A New Normal: Trends To Consider When Selling Online
Government imposed lockdowns and new social distancing measures are shaking up entire industries–and retail is not exempt. Many business have started selling online as consumers who might have looked to the high street for their shopping three months ago are now setting their sights on the web.
It’s the intensification of a trend that was already in full force: the migration of commerce to online platforms and an evolving face of physical retail.
Now, however, eCommerce also acts as a lifeline for businesses to stay operational during times of lockdown. Many previously brick-and-mortar retailers have quickly had to pivot online to stay in business.
In this article, we’ve compiled some insights from recent months. We’ll discuss what they reveal about the state of eCommerce going forward, and how you can adjust your marketing, merchandise and customer outreach to meet new demands.
Pivoting to eCom is fairly straightforward, if you haven’t done so already. To get you off to a good start, it’s worth getting a sense of the current state of the market.
Let’s get started!
Sales are surging in some sectors, while falling in others.
Limited social interaction and more time spent indoors are changing the way we shop. Certain sectors are performing better than others as a result–reflecting the way people are choosing to spend their time and money.
It should be no surprise that discretionary spending is down across the board, with 69% of UK organisations seeing dwindling demand for their products and services. eCommerce alone has shown a roughly 0.3% global decline in traffic growth.
These numbers, however, fail to account for the fact that sales will be surging or stalling depending on what you’re selling online. Businesses can still thrive online, but web-store owners will need to pay extra attention to consumer behaviour and watch for rises and falls in demand for their products.
For example, a steep hike in sales in the first week of April for electronic and home and garden products reflected the need for UK consumers to keep themselves occupied while in quarantine (these industries saw 90% and 70% YoY growth respectively).
An example of effective online merchandising in response to changing demands comes from Humble Bundle. Seeing growth in demand for video games and other digital entertainment products – Humble Bundle offered its customers a bundle of video games and eBooks worth $1,071 for just $30 for a limited time – 100% of the proceeds went towards charities of the buyers choice.
Product bundling is an effective method to move high demand stock from your eCommerce store in a way that’s valuable to consumers.
Note that this is not to say that businesses should be profiteering by selling in-demand products at a hiked-up price. The products you choose to sell should still align with your businesses purpose and identity.
Action Point: Calculate self-through rate of your products.
One way to forecast demand for certain products is to check their self-through rate. Monitoring sell-through is a way to measure the effectiveness of the merchandise you purchase from manufacturers or suppliers. It helps merchants understand how quickly products from certain manufacturers sell.
With that knowledge, merchants can make smarter inventory purchasing decisions and assure that they carry enough stock to meet demand while not carrying too much.
Sell through rate is calculated by dividing the number of units sold by the number of units received, then multiplying the sum by 100
Most retailers calculate sell-through every 30 days. After 180 days of sitting on shelves or in the stockroom, that product is considered dusty inventory and should be discounted and sold to make room for new, seasonally relevant products that can be sold at full markup.
This is an important step to take before investing in costly marketing campaigns and purchase orders, and can be done easily with analytics software like Lightspeed Analytics.
Once you’ve figured out which items are in demand and worth selling online – make sure you make use with effective online visual merchandising and sharp product photography to get customers to buy.
Email open rates are up 40%.
Email marketing is important as it’s ever been for businesses who are selling online. It’s a crucial tool for attracting web traffic, gaining new customers and retaining existing ones. According to a report by Wunderkind, retail email open rates are up 40% from their pre-COVID-19 level.
Multiple factors play into why this is–an increase in free-time, extra receptiveness to news and updates, or shoppers seeking out the retail therapy they’d usually get on the high street.
But this isn’t business as usual. The kind of aggressive email campaigns that may have worked a few months ago could now be perceived as tone deaf, opportunistic and could ultimately hurt your brand.
Whilst businesses and customers alike are forced to migrate online–shoppers usually who may usually seek promotions and deals now look out for information, advice and reassurance along with it.
Action point: Use email marketing to inform and inspire.
Businesses that use their email platform to offer useful and uplifting content to their customers could see more engagement than those blindly pushing their products.
Before crafting an email, entrepreneurs should consider how it serves to benefit the consumer in a way that’s relevant to their situation. If it isn’t immediately obvious, it may be time for a rethink.
Marketing emails should also be easily skimmable, assuming a friendly, personable tone. Customers are less likely to engage with uninspired or poorly formatted emails.
A great example comes from apparel retailer Marine Layer, who creatively fashioned a marketing email into a work-from-home style guide.
The formatting is clear and colourful, the tone is positive and playful without coming across as inappropriate. Links within the email are weaved into its structure in a way that doesn’t seem too suggestive or pushy.
Sending out relevant and useful email content helps nurture a personal connection between a business and its customers. It puts the business at the forefront on their minds even if they’re not currently in a position to shop with it.
Using email automation platforms like Mailchimp allow web store owners to craft succinct and personalised email campaigns by syncing customer data from their eCommerce site.
Businesses that can demonstrate how they can add value to customer’s lives, even during a pandemic, could drive more conversions and retain more customers when things return to normal. Use this time to help customers, not just profit from them.
Customers are increasingly worried about the future.
Knowing how COVID-19 is affecting your customer base helps strike the right tone, and offer appropriate goods and services when selling online.
In a recent poll by YouGov, 70% of 18- to 24-year-olds said they were worried about how coronavirus will affect their future employment prospects. Only 43% of people fifty years and older signalled the same concerns.
With insights like this in mind, you can make better predictions about the needs of your customers going forward.
For example, your customer base may consist of young adults who are currently worried about work. For them, advice, reassurance, real news and information have more impact than promos, deals and hard sales.
Older audiences may have more stability and therefore won’t share the exact same concerns of younger people. They will nonetheless be feeling the pinch of a global crisis. For them, reassurance is also key–creating a sense of normalcy may give customers the confidence to keep shopping with you.
The age of your customer base will also determine the most appropriate channels to reach them on. This is important to keep in mind if you’re revising your social media strategy.
According to the Pew Research Centre, the number of active baby boomers on Facebook doubled from 20% in 2012 to 41% in 2019.
Conversely, the number of teens ages 13 to 17 using Facebook dropped from 71% in 2012 to 51% in 2019. Teens have shifted their attention to other platforms like YouTube (85%), Instagram (72%), and SnapChat (69%)–and that’s one trend that COVID-19 isn’t likely to change.
To get a good idea of how your customers are feeling, knowing which groups they fall into, and how to reach them, is key.
Action point: Focus on adding a personal touch to online customer experience.
During the 2008 recession, companies that innovated in the area of customer experience generated 3x higher returns than those who didn’t.
With the rise of experiential retail – customer experience was stealing the spotlight long before the pandemic. Now, with eCommerce being one of the few ways many people can safely shop, online experience will need to compensate for the lack of tactile experience and human interaction.
Use social media channels to communicate meaningful stories around your business and product. For customers craving comfort, contact and normalcy, it will put your brand and business and the front of their minds, and can ensure long-term customer retention.