While retailers are no strangers to eCommerce strategy, the sweeping changes in consumer behavior are pressing them to reconsider and, in many cases, transform these strategies. Part 1 of this three-part series dwelt on the changes in consumer behavior and the eCommerce ecosystem. The eCommerce landscape is much more complicated than ever before and has expanded its horizons across the commerce value chain. Some of the tangible changes include -
- Technology as an enabler - Technology helps retailers address consumers' needs more effectively. By exploiting technology, retailers can better anticipate consumer needs, target and engage them at the right time with the right message and product, convert them to a buyer and finally, fulfill the order across channels. Technology also amplifies the understanding of consumer buying behavior through intelligent analysis of shopping data, enabling sales and marketing teams to develop more personalized and relevant strategies.
- The best interface across channels - It is no longer possible to get by with a select set of channels to engage the consumer. A radical change in approach to the best interface is that no interface at all is warranted. This new thinking retains the consumer at the center of the eCommerce strategy and designs interactions around that. Retailers must imagine a consumer's daily digital journey and determine how to insert themselves as part of that journey seamlessly and intuitively. In such a scenario, the consumer is not required to switch from whichever channel is used to a traditional owned channel such as a website or app. This human-centric or consumer-centric thinking allows for a retailer to engage consumers wherever and whenever the consumer desires. At the same time, it does not mean that this is the end of the brick-and-mortar store or the owned channels. Consumers will continue to visit stores that offer engaging experiences.
- Revamping the supply chain – Consumers expect to explore and purchase any product that they desire as per their convenience. For retailers, this means they must have visibility into their global product assortment and inventory across online and physical stores. Moreover, with demand for shrunk delivery times increasing, businesses are compelled to overhaul their supply chain ecosystem. Retailers are responding by setting up dark stores, micro-fulfillment centers, and cloud kitchens. At the same time, CPG companies opt for distribution centers and partner with Quick commerce providers to enable last-mile delivery capabilities to cater to drop-ship orders from retailers and D2C orders from the consumer.
- The rise of marketplaces - A consumer shops for products usually in a marketplace that may or may not be owned by the company. It is a preferred option as it is a convenient one-stop-shop for consumers. Therefore, CPG companies must have their offerings listed in a relevant fashion. Further, they must zero down on the right catalog and pricing strategies in each marketplace. Determining the appropriate fulfillment approach is a critical success factor with the emergence of quick commerce and its impact on the brand image. Decisions must be made on whether to partner with a last mile delivery provider or set up an in-house fleet or use a combination of both. As always, customer feedback from these marketplaces must be actively tracked and acted on to augment the brand image.
- Customer as an influencer – Like how celebrities in the past helped generate brand recognition and more sales, retailers must now view key customers as brand partners. Almost 50% of users rely on influencer recommendations before making a purchase. Not surprisingly, the influencer marketing industry was expected to reach almost $10 billion in 2020 . In this age of fickle loyalty, they must develop programs to reward customers for the additional revenues they generate to ensure their stickiness. In fact, some brands are providing such influencers with an online platform to drive sales and share the rewards with the influencers via commissions, goodies and promotional visibility
The impact of these five changes extends across multiple functions in an organization, including marketing, merchandising, eCommerce, store-ops, supply chain and customer service. As a result, organizations must take a holistic view of digital commerce and transform their businesses to capitalize on the opportunities presented by an increasingly digitized world.
How can businesses succeed in an ever-evolving digital commerce landscape that witnesses rapid shifts in consumer behavior? The solution lies in employing a commerce platform that achieves the perfect balance between business and technology agility. The last part of the series presents Infosys Equinox, a digital commerce and marketing suite designed to deliver just that.
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