Even in a tight spending market, where consumers are becoming more complacent with the increase in the cost of living and skyrocketing inflation, retail and eCommerce sales have revealed positive growth in the first quarter.
According to data released by the United States Census Bureau on 19 May, eCommerce sales accounted for around 14.3% of total retail sales, with a total estimate of $250 billion in seasonally adjusted sales. The recent estimate was a positive 2.4% increase compared to the fourth quarter of 2021.
Forward-looking estimates provide a positive indication that American consumers are still somewhat resilient even as soaring inflation and supply chain issues have seen consumer prices increase to their highest in more than four decades.
On this front, eCommerce is projected to overtake the in-store shopping experience in the coming years, as more and more consumers are willing to adjust to a more suitable digital lifestyle even as the pandemic starts to wane.
Research published by Merkle found that 48% of consumers increased their spending amount on eCommerce sites in 2021 than they did in 2020. The growing demand for more digital experiences in the retail sector has now meant that businesses are adapting faster, and more frequently than they did before and during the pandemic.
Today it’s possible to find nearly everything and anything online, from household items, consumables, attire, electronics and other consumer-based goods. Behemoths such as Amazon, Walmart, and Shein have shown smaller businesses the growth possibilities that lie within eCommerce.
For businesses that aren’t so frequented with eCommerce and online shopping, the widening gap between brick-and-mortar and online is only looking to become more prominent in the coming years. This is not only true on a competitor level, but changing trends and a shift in generational buying power are also the driving force behind the rapid growth of eCommerce.
A study on more than 2,000 American consumers found that roughly 43% of millennials were among the highest group of consumers who are more likely to prefer a customized and personalized online shopping experience.
An array of factors are driving the change behind consumers' needs for a more personalized experience, with the pandemic and technology at the forefront of the change.
The shift in how consumers perceive brands, what they are looking for, and who they want to interact with online makes it difficult for those businesses who are unable to adapt rapidly and utilize analytical tools to assess consumer behavior.
So, how can eCommerce sites remain relevant in a challenging and competitive market through the aid of on-site personalization? Here’s a look.
Increased Consumer Engagement
Consumers today, especially younger and more tech-savvy shoppers are more open to sharing their personal information with companies if they can provide them with a personalized shopping experience, according to recent research by Accenture.
Younger consumers, and perhaps a select few Baby Boomers and Generation X shoppers are willing to spend more time online browsing products and services if a company tailors the experience to their needs.
Moreso, with the dominance of social media and the role it plays in brands' effective communication strategy, it is perhaps important to consider how social media is curated according to buyer preferences and needs.
Product and Service Recommendations
It might seem a bit tedious, as no one truly enjoys constantly seeing a product or service being advertised to them via social media, email or while browsing websites. Having more personalized recommendations can help entice customers a lot quicker, and direct them to an online store faster.
Research by Smart Insights found that personalized product recommendations that are directed to a select group of consumers can generate 68% of total eCommerce revenue.
This just shows again how important a personalized experience can be, but more than that, the impact it can have on revenue and increased sales.
Personalized Email and Communication
Email marketing in itself is perhaps a contemporary marketing tactic that can help drive sales and customer interaction. In the digital age, email marketing also helps to deliver a tailor-specific message to buyers and can be directed at a selected target audience.
Some businesses go as far as to use email marketing and messaging as a way to analyze consumer behavior. This way they are able to see how impact-driven their messages are, and how consumers engage with the brand daily.
If you’re not completely convinced, just consider the fact that sending our welcome emails to new subscribers can help to increase customer engagement by more than 500%.
Lowering Cart Abandonment
Nothing is perhaps more frustrating and challenging than understanding why and when during the shopping experience a customer opts to abandon their shