By Nils Zündorf, Amazon expert and managing director of the largest European Amazon agency, factor-a
The pandemic’s effects on customer behaviour in 2020 lead to significant changes in the e-commerce world. With increases in online sales of over 30% compared to 2019, UK merchants who were set up for online shoppers were the big winners of 2020. Although the pandemic is slowly coming to an end, new formed habits of customer behaviour will stay, forcing retailers to go over their e-commerce strategy and make some adjustments to be prepared for what’s to come.
While physical shops will stick around, shoppers have become used to the endless possibilities and convenience of online shopping. Retailers should look into combining the best of both worlds and build a hybrid retail model.
Here are the five trends worth incorporating for a future hybrid retail model.
Twitch is a great opportunity for retailers to reach a fast growing audience with many interests aside from gaming
During lockdown many people turned to online shopping and other virtual services such as gaming and e-sports. Right now, the UK has the world’s fifth largest and Europe’s second largest interactive gaming industry. The industry is twice as lucrative as it was a decade ago. One of the biggest streaming platforms is Twitch, which attracts millions of users to game, stream or just chat. Although it originally gained its popularity through gaming and e-sports, the platform is also being used to live stream other content, such as cooking, workouts, music productions and more. Twitch is a great opportunity for retailers to reach a fast growing audience with many interests aside from gaming.
Amazon announced in September last year, a new collaboration between Amazon DSP and Twitch, which allows retailers to create display and multimedia campaigns based on Twitch user data on the platform as well as in networks outside the Amazon ecosystem. Compared to sponsored ads, these ads have a much wider reach and can address target groups regardless of a specific product search. For many retailers this is still uncharted territory as the number of retailers who are using Twitch for advertising remains rather small compared to the size of the platform. Major brands like Burberry, Old spice and Pepsi are already using the synergies of the platform but it won’t take long for other retailers to follow suit.
Over 20% of UK households have smart speakers and this number is expected to triple by 2023
During Prime Day, Amazon showed how important this channel is going to be, by using last year’s sales days (Prime Day and Black Friday) to push its smart speakers and other devices into the market. Right now, over 20% of UK households have smart speakers and this number is expected to triple by 2023, Amazon’s Alexa remaining the most popular one. The new home companion is in kitchens, bedrooms and living rooms, thus creating a new channel to interact with customers. At the same time it offers the opportunity to establish and integrate brands into the consumer’s everyday life while certainly throwing old marketing principles out the door. Companies who are eager to enter their customers’ homes with Alexa are not only able to sell their product but are accessing a new touchpoint in the customer journey for branding, service and marketing. While not every product is suitable for selling via voice assistant, retailers should take a closer look at Alexa Skills. The number of speech-based apps is growing rapidly. If retailers manage to provide a useful skill for their customers it will give them a decisive edge against their competitors.
Enabling customers to virtually try on clothes and make-up, while sitting on the couch, will give online merchants a big advantage
Especially fashion and cosmetics retailers will profit from this trend amidst closed shops on High Streets. Enabling their customers to virtually try on clothes and make-up, while sitting on the couch, will give online merchants a big advantage even after shops will reopen again. This is exactly what retailers want to include in their hybrid retail model. Even after the pandemic, shoppers will likely continue to use this approach.
Forming a bond with potential customers via social media through ways livestreams can be an important step for retailers
With social media networks adding (more) shopping features to their platforms like Instagram and Facebook shopping, this will continue to be an important development to watch. While on the one hand this is another channel to sell products, it especially helps retailers to stay connected to customers and engage them with their brand. Forming a bond with potential customers via social media through ways livestreams can be an important step for retailers to help maintain strong customer relationships.
To sum up, online shoppers have an endless combination of channels, devices and touch points and brands need to understand the complexity of consumer shopping behaviour. This will require businesses altering their digital real estate to accordingly reflect this assortment of customer journeys. One of the main challenges this brings is the huge amount of customer data and retailers will need to learn to interpret this information to build a solid strategy.
About the author:
Nils Zündorf, Amazon expert and managing director of the largest European Amazon agency, factor-a. He has been working in e-commerce for over 10 years and has advised hundreds of companies on how to navigate the e-commerce space – even far beyond Amazon.
factor-a advises more than 150 manufacturers and brands on how to maximize their success on the sales platform. With the creation of factor-a suite, an intelligent software solution, the company helps retailers navigate, interpret and use e-commerce data successfully.
factor-a is Europe’s largest Amazon specialist agency. The company advises more than 300 manufacturers and brands including clients like Levis, Yamaha, Johnson & Johnson and JBL on how to maximize their success on the sales platform. With the creation of factor-a suite, an intelligent software solution, the company helps manufacturers navigate, interpret and use e-commerce data successfully. In May 2018 factor-a joined the international full-service digital agency Dept which employs 1,150 people in 11 European countries and the USA.
(A Retail Times’ sponsored post)