It is more important than ever for retailers to be well prepared for Peak 2021, remaining agile and fleet of foot to react to what the market throws at them while meeting consumer demand at its point of origin, says Sophie Wilson at Astound Commerce.
Panellists on our recent webinar agreed that Peak 2021 will be like no other as a result of consumer behaviour changed by the pandemic, much of it permanently.
The good news is that Peak demand looks like it will be strong. Nearly a quarter of consumers across the globe predict they will spend more on gifts in 2021, in contrast to their holiday spending in 2020. When asked about the rationale behind this projected increase, the top two reasons were to make up for missed holidays in 2020 (52%), followed by an improved financial situation (34%).
However, the question is how to capitalise on this combination of optimism and pent-up demand? After all, the expected sales bonanza will turn to dust if it was not handled right; for instance, our research shows 62% of shoppers will abandon their search if they couldn’t find what they wanted. In addition, mandatory shipping fees or expensive shipping costs and uncertainty about personal and payment security are the top reasons 67% of global shoppers will abandon a digital site.
So, in the context of many stores being shut permanently, search and discovery are more important than ever, and made more effective with both speed and relevancy. And that search and discovery process needs to exploit all the advantages of the store, bringing the fitting room home.
One important technology to embrace to bridge the on/offline divide is video, so that consumers that used to shop in-store as a pastime, can still get onsite and get direct access to expertise of store staff, albeit virtually. This approach was complemented by the research that showed that in Europe, consumer channel preference for most shopping behaviours during 2021 Peak would be desktop, an ideal channel for video and live-streaming.
However, brands must consider shoppers’ channel preferences mainly in order to provide a unified, seamless experience. For example, Millennials have a greater preference for mobile web than Generation Z – who generally prefer desktop browsing and purchasing.
The next step is to make search and discovery more personal, using clickstream data to dynamically change the user interface. Gathering and using data is also a route to personalisation to boost average order value and total sales, but also to enable retailers to cut returns by looking at serial returners and recognise whether they are genuine and valuable customers or possible fraudsters. Data analysis also enables retailers to see what goods sell well, or not, so they stop promoting goods that just keep on being returned.
This level of access for consumers comes with risks around data and security with our research highlighting 67% of consumers would leave a website if they thought their information was not secure. So, search and discovery that got people in the room as it were, must be backed up across the whole journey, using personalisation and then offering convenient payment services such as Buy Now Pay Later. This is of particular value to young shoppers, 50% of whom do not have a credit card, and who now shop regularly for low-cost items using BNPL.
The end goal of having visibility across the whole shopping journey is to close the loyalty loop – strip out points of friction, enable customers to express their preferences and make it easier and more rewarding for them to shop. This is the goal for the business generally, but particularly for Peak to capitalise on the favourable purchasing intent.
Loyalty is the top-ranked indicator for shoppers when deciding which brands to shop from during the 2021 holiday season, superseding both price and convenience. However, retailers and brands should focus less on using many of the current techniques for conversion and driving loyalty. Rather earning it by making sure the retail brand is visible and available across all channels including social, targeting customers, protecting their data, making communications and offers personal and bringing the store experience online. And at the point of sale, this is about offering the best payment, delivery and returns options.
The offer must reflect the extent to which pandemic behaviour has now become embedded. We know many global shoppers expect to continue using curb side pickup, indicating an increase in usage from before the pandemic of 32% – correlating with an 8% decline in buy online, pick up in store utilisation.
Consumers are now shopping seamlessly across channels and brands need to meet this behaviour with equally seamless operations. Creating the optimal customer experience remains an ongoing and continuous journey and with Peak rapidly approaching retailers and brands should focus on searching for loyalty cohorts and optimising using plug-ins to fix any gaps; while ensuring that the promise in Peak promotions could be fulfilled in terms of stock availability and fulfilment.