Ecommerce could easily join “unprecedented”, “new normal” and “uncertainty” in the ranks of 2020’s most overused business parlance.
However, the rapid acceleration of online shopping, and the ability it’s affording companies to adapt quickly to the needs of a generation of consumers in flux, ensures its buzz carrying through to 2021.
At the height of the initial coronavirus lockdown, online sales accelerated around the world as physical stores closed. In the second quarter of 2020, global revenue from online sales skyrocketed 71 per cent year on year as people rushed to buy essentials, according to data from the Salesforce Shopping Index.
Even as bricks-and-mortar stores have reopened, the shift to online has remained pronounced, especially across categories such as fast-moving consumer goods and groceries. In the UK alone, the Office for National Statistics reports that sales of online goods increased 51.6 per cent in the year to August.
With the all-important festive period looming, research from payment firm Klarna reveals that 71 per cent of British consumers are reluctant to shop in-store in the lead up to Christmas. Some 56 per cent say they expect to do more online shopping this year than previously.
As consumer habits shift, brands have been retuning their offerings to take advantage, whether that’s bringing shopfronts online, using data to improve the customer experience, launching subscription services or using tools such as augmented reality (AR) to sell their products.
From Beavertown Brewery to Fender, Amazon to Aldi, companies have been investing heavily in tech and talent to power the ongoing shift away from hard-to-reach shelves into direct to consumer (DTC) and third-party digital sales. It’s boosting their bottom line too, with Beavertown reporting a 1,000 per cent sales boost in lockdown, showing the potential ecommerce has to underpin business growth.
Retooling tech to power online sales
But the innovation can’t stop now. During the pandemic, brands have sought to bridge the gap between the physical and digital, building experiences that cater for customers who now expect in-app sales, delivery and pick-up as standard.
For Debbie Ellison, chief digital officer at ecommerce marketing agency Geometry Global, however, companies must look beyond omnichannel strategies and to connected commerce experiences if they want to unlock opportunities for growth.
She argues that tech which goes beyond the operational requirements of retail and supports the aggregation and understanding of shopping behaviour across various digital and physical touchpoints is what’s going to give brands the competitive edge.
Pointing to L’Oréal, Revolution Makeup and Gucci, which all recently used AR to enable shoppers to try on products at home, Ellison says she expects exponential growth in brands and retailers using AR in the move to create more engaging online shopping experiences.
Along with compelling “try before you buy” tech, social commerce is also undergoing a shift. Throughout the pandemic, Instagram and Facebook have been aggressively chasing on-platform sales, expanding Facebook Shops and the ability to check out on the platform, and IGTV (Instagram TV) shopping.
“Shoppertainment” and live stream ecommerce have been taking social selling up a notch too. As Amazon’s Twitch creates shoppable experiences in the West, in China, Alibaba is seeing success by turning ecommerce into entertainment on a grand scale. In Southeast Asia, ecommerce companies, including Lazada and Shopee, are among those using live streaming to help sellers connect with audiences.
Zhou Junjie, chief commercial officer of Shopee and head of Shopee Singapore, says the feedback from sellers is positive, with participants seeing sales increase by up to 75 per cent attesting to the appeal of the new feature.
Ecommerce opportunities await those ready to innovate
One brand investing in connected commerce is Tata Group, the sprawling $111-billion Mumbai-based business which sells everything from jewellery and steel to tea and salt. “There is no better time than during a crisis to innovate,” says Liliana Caimacan, head of innovation at Tata Consumer Goods.
When COVID-19 thwarted Tata’s plans for the UK launch of herbal tea and kombucha brand Good Earth, the obvious solution was to delay introduction. However, Caimacan saw an opportunity to lean into the brand’s positioning around experimentation. She struck up a partnership with Sainsbury’s online and pivoted to social commerce and digital experiences on platforms like Instagram to build awareness, quickly moving media budgets away from out of home.
Its hand may have been forced, but in reinventing the rules of a very mainstream category, Caimacan says Good Earth has already had great success in engaging consumers.
Moving into 2021, Caimacan says the lessons gleaned from this experiment will see its ecommerce offering focus on DTC and streamlined customer experiences “based on a deep understanding of behaviour”. The business will use behavioural science to engage with people better online and invest in razor-sharp targeting techniques to drive digital sales and business growth.
Driving business growth through content
Aside from the glitzy tech, connected commerce underpinned by data and investment in direct selling, there are other, more practical solutions companies could employ to stand themselves in good stead for the year ahead. This includes sharpening their focus on content to close the gap between those seeking inspiration online and those clicking the buy button.
Marks & Spencer recently inked a two-year partnership with multi-language ecommerce content producer Quill, which will see it deliver more than 50,000 pieces of high-performing content for the brand’s website. This includes product and category descriptions, as well as online customer buying guides.
This is expected to propel a higher proportion of M&S website visitors through their purchase journey, not only increasing online revenue, but also improving the return on investment on all M&S marketing activity that drives traffic to its website. Stuart Stiles, head of product content for M&S.com, says the British retailer has already seen “fantastic results” and has bigger plans to double down on its digital offering. “Customer shopping habits have changed, the trend towards digital has been accelerated and in response it is critical we turbocharge M&S.com,” he says.