By Bruce Tompkins
Partner, Tompkins International
Revenue from eCommerce is growing rapidly. Today, eCommerce typically makes up 10-15% of revenue for retailers. This is great news, even if you are a brick & mortar firm, eCommerce also leads to in-store sales. Even Amazon has recently opened its own brick & mortar store in Seattle. The retail giant understands that in order to be successful in retail you must create a seamless experience for customers, both online and in stores.
Tompkins International conducted a December 2015 survey in which retailers and consumer-packaged-goods companies made up 74% of respondents, with normal distribution of companies by size (in revenue) from less than $250 million to over $25 billion. The survey found that over 66% of companies do not use Amazon for selling and fulfillment purposes. However, we at Tompkins International see more and more companies turning to Amazon for selling and fulfillment.
As of December 2015, SKUs available only online still represented 23% of all SKUs and a surprisingly large percentage (25.1%) of SKUs are only available in stores. This being said, nearly 50% of SKUs are available online and in stores and 45.2% of survey respondents predicted that the number of available online and in-store SKUs will increase.
The bottom line: eCommerce is trending significantly up, which provides an opportunity for those who are ready for the challenge. eCommerce success largely depends on marketplace traffic. In the U.S., that may mean Amazon, unless other alternatives are explored. The data shows that many companies have a lot of work to do to be competitive in the online market. eCommerce is here to stay and retailers need to make use of this opportunity immediately.