2020 can be certainly named the year of e-commerce – online sales reached a level projected for 5 years from now and experienced a 20% growth. E-commerce stores’ share in retail trade increased, while 46% of online businesses recorded an upward trend caused by the pandemic.
New users started buying online and many started using online services in categories which used to require direct interaction (such as gym classes, education, doctor visits, and psychotherapy). Many companies have been pushed by the market to digitalize or to implement changes in their existing e-commerce systems: witness the fact that Amazon has taken on 1.3 million new retailers.
The pandemic triggered behavioral changes that will stay with us even after things get back to normal. We need mobility and accessibility – but without leaving home. We need a sense of belonging and safety – but without physical contact. We need to be treated individually and respected – but without visiting a store or salon. How can businesses achieve this?
1. Marketplace: A brand’s own e-store
The first time you see a product is on Instagram. Later on, in the office, its ad blinks on a website. Next, on your mobile, you try to reach the store to check out details. Maybe you post a message on Facebook enquiring about the size. Finally, you will sit down at your computer to see cheaper options on Allegro. Does this ring a bell? It is characteristic of most customers’ behavior: before they buy the product, they browse its details in a few independent sources.
The standard omnichannel range we are bound to service has this year been extended to include social media sales (to be discussed later) and a marketplace whose importance has risen by 18%. The digital marketplace accounts for half of online retail sales.
Frequently, the first product interaction is on sales platforms, which then leads to a purchase made directly in a store. In Poland, 40% of the market is held by Allegro; the world's powerhouse, Amazon, ranks third. A recommended strategy, particularly for smaller retailers, is to run their own online store and put their products on sales platforms.
Digital stores bring about serious challenges in terms of branding and communicating product information. In a 2019 Accenture survey, 81% of respondents remembered the information provided on the product page of a product they bought 3 months earlier, whereas only 28% remembered its TV commercial.
2. Social Commerce: Quickly going from inspiration to purchase
A year ago, we knew Facebook's marketplace as an available yet rarely used option. Currently, social commerce is one of the key market trends. The option of making purchases at the app level is available on Facebook, Instagram, TikTok, YouTube, and China's WeChat.
Customers can shift from viewing information to payment in just one click. This trend does not merely add another sales channel, it significantly shortens the customer journey. It is most popular among young consumers. This year, 11.5% of online sales in China have been made via social media. A quarter of all companies sell via Facebook. And more young people rely on social media inspirations – 55% of Gen Z and 50% of Millennials, as compared to 38% of Gen X and 27% of Boomers.
3. Conversational Commerce: Information on demand, part 1
Imagine managing everything via Messenger. Say you want to add a bag of flour to your grocery order. The store has your name, they know the order you placed and the type of flour you usually buy – the data is all there. The question is how to make use of it.
Conversational commerce is a trend which turns sales (and marketing and customer service) into a conversation, via the tool most frequently used. No wonder the trend is favored in countries like Indonesia, where commercial exchanges have traditionally been informal.
From a technical point of view, implementing a full service without using consultants is not an easy task. It requires the use of speech processing tools like chatbots and integrating them with all customer and order data storing systems. A good starting point might be to analyze what customers write to the company about. In many cases, implementing a simple chatbot appears to be sufficient to handle most questions.
The trend will most certainly keep expanding, and not only in the upcoming year: ever since Uber integrated with Messenger in 2015, it has been continuously revealing new features.
4. Voice Commerce: Information on demand, part 2
The trend of voice interfaces has been on the rise in recent years and has occupied increasingly more aspects of everyday life. In Poland, though, voice interfaces are not as widely employed.
What are the advantages of voice commerce?
- First, it offers increased accessibility both to consumers with limited Internet and to those who lack time to make a phone call.
- Second, it shortens the customer journey – basic shopping no longer requires a scramble through product pages, commercials, and search engines. Instead, the customer could be driving a car or preparing a meal while they make their request.
