In my last article in this series, I pointed to ecommerce’s exponential growth rate and outlined some of the key drivers of this growth as retailers and other businesses continue to align their capabilities with marketplace demand. I would now like to address six key online trends that you should take into consideration as you invest in ecommerce systems.
6 Online Trends Essential for E-Commerce Success
Personalization
Site visitors are demanding one-of-a-kind experiences that cater to their needs and interests. Technology is available, even to smaller players, which can capture individual shoppers’ interests and preferences. You can then dynamically generate a shopping experience and product offerings that are tailored to these individualized parameters. Promotions and complimentary product offerings and customized merchandise are becoming feasible. You have the opportunity to make each online customer feel recognized and appreciated - which will make your site “stickier” than those of your competitors.
Cross-Channel Integration
Single-channel shopping experiences are being replaced by multichannel opportunities, enabling consumers to enjoy consistent brand and service via their shopping method of choice. In many cases, consumers use multiple channels during a single event (e.g. using a mobile device to check competitive pricing during an in-store visit). Retailers need to adapt to this omnichannel environment and ensure that their backend operations are capable of delivering a consistent brand experience across all channels. They need to be sure that products sold via different channels are sufficiently differentiated to account for price differences.
Mobile
Mobile currently accounts for 5-10 percent of all retail transactions. However, the big news is that mobile commerce is increasing at a rate of over 130 percent annually. Retailers that lack a robust mobile commerce platform stand to lose revenue quickly. Today a robust mobile commerce presence requires more than a mobile-optimized website. Companies need to offer delivery status, real-time notifications, click-to-call, maps, product information that is easy to read on a mobile screen and other advanced features to stay competitive.
Scalability
Growth and scalability are two sides of the same coin. Smaller retailers have invested in creating e-commerce systems that can handle a large volume of transactions, but many have overlooked their backend and fulfillment operations. To accommodate growth, companies need to proactively evaluate their internal capabilities and those of their third party logistics providers (3PL’s) to scale quickly for a higher volume of more complex orders. Reverse logistics, the ability to be able to handle returns and exchanges quickly and economically, is becoming a key differentiator.
Shipping and Delivery
Until recently, shipping was considered simply a cost of doing business. Now, same-day delivery and innovative fulfillment networks are considered competitive advantages. For example, some retailers are offering in-store or third-party pick-up for online orders. Another post-transaction strategy is the use of branded packaging for home delivery orders. Retailers are replacing standard brown boxes with branded boxes in a variety of shapes, sizes and colors that are intended to reinforce a consistent customer experience. The ability to respond to customer inquiries and complaints quickly and satisfactorily has never been more important. Even small merchants should be prepared to compete with services that Amazon and other major online retailers offer.
Online Loyalty
With more retailers bidding to rank high on Google search results for specific key words and deploying largely the same customer acquisition strategies, costs are rising quickly and the online space is becoming cluttered with websites offering similar products. It is estimated that the cost of acquiring a new customer has increased to 21 times the amount it takes to retain an existing one. To strengthen customer loyalty online, retailers are beefing up delivery and return options, investing in offering a frictionless buying experience, and focusing on personalized customer service.
While most emerging growth companies cannot afford to invest in every advanced ecommerce technique, it is critical to consider trends in the marketplace and choose the right strategy and investment focus, which will translate into greater online market share and bottom-line results.
In my next article, I will discuss various online business models, especially disruptive ones that are changing the entire supply chain.
About the Author
Jennifer brings to Newport over 10 years of C-level experience. She has demonstrated an ability to take strategy from conception to execution, achieving excellent results for family businesses and private equity-owned companies. Contact or learn more about Jennifer here.
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