According to the latest edition of the annual Internet Trends report published by Silicon Valley venture capitalists Mary Meeker and Liang Wu, there are now more than 2.4 billion people worldwide who use the Internet. As astonishing as that number is, however, it doesn’t even include the number of individuals now using smartphones, which also have Internet browsing capabilities – that number tops 5 billion worldwide! The crazy part is that both of the preceding numbers are growing rapidly.
e-commerce in the US is well on its way to reaching an estimated $370 billion by 2017
Given those astonishing numbers, it should come as no surprise that the consumer marketplace on the world wide web is growing just as quickly. According to Forrester, e-commerce in the US, which topped $231 billion in 2012, is well on its way to reaching an estimated $370 billion by 2017. Moreover, online sales, which already account for 8% of total retail sales, are not only expected to continue their blazing fast growth, but are also on pace to eclipse traditional brick-and-mortar shops.
Have we managed to get your attention yet? No? No problem. Let us enlighten you on what all of these facts and figures mean to you and your business, and why you could or maybe already are, losing millions of dollars in untapped revenue.
As highlighted in recent studies done by Akamai and useability.gov, there are some absolutely critical issues that many individuals and companies need to keep in mind in developing their presence online. Although the list is quite extensive, we will highlight some of the most noteworthy facts.
1. Approximately 50% of all Internet users expect a web page to load in no more than two seconds.
2. If a web page fails to load within three seconds, 20% of all Internet users will close the page and visit a competitor’s website. At five seconds, the abandonment rate jumps to 30%.
3. Almost 80% of all Internet consumers, who encounter poorly designed websites, experience slow page loading times, or are unable to find desired content easily, will not return to a website, and will turn to a competitor. Furthermore, more than 1/3 of such users will tell others about their poor experience.
4. Smartphone users searching the Internet are even more easily frustrated by content viewing issues and page load times. Approximately, 73% of the smartphone users participating in the Akamai study complained of such issues.
5. As revealed in studies done by useability.gov, due to its influence on a website’s traffic, web design is one of the most important components of any website. Along the same lines, their studies have also shown that website design has an extremely high correlation to a company’s credibility with consumers, and ultimately has a significant impact on revenue.
The Break Down
So what does all this mean in terms of dollars and cents? QuBit, a consumer conversion optimization company run by four ex-googlers, says it translates into billions of dollars. According to a study conducted by QuBit, in which it surveyed 60,000 consumers across 80 different websites spanning the retail, travel, technology, finance, and publishing industries, poorly designed and slow loading websites cost businesses approximately $2.84 billion each year!
poorly designed and slow loading websites cost businesses approximately $2.84 billion each year!
Breaking it down even further, this means that a company generating only $200,000 a year in sales is losing out on average of upwards of $15,000 annually. When this is coupled with additional revenue companies are failing to realize due to mismanaged SEO practices, branding mistakes, and poorly designed and executed online marketing strategies, the total amount left on the table by a company grossing only $200,000 each year far exceeds $100,000. Taking the steps necessary to tap into this stream could boost their annual revenue by a 50% margin!
The Bottom Line
Studies have repeatedly shown that the online consumer market place is growing everyday, and becoming an increasingly important facet of every company’s revenue streams. As technology continues to advance, e-commerce will begin to overshadow and eventually overtake the traditional brick-and-mortar store as many organizations’ primary monetary pipeline. Consequently, strategic and efficient website design and management will only continue to rise in importance. The vast majority of companies, however, fail to grasp the importance of such issues, and thus are unable to take advantage of additional revenue pipelines readily available to them.
The most successful and profitable companies will recognize, if they don’t already, the critical nature of these matters and be able to increase revenue dramatically by improving the design, speed, and interactivity of their websites. It is no secret that you have to spend money to make money, and, while quality website design and development services are not cheap, the organizations that make the necessary capital expenditures will see the biggest gains. Therefore, the question that remains is: how much revenue will you let slip through the cracks? Just remember, the longer you wait to take action, the more it will cost.