Online retail growth in Australia and FOMO

November 9, 2015 General, General

survivaltipsAustralians are famous for their love of sunshine, surf, a beer and a good BBQ. But current stats show Aussies to be just as passionate about shopping, the Internet and smartphones.

Half of Australians also jump on social media every day, to drown the world in pictures of food, outfits, new cars, weddings, current mood, ‘no make up selfies’ and provide updates as to their every move up until the time they go to bed. Even after lights out, they lie in bed for hours staring at a small screen, increasing their sleep debt as they experience the Gen Y phenomenon of FOMO (‘Fear of missing out’).

Now for the statistics overload:

  • Out of nearly 24m people, only 15% of the population is over 65, with 86.9% of the country using the Internet.
  • In 2015, almost 90% of the population owned a smartphone and 60% owned a tablet
  • According to 2015 Sensis, 50% of consumers access social media everyday (up to 79% for the 18-29 age group).
  • Almost 70% of the population shops online.

It has been forecast that retail e-commerce (e-tail) sales in Australia will rise 14.4% this year, passing $10b. Compare this to the predicted 3% rise in total retail sales in Australia ($231b in 2014, expected to reach $238b this year), and it is clear that e-tail is a major source of growth for the sector.

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The digital revolution has transformed retail more than just about any other industry. With such strong growth, the online retail market is reaching a level of maturity, with new players unlikely to see the same growth spikes enjoyed by the original pioneers. Increased competition is great for consumers, but not so great for start-ups, as prices are driven down by larger sites opting for below cost flash sales to drive volume based supplier incentives.

Most online marketing practices revolve around the retailer’s website, with subscription based models, social media advertising and retargeting campaigns all trying to steer the consumer back to the main site or app.

And that makes the website and/or app a potential single point of failure in a retailer’s marketing strategy.

Consumers are brutal and impatient with online purchases. Pause at check-out, too many pop-ups, too many questions, payment gateway issues etc etc, can really make it hard to get the customer to purchase, let alone return to the site.

Unlike a chain of retail stores that can redirect customers around a city to another store when there’s an issue in the shop, when a site is down and the consumer is set on making that purchase, there’s a good chance they’ll ‘Google’ the item and go elsewhere.

So if you’re an e-tailer, what steps can you take to keep your site up?

1. Choose the right CMS

A content management system is software that keeps track of every piece of content on your website, much like your local public library catalogues and stores books for easy access. A major advantage of using a CMS is that it requires almost no technical skill or knowledge to manage. Since the CMS manages all of your content, you don’t have to. The most popular CMS’s for ecommerce are Magento and WooCommerce (WordPress).

Each CMS has different requirements to achieve maximum performance and reliability. So make sure your web host understands and has experience with your chosen CMS.

2. Be ready for sales

Websites often crash or come unstuck when a marketing campaign, flash sale or social media strategy attracts large volumes of customers without first checking that the infrastructure can cope. It’s no good waiting until just before the campaign goes viral before calling the developer or host in a panic to check there is enough server capacity.

If you’re in the habit of paying for extra everything just in case you may need them some day, you might already have a heap of machines ready to take the load (and a much bigger monthly bill to boot). But If you’re not a fan of throwing money away, you need to forecast and prepare for the increase in traffic.

Based on prior trends, your host can help you determine how far to scale up and for what time frame. However, for complete confidence, cloud-based elastic computing can burst up and down as required, making sure your site is always prepared for any unexpected uplift.

3. Code deployment

There’s many a slip betwixt cup and lip, so make sure your developer has a process for thoroughly testing code before it goes live into a production environment. The last thing you want is to have some unruly code slip through into production and scupper all of your inventory items just before the big sale launch.

Most developers schedule code deployments infrequently, as it’s an arduous process. So when bad code is somehow deployed, the dev has to go back to trawl through the recent releases to find the culprit. While this long and painful process happens, the site may be slow (or down), leading to a potential reduction in sales.

Ideally, the developer should use staging and testing environments to thoroughly check any code. As any variations between these environments will mean the results of testing will be inconclusive, these should always be an exact mirror of the production environment. A solid testing, staging and production setup makes it easy to test and deploy, without the downtime involved with traditional deployments.

4. High Availability

As a single server is also a potential single point of failure, High Availability (HA) infrastructures involve more than one server. The benefits of a highly available environment tend to be straight-forward and relatively obvious. However, a number of considerations come into play; most commonly, cost.

But this increase in cost should be balanced against overall uptime and performance, recovery time in the event of a failure, and maintenance flexibility. Each of these can also pose a major expense to your business, through lost sales, increased man-hours and speed to market.

To see whether High Availability would work for you, ask your host about its SLAs. What is the guaranteed turnaround time to rectify a problem in a non-HA environment before you become eligible for compensation? Usually this is measured in hours, if not days, so consider what this would mean for you in lost sales terms if the worst were to happen during your biggest sale of the year.

5. Stay on top of patching, updates and security

Your site is made up of many layers of software, sitting on top of infrastructure. Software vulnerabilities are regularly found and exploited, placing your website and your customers at risk. Without the preventative work of your developer and host, these can harm the integrity of your site, resulting in downtime and customer loss.

The site’s stability is only as good as the health of this software, with the application layer at the top. Your CMS, plugins, underlying language framework and Operating System should also be continually updated and patched.

These are but a taste of best practices involved in keeping a business-critical website up. Until a generation feels the need for a digital detox, online retail will remain the most effective method for reaching a wider audience with your products. Architecting a robust website front and back end will ensure that the FOMO generation can continecontinue to shop with you without a hitch.

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