GUEST COMMENT Why frictionless commerce is the future for retail
Ecommerce broke the dynamic of traditional retail, where the retailers held all the power. They chose what products they bought from manufacturers, and how they sold them to consumers. Retail sales teams would decide which products to place where, and how to activate them – a difficult decision that often resulted in cluttered shelves. Brands were left competing to offer the most attractive promotions and the flashiest point-of-sale package, to cater as much to retail decision makers as to consumers.
Consumers are now firmly in charge. Carrying their decision making tools with them in their pocket. They are always ready to search for information, read reviews, or shop - consumers have come to expect the same readiness from brands. They want a frictionless shopping experience, from mobile and online through to in-store. Helped by technology and consumer expectations, brands and manufacturers are now able to build entirely new value propositions around the consumer, through business models like mass personalisation, automatic subscription and instant delivery.
A good example of this sort of alternate retail is Zenamins, a company that provides personalized nutritional supplements. On the Zenamins website, consumers can pick out health issues, specific conditions and vitamin deficiencies. Zenamins then mixes these and sends them over to the consumer – and at the time of checkout, a consumer can request they get this personalized blend of vitamins on a recurring basis. With this level of personalisation and ease of use, it is easy to see how a company like Zenamins offers a very unique value proposition. What the subscription also does it is gives Zenamins permission to communicate – as consumers receive shipping confirmation emails on a regular basis, there is a clear mechanism for Zenamins to improve long term customer lifetime value.
The retail brands with success in this new ecommerce landscape are those that understand how to build a strong and coherent content strategy across all consumer touch points. New technology and retailers’ access to in-depth and quantifiable data gives unprecedented possibilities to tailor content to consumers. More and more consumers now expect a personalised experience, based on what they’ve previously bought, what they like and how they like to shop. Retailers from Amazon to Net-A-Porter are starting to find ways of better engaging with their consumers based on data. They’ve set the bar very high, and now all brands need to provide that level of consumer knowledge and engagement through their ecommerce touch points, and moving well beyond just consistency of brand look-and-feel. Data and technology advancements allow brands to unlock and monetise consumer insights with real-time solutions, customisable audiences, endless creative opportunities and resourceful activations – whether on a brand’s own website, on social media or via third party retailers.
Crucially, the ecommerce experience goes way beyond a website, and should not only be reflected throughout the internet but in physical stores as well. We are starting to understand the massive influence that ecommerce has on offline sales. The traditional divide that has existed between online and offline shopping is now indefensible, and the most successful retailers are ones who are adapting to this omnichannel world. One retailer who is doing this remarkably well is Waitrose, with its Pick Your Own Offers programme, giving consumers a high level of personalisation. The scheme is a win-win for the retailer and the manufacturer, as it drives loyalty at both the retailer level and the item level - and for a retailer who has focused on a premium in-store experience it is a definite win.
With $1.9 trillion of sales projected in 2016, it is easy to think of ecommerce as just a sales channel. This is a temptation that brands must resist. Ecommerce is not just about conversion media; in a world with shorter time to influence consumers and with higher consumer expectations, brands must think about what will make them the first port of call. The entry of programs like Prime Now has reduced the window between desire and delivery to zero, so if brands wait to start communicating with a consumer when they raise their hand to say they are in market, it’s entirely too late.
Ecommerce is about much more than giving the consumers a place to input their credit card details. Brands need to think of ecommerce as more than just a sheer transaction mechanism, given the way that we make product decisions has now changed completely. Brands need to tell their story with relevant content and most critically, make sure that their product detail pages don’t look totally detached from brand destinations like websites and Facebook pages. Owing to the fact that most organisations have different teams for sales and marketing, there is often a massive disconnect between the brand and the product – this divide is one that must be overcome. Switching costs in a world of ecommerce are incredibly low, as are barriers to entry, so brands that seem to have an inconsistent identity will be challenged. In the world of ecommerce, everything is so much more equal than it ever was before.Mudit Jaju is digital and data partner and head of ecommerce at MEC Global