Melanie Vala, Chief Commercial Officer of Splitit, explains why the retail marketing effort should focus on growth and competition, influx of online shoppers, sustainability, AI and payment methods.
Online retail is experiencing rapid growth and evolution, greatly accelerated by the impact of the pandemic. In fact, e-commerce revenue is expected to reach a staggering $5 trillion this year and shopping habits continue to change.
Now, retail marketers must determine how they can embrace these changes and apply them to their marketing strategy going forward.
It’s important to realize that today’s buyers have considerable control over their buying journey through a variety of channels. To drive sales in an increasingly competitive environment and meet ever-changing customer needs, marketing teams must create memorable experiences at every touchpoint that keep customers satisfied and coming back for more.
As we look ahead to the rest of 2021, here are five big macro trends retailers should keep in mind when evaluating their marketing practices:
1. Continuous growth and competition
The continued growth of e-commerce will lead to more companies entering the field. This increased competition puts additional pressure on businesses to remain relevant to their customers and retain them. In the past, merchants offered loyalty program benefits to be used only in their physical stores, but that is changing. Today, online retailers are expanding loyalty programs to include online and mobile shopping.
To do this, retailers offer subscriptions that allow customers to save money if they commit to paying a monthly subscription fee for their purchases (for example, Amazon Prime, Instacart and Fabletics). Another way for digital retailers to extend loyalty programs is to offer convenient or money-saving subscription boxes or subscription items. Today’s brands would benefit from evaluating whether these offers could positively contribute to driving sales growth and brand loyalty and incorporate them into their marketing plans accordingly.
2. The influx of new online shoppers
The pandemic has brought many housebound customers online and mobile for the first time. Now, e-commerce stores, rather than brick-and-mortar stores, are the primary path to purchase for many brands. To retain these new customers, digital marketing strategies must include technology to ensure that the journey to purchase company merchandise is easier than that of competitors. This could include robust search and filtering capabilities so customers can quickly find what they want, unobtrusive but effective personalization at every touchpoint, sites that load almost instantly, and streamlined returns and exchanges.
In addition, ensuring rapid order fulfillment through improved logistics networks and increased fulfillment efficiency will be key to winning and retaining new customers. So will the use of chatbots, which can help customers find what they want, when they want it. Retail marketers who adopt performance-enhancing technologies will be in a better position to attract growing numbers of online shoppers to their sites.
3. Buy now, pay later
Another way to make digital shopping more comfortable and engaging is to offer the option to buy now and pay later. Although credit cards have always provided this option, most buy-it-now, pay-later (BNPL) providers do not charge any interest or fees and do not affect the customer’s credit usage metric on plans. credit rating. BNPL was popular before the pandemic, but during the pandemic consumers preferred longer payment plan options. In fact, over 40% of credit unions have moved from a five-payment plan option to a seven-payment plan option. Online retailers that offer BNPL options experience increased shopper spend, lower risk of cart abandonment, and returning customers if they have a positive shopping experience. If your brand doesn’t offer BNPL as a payment option, now would be a good time to offer shoppers this extra flexibility.
Increasingly, buyers want to support companies that have been produced in an environmentally friendly way or that preserve the environment or encourage recycling. The notion of sustainability contributing directly to the bottom line has been difficult for most companies to accept until recently. By 2030, at least $12 trillion in marketing opportunities will be linked to the United Nations Sustainable Development Goals. Online retailers need to implement sustainable practices and develop marketing strategies to support this.
To this end, online retailers should consider practices such as including sustainability messaging in all advertising, social media and influencer marketing, reviewing packaging materials, sending electronic receipts or adding products that encourage sustainability or finding eco-friendly alternatives to existing products. .
5. Artificial Intelligence
By 2022, online sellers are expected to spend $7.3 billion on artificial intelligence, up from around $2 billion in 2018. Modern retail brands can leverage AI to improve customer experience through personalization. Delivering personalized experiences on-site or as part of retail marketing efforts has been shown to increase sales. In one study, 40% of customers said they spent more than expected when retailers used a high level of personalization. AI also helps drive sales by improving the voice commerce experience and through fulfillment efforts. Continued investment in AI will help today’s brands stay competitive and keep customer satisfaction at high levels.
If we’ve learned anything from 2020, it’s that retailers can no longer dictate how and where customers will buy. For the remainder of 2021 and beyond, retailers will need to remain flexible and communicate with customers whether they are buying in-store, online or via mobile device, or which payment method they choose.
Retail marketers who focus on personalizing the shopping experience using AI and promoting eco-friendly practices will help drive sales growth for digital marketers. As e-commerce continues its upward trajectory and digital customer experiences improve, e-commerce retailers who plan and develop marketing strategies around these trends will be in a much better position to reap the benefits.
Mélanie Vala is Sales Director at Splitit