Or Lenchner, CEO of Luminati Networks
Those UK retailers who have relied solely on the traditional brick-and-mortar-focused shopping model have been particularly hard hit by the pandemic. One does not have to look far for examples of UK retailers that have gone bust since March; high-street staples such Peacocks, Jaeger, and Harveys Furniture have all gone into administration, simultaneously taking many livelihoods with them. Online shopping has clearly taken over the retail sector with the intention of continuing to dominate the traditional holiday shopping season.
To state the obvious, times have changed, and the statistics back this up. Recently collected data with Vanson Bourne shows that the number of shoppers heading online has increased from 24% in 2019 to 51% in 2020. Meanwhile, 44% of the consumers surveyed stated that they are unlikely to carry out any physical shopping in the remainder of this year. Additionally, 61% are planning to continue shopping online well after the pandemic ends. So, what do these newly released figures mean? Have retail consumer habits changed permanently?
There is light at the end of Covid-19 tunnel, with many retailers facing the prospect of reopening in the near-future, pending vaccines. But is this guiding light a realistic one? While the older demographic in the UK has been traditionally reluctant to fully embrace online retail, Covid-19 has driven these people, who would otherwise have avoided e-commerce, to shop online for the first time.
To be exact, consumers aged 65+ have seen a significant increase in the number of those who do a majority of their shopping online, jumping from 15% a year ago to 39% today. A majority cited increased convenience as a leading factor in their shift to online shopping – convenience that may obstructefforts to attract these avid online shoppers back to the offline world.
This begs the question, if the status quo has already changed so radically, are retail sales events such as Black Friday and Cyber Monday really necessary in 2020? Britain is already leading the way when it comes to online retail adoption, with stats showing that Brits are going online at a pace that far outstrips US consumers (7%).
The new normal – online retail events starting earlier than ever
As e-commerce has become the main shopping channel for all, online retailers have already begun offering steep discounts well ahead of the holiday shopping season, particularly in parts of the retail sector that were hardest hit. This is to tempt consumers whose incomes had, in many cases, been dramatically reduced because of the pandemic.
These early and steep discounts now pose a real challenge for all online retailers when it comes to shopping events such as Black Friday and Cyber Monday. They need to bring much more to the pricing table if they want to reel in consumers who have already come to expect, and are therefore de-sensitized to, low prices. The bottom line is that fixed “traditional” discounts alone will no longer be enough. With more than half of shoppers (55%) stating that they use comparison sites to help them shop for the most attractive deal, standing out and ahead of the crowd could not be more imperative.
So, how do online retailers make sure they stand out from the pack?
So, how can online retailers effectively differentiate their products, prices and special offers? When the online sphere is so fiercely competitive, online retailers need to be aware of every step that their competitors are making in real time. In the modern retail environment, creating the perfect price for consumers involves precise calculations based on online data.
On top of that, online retailers obviously need to go into virtual battle, in real-time for their customers’ attention. Retailers need to ensure that they are addressing their customers’ sentiments before those sentiments become a demand. To illustrate it with numbers, 32% of respondents in the aforementioned survey chose ‘securing the best price’ as the most important factor influencing their holiday shopping online. With that in mind, online retailers want their offer to be the one that keeps their online customers looking for the best holiday deals on their channel.
This may sound like a complex operation, but in reality, it is actually simple. Automated, AI/ML-based, online data collection is one solution that can provide clarity to a world filled with numbers. This is where keeping up with competitors, especially during the highly competitive holiday shopping season, is simplified into an ‘on-demand’ request.
Seasonal retail events may not be what they used to be pre-pandemic, but the rules of the online sphere have been expedited and accelerated into the future. Online retailers seeking to secure consumers’ attention should look at this shopping season as a guide to the foreseeable future. They should also look towards online data-driven insights to pave a direct path to success in the e-commerce dominated landscape of the future.