We might think of online shopping as a recent development. However, e-commerce was first introduced in the 1960s through an electronic data interchange on value-added networks. The medium grew with the increased availability of internet access and the advent of popular online sellers in the 1990s.

Jeff Bezos of Amazon began operating his book shipping business from his garage in 1995. Ebay, which enables consumers to sell to each other online, introduced online auctions in 1995 and their business model exploded to become the main player in e-commerce transactions worldwide.

Like any digital technology or retail model, e-commerce has evolved over the years according to the availability of different platforms – as mobile devices became more popular, for instance, mobile commerce has become its own market. Social media has also become an important driver of e-commerce. As from 2014, Facebook drove 85 per cent of social media-originating sales on e-commerce platforms.

The changing market represents a vast opportunity for businesses to improve their relevance and expand their market online. More than 40 per cent of internet users – one billion in total – have purchased goods online according to payment solutions company Paymill.

The changing market represents a vast opportunity for businesses to improve their relevance and expand their market online

There is no denying that online shopping is growing in popularity year on year, generating billions in sales. Online shopping is rapidly increasing in Malta as well. According to a Eurostat report released in December 2015, 51 per cent of the Maltese population shop online, with the highest share of 83 per cent of e-buyers within the 16-24 years age bracket followed by 79 per cent within the 25-34 years age group.

Last year, Malta had the EU’s second highest share – after the UK – in shopping for clothes online. Also last year, almost half of Malta’s online shoppers (49 per cent) purchased travel and holiday accommodation over the internet followed by 36 per cent of Maltese e-shoppers who purchased books and magazines online.

These figures show a significant increase when compared to those published by Eurostat in February 2008, which showed that only 20 per cent of Maltese made an online purchase the previous year.

One of the main reasons why online shopping is becoming more popular is the increase in security measures for online payment. Secure payment gateways not only keep credit card details private but also assist clients to get their money back in case something goes wrong with their online orders.

But how do local consumers view online shopping?

Steve Sciberras, managing director of a local hotel, says that online bookings and payments offer the advantage of dealing directly with clients. Through its dedicated website, Sciberras says the hotel manages bookings and direct payments from customers. Sciberras says that sometimes they also shop online for the hotel’s needs because of lack of availability.

On the other side of the coin, D’Amato Records Shop manager William D’Amato says that without any doubt, the arrival of online shopping has badly affected their business. In order to meet this challenge, they have decided to lower their profit margins so as to remain competitive.

D’Amato says that while online companies buy in large quantities from the manufacturers, here in Malta, businesses buy in small amounts – this puts local retailers at a disadvantage with foreign online companies. Having said that, D’Amato Record Shop is still thriving and he assures me that they are always looking for ways to improve their business and are presently in the process of developing an ambitious, modern website, where both local and foreign customers would have access to purchase products from them.

Isabelle Cassar, an assistant manager in a local restaurant says she prefers to buy from foreign websites and the reason she shops online is she finds the system more organised and comfortable. She shops every month but more frequently during the sales.

Rita Cilia says she buys online and her three children are also avid online shoppers. Another added bonus for her is that she can sit down at the comfort of her home and look at thousand of products before choosing the right ones. She also says that, for those retailers that do not shop to Malta, there are local businesses which provide her with a foreign address, thus facilitating online purchases.

Like anything else, online shopping will surely evolve. Retailers of all types are expanding products offerings, adding in-store pick-up, free shipping and experimenting with social media.

It is getting harder to tell the difference from sole small internet retailers to huge leading companies and department stores with online portals since all of them are reinventing how we will shop online in the future.

This does not come at a detriment to brick and mortar businesses since the development of e-commerce encourages enhancements to in-shop experience. As it becomes easier to compare prices, shops will need create better shopping experiences with more knowledgeable sales staff and exclusive products that are hard to find anywhere else.

New online shopping trends

In-store pick up
Large companies are implementing in-store pick-up for orders placed online, while others are going a step further by bringing online purchases out to your car. Supermarkets are also letting shoppers order groceries online and pick up at a drive through.

Pick-up depots
Smaller retailers without a vast network of stores are opening designated pick-up locations for goods ordered online.

Mobile apps
Apps for all platforms are growing. The ones that allow for price comparisons are already among the most heavily used.

Video
Retails sites are letting customers upload video clips modelling new clothes that have just been purchased.

Social networking
Facebook and Twitter are main players nowadays. Consumers can ‘like’ or ‘follow’ a favourite retailer and get discounts or tops on deals.

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