Online Retailers to Up E-Commerce Tech Spend, but Not as Much as Last Year

Though 72% of internet retailers plan to purchase e-commerce applications or services this year, they’ll be spending less than they expected to spend last year, according to Internet Retailer’s latest survey on e-commerce technology spending intentions.

A whopping 73.6% of respondents say they plan to increase those budgets 15% or less, compared with 49.4% of respondents last year who said so; moreover, about half (47.2%) say plan to increase those budgets 10% or less, the survey found.

Below, additional findings from Internet Retailer‘s survey.

The top spending priorities of online merchants:

• Replacing outdated e-commerce platform: 28%
• Miscellaneous apps: 20.5%
• Content management system: 11.9%
• Web analytics: 11.8%
• Order management system: 8.2%
• Site search software: 6.8%.

Among the top new website features or applications to be implemented:

• Customer reviews and ratings: 35.5%
• Inventory availability tools: 34.2%
• Blogs, forums or videos: 32.9%
• Streamlined navigation using Web 2.0: 26.3%
• Mouse-over tools: 25%

Most online merchants, however, intend to keep their current platforms and applications:

• 67.1% intend to keep their rich media applications.
• 61.7% don’t intend to replace their web analytics software.
• 55.2% will continue to used their present content management system.
• 55.2% don’t plan to buy site search software or service.
• 52.6% will stick with their current order-management system.
• 46% plan to keep their in-house or third-party platform.

Other highlights from the survey:

• At two-thirds (67.1%) of e-retail companies, the official with the final word on tech purchases is the CEO; next are the CIO (9.2%) and CMO (6.6%).
• The annual e-commerce tech budget is $50,000 or less at 51.4% of online retailers; that budget at 27% of retailers ranges from $50,001 to $200,000; 9.5% have budgets of $200,001 to $999,999; 5.4% have $1 million to $2.5 million; and 6.7% have budgets of more than $2.5 million.
• 51.3% of the surveyed retailers don’t plan to hire a consultant or other third-party help for a major technology upgrade in 2008.
• 73.7% run their own internal fulfillment program. Among the remainder that do outsource fulfillment, 65% plan to keep their third-party provider.

About the study: The survey was emailed in early June to subscribers of IRNewsLink, Internet Retailer’s e-newsletter; responses were collected and analyzed by Vovici Corp.; 92 web-only merchants, chain retailers, catalog companies and consumer brand manufacturers took part in the survey.