terms of meeting their customers' needs.

Information overload: 86 percent of shoppers hate registering for ecommerce accounts

Ecommerce merchants that require shoppers to register new accounts in order to complete a transaction are annoying the majority of their visitors and may even be losing sales as a result, a new Janrain survey suggests.

Nearly nine in 10 shoppers (86 percent) said they found it bothersome when retailers forced them to create new log-ins for ecommerce websites – a number that has grown 10 percent over the past year. More than half of respondents (54 percent) said they would leave the site and not return if faced with that issue.

Companies hoping to glean more information about their shoppers through these forms may want to think twice – 88 percent said they leave incorrect information when asked to fill out information, up 12 percent over last year.

Retailers should explore other options, such as enabling users to sign in with their Facebook credentials, minimizing the amount of details customers need to input before making a purchase, or not requiring them to create account until after the transaction has been completed.

IBM: Mobile devices played integral role this holiday season

While mobile devices still haven't become core pillars of the shopping experience, 2011 was the year many retailers began experimenting with them. Those retail merchants that took the gamble saw their efforts pay off, with IBM observing a notable uptick in both mobile sales and traffic in 2011.

IBM suggests nearly one-fifth of holiday website traffic (18.3 percent) came from web-enabled phones and tablets, up from 8.4 percent the previous year. On Christmas Day, 14.4 percent of total sales were generated from the devices as well, compared to 5.3 percent one year ago.

"Mobile was certainly a bright spot this holiday season," Todd Cabell, director of ecommerce at Crutchfield, told Internet Retailer. "It's clear more and more customers are becoming comfortable using their mobile devices to research and purchase a wide variety of products."

More than 91 million Americans owned smartphones as of November, and that number continues to grow as each month passes. Moving forward, it will become paramount for retailers to have a mobile plan in play.

Online shopping reaches new highs in November-December period

With 2011 now in the books, digital measurement firm comScore has totaled up online spending figures for the two-month period between November and December. Overall, Americans spent $37.2 billion over the 61-day time frame – a substantial 15 percent increase over the same time last year.

The most money was spent, unsurprisingly, on Cyber Monday. Americans spent upward of $1.2 billion on the internet shopping day, up 22 percent from the $1.02 billion spent on the same day in 2010. The shopping day to see the biggest year-over-year jump was Black Friday, which improved 26 percent from $648 million to $816 million, suggesting that consumers no longer view the promotional day as an in-store only event.

"The 2011 online holiday shopping finished with slightly more than $37 billion in spending, up about 15 percent versus year ago," said comScore chairman Gian Fulgoni. "With brick-and-mortar holiday retail estimated to have grown about 4 percent this year, it's clear that ecommerce continues to gain market share from traditional retail due to the attractiveness of the internet's convenience and lower prices."

Overall, the top five days to see the most online spending were November 28 (Cyber Monday), December 5, December 12 (Green Monday), November 29 and December 6. Interestingly enough, not all of the promotional shopping days spurred customers into action. For example, customers spent only $1.07 billion on December 16 (Free Shipping Day), which was only the sixth-heaviest shopping day.

It's crucial to note, however, that online shopping has made giant leaps over the past two years. Americans are now shopping on the channels that make sense and are convenient to them. Whether it's online or in-store, it's crucial that retail merchants reach shoppers in a multitude of ways.

"Despite their continuing price sensitivity, consumers felt a bit more comfortable opening up their wallets this year, although this appears to have occurred as a result of a decline in the savings rate. Nonetheless, it’s clear that, at least on the basis of top line growth, this was a Merry Christmas for many online retailers," Fulgoni adds.

Merchants looking to make the biggest impact need to connect with customers through a variety of means. For example, quick response codes can bring consumers to online stores, while in-store pickup options enable brands to encourage customers to come in and shop.