InternetRetailing rounds up the latest news, insights and trends on how retailers and customers are responding to this year’s peak trading season. In recent years pre-Christmas shopping has been at its highest over the Cyber Weekend of Black Friday to Cyber Monday, but the shape of this year’s shopping could well be different since English non-essential shops are now closed until 2 December under a second Covid-19 lockdown, while in Scotland non-essential shops are closed in 11 Tier 4 areas including Glasgow. Non-essential shops are currently open in Wales and Northern Ireland.
NOVEMBER CROSS-BORDER ONLINE SALES GROW 88% YOY AS THE IMPACT OF BLACK FRIDAY STARTS EARLY
International online same store sales have increased by 88% over the first two weeks of November, compared to 2019, as cross-border ecommerce sales remain at record levels, according to data compiled by cross-border ecommerce leader, eShopWorld (ESW).
With lockdown directives varying from market to market, the 2020 Peak Trading period continues to be marked by unparalleled uncertainty as online shopping increases and numerous countries launch early discounting for an online only Black Friday.
However, as coronavirus restrictions tighten across the country, data shows that UK consumer confidence has fallen to its lowest level since May.
This new downturn in consumer spend highlights the need for UK brands and retailers to embrace international sales opportunities not just associated with the Golden Quarter but for long-term business performance, as many brands brace themselves for the fall out of covid and the looming impact of Brexit on trade.
ESW’s sales data reveals the top 10 markets for YOY cross-border sales growth during the first two weeks of November with Mexico (376%), Chile (312%) and Israel (304%) recording the highest increases as the most prevalent emerging international ecommerce markets.
Tommy Kelly, CEO of ESW says: “In 2020, our data shows the retailers who will ‘win’ – both in Peak and beyond – are those with a deep understanding of global market expectations who can leverage that insight to engage directly with shoppers in the international markets that they serve in meaningful ways to grow long-term loyalty,”
IS BLACK FRIDAY 2020 HEADING FOR A £8.49BN DISASTER?
Black Friday 2014 turned from a retailer’s dream to a delivery nightmare as overwhelming demand crashed many UK websites and snapped supply chains. ParcelHero fears a lockdown Black Friday will be even worse this year, estimating a £8.49bn disaster.
With online sales already up 53% YOY because of the impact of the pandemic, the added surge in demand from the Black Friday sales could cause another disaster, says ParcelHero’s head of consumer research, David Jinks MILT.
This year, it is predicted that retailers’ deliveries will put an estimated 592 million parcels in the system in the weeks before Christmas. Due to Black Friday, this Mount Everest of Christmas peaks will spike between 27 and 30 November – still inside the critical lockdown period in England.
Following the multiple catastrophes of Black Friday 2014, huge numbers of consumers decided to turn to buying online instead; spending a then-record £810m online. Yet, no-one was prepared for this scale of online ordering. Nearly one in three (31%) online shoppers experienced problems with their orders that Christmas, 49% suffered from missed deliveries due to overstretched companies’ erratic delivery patterns, while 45% experienced late deliveries or never received their goods.
The spike in online orders caught many of the UK’s most respected brands off-guard. The likes of AO.com, M&S, River Island, Currys-PC World, Shop Direct and Debenhams all admitted to disruptions to their delivery networks in fulfilling the record amount of orders.
WHAT WILL CONSUMERS WANT THIS CHRISTMAS SALE SEASON?
How consumers shop this Peak will be different, but how different? Research by Diginius, a UK provider of proprietary software for digital marketing and ecommerce solutions, suggests that there are a few key elements of customer demand that retailers need to focus on this season.
- Promotions, price and everything nice – While businesses seek to claw back some lost revenue, following the financial impact of the coronavirus, it is important to keep in mind that consumers will also be motivated by price and value this year. Black Friday sales, pre-Christmas offers and Boxing Day deals will perhaps be the most appealing times to shop for these customers.The most popular channels for online research are Amazon (62%), Google (47%) and brand websites (45%) – in that order. These are the channels retailers need to focus their marketing on. With 70% of users checking the price of products on Amazon before placing an order, there is clear evidence that price is the deciding factor.
