The sun is out but no summer break for retailers
In this latest blog, Imran Choudhary, retail solutions specialist, Smarter Commerce, IBM, discusses his initial thoughts and recommendations on the IBM Digital Analytics Benchmark UK Christmas Readiness report.
As most people enjoy the summer, retailers are hard at work planning and hypothesising on what to expect this Christmas. This reminded me to re-visit the IBM Digital Analytics Benchmark UK Christmas Readiness report. While you click to download it, here are my initial thoughts and recommendations.
Hindsight can often provide indicators as to where to go next. Mobile, growing to a record high of 37.2 percent of all sales last Christmas, and becoming the ‘must have’ of 2014, is a reminder of its obvious and expected dominance this coming season - something of which most retailers are well aware.
However, historical data also highlights areas for concern. Average order value has remained flat at around £80 and number of items per order has dropped. This is prompting retailers to up the ante on data and create the most engaging experiences, refine personalisation, and improve product recommendations - the latter being a proven and effective way of realising double digit growth in sales revenue.
Equally, social still remains a challenge for retailers, with less than one percent of visitors arriving on websites from social channels, resulting in 0.1 percent of sales. But our last annual consumer survey revealed 43 percent of consumers post socially about retailers and 30 percent post about the purchase, creating a digital version of the old ‘word of mouth’. It will be interesting to see what comes out of the rumoured addition of ‘buy’ functions to social sites and this is definitely something for the industry to keep a close eye on.
Additionally, consumer attention span is becoming ever shorter. In February bounce rate reached a high of 30 percent, and in March average minutes spent on site hit a new low of 6:49. Putting aside the usual hygiene factors such as ‘optimised for mobile’, search and navigation, retailers need to deliver a personalised and rewarding shopping experience as the challenge with customer attention has never been greater.
Beyond the usual efforts to generate inspiring content, improve product recommendations and ensure all boxes are ticked with regards to payment and fulfilment, online retailers also need to cover the ‘unknowns’, by analysing interactions from the user’s perspective , enabling quick corrective action to fix design or usability problems which directly affect revenue.
Finally, omnichannel should always be at the heart of any retailer’s strategy, regardless of the Christmas peak. Expect highs in click-and-collect, as consumers want to guarantee receipt of their items. Communication and delivering on promises will assure good service and future advocates, but retailers must also remember the basic cross-sell opportunity when the customer comes in to collect.
This is a key differentiator for any retailer trying to get an edge over the pure eplayer, and data plays a key role here again. If the store fails to understand the customer or the path to purchase, for example by recommending an irrelevant cross-sell with no link to the customer’s purchase or interest, the opportunity to increase the customer’s average order value will be lost.
Retailers needs to dip into their large data pools to segment, interrogate past touchpoints, the consumer’s behaviour online and offline, as well as wisdom of the crowds, to intelligently create recommendations and a personalised experience for the customer at the right time, right place, and right price.
Every interaction is an opportunity, so make it count.
Interested in this topic? Download the IBM Digital Analytics Benchmark UK Christmas Readiness report.
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