Ecommerce during the COVID-19 pandemic: How to turn challenges into online growth opportunitiesLucy Clifton
The COVID-19 pandemic has caused knock-on effects on almost every aspect of our lives. The retail industry is no exception: 2020 has seen a 26% increase in online fashion sales as a result of consumers drastically shifting their buying habits towards digital channels.
Many companies have been forced to respond innovatively, with the birth of websites like Bookshop offering a vital lifeline to independent retailers who previously relied on customer footfall for sales.
This online shift has also caused the acceleration of tech advancements that were expected to take years to catch on pre-pandemic: the departure from cash, and the migration from chip and pin to contactless payments happened almost overnight in order to keep up with evolving safety guidelines. Businesses have been forced to keep up with these technological adaptations, while assuring consumers that their supply chain is in line with hygiene regulations.
The challenges of transforming customer footfall into online growth
This digital revolution has presented a number of challenges for retailers. Independent shops and smaller brands face fierce competition from huge aggregators such as Amazon and ASOS, whose infrastructure has been prepared for the surge in online sales for years prior to the pandemic.
Smaller businesses have been forced to upgrade their online offering in order to compete or even survive, which can incur huge logistical expenses in initially enhancing the order, delivery and returns processes. Additionally, the past year has seen an increased interest in sustainable responsibilities, so businesses are often expected to select more eco-friendly (and costly) options.
The complete lack of footfall due to stay-at-home messaging also means brands are now missing out on the impulse buys that previously occurred at airports or on the way to meetings and events. As a result, businesses can no longer rely on eye-catching products and window displays to draw upper-funnel customers, and instead must turn their attention to innovative targeting strategies.
The future of online shopping
Although these challenges have caused a large amount of change amongst offline-focused businesses, this change presents a key opportunity for brands to harness the capabilities of their digital channels to maximise future gains.
Even in the post-pandemic world, ecommerce is expected to grow, with Retail Economics analysts predicting that 53% of UK retail sales will be online by 2028. The convenience offered through online shopping is a prime reason for this, with the time-saving nature of online purchases encouraging people to stick to habits picked up during lockdowns.
Additionally, hygiene concerns are expected to long outlive COVID-19 lockdowns and affect consumer behaviour as a result, meaning that online shopping will remain a preferable option for many customers. Online retailers are constantly improving their offerings in response to increased competition, encouraging customers to shop online instead of in brick and mortar stores.
Ecommerce opportunities in digital marketing
In the coming months, digital channels will be the main driver of growth for ecommerce brands, with huge opportunities to innovate and generate remarkable results.
Social commerce is a goldmine, with reports showing 42% of Gen-Z consumers stating they’ve purchased fashion items directly through social platforms. Purchases through these channels are largely unplanned, so tapping into the likes of Instagram, TikTok and Facebook is the perfect replacement for the impulse buys that were previously made in store.
Anyone with a social media account will have noticed the evolving nature of ad-formats, with brands creating seamless content that fits into audience feeds like never before. Brands are getting smarter with how they capture consumer attention, and formats such as ‘live shopping’ (Facebook and Instagram), ‘catalogue ads’ (Snapchat and Pinterest) and TikTok ‘shop window’ ads present exciting new chances to drive higher digital sales.
There are also emerging formats that enable brands to bring the in-store experience directly to customers at home; through augmented reality and automated conversational chatbots, brands can emulate the personal assistance that consumers are used to receiving in-person, providing maximum contact without the physical footfall.
It’s crucial for brands to recognise that online growth requires innovative and new approaches to driving offline sales. The recent closure of stores like Debenhams and Topshop demonstrate the importance of businesses reinventing themselves if their sales previously relied on in-person browsing. To translate these sales online, advertisers must upgrade their digital presence to remain front-of-mind for their target audience.
What should retail businesses do to maximize online growth
In order to shift consumer perception, drive new audiences online, and position themselves for rapid online growth, retail businesses must implement a strategy with tech at its core. By fostering a culture of experimentation, marketing teams will be best placed to use tech to adapt, scale activity more quickly, and flexibly shift business priorities to accommodate changes.
Embracing technological advancements will also help businesses stand out from competitors: beyond simply upscaling their digital presence, advertisers need to critically assess the options they currently offer consumers, from introducing accessible payment options like Paypal and Klarna to a wider variety of click and collect options.
Although national lockdowns and social distancing are (hopefully) short-term restrictions that must be accommodated, improving website experience and upgrading targeting strategy will only serve to keep customers returning to successful brands long past the pandemic.
Now is the time for businesses to guarantee their operation is smooth from start to finish; using tech and data to maximise the user experience will keep customers visiting certain websites over their competitors. With this in mind, CRO teams should be auditing webpages to ensure the on-site experience is friction-free, with a simple user design that is effectively optimised for mobile or app functionality.
It’s also essential to reevaluate the current logistical operation to ensure returns and exchanges are as smooth, accessible, and safe as possible so that customers aren’t being dissuaded from returning in the future.
A new ecommerce strategy for the future
By adopting an omnichannel approach, brands will gain greater reach across their entire audience demographic, setting them apart from competitors by remaining front-of-mind while in-store shopping is unavailable. If they aren’t already doing so, performance marketing teams need to shift their focus to social channels in particular, experimenting with new features that could give a competitive edge.
In line with shifting focus to new channels, this is also a good time to experiment with budget allocations. Reassigning budget to funnel audiences towards digital channels as opposed to out-of-home advertising will increase viewability of advertising; soon enough there will come a time for eye-catching billboards and subway/underground campaigns, but while the majority of consumers are stuck at home it’s far more beneficial to funnel budget towards creating ‘thumb-stopping’ content that will drive users onsite.
Businesses need to critically assess the current services offered, upscale their digital operation to keep customers at the heart, and ensure they can successfully transform footfall and in-person impulse buys to online sales.
If you think your digital operation is in need of some expert consultancy, full management, or anywhere in between please don’t hesitate to get in touch!