- Third, it reduces contact time. Experience proves that users frequently choose a voice interface to ask for additional information, change their password, or find a contact phone number. Thus, integration with Voice User Interfaces (VUIs) will reduce call centers’ workload.
- Fourth, VUIs can significantly boost marketing potential, both in terms of data collection and by creating more suitable offers. Behavioral voice tracking may facilitate segmentation and offer personalization.
Voice commerce may be seen as the next stage of chatbot development – a tool for automating customer communication. It must be kept in mind that for VUI to win customers, it should be very well done, closely correspond to consumer needs, have a ‘personality’, and be able to anticipate standard and non-standard usage situations. A good way to start may be integrating with one of the giants, like Siri or Alexa.
5. Visual Commerce: Tapping into the most powerful sense
Scientists estimate that 95% of buying decisions take place in our subconscious. Contrary to what we would like to believe, a visual store website has more influence over us than any rational calculation. Nowadays, as we’re largely confined to our homes, we have less exposure to stores’ face-to-face sales techniques; thus, we’re becoming more sensitive to what we see on the Internet.
Visual commerce quite explicitly shifts focus to the visual side of the media. It takes product photos, user pictures, and all graphic elements and videos to a whole new level. In this commerce, it is the image that will create the appeal and spur purchase intent. Graphics become interactive: just like visiting a store, when you see a product that you can touch and handle. Products in photos must be clickable. They must be shown from all sides, must rotate, etc. The client should be taken through the process of the purchase experience. On top of that, visualizations should be unique and personal; the value of a static photo bank is on a major decline.
Taking more care of the visual side of the store will truly pay off, not only in generating higher conversion rates but also in making your website memorable. In turn, this brings repeat business to the store, as customers wish to re-live a captivating shopping experience. Nearly 70% of customers value visual presentation over descriptions and reviews; adding videos can boost sales by 40%.
A good way to start enhancing visual communication is to sort and streamline your data. Implementing project information management tools will help maintain coherence and can facilitate implementing further visual changes while preserving scalability.
6. Personalization: The customer as an individual
Ever since the pandemic locked us down in our homes, we have been deeply missing the individual treatment we used to receive in stores. We have been longing for the understanding waiters used to give us in restaurants or the exclusive atmosphere created by spa personnel. We crave sales techniques evoking a sense of understanding and care: 74% of users are annoyed by e-commerce that does not cater to their needs, and only 14% think their recent online experience felt fully personalized.
How can we make personalization happen? A major proportion of Millennials (70%) are annoyed by sales e-mails. Almost half (47%) of users look for products recommended in sets. Nearly all advertisers (98%) can see a difference in the perception of personalized advertising.
Personalization begins with user data. What do customers buy? What are they doing? How do they navigate the website? Which other stores do they visit? To implement basic personalization, we don’t need advanced mathematical models; standard data analysis and segmentation will suffice. If finances permit, it is recommendable to apply some Big Data or Artificial Intelligence mechanisms, which have proved very efficient for grouping data. If well done, this may boost sales by over 10%.
A good first step is to add Google Analytics to your online store; in a matter of days, your business will start collecting information about customer behavior. The next step is to use your findings to adjust to consumer habits.
Last year brought about a raw realization of the importance of flexibility in business. Responding to fast-changing needs through prompt adjustments is key to staying competitive.
From the customer's point of view, flexibility is needed mainly in product range, payment methods, and delivery channels. Implementing changes in the range of products is assisted by an efficient product data management system and a smooth production process that tightly cooperates with marketing.
Various customer needs will be catered to by a wide range of payment methods, starting from the standard payments (e.g. credit card, bank transfer, etc.) to the currently popular delayed mobile payments (Buy Now Pay Later) and payment via cryptocurrency. It is also advisable to consider flexible payment models, such as the pay-as-you-go and pay-for-what-you-use systems.
Implementing new delivery channels may not be an easy task. Meeting flexibility needs can call for integration with tools like BaseLinker, which will also make subsequent integrations easier.