While many companies struggled with the lockdowns, business shutdowns and local retail store restrictions, online and ecommerce businesses boomed.
As consumers found themselves stuck at home and quarantined, they turned to the internet and online businesses for purchases and support. Retail businesses with the available infrastructure turned their focus to ecommerce. Other existing businesses had to rapidly scale up to meet demand. The market flooded with new prospects, new customers, new competition and new opportunity.
Overall, 2020 saw upheaval, opportunity and market shifts for ecommerce. As the market begins to consolidate and we settle into a new normal, businesses with the right strategy and infrastructure will find opportunity and profit. Businesses operating on dated strategies and assumptions will quickly succumb to market reality as consumers move to the ecommerce companies that can better meet their needs.
Looking Ahead for Ecommerce in 2021
The flood of new customers and a public ready to embrace online and digital shopping have created opportunities for ecommerce businesses, but they have also created new challenges that many companies are ill prepared to overcome.
Here are the trends we see shaping ecommerce.
Increased Competition for Customer Acquisition
For much of the past year, businesses struggled to keep up with customer orders. Often, the supply chain would slow sales more than a lack of orders.
To continue that growth as local businesses begin to open up and the online competition scrambles for fewer and fewer undecided customers, you’ll need a new strategy. Many of the current avenues for digital advertising — social media and paid search, for example — are highly competitive. As companies like Google and Facebook grapple with new demands for privacy and increased regulation, marketing costs are expected to increase, and campaigns will deliver lower returns.
2021 Strategy: Look at building out and expanding your digital marketing strategy. As competition in the digital space increases, look at other marketing channels. Develop new ways to reach customers. Look at building a content strategy or providing additional customer value. Start by understanding your customer. Create a new buyer persona that reflects the changes brought about in 2020. This may reveal new digital marketing opportunities.
Enhanced Customer Experience and Building the Business Brand
In the past, the focus of the online shopping experience was that it was online. A consumer went to a brick and mortar store for an “experience” and they went online for convenience. Now, with limited access to the retail shopping experience, consumers want more from ecommerce retailers. They want a personalized online experience, with all the information they may need or want at their fingertips as they make a buying decision.
This directly feeds into the need for ecommerce companies to build their brand. With growing competition and more choice, ecommerce businesses need to quickly identify and communicate their brand message. You need to sell with a specific purpose in mind. You need to position your products and convey your company’s value to the consumer. Your brand needs to be an integral part of the customer experience. This is how you stake out your position in the crowded ecommerce market.
2021 Strategy: Building and communicating your brand should be a strategy that shapes every business process. Start by determining the goal of your business. Is it providing a benefit or value for the customer, meeting a market need, or perhaps focusing on a unique attribute of your company? Consider also the technology you are using, and if it is delivering what the customer needs. The right PIM (Product Information Management) system, for example, connects the customer to product information. Make sure you are communicating your brand and anticipating customer needs as best as possible. Everything you do feeds into the customer experience.
The Need for Flexibility and Customization
As ecommerce companies begin to build out their technology stack, they are going to demand more of their ecommerce platform. Automation and improved customer experience don’t just happen magically. You need to have the right tools and an effective technology infrastructure.
This is a reason why more and more companies are looking at customization options in their technology platforms. They need suppliers and providers that are willing to say, “Yes, we can do that,” rather than systems that set limits. Flexibility and adaptability are higher priorities than a comprehensive feature set or complex options.
2021 Strategy: Take time to review your current ecommerce platform and supporting technology. Start by identifying your core business requirements. Consider your company goals, and then look at how the technology supports the goal. For example, consider if the system supports complex approval rules and business processes. How will it support your reporting requirements? What about billing options or applying discounts? What are the search capabilities? Rather than just fixing the current problems, look at supporting future needs as your business grows.
Renewed Focus on Fulfillment and Automation
With increased competition, ecommerce businesses need to capitalize on every opportunity for a competitive advantage. They need to differentiate themselves from other businesses, and leverage those advantages to drive customer retention.
More and more companies will find fulfillment the best way to differentiate themselves. Customers who can’t go to their favorite local store are hungry for a smooth online shopping experience. They want personalized service. They want their order as quickly as possible.
2021 Strategy: Consider what you can do to improve fulfillment. How can you deliver faster? What can you do to improve packaging and provide a personal touch with every order? Identify opportunities for improvement. Outsource what you can, and pay a little more for packaging and labels that boost the customer and shipping experience. Regularly review your ordering process to see where you can anticipate customer needs and provide the moments of personalization and delight that customers want.
Finding Ecommerce Success in the New Year
Many companies recognize the need for updates, changes and a new business strategy, but they wait to make a change because the business is doing good enough. They see change as a risk, and so they delay.
With more competition in the market, and the changes to consumers and customers, there is no time left to wait. Putting off an ecommerce platform update, a new marketing plan, or a project to correct your processes is the greater risk. There have never been more or better reasons to start a new initiative.
If you have questions or would like to set up a no-obligation consultation with a member of the GO2 Ecommerce team, then contact us today. We’re working with industry leaders and standing on the cutting edge of the latest ecommerce innovations. Let’s see how we can help you reach your business goals.