Daily Roundup for 2007-12-27

  • Venture capitalists don’t want to pay their legal fees for financings. Don’t fight this term—that’s a “big move on a little issue.” Instead, cap your contribution to the investor’s legal bill. And watch the legal bills in small financings: don’t spend a large portion of the investment on lawyers or give up a lot of equity for the privilege of paying your investor’s legal bill.
  • Forget about strings of pearls, dive watches or flower baskets. This could be the year of Barcaloungers and blenders. According to early online shopping statistics, sales of holiday stalwarts like jewelry, watches and flowers have dropped from last year’s levels, while sales of more practical items like furniture and appliances have climbed about 70 percent.

Continue reading “Daily Roundup for 2007-12-27”

Important eCommerce Trust and Safety Statistics

At the PESA Summit this past week, there was a lot of talk about how to improve e-commerce conversion rates. I believe there are three critical drivers for conversion: product selection, price, and trust. Each of these issues would provide substantial content for an article, but I thought I would dedicate today’s post to a number of very important trust-related statistics.

If you have any doubt about the role of trust and buyer confidence in your e-commerce business success, please take a quick look at these stats.

  • 55% of online shoppers say trustworthiness of the merchant is most important (vs. price, convenience, pleasure, other)
    (Source: Online Shopper Research Report, 959 respondents, August 2006)
  • 65% of online shoppers buy only from sites they know and trust
    (Source: VeriSign Secured Seal Research Review 08/06)
  • 72% of online shoppers are becoming more cautious when buying online
    (Source: Gartner Research, 5000 respondents, May 2005 survey)
  • 73% of online shoppers are concerned about the item being misrepresented (inaccurately described, counterfeit)
    (Source: Online Shopper Research Report, 959 respondents, 08/06)
  • 76% of online shoppers are worried about never getting their purchase
    (Source: Online Shopper Research Report, 959 respondents, 08/06)
  • 81% of online shoppers are concerned about merchant return/refund policies not being honored
    (Source: Online Shopper Research Report, 959 respondents, 08/06)
  • 84% of online shoppers are concerned about merchants not treating them fairly
    (Source: Online Shopper Research Report, 959 respondents, 08/06)
  • 85% of online shoppers are concerned about identity theft
    (Source: TNS Research, 08/06) 
  • And, amazingly, over 50% of all U.S. internet users still don’t buy online (even from Amazon.com!).
    (Source: Bear Stearns, September 2006)

With respect to this last statistic, "trust" issues are the primary
driver of e-commerce non-participation. Amazingly, more than 50% of
your potential customers will not buy online because they are nervous!
Are you kidding me? That is a huge number, and obviously, the time has
come for the e-commerce industry to take this issue seriously.