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By Ralph Robinson, Head of Retail & Consumer Markets, BJSS
Online shopping surged following the start of the Covid-19 pandemic and retail e-commerce sales are predicted to grow by 16.8% in 2021 to $4.921 trillion. However, a small handful of companies will eat up a large chunk of this because the US e-commerce sector is dominated by retailers like Amazon and Walmart, with 150 million users (46% of the US population) and 86 million users (26%), respectively.
Early-adopter advantage, pre-existing scale and strategic use of technology have made these companies difficult for smaller retailers to compete with, while also setting a high standard for the e-commerce experience all retailers must offer.
So what are you supposed to do to compete with the e-commerce giants? Luckily, there are quick, effective ways that you can offer the same online experiences that the big players do at a fraction of the cost. In this article, we’ll explore how emerging technologies around personalization, price optimization, social content aggregation, delivery optimization and scalable conversational commerce could give you a competitive edge.
1. Anonymous Personalization
The value of customer data to drive sales is clear – Amazon’s conversion rate for Prime members (the customers it holds the most comprehensive data on) is a staggering 74%. Yet up to 97% of website visitors remain anonymous and legislation like the California Consumer Privacy Act (CCPA) is setting a precedent for how states can enact strong privacy controls online. Are brick-and-mortar retailers therefore helpless to personalize the online shopping experience?
Apparently no longer! Zero-cookie anonymous website personalization platforms now exist, allowing retailers to segment visitors and personalize their experiences in real-time. This expands the target market from just those customers who are signed in or using loyalty schemes to the majority of visitors. With some big-name integrations like Shopify, Salesforce and WordPress, and customers from Boohoo to Speedo, there might just be something in it.
Check out: Personify XP is a good place to start (although there are alternatives).
2. Price optimization
Did you know that, in 2020, on average 88% of online shopping orders were abandoned worldwide? And if you’re unable to compete with the low prices of Amazon, with its huge economies of scale, you might have to look for more creative ways to reverse those missed sales opportunities. One option is to let customers negotiate on price. Bartering has worked in physical retail for centuries, but until now it’s been much more challenging online. Enter solutions like Nibble, where simple blue price buttons integrate into your product listings and allow consumers to haggle over the price with a chatbot.
I tried this for myself and it’s really fun! Don’t expect rock bottom discounts, however, since retailers set upper and lower thresholds, but a small saving on a product combined with the interactive experience of bartering could improve conversion. According to Nibble, most customers still buy full price even with a haggle option, but it seems a great way to maximise the chance of closing deals for shoppers who love a bargain.
Check out: Nibble’s demo lets you negotiate on the price of a speaker - I saved $20!
3. Social content aggregation
Nearly three-quarters (74%) of North American consumers spend an average of 1.6 hours a day on social media, so it’s not surprising that retailers are increasing their activity and analysis of these lucrative sales platforms. Nevertheless, it’s difficult (if not impossible) to sift through all the content relevant to your brand and integrate the right messaging into your e-commerce experience.
However, solutions like Knexus use Artificial Intelligence and other technologies to automatically analyze your social content and seamlessly integrate it into your shoppers’ online journey. Regardless of location, content can be automatically tagged and indexed before integrating rich, engaging material back into your own e-commerce site. This data can also improve personalization and conversion by removing the need for shoppers to leave the site for social validation or to seek out off-site reviews. With some impressive conversion uplift stats, it’s one to consider if social proof plays an important role in your shopper journey.
Check out: Knexus to learn more.
4. Delivery optimization
The number of parcels being delivered went through the roof over the pandemic and delivery robot volumes are forecast to quadruple in the next five years to become a $579m industry. However, we’re still years away from competitively priced autonomous delivery for retailers aside from big players like Amazon, which means that getting delivery right is critical in the meantime.
Delivering items to the right location is still a pain point for many customers - ZIP codes are notoriously inaccurate and a source of frustration for delivery drivers and satnav users alike! Solutions like what3words and PostTag, however, provide more accurate locations. The latter is used by delivery brands and retailers to provide precise consumer and business locations to their drivers, increasing efficiency and reducing wasted time searching for the right door or entrance. More efficient delivery also significantly reduces carbon emissions, providing both a social and economic reason for businesses to reconsider their routing and delivery optimization.
3. Scalable conversational commerce
When everyone wants customers to download their app, why not just meet customers where they already are? Two billion people used WhatsApp in 2020 and retailers are fast realising the power of the platform for shopper engagement and communication.
Solutions like HelloDone provide conversational AI at scale, facilitating customer order tracking, product queries and returns, all through a familiar existing platform like WhatsApp or Facebook Messenger. This clever solution harnesses automation to make it easier for retailers to instantly answer customer questions, improve retention and reduce frustration. Shoppers can use the solution to quickly navigate to relevant information without needing to learn how to use a new website, fill out a form or download an app.
learn how to deliver an outstanding e-commerce customer experience
While the technologies listed above have yet to fully reach the mainstream, they present solutions to many common e-commerce challenges. And with the explosion in online shopping showing no signs of slowing, utilising the most cutting-edge solutions to deliver stand-out customer experiences online is no longer just nice-to-have – it’s crucial to survival.
If you want to learn how to harness digital innovations to keep pace with your competitors, download our free white paper, Retail E-Commerce: Driving Sustainable Growth Through Innovation. It contains advice and insight based on BJSS’ experience building bespoke software solutions for leading retailers in North America, Europe and Australia.