3 recommendations for ecommerce performance in 2021

Many new consumers were forced to shop online this year, and brands and retailers that relied on physical stores have had to adapt.

With the Q4 retail peak impacted by lockdown tiers, sadly some businesses have not been able to adapt quickly enough and their employees have paid the price. Arcadia and Debenhams combined employ more people than the UK fishing industry which provides some interesting political perspective but also highlights the scale of the challenge for some of those brick and mortar brands.

Changing the engine mid-flight isn’t easy and even once you’ve done that throughout 2020, 2021 still looks very daunting as you go toe to toe with the established online players maybe from a standing start. However, it’s worth remembering that a good proportion of those shoppers who’ve been forced online in 2020 won’t stick around when shops are safe to open again. It’s also worth noting that those new digital shoppers who do stick around online will be more likely to favour the brands they know and trust from the offline world. This gives some hope to those brands who can transform their online experience quickly. 

Regardless of your brands’ back-story, being visible online and offering an excellent digital experience will be right at the top of your wish list. As we start to plan for the year ahead, the Croud commerce team believes there are three key considerations to keep front of mind…

1. Supercharging product discovery will be a key focus for ecommerce in 2021

For years, digital commerce has focused on removing friction and making it as easy as possible to buy. Amazon is the obvious example of this; a database with millions of SKUs – you search and then you buy. There has been lots of talk about offline retail moving online like it’s a straight swap, but that’s not quite true. Online shopping is mostly very functional and highly intent driven, but lots of sales in physical stores actually happen when shoppers experience friction. Friction gives them time to discover new products and make impulse buys. There’s a clear correlation between dwell time and sales value in physical retail. 

The next big challenge for online retailers is how they can boost product discovery in the digital world – how do you get users to stumble across new items online? Part of the answer is smart recommendations based on patterns/lookalikes and intelligent bundling. But social and video have a big role to play here too. Potential customers in these places have a different mindset, are more receptive to product discovery, and many of the big platforms are adding new ecommerce ad formats, storefronts and payment capabilities. 

It’s not only the social platforms to watch here either, Amazon has been moving in the opposite direction adding more social and engaging features and content to move them up the funnel too. Keep an eye on Amazon posts, stores and live shopping next year. Live shopping already accounts for 10% of ecommerce in China, and it was pushed hard by Amazon with discounts and incentives for key influencers who created content during Q4 peak events.

2. Brands & retailers must evolve their physical and digital experiences to meet changing shopping needs

Physical retail will surge when safe but we’ll have fewer stores that serve different purposes for brands and shoppers. We shouldn’t really be thinking of physical and digital retail in silos. As we head into 2021 many more brands will be thinking about physical stores in terms of how they can complement the digital strategy and experience rather than the other way around. It’s going to be fascinating to see how brands adapt those physical store spaces in 2021. For sure we’ll see more automation and tech to remove friction and human contact in things like payments and self ordering. On the other hand, lots of the brands will continue to invest in technologies like AR / VR to simulate physical experiences and bridge those gaps in digital retail.

Consumers move really quickly in almost every direction between platforms, devices and locations when they are exploring and evaluating products. They don’t think in channels like marketers do and so you need to be there to meet them with great content when they’re in discovery mode and also in those moments when the intent is triggered.

If you’ve just added to or bolstered your digital presence in 2020, then you’ll need to ensure that each touchpoint is adding value to the customer’s journey and understand the role it has to play. Online and offline experience and media must be planned as one, and you really need to get everyone involved in that working together. Eighty-six per cent of purchases are now researched online, and we know huge numbers of shoppers check sites such as Amazon as part of the purchase process online and in-store to get more information, compare prices and check reviews. For most shoppers retail became digital-first some time ago.

Google is also doubling down on experience too which is going to make it harder to get found if your site isn’t in good shape. From May they’re adding core web vitals to their existing page experience signals which is another big reason for brands to take notice and act now.

3. We have to get ready for a step up in competition levels and sophistication

Q4 2020 was fascinating – Primeday, the second UK lockdown, and the fear of fulfillment systems going into meltdown stretched things out and created some unexpected opportunities. The peak event days are usually won by the brands who have the most attractive offers and merchandising supported by aggressive but well thought out paid media. That’s just the way it is and the same will apply in 2021. Given competition is only going to get more intense, think carefully about how you use the spaces between those key events when gift shoppers are switched on but less competition activity means you can cut through the noise.

Many advertisers will be better prepared for the unexpected. We saw a number of big advertisers caught cold this year without the flexibility to react quickly leaving gaps for challenger brands to gain visibility and steal market share. We’re expecting contingency budgets to be built into all those media plans next year so they’re better equipped for the next black swan event.

We’ll all be forecasting from a new baseline when the dust settles and it’s difficult to be precise about that. Ecommerce in the UK excluding grocery jumped from 30% to 60% during summer and has settled at around 40%. Build-in that growth and then some if you want to be ready to flex the plan and react faster in 2021.

A coordinated strategy is fundamental to success

The reality facing any brand who has a digital presence is that there are now lots more competition online. As we head into 2021 you need a strategy and a framework that unites all of your teams and partners towards common goals.

We see brands doing great work in specific areas of their commerce strategy all the time, but often there are big gaps. These random acts of ecommerce deliver good results in isolation, but when the competition is so intense, brands need to get all functions consistently working together to stay ahead.

At Croud, we use our Commerce Development Framework (CDF) to help brands to unlock the full potential of their commerce strategy and marketing. Regardless of which model you choose to use and how you adapt it to your unique business, bringing all stakeholders together behind a shared vision, measurements and ways of working gives you the best chance of success.

Croud’s Commerce Development Framework (click to enlarge)

If you’d like Croud’s performance experts to audit and benchmark your commerce approach then please get in touch. See you in 2021!

by Andy Siviter
29 December 2020



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