Roadmap for Commerce

Commerce Trends (Fuelled By Shopify’s Trend Report)

Commerce is continuing to change at a rapid pace. As new tech develops and customers shopping behaviour is changing through the pandemic. We’re finding ourselves at a really exciting time for e-Commerce. I’ve looked at some of the commerce trends finding themselves in the spotlight this year. I’ve dived into eCom and looked at what Shopify’s study conducted in Sep 2021 by Forrester Consulting uncovered. The Report is called the Shopify eCommerce Marketing Credibility study. Let's break it down and review it with a small brand lens.

Shopify led some market research with Global brands and uncovered nine key trends around the future for commerce. Building out a roadmap for the future is key. Utilising some of the insight that Shopify has shared in partnership with Forrester Consulting. Helps build a background to your 2022, and ideas, thought-starters or consideration points for your short to long-term marketing plan.

In conclusion of their study in September 2021. They arrived at three key pillars each with its own obstacles:"

eCommerce trends

• Rising Acquisition Costs

• Death of third party cookies

• Social Commerce

Retail trends

• Retail Competition

• Omnichannel Shopping

• Retail staff Retention

Shipping and Logistics trends

• Supply Chain Vulnerability

• Social and Environmental Impact

• Transparent Delivery times

Spending Habits are Shifting

The last two years have sped the rate of change in commerce. From traditional bricks and mortar stores moving online or revamping and rebooting their propositions. In the case of some legacy brands, rapidly deploying updated systems to antiquated tech was a must. They've changed offerings and processes to meet technological change. Pivoting was essential, if this is welcomed within the business, it was and still is a key element to success in the new world we find ourselves in.

People are more willing than ever to buy from brands that resonate with them because of geography, company values or sustainability.

In the Shopify eCommerce Marketing Credibility study (catchy). 47% of the consumers said having a local presence was a significant factor for which brands they shop from. They’re accepting slower shopping times for the right brand. Consumers are more likely to purchase from a company with strong brand values. 77% are concerned about the environmental impact of the products that they buy.

Statistica has predicted commerce sales to triple by 2025 as people return to in-person shopping or shopping in new ways. 40% suggest they’re going to pay with cryptocurrency. So whilst we might still be in a period of uncertainty, certainly until we’re out of the winter here in the UK. There are those green shoots, that may mean we’re heading towards a more stable year. ( Watch this space!) We need to ensure we’re gearing up our stores and commerce opportunities for our new and existing customers.

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OObstacles: Rising acquisition costs, death of third party cookies and social commerce.

The future of tech and its personalisation is changing, as third-party cookies phase out the ability to choose whether users have the choice to use their data. Personalisation will be harder, however, as a brand marketer this is where I feel the power of the message and being able to really talk to your ideal customer and retain your loyal customers will be key. Ensuring you’re true to your values, business, and planet will win individuals over who are on the same path. Brand building is going to be key and that is something which alongside competition from other brands will help you stand out amongst the rest. Check out brand building ideas below on how you can look to heighten the awareness of your brand, and more importantly your brand  salience with your target audience.

Rising acquisition costs come into the limelight here, as we can’t be as laser focused on how much it costs to actually acquire our customers, due to data privacy. We may have to look for alternative  means, such as blended return on advertising spend. Which looks at the holistic view of your data. Also as companies deploy brand building and compete against DTC it can feel like a whole lot more is going on your marketing budget.

Social Commerce is providing new ways for brands to interact with their customers. The Shops proposition via Facebook and Insta. Is excellent for browsing. It lets you build a connection with your customers, and if they’re coming to you instead of seeking amazon or a marketplace where it’s price over emotional factors then you’re winning. Live Shopping is exploding, it gives the ability for peoples’ favourite brands to bring a social element to their experience. 49% of brands plan to invest in social commerce in 2022.

What could you implement into the business?

Think about how you can touch on these, you could run a live and sell outlet stock, bring an overall social feel to any launch. Which can come effortlessly to some small businesses, as this is your playground, right? It’s where you started, and keeping that in check, and ensuring you’re delivering true to your values will keep your customers happy, and new ones intrigued.

Ideas:

• Review brand building exercises. Getting back to basics away from hyper-targeting. How do you create a plan that will talk to your customer? Get to know your customer and their feedback both good and bad

• Build your community across social channels, email. Connecting with them will help you cut above the rest when it becomes crowded. Use 1st Party data, own your relationship with your customer so if anything happens to the third parties you’ve still got a revenue stream

• Use Socials’ tool to help you sell. Live Chats, Video. With user behaviour changing on the platforms. Using some of these tools will help you sell more and build a connection with like-minded individuals.

Obstacles: Retail Competition, Omni-channel shopping, Retail Staff Retention

Think about new elements affecting the journey, such as Virtual Shopping, in-store Appointment shopping, click and collect and local delivery. The movement for small businesses to play in this arena is huge. The Direct-to-consumer (DTC) competition is rising. So whilst doors open for these businesses. How can you put yourself ahead for customer attention?

Think of it as differentiation and diversify your offering. So you’re not competing on Price, but brand proposition. They want to buy from people who stand for something. According to the study, 52% are more likely to purchase from a company with shared values. Focus on

• Customer Retention

• Lifetime Value

• Customer Experience

• Community management 

Building your community helps build trust and brand equity and the overall longer customer retention of your business. Giving your members a clear reason to keep coming back is key. If your market suits it, give them a chance to be part of the brand i.e NFT sales. Which grew 8x in the last two quarters of 2021. Using it as a badge of honour and early adopters of this are finding it shows off their brand association. Consider leveraging the space as proof of authenticity or to track the providence of physical products. Depending on the platform provider. 

