Consider making these data-driven ecommerce upgrades now to future-proof your business
Digital ecommerce channels have been maturing slowly for a couple of decades, but this year’s events have finally and firmly moved them to the forefront of retailers’ business plans. Ecommerce has seen dramatic growth this year, as the pandemic and social distancing have shifted consumer behavior to online and mobile sales channels.
According to a June 2020 Forrester report, 70% of consumers are buying more items online than before the pandemic, and more than 90% say they’re shopping online as much as possible to reduce the need to go to physical stores. Many industry analysts say those changes are here to stay and predict steady growth in ecommerce’s share of retail sales through 2024:
This growth trend is good news for many ecommerce businesses, with one caution: With such strong growth in sales this year, it can be easy to overlook the need to invest in new ecommerce technology and tools. However, to keep customers, grow market share and earn more revenue over the long term, it’s critical to upgrade and update the way your store uses data, so you don’t find yourself lagging behind your competitors.
Here are the key areas where your online store may need to raise its data game to keep up with new technology and rising customer expectations.
Comprehensive personalization for better CX
Ecommerce and omnichannel advisors have been promoting seamless personalized customer experience for a while now as a way to build loyalty and increase customer lifetime value. Content personalization can be present in elements such as recommendations for future purchases, search results, and any and all communications with the customer. However, the implementation still has a long way to go.
Forrester reported in June that just 14% of consumers and 22% of B2B customers agreed that their most recent digital purchasing experience was fully personalized. That could be about to change. In June, 40% of ecommerce merchants said they’re planning to moderately increase their personalization investment, whether through targeted content, product suggestions or better search functionality, with another 24% of merchants planning to invest significantly more.
As more merchants deliver more personalized experiences, they will become a primary factor in how customers evaluate brands and decide where to shop. If your customer experience isn’t personalized across your online store, mobile app, emails and social interactions, it’s time to make improvements to avoid falling behind.
Improved digital merchandising capabilities
Digital merchandising has long aimed to replicate and even improve the in-store retail discovery experience by using analytics to identify and promote likely purchase drivers. So far, online merchandising hasn’t been as effective as the in-person variety: about 11% fewer shoppers add impulse items as they shop online, compared to shopping in stores.
To close this gap, the majority of merchants said in June they plan to invest more in digital merchandising, with 28% planning moderate investment increases and 32% planning a significantly larger spend, per Forrester.
Like accurate personalization, an effective digital merchandising process requires a lot of data--about the customer and your inventory to display products they’re likely to want, promote in-stock items or bundle slow-selling items with more popular merchandise. And like personalization, as more stores improve their merchandising online, customers will come to expect appealing offers everywhere they shop—including in mobile shopping apps.
Better mobile commerce experiences
There’s been some coverage of the fact that some consumers are using their desktops and laptops more to shop from home, but overall, the trend toward mobile shopping remains strong:
- Mobile commerce is expected to total $314 billion for 2020, more than 44% of all ecommerce revenue.
- App installations surged 40% and mobile commerce sales through apps reached $27 billion during Q2 2020. In July, 59% of all US adults said they preferred to shop on their phones, with under-45s strongly preferring mobile to desktop shopping.
Because of the accelerated adoption of mobile commerce, 62% of merchants told Forrester they plan to invest more in their mobile apps over the next 12 months. Some retailers are already driving traffic to their apps with app-exclusive holiday offers, while others are using different mobile capabilities like SMS to connect with seasonal shoppers.
In addition to better apps and text campaigns, ecommerce merchants should review and possibly revamp their mobile marketing strategies to factor in new consumer shopping habits, like responding to push notifications of flash sales and coupon codes.
Transparent stock and fulfillmend data
Many merchants are now in reactive mode, switching their focus to improving productivity for their teams, improving data utilization for decision-making and responding to customers’ desire to find in-stock items.
Stockouts were a frequent source of disappointment for consumers in physical stores before the pandemic arrived. In November 2019, 39% of consumers said they’d left a store because the item they wanted wasn’t on the shelves. Now that frustration has moved online, where supply chain issues and high demand for many items have caused widespread shortages of products from curtain rods to kayaks. And the online shopping shortages have created another frustration—ordering items only to learn that they’re backordered for weeks or months.
Because of these experiences, customers want to know that the item they’re adding to their cart is available and ready to ship. Real-time inventory management is the way to provide this information, and for many retailers that requires a data platform upgrade. Sixty percent of ecommerce merchants told Forrester they’re stepping up their digital operations investment over the next 12 months. Other merchants ignore the transition to real-time data at their peril.
Once the item is out the door, customers want to know where it is and when it will arrive. Tracking data from shipping carriers is one basic option. Another is a white-label third-party shipping tracker within your store that lets customers see their items’ location in real time without leaving your website.
Smarter fraud prevdention strategies
Consumers and B2B decisionmakers aren’t the only people making more purchases online. Fraudsters, always eager to capitalize on disruption, have increased their attacks on merchants. For example, BOPIS (buy online, pickup in store) fraud is up by more than 50% since the start of the pandemic.
Also, because so many people started shopping online this year, merchants are seeing high numbers of brand-new customers, leaving merchants with a fraud-screening dilemma. Are those new customers legitimate shoppers or fraudsters who’ve created accounts to run scams? The challenge is made more difficult because without a customer history to inspect and evaluate, basic fraud detection programs may have trouble scoring those orders correctly.
A better approach is to use algorithms that analyze the entire context of the order, including device identity and location, consumer data from other sources and other data points—and then have experts review the orders that look like potential fraud. That two-step process screens out fraud but also avoids falsely declining good orders, which can permanently drive away customers.
Better data, better applications, better ecommerce CX
Clearly, the next big improvements in ecommerce customer experience will be driven by data. Customer history and behavior data matters for personalization, merchandising and fraud prevention. Inventory and logistics data supports better merchandising, stock status and shipping information. And both kinds of data support a better mobile shopping experience.
Right now, the boom in ecommerce is giving merchants data along with revenue. It’s up to merchants to reinvest the insights from their data in their business.
Original article at: https://www.business.com/articles/data-driven-ecommerce-upgrades/