Digital Cream Singapore: Ecommerce
Ecommerce has been a major driver of Internet growth for 25 years now and one might think that there were few ways left to innovate the online shopping experience. Yet, year after year, new forms of ecommerce emerge, and brands must reposition themselves to continue to take advantage of consumers changing online shopping behaviours. So, what has changed recently? And how are brands adjusting to capitalize on the new opportunities from the changing landscape? To find out, ClickAcademy, in association with Amazon Web Services, recently held roundtable discussions with client-side marketers at our annual Digital Cream event. At the Ecommerce table, hosted by Ajay Shankar, Ecommerce Director, Lenovo, attendees discussed their experiences and insights about the ever-changing world of online shopping. Below are highlights from the day's discussions.
1) Generational shifts will change ecommerce to a great extent As we enter the 2020s, consumers are changing. Baby boomers are steadily leaving the workforce and GenZs, or those born between 1997 and 2010, are starting their professional career. No longer are Millennials the 'new' generation. They are growing older, starting families and changing their internet browsing - and buying - habits. While attendees had differing ideas about what this generational shift would mean, everyone agreed that what has worked over the past 10 years will not continue to be effective.
2) Out: Channel conflict, In: Seamless journeys Our table host, Ajay, has been the moderator at our Digital Cream Ecommerce table for 8 years straight - and channel conflict has been one of the main topics for at least the last 3 of them. This year, however, he noted that there has been a shift away from discussing how best to divide sales by channel and toward how to manage a seamless customer journey across all channel. Brands this year are looking at ecommerce as part of the customer journey and are keen to track, manage and attribute channels as part of a single customer journey. 3) Customer acquisition costs are rising Marketers agreed that, overall, it is costing brands more to acquire new ecommerce customers than ever before. While it's difficult to identify a single reason why, attendees felt that changes in online behaviours, such as less web browsing, is a contributing factor. Moreover, because all digital marketers are going after the same customers on the same channels, they are driving up the costs for each other.
4) Brand sites and marketplaces must coexist Finally, brands have apparently resolved the conflict between selling via their own site and marketplaces. They must sell on both. What marketers have realized is that in the customers' eyes, both are important and it’s not one versus the other. Customers look for one type of product on the marketplaces and another on the 'brand.com' and so both are equally important for brand e-commerce.
How ecommerce marketers are capitalizing on trends
It's one thing to identify the trends, it's another to come up with ideas about how brands can flourish as the ecommerce world changes. So, what are marketers doing in reaction to the above trends? 1) Reimagining the 'brand.com' site One of the most pressing issues on ecommerce marketers' minds is how to manage their own site so that it complements instead of competes with marketplaces. Ideas included implementing loyalty programmes and ensuring that the brand site had the latest and greatest products. Whatever tactic they are pursuing, though, attendees agreed that the strategy is to build a strong brand relationship with customers regardless of the channel. Interestingly, not a single brand marketer said that they were moving away from developing their own website. All are aggressively developing both marketplaces and 'brand.com' as ecommerce sales channels. 2) Seeking more data from marketplaces While using marketplaces is now a given, brand marketers are still not happy with their relationship with them. They are concerned that customer acquisition and performance data are not made available to them and so marketers struggle to come up with a comprehensive go-to-market strategy which includes marketplaces as a key channel. Lack of post-search performance data was also raised as a concern. Still, some ideas emerged for how brands can still use marketplaces effectively, even without performance data. These include selling end-of-life products on the platforms and developing bespoke product portfolios for them.
3) Finding new channels for customer acquisition As mentioned above, customer acquisition costs are rising and so marketers are looking for ways to drive demand at a lower cost. One way some participants are doing this is by exploring new channels, such as influencers / KOLs. Another tactic being tries is through developing partnerships with non-competing brands so that they can tap into each other's customer bases. But the most popular way marketers are trying to lower acquisition costs is by trying to reduce their need to get new customers. They are developing retention programs designed to nurture their existing customer community. Tactics for this strategy include viral and email marketing to ensure that the brand stays 'top of mind' with their existing customers in an attempt to increase brand loyalty. 4) Taking another look at personalisation Personalisation has been one of the most popular ways for ecommerce marketers to boost sales. Whether it is through bespoke email offers, dynamic retargeting display ads or recommendation engines on the website, brand marketers have long relied on personalisation techniques to nudge up ecommerce revenue. Now, however, marketers are looking beyond the basics and thinking about how they can make the whole customer experience more personalised. Doing so would include changing the website so that navigation options matched how people used the site with a goal of shortening the user journey and increasing the click to purchase rate. While still in its early stages, participants agree that these new approaches to personalisation sound promising and hoped to give updates on their effectiveness at Digital Cream 2020!
A word of thanks
ClickAcademy would like to thank Ecommerce table moderator Ajay Shankar, Ecommerce Director, Lenovo and subject matter expert Brendan O'Shaughnessy, Chief Commercial Officer, ViSenze for hosting the day's discussions on the trends and new directions brands are taking with their ecommerce initiatives. We'd also like to thank all the brand marketers who took time out of their busy schedules to share their experiences, insights and frustrations with the current ecommerce landscape. We hope to see you all at future ClickAcademy events!