Our very own Derek O’Carroll, CEO of Brightpearl, joined UKFast and a selection of other specialists at the recent Ecommerce Expo event for a discussion on the key trends in ecommerce and what to expect for 2018.
Please watch the video for the full conversation, which lasts 45 minutes. We've also collated some of our top takeaways and highlights in this blog for you as well.
Growing Omnichannel Importance
While the majority of retailers have an omnichannel strategy in place, less than 10 per cent believe they are executing it well; this has serious ramifications for those ecommerce retailers looking at different channels.
Many ecommerce businesses are still not fully aligning their websites (that may have been created 3-5 years ago) with their back office. Without one ‘single system’, retail will continue to run into a wall.
Rise of the Independent Retailer
The growth of the independent retailer is causing a discernible change in the makeup of the UK’s high streets. Derek O’Carroll states that “The top 500 retailers have seen a 12% decline on the high street, compared to an increase of 20% from independent retailers”.
Consumers are increasingly looking for individual, stylized brands with 78% willing to pay more for great customer service. This growth is being reflected in key sectors, such as restaurants, fitness, fashion, cafes and hair and beauty salons.
Some retailers, i.e. FarFetch, who understand their brand and the customers they are selling to, do not necessarily need to compete on price or delivery. By using data to understand what your customers want, you can shape your ecommerce offering to best suit them.
In 2016 alone, sales through mobile grew 90%, with more than half of online purchases being made from smartphones.
Global mobile and tablet browsing now accounts for 51.3% versus the desktop’s 48.7% and 41% of all transactions are now through mobile.
Mobile browsing will continue to drive ecommerce. There were predictions that, for the first time, the majority of holiday season sales in 2017 will be over mobile.
Millennials are nearly 3x as likely as Baby Boomers to have made an online purchase from bed, and over 50% of smartphone users grab their phone immediately after waking up. This highlights the importance of morning/evening buying windows, and retailers must look to capitalize on these habits, e.g. with well-timed offers and content.
Data, Data Everywhere
Customer insights are becoming much more widely available and accessible to businesses of all sizes and 2017 has seen more retailers translating shopper buying behavior into useful insights. However, the challenge is using this data effectively; retailers now have so much data available to them that they can be overloaded by information.
O’Carroll advises retailers to be clear on what they are trying to achieve and to focus on “four or five key metrics or KPIs that are really important to your business - these may be related to logistics, front office or the back office - and act on what the data is telling you.”
From Click, to Swipe, to Chat
Voice search/recognition technology (think Alexa) and chatbots have made huge strides this year. O’Carroll believes that as more businesses opt for end-to-end single platforms, supported by clean data, retailers will see huge benefits in the technology for customer service and for B2B interaction, for example, asking "what’s my margin on this red shoe today?"
We Still 'Like' Social... and Email
Facebook and Instagram are continuing to grow in influence (Facebook skews towards an older generation, while Instagram users are primarily millennials).
Platforms such as Instagram present unique opportunities for brands who have a point of view and are image-focused to visually represent their brand, celebrate its personality, and keep it top-of-mind for users who scroll through their feeds. However, it can take between 3-4 years to see meaningful impact.
Conversations from social media remain low. Channels are seen as an influencer ‘up the funnel’, however, there remains a great opportunity to drive brand awareness, shape perception and cultivate brand advocates.
Email is not dead! There are brands who use it well, such as Mr Porter. The key is obtaining and using customer data effectively to produce engaging, relevant content, preferably with personalized, well-timed messages.
Technology for the 'Now' Generation
O’Carroll states that the systems and technology that larger retailers use wasn't built for real time ecommerce, and is not a good fit for the millennial ‘we want now’ generation.
Larger retailers, unable to move away from these embedded systems, are adopting technology for real time commerce alongside these legacy areas, leading to disparate, inefficient workflows.
There is a real opportunity for mid-sized retailers, those without inflexible legacy systems in place, to gain competitive advantage through joined up all-in-one solutions that support real time commerce and enable them to react to the challenges of ‘immediacy’ that younger consumers present.