By Zsarlene B. Chua

As e-commerce becomes more ubiquitous, so much so that a Netherlands-based auditor noted that “consumers no longer go shopping but are shopping anytime, anywhere,” consumer needs similarly grow and e-commerce sites should take note of what users find important. A study has shown that consumers consider data protection as key to earning their trust while excellent customer service earns their loyalty.

In the Philippines, the e-commerce industry was worth $1.15 billion in 2013 and is projected to “increase at a compounded annual growth rate of 101.4% from 2013-2018,” according to data cited by the Department of Trade and Industry in its “Philippine E-Commerce Roadmap 2016-2020.”


The study, conducted by KPMG International, which analyzed online shopping behavior of 18,000 consumers (aged 15-70 years old) from 51 different countries, showed that while people go to e-commerce sites mostly because of convenience (58%) as they are unhampered by regular store hours, sites need to ensure that the consumer’s data is protected as 63% of those included in the study indicated data protection as their number one qualification for sites to earn their trust.

“While most companies are, of course, making a concerted effort to protect their customers’ personal information, frequent media reports on data breaches around the world continue to make consumers anxious and keep the issue top of mind,” said Willy Kruh, KPMG International’s global chair for consumer markets in a press release.

In 2016, internet service company Yahoo! reported two major data breaches of user account data (which included names, e-mail addresses, telephone numbers, security questions, and dates of birth) to hackers with the first announced breach, reported in September, having occurred in late 2014 and having compromised over 500 million Yahoo! user accounts. This first announcement was followed in December of the same year by another discovered breach, this one occurred around August of 2013 which affected over one billion user accounts.

The Yahoo! breaches are considered the largest ever discovered in the history of the Internet and the company is currently facing several lawsuits and investigations.

In terms of loyalty, nothing trumps excellent customer service as 65% named it as the “number one loyalty-earning attribute” followed by exclusive promotions and offers at 45%.

The study also noted that younger consumers — the Millennial generation — tend to be more loyal towards companies that offer personalized interactions: customized promotions, anticipation of needs, having a sense of community, one-on-one engagement in social media, online games, and other interactive experiences, as well as concierge services.

“The more traditional attributes like excellent consumer support, loyalty offers, and membership programs will remain important for all companies to consider as part of their mix. The challenge will be for companies to find ways to also offer more personalized services to satisfy Millennials who, in 10 years, will be the mainstream consumer. One-on-one engagement will become an expectation for the majority of the market,” Mr. Kruh said.

The study also shed light into consumer behavior as it showed that while the Millennial generation is far more tech-savvy than its predecessors, they are by no means the biggest spender in the market as Gen X-ers (those born between 1966-1981) were revealed to have made 20% more online purchases than their Millennial counterparts while Baby Boomers (those born from 1946-1965) make as many online purchases as the Millennials but trump everyone in terms of spending as Baby Boomers typically spend $203 on average while Gen X-ers spend $190 and Millenials spend about $173 on each purchase on average.


Another consumer behavior that’s gaining traction on the e-commerce field is posting product reviews online with the Millennials leading the pack, with 34% having responded that they were most likely to post a review followed by Gen X-ers at 29% and Baby Boomers at 29%.

“The growing trend for consumers to post positive reviews is driven by factors including the rise of social media, where consumers subtly compete with their peers by publicly sharing their latest purchases and experiences; the rise of bloggers, whose business models are based on providing product reviews that drive affiliate clicks; and sellers, who proactively solicit ratings from happy customers,” Mr. Kruh said.

Reviews were most likely be posted directly on the sellers’ Web sites (47%), followed by posts on Facebook (31%) and then on the manufacturers’ or the brands’ Web sites (18%). This is a trait consistent across all age groups, the study said.

“The implication for companies is that user-generated reviews are being posted on sites that are increasingly out of their sphere of control or influence. Companies need to integrate these social media sites into their marketing and customer strategy,” Mr. Kruh said.