Everyone is talking about trading in the new normal. But what is the new normal?
As governments around the world issued lockdowns, consumers adapted to life indoors and shifted their spending online. As a proportion of all retail, online shopping reached 31% in April, up from 22% in March. This shift in spending will likely persist post-lockdown as consumers become accustomed to a “new normal” of shopping through direct-to-consumer and digital commerce channels. Although the possible decrease in disposable income for some consumers might mean a shift to bargain-hunting.
Some brands will be tightening the purse strings too. According to a recent survey, 90% of marketers say their budget commitments have been delayed 85% say they have paused new hires, and 81% say tech or infrastructure spending has been suspended.
When switching your strategy to survival mode, it’s easy to fall into a short-term mindset. But decisions made during a crisis can have lasting effects – positive or negative – on the path back to growth.
Amidst the fog, many businesses lose sight of their greatest indicator of direction when navigating times of uncertainty: the customer. The stakes are higher during times of crisis, and customers feel the impact of their experience with a business more acutely than in normal times. This means a greater opportunity to foster deep levels of customer loyalty, and companies that take advantage of this are in a better position to swiftly return to growth once conditions improve. The statistics back this up. During the financial crisis of 2008, companies that prioritized customer experience delivered three times the shareholder return of those that didn’t.
Marketers seem to have come to the same conclusion. In an audience poll from a recent Econsultancy webinar, over 2/3 of organizations say they will keep, or even increase their personalization efforts.
It’s clear that the decisions that you make now will set you up for success or failure long after the crisis is done and dusted. So how can you create a path forward in this post-pandemic world?
To adapt to the new economic realities, we recommend focusing on three key marketing areas.
1. The marketing mix
The shift in consumer behaviors calls for a shift in marketing investments too.
Consumers are not only spending more money online in response to store closures and social distancing guidelines, but many have turned to the internet for their source of entertainment and social interactions, too.
Globally, 44% of consumers state that they spend more time on social media than before the pandemic.
Take advantage of consumers’ increased screen time to meet their evolving needs through relevant offers using the right mix of digital marketing channels.
Your website is your storefront to the world. Anything you can do here to improve the website conversion rate, reduce bounce rate and smooth the user journey will have a significant impact on revenue.
Email marketing might not be as hip as some of the newer tools in a marketer’s toolbox, but it continues to be the most effective channel for increasing the value of your customer base. With the economic fallout from COVID-19 placing new cost pressures on retailers, increasing the use of email marketing allows organizations to maximize current customer relationships rather than spend limited resources on costly customer acquisition campaigns.
More time spent indoors and on screens has led to an increase in email open rates. Hubspot reported that across March, open rates increased by 21%.
Embrace authentic, unpolished UGC from your customers and employees across your marketing channels. Doing so will not only allow for higher volumes of social media content under scrutinized budgets, but it will also resonate more deeply with your audience.
2. Tailored experiences
As an increasing number of customers navigate digital channels, it’s important to make the experience as smooth and easy as possible.
There are three key shopper segments you should be catering for on your website and in the emails you send.
You will likely have some novice online shoppers on your website, so ensuring digital commerce channels are easy to use is more important than ever. In fact, our research shows that 60% of consumers would stop buying from an online store if the website was difficult to navigate.
When shopping online, consumers look to substitutes for shopping inputs they typically gain from brick-and-mortar stores — namely, trying out products in person and getting advice from a sales assistant. Social proof can help recreate that person to person experience. Features such as customer reviews, UGC and crowd-sourced guidance can boost buying confidence, especially among shoppers less acquainted with purchasing online.
Make sure you don’t scare shoppers away with products above their desired price range. Using a tool such as our Price Affinity Predictor will reduce bounce rate of new visitors by displaying product recommendations in the price level most likely to appeal to them.
For first-time buyers, build a personalized post-purchase experience to keep them coming back after lockdown ends. And be sure to thank them for trusting your brand during this unprecedented time.
Loyal customers have already made a purchase or have otherwise opted in to provide their email, making them the easiest audience to convert with the least acquisition expense.
Make sure they find what they like quickly by personalizing key areas of your website based on the brands the customer shops for regularly, for example. Reach their inbox at opportune moments by setting up triggered emails when their favorite brand offers a new product. A recession will bring out the bargain hunters so offer suggestions that might fit their preferred budget or alert them to sales on items they’ve browsed.
Due to swift changes in consumer behaviors and preferences during the pandemic, you can no longer rely on personalization approaches that use historical customer data from previous months. The impacts of COVID-19 have completely upended the status quo, and because of this, there is no historical data that you can rely on to make informed, data-led decisions. So, how can organizations adapt their marketing efforts despite a lack of historic data?
Leading measurement indicators
Organizations often focus on purchases as a success metric. While future transactions, returns and customer service costs can provide a more complete picture, those indicators usually delay measurement by an additional month (or more). Instead, look at leading indicators for signs of changing customer behaviour. This may mean using clicks instead of purchases as a way to measure marketing effectiveness.
You might be accustomed to making data-driven decisions at a segment or product level. But it’s crucial to assess which decisions you can make at a higher, aggregate level. For example, product recommendations that are usually more effective when segment-based could be replaced with trending product recommendations. Doing so offers two advantages:
- It might be a more accurate reflection of consumer needs during this time of rapid behavioral shifts. Trending products may be more pertinent to consumers’ current needs than affinities based on purchases made a few months back.
- The algorithms will be able to learn new behaviors more quickly. Aggregating behaviors across consumers means there is more data available to retrain models or measure testing results.
A new era of eCommerce marketing
There has never been a more exciting time to be in eCommerce and some verticals have seen phenomenal growth over the last three months.
But there’s no sugar-coating it. Many marketers and eCommerce professionals will be expected to do more with less in the next year or two.
However, with the right tools and strategies, it is possible to work with less and still deliver revenue. While some aspects of your strategies will change, it’s vital to remain customer-centric and adapt to new ways of selling to provide a seamless customer experience. That way, you’ll not only survive but thrive in this new era of eCommerce marketing.