A glance at the e-commerce world suggests that it’s expecting an exciting season.
Deloitte claims that while the general retail sector will only see slight growth, online sales will grow by up to 35% in comparison with last year. And with 73% of consumers saying their overall holiday spending will either stay the same or increase this year, there’s a lot to look forward to.
At the same time, online retailers are bracing themselves for ever-aggressive competition, the need to navigate mass inventory, and supply-chain disruptions. Together with shifting consumer behaviors, these realities could build the basis for the perfect storm, making this year’s Black Friday and Cyber Monday particularly stressful.
Rising above the crowd during the most critical time of the year isn’t about mere luck; success comes to those who are prepared. So what can small and medium-sized e-commerce brands do to fend off the giants?
Double down on customer service. During the shopping season, the goal of each brand is to make its customers comfortable with making fast purchase decisions. This means supporting them in any way possible, providing prompt and helpful responses to queries, and communicating key information in a transparent manner. Even when falling behind with fulfillment and logistics, e-tailers need to keep shoppers updated with realistic timelines.
To make this happen, brands might need to lean on some extra resources, both in terms of setup and staff. Nobody can afford to lose a potential customer due to slow answers, so live chat is an invaluable tool. Brands can either rely on staffed chat that is supervised at all times, rely on additional resources only during rush hours, or turn to a fully automated chatbot. According to Shopify, customers who chat with a brand convert three times more often, and have a 10-15% higher average cart value. With tools like Hero, brands can offer personalized experiences and explain their products through various practical features.
To prepare, brands should create a pool of answers to the most common questions and inquiries. This can help them maximize efficiency while delivering consistent service when a customer experiences frustration due to a delayed order, or a product arrives damaged. Brands should always highlight their returns policy, an aspect that can make or break a holiday strategy.
Bet on uniqueness. To gain an edge, smaller retailers should focus on their strengths, rather than wage a risky price war with competitors. After all, it’s key to remember why customers tend to shop with smaller brands. To distinguish themselves from bigger competitors who lack a personal approach, smaller retailers should emphasize their story, value proposition, and overall uniqueness. Whether it’s a specific innovation or a twist to an evergreen product, carefully tailored rewards program, powerful brand philosophy, social impact element, or A-Z personalization, it’s important to be someone that shoppers want to talk about or engage with.
Non-discount incentives are a great example of engaging customers creatively during the shopping season. For example, Inkbox, a seller of temporary tattoos, has seen great results after incorporating Smile.io, a rewards program extension. With the “Inkfam” program, the brand has managed to drive greater revenue and social sharing, while increasing repeat purchases by 28%.
Optimize the checkout process. Neat website, irresistible deal, perfectly captured products: none of these elements matters if the customer is ready to buy, yet encounters numerous obstacles at point of sale. Convenience is yet another strength to bet on this Black Friday.
Optimizing the latter part of the journey to secure an easy and frictionless checkout process works wonders for increased conversion and reduced cart abandonment. Brands should ensure that the process is secure, that there aren’t any hidden final costs, that the registration process is as simple as possible, and that forms are optimized and can be filled in without any hassle.
Another great way to facilitate checkout is by offering diverse payment options. It’s well known that most carts are abandoned at the payments stage, not at checkout login or upon learning about shipping costs. At the same time, 25% of US online shoppers actually abandon their carts because their preferred payment option isn’t offered. By incorporating flexible payment options, customers can spend money during particular peak days without negative effects on their credit score or limitations.
Flexible payment options also contribute to a brand’s ability to upsell customers, resulting in a substantial increase in average order value.
Use data-driven insights to pivot. “The retailers that use real-time data to understand individual consumer preferences, make changes the data shows are needed, and effectively leverage multiple channels, will be much more successful in securing consumer spend this holiday season,” says John Nash, chief marketing and strategy officer at Redpoint Global.
Apart from social media, it’s critical to consider advanced retargeting strategies. While ad space will be extremely busy in the upcoming weeks, retargeting customers through these channels to buy on the brand’s website will pay off. In addition, a brand’s e-mail strategy should be personalized and carefully designed around different trigger actions, such as progressive deals or cart reminders.
At the same time, data should be used to ensure a smooth running of all backstage operations. Having an eye on trending items can help brands stay on top of their offerings. Real-time insights can be life-saving: out-of-stock items remain a point of friction for many consumers during the holiday season, with 36% of customers rating it as a top frustration. So there’s no doubt that now is the time to embrace automation. Multiple tools, such as Shopify Reports, are available to forecast demand and identify what to stock up on.
Retailers can also turn to analytics solutions to monitor competitors’ movements and the latest shopping trends, and alter prices and offerings accordingly. Dynamic pricing is another strategy to try out — it can help brands both get new customers and win the attention of comparison shoppers. According to McKinsey, these strategies can improve a brand’s margin by up to 10%.
Craft killer deals. Black Friday doesn’t only need to be one or two days. Smaller brands can rise above the noise by tapping into the shopping season before it officially starts, and extending it for longer than some of the bigger retailers would. This is a smart way to get additional exposure, but it’s crucial not to abandon the sense of urgency. In other words, customers should know that the special offer is limited, and there will be a point at which it ends.
Another great window of opportunity is to promote products that have been doing well in the past months. Big brands are likely to want to keep their margins on goods like loungewear, workout tools, and board games. By including such high-demand products in sales, brands are also more likely to activate other items and meet their upsell goals better. After all, the goal is to sell multiple products, to increase the average order value and gain a stronger position for the entire fourth quarter.
For many e-commerce stores out there, this year’s Black Friday performance could be a matter of survival. Luckily for smaller brands, even bigger retailers are bound to experience supply-chain delays. As disruptions won’t discriminate, success will be defined by embracing the situation, optimizing for greater efficiency, and championing transparent customer communication.
Chaim Lever is co-founder of Four, a split-payment platform for shoppers and spenders.
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