As potentially digitally-native brands go into a physical store space, favourable lease prices are given. Considering a cross channel approach is key to shopping and keeping at the forefront of a shoppers mind. Digital and PHysical Retail - shouldn’t operate in silos.

People will want to order online and return to a store or look in a showroom and buy it online? Consider the connection between your spaces and the customer journey might transcend both. 

Also, as more and more Virtual Shopping behaviours become popular. Thinking about your staff and their offering within your business is key. Live Shopping for example is something that will need a few people on deck, but can catapult you if you become known for always delivering Live Shopping at a certain time, maybe the weekend! Friday Night.

Obstacles: Supply Chain Vulnerability, Social and Environmental Impact and Transparent Delivery Times

Supply chains, resources and access to staff will remain constricted for businesses whilst consumer demand increases. In the US the average cost of a shipping container is now over $10,000, 4 x higher than a year ago.

Whilst all of these elements don’t feel as sexy as marketing or talking to your customers. Getting this right is key. Future proof yourself by building diverse business relationships across your supply chain, shipping, fulfilment networks. And build resilience into your supply chains. Be transparent with customers about your challenges and expected dates according to McKinsey, early adopters of artificial intelligence-enabled supply chain management can improve logistics costs by 15%, inventory levels by 35%, and service levels by 65%, compared with slower-moving competitors. The growing use of cloud-based software, which allows supply chain partners to share real-time data, is also hugely beneficial.

Sustainable business practice. Nearly half of customers choose to buy from brands that have a clear commitment to sustainability. Make sure you’re looking at how your current processes work, how they can improve, or what the short/long term goals are. No one is going to have this 100% right, but we can try. We’re all on this journey together. How can we make sure that we’re sharing our goals, visions and reality? There’s been a 71% rise in online searches for ‘sustainable goods’ globally since 2016.

Consumers are no longer just virtue signalling. They’re finally putting money behind their beliefs, and brands are responding: 53% per cent of companies* are making improved sustainability one of their top priorities for 2022, and 39% are improving efficiency in manufacturing processes, according to Shopify research.

Shopify has seen more and more customers leave a check out process because the delivery times weren’t clear. If you can be clear on your lead times it will help you win your customer over. If it’s handmade chances are they’re going to welcome a longer lead time for a higher-priced item as it may add to its kudos. Dependability is key for customer retention.

Brand Building is key:

I’ve been working on and making sure my clients’ marketing teams have a brand-building approach that suits their budgets. It’s not necessarily always on advertising, but there’s a way to look at this across organic and paid channels. We want to increase the customer lifetime value, boost conversion rates in the short term and attract out of market buyers in the long term. And a key factor of this is a strong brand presence.

80% of customers conduct their research online before making a purchase decision. Businesses need a strong brand to earn their place in the minds of consumers. A strong brand makes performance marketing effective. In the short term. It’s also the foundation of sustainable growth. Strong brands draw more organic acquisition, retain more customers and can raise their prices.  The most powerful lever to increase profits.

• Looking at key brand indicators such as market share or brand consideration are key metrics to follow. You would expect to see an impact six months after initially starting the advertising. 

• Consider consumer experience metrics. What is the Brand Awareness, perception, intent, brand recall and category preference scores? How does it compare? What’s your net-promoter score?

• Record changes before and after a campaign by measuring direct traffic, organic traffic for branded keywords and backlinks. On platforms look at metrics such as followers, engagement and share of voice across PPC Advertising, SEO, Social Media and PR.

• Depending on the industry mixing brand-building marketing with performance marketing can support your goals to create lifelong customers and brand evangelists. You need to experiment with the exact split. But around 60/40 to achieve an increased return on investment from performance-based marketing.

Focus on building brand awareness, have shorter spurts of sale activation so you can build your overall awareness or fame of the brand. One element to bring this back to 2022. Is to remain true to your values and the activations that occur at these moments should be ‘selling’ but how a customer may want to hear from you. i.e Community focussed and being part of your brand story where you share the same values. Les Binet is the Head of Effectiveness at Adam and Eve DDB depicted this in the following model. Something to think about as a basis of your strategy for the year.

If you want to chat about your Marketing Strategy for your business, and implementing channel activity that supports brand building then please let me know. Happy to have a call and discuss how I can help you, or whether there is someone more suitable.

Sources:

• Shopify’s 2022 Future of Commerce report is based on data from the Shopify platform, which supports millions of Shopify merchants operating in the United States, Canada, Asia Pacific, Europe, and the Middle East.

• Shopify paired this data with a global commissioned study conducted by Forrester Consulting on behalf of Shopify. The survey covered consumers and businesses living and operating in Australia, Canada, France, Germany, India, Italy, Japan, the Netherlands, New Zealand, the United Kingdom, and the United States. The study included 12,000 global adult consumers who have made an online purchase in the last year, and 350 commerce strategy and decision-makers at consumer packaged goods and retail companies that generate at least $500,000 in annual online revenue

• ​​https://www.shopify.com/research/future-of-commerce

• https://www.warc.com/newsandopinion/opinion/les-binet-on-why-long-term-marketing-matters-in-the-age-of-short-termism/3307

• Les Binet and Peter Field 2013. Brand Building and Sales Uplift vs Time Graph