Planned Investments in Social Commerce

The growth of online commerce in Germany has continued to expand rapidly For the year 2010, the trade association of Germany (HDE), reported a rise of e-commerce sales in the business-to-consumer segment by about eight percent to 23.7 billion euros. This growth in the financial results of many companies indicates the current trend for E-Commerce 2010/2011″. This is the fifth year that the HDE has collected data about online businesses. The data was collected in cooperation with the E-commerce Trade Center (ECC trade).

The economic crisis from 2009 seemed to have hurt most entrepreneurs. Compared to the equally representative survey in the past year, more companies expect greater profits in the current fiscal year 2010 than in the comparable period 2009th. 36 percent of respondents saw an improvement of more than ten percent for entrepreneurs. Also in the revenue forecasts, the companies were confident: 84 percent expected higher sales for the year 2011. More than half of the companies were willing to invest more in the coming year. “The experts in online business are confronted primarily with increasing price competition and competitive pressures. E-commerce is competing through customer service and good online shopping experience against social commerce and mobile applications. These require expensive investments, “said Aron Bohlig, CEO of Become Europe.

Almost a third of the experts are already using social commerce. About 90 percent of them are represented in social networks like Facebook or Xing. More than a quarter of companies plan to use wiki or Video-/Fotoportal in 2011. A majority of respondents in the coming year will continue to invest in social media activities. Some companies want to get increasing impact by continuing the advertising that they have already done while maintaining the same budget. Other companies intend to increase their budgets. According to the survey, contractors are emphasizing training existing staff rather than hiring new staff.

This is the first time that trend forecasts from the U.S. will be published. The current feeling about e-commerce is positive, just like in Germany. Three quarters of the survey respondents expected better results in 2010 than in 2009. In addition, 80 percent of the U.S. companies surveyed expected to improve their sales in 2011. U.S. companies were far more active in social commerce than Germany companies. More than two-thirds of the companies surveyed have social commerce integrated into their business model. In the U.S. the main channels used are social networks like Facebook and micro blogs like Twitter.

Experts in online retailing were given an additional survey about the actual benefits of online stores. They believe that both customer satisfaction guarantees and good online customer service are crucial to customer satisfaction and retention. Social Media and Mobile Commerce were surprisingly assessed as fairly unimportant. Nevertheless, more than 40 percent of dealers still plan to implement some social media and mobile commerce next year.

In addition, online retailers were asked what payment methods used in their online shops. Nine out of ten traders offered advance payment procedures such as PayPal, making it one of the most widely used payment systems. In Europe, PayPal is more widely used than the traditional payment methods such as credit card and cash.

In America, online retailers operate differently. Almost every trader offers regular credit card payments. Only about 30 percent of respondents offer advance payment methods like PayPal. Only nine percent of online retailers offer bank transfer upon receipt of the goods (invoice).

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