Accentuating the retail positives

By Ben Sillitoe

It would be remiss to write a general retail news article or blog without expressing just how challenging the trading and operational environment is for the industry.

The last nine months of pandemic pandemonium on top of an already embattled sector creates a negative outlook for many businesses in this industry of ours. If you’re anything like me, when combining that situation with events in the wider news cycle, it’s a battle to stay upbeat.

Of course, this is all documented in detail across multiple publishing platforms — including on previous blog pages of ours. For today, my inaugural 2021 IMRG blog, I want to accentuate the positives to lift spirits as retailers set sail on another unpredictable calendar voyage, with reference to Johnny Mercer’s song of that jolly title.

♪They said we better, accentuate the positive

Firstly, it should be noted the online retail expansion most retailers experienced in 2020 is not always as positive as headline-grabbing digital sales growth stats suggest — particularly for multichannel retailers set up to take most sales through shops. For those companies, sales may have risen online but they were likely down overall.

However, in the long term, surely retailers’ experience of dealing with greater volumes of online sales in 2020 will stand them in good stead. They learned what is required to successfully navigate peak periods; they gathered more data about their shoppers; and brought forward some previously delayed important investments.

Andy Harding, UK managing director of Openpay, a buy now pay later services provider, says: “An unequivocal learning from 2020 was the importance of prioritising the digital channels within a multichannel business.

“Despite the growth in online retailing, many retailers still considered their stores to be their priority given that the majority of their sales came through that channel. Those were the ones that found it harder to adapt to the changing needs and demands from consumers and ultimately struggled.”

He adds: “The challenges served as valuable lessons and encouraged retailers to revaluate their business model. What is evident is that the retail industry can be creative in reshaping itself.”

Izabela Catiru, product marketing manager at ChannelAdvisor, an eCommerce solutions provider, says as a result of this operational evolution “many now find themselves with vastly more sophisticated infrastructure to market and sell online across a range of channels”.

“When properly harnessed, the data accrued from this surge in eCommerce gives brands everything they need to continually optimise their customers’ online experience,” she explains.

“Retailers and brands can now better target consumers, utilising marketplaces to provide up to date and accurate information to help with product research and harnessing social media advertising to appeal to shoppers browsing these platforms.” 

Monica Eaton-Cardone, COO and co-founder of Chargebacks911, a chargeback management company, says for retailers embracing online in 2020 — many doing so for the first time — it “was incredibly positive change” allowing them to enter new markets, expand across borders, and cater to new demographics.

“As we head into 2021, the opportunity to serve newly developed customer bases will continue as these positive changes become part of a larger long-term transformation.”

♪Eliminate the negative

As Catiru suggests, these inflated customer bases are a new data opportunity.

A frequent moan related to store retailing is the difficulty in understanding who made a purchase, making it tricky to target them for future trade. But with more online transactions, that process becomes easier.

Alex Timlin, senior vice president of verticals at Emarsys, a marketing software provider, comments: “The one saving grace was how much more customer data retailers were able to collect as a result of the rise in eCommerce.

“Retailers have had the opportunity to gain all sorts of vital customer insights — both at an aggregated level by audience segment, but also at an individual level — in terms of purchase behaviour and product preference.”

This will aid personalisation, segmentation, targeting, and wider marketing strategy in 2021, he explains.

Brad Houldsworth, head of product at Remarkable, an eCommerce platform provider, says while 2020 may have seen loyalty drop as consumers shopped new brands, in 2021, “this set of new customers can be focused on more than ever, and built upon to increase customer retention”.

Retailers also discovered in 2020 which fulfilment partners they can rely on and how best to manage multiple fulfilment providers. There’s nothing like a crisis to make clear a supplier’s strengths and weaknesses.

Bren Standell, commercial director for parcel locker solutions at Quadient, remarks: “Although a rapid industry shift can be overwhelming, it poses both opportunities and challenges for retailers in 2021.

“As organisations and individuals continue to embrace digital transformation, it is essential for retailers to optimise their online shopping experience by investing in reliable delivery products and services.”

Delivery Services

♪Latch on to the affirmative

One sector of retail that benefited from the 2020 earthquake was online marketplaces. The big boys with breadth of merchandise such as Amazon, Alibaba and eBay, and the more curated marketplaces run by the like of Asos and Joules all performed well.

Selling via marketplaces isn’t for every brand — ask Nike, for example, which is going through a process of streamlining wholesale partners and pulling away from selling on Amazon in order to take more brand control. However, there are clear positive results for those using marketplaces in a well-thought-out way fitting their individual proposition.

Brendan Walsh, UK general manager at Mirakl, an online marketplace and drop-shipping solution provider, says: “In 2020, we’ve seen that retailers that implemented a marketplace within their eCommerce offering have managed to stay above water and go even further to make the most of the window of opportunity created by the pandemic in response to drastically changed consumer behaviour.” 

He adds: “By leveraging the technical and marketing power of established online retailers, the specialist, niche or simply small retailers that do not have the cash to compete online can also boost their brand presence and benefit from a huge potential customer base by joining a marketplace as a seller.” 

Retailers should probably build on the technology or online services that grew in usefulness and prominence in 2020. From new fulfilment structures and delivery methods, to online-to-store connections and personal email communications, many innovations keeping retailers in business in 2020 were highlighted on these blog pages.

Justin Sears, vice president of product marketing at Lucidworks, a search and data company, says pre-pandemic modern retail customer service and contact centres already favoured omnichannel customer experiences, powered by natural language processing, machine learning, virtual assistants, chatbots and interactive voice response.

But that is set to develop further in 2021 and beyond, he argues.

“Even as consumers shift back towards modified, in-person shopping, customer service leaders have learned new ways to pleasantly deflect support calls with those new technologies,” Sears says.

“Those new strategies will persist and fundamentally change the ways consumers interact with the companies they do business with. In 2020, the trend towards smart self-service options leapt ahead by several years, and we will feel the results of that acceleration in 2021.”

Abi Wendt, head of client performance at Mention Me, which offers customer referral and retention programmes to brands, reports a significant referral uptick for 2020.

“In tough times, people actively tell others about the brands supporting them, and those they tell tend to act on their recommendations,” she explains.

“In Q4 2020, online orders for our beauty clients were up 88% year-on-year, while referrals were up 137%. The past year has highlighted the untapped value of existing customer bases — instead of focusing solely on driving short-term sales, retailers should prioritise nurturing meaningful relationships with their customers.”

Meanwhile, for Rob Delijani, senior director of growth strategy at Wunderkind, a software company helping retailers identify online customers, finding the right mix of paid channel versus own-channel marketing activity was key to success for retailers in 2020.

“The most successful brands realised that online marketing was the fuel that they needed to pour on the fire in order to ensure they hit sales goals during restricted spending times,” he states.

“The brands that focused on owned-channels were rewarded as consumers began to treat their inboxes like virtual shopping malls. Searching their emails, instead of the store shelves, for the latest deals on the products they purchase most often.”

♪Don't mess with Mister In-Between

The above crosshead, like the others before it, is lifted from the upbeat Johnny Mercer song we’ve been referencing throughout the blog to keep spirits high. This particular line speaks of the importance of being decisive, and will resonate with retailers battling to keep pace with continual evolution in their market.

Barley Laing, UK managing director at Melissa, which helps retailers verify customer addresses and contact details, comments: “One of the main positives in 2020 is those retailers who were lukewarm about the online channel finally taking it seriously.

“Lockdowns and increased consumer concerns about visiting the high street have forced the hand of retailers who were dragging their heels about ramping up their online presence.”

James Brooke, founder & CEO of Amplience, a content management platform provider, says 2020 forced retailers “to place digital at the heart of their business” and he encourages further speedy action in the year ahead.

“Retailers need to accelerate transformation initiatives and become digital-first and customer-centric,” he adds. “They need to invest in headless content and commerce technologies that give them the freedom to do more.”

Alecxa Julia Cristobal, marketing content writer for AsiaPay, a digital payments provider, says as online purchasing became “more of a necessity rather than just a leisure activity” in 2020, retailers who adapted easily were those which performed well.

Rory O’Connor, founder & CEO of Scurri, a delivery management software business, says: “In 2020, retailers turned to virtual experiences to keep shoppers engaged while they are increasingly seeking personal and unique experiences.

“The brands that are innovating and developing technology that facilitates new types of online purchasing will be the ones ahead of the game in 2021. Retailers should focus on the positives that came out of this year to ensure they continue to not only survive, but thrive.”

Digital Transformation

Summary

In further advice to act decisively and take 2020 learnings into this new year, Ed Hodges, CEO of HelloDone, a conversational commerce tech company, suggests consumers’ heightened expectations around service online and in stores will not reverse.

“I believe there is a huge opportunity for vendors in a post-Covid world to push forward with tighter integration of their physical and digital retail offerings to create a truly omnichannel experience that reduces friction in the purchase journey, builds customer loyalty and increases conversions,” he comments.

The final injection of positivity as we look to bring gloom down to the minimum, comes from Matthew Furneaux, global commercial director at GBG, an identity management, location intelligence and fraud prevention company.

“Looking ahead, Covid will undoubtedly continue to impact trading patterns, plus there’s the threat of Brexit to consider,” he notes.

“But despite all the uncertainties retailers face this year, I’m confident that agile, tech savvy, customer-focused brands have the best chance of riding the volatility and still achieving growth.”

Happy new year, everyone.

By Ben Sillitoe

Published 14/01/2020

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