- Trust – Considering the uncertainty and disruption caused by the pandemic, it is key that trust and brand confidence remains with the consumer. To achieve this, retailers must manage activity effectively; especially for those now dealing with multiple sales channels, online, offline or via different marketplaces. For instance, ecommerce platforms such as VTEX align and integrate all of a brand’s sales channels. With all information kept in a centralised management system, businesses can be more responsive, retrieve data faster and in turn, provide better customer support that is quick to respond, and to effectively resolve issues, should they appear.Similarly, as shoppers will be buying online and having gifts shipped to friends and family this holiday season, businesses need to ensure they offer a reliable delivery service, too. With regular updates on shipping progress and informing customers of any delays.
- Product trends and predictions – Google trend research has shown that ideas for homemade gifts have experienced a 10% increase in search volume than this period last year. Similarly, searches for hampers have increased by 175% and letterbox gifts by 450%, suggesting items that can be gifted ‘remotely’ or from a distance are the theme for this year’s wish lists. However, searches for traditional gift items such as perfumes, aftershaves and jewellery remain consistent.
MARKETPLACE ONBUY TURNS TO PRIME-TIME ITV AD SLOTS TO DRIVE PEAK SALES
OnBuy.com, the self-proclaimed fastest-growing marketplace in the world, is taking the somewhat unusual step of launching a major national TV ad campaign on ITV ahead of its Black Friday sale and the run up to Christmas.
The £1 million campaign is to increase consumer awareness and support retailers that sell through the marketplace and aired for the first time on ITV on Monday 23rd November, just before 7:30pm.
“We’re encouraging the British public to support independent retailers this Black Friday and beyond through an eCommerce platform that truly has the seller’s best interests at heart,” says the founder and CEO of OnBuy, Cas Paton. “Consumers are choosing to shop with fair and moral brands more and more, so now is the time to bring OnBuy to the front of every shopper’s mind.”
WHICH WILL KILL CHRISTMAS FIRST; BOTS OR COVID?
With the pandemic forcing most retailers almost exclusively online, the use of automated bots to purchase goods ahead of genuine consumers is steadily increasing – look what happened when Sony launched Playstation 5 and bots took over.
The danger is that what was once a scam generally associated with limited edition trainers, new tech gadget and concert tickets, is now impacting essential goods. What might happen if bots bulk-buy PPE, forcing the prices up?
So warns Amir Nooriala, Chief Commercial Officer at Callsign, who argues that without retailers installing the appropriate protection, bots could not only ruin Christmas, but wreak havoc on more critical aspects of our lives. At the same time, if they aren’t careful about new security measures disrupting the customer experience, there could be a negative impact on sales.
“Bots are growing in sophistication and are excellent at mimicking human behaviour to dupe retailers’ websites. This makes the challenge of identifying them even more difficult,” he says.”
Nooriala continues: “Where retailers can get ahead is by using bot detection and location capabilities as standard. By checking the device (i.e. has it been used to make purchases on our platform before) and behaviour (such as keystroke) they can ensure it’s a real person making the transaction and not a bot or a criminal. They also need to update the payment user journey on their website to positively identify the user at the start of a transaction. By conducting checks at the very start of purchase, retailers can then record an individual’s behaviour and flag previous purchases to build up an accurate customer profile. This not only improves protection for both the retailer and customer but also streamlines the checkout experience once the person has finished shopping – helping reduce shopping cart abandonment. “
For retailers to cope with the proliferation of bots, they need to invest in security and user experience now — ideally through a single vendor, warns Nooriala. “Never before has providing a user-friendly and highly secure customer experience been more critical as they emerge from lockdown 2.0,” he says. “Finding the balance between user experience and security will play a vital role in boosting brand loyalty as retailers ride out the next few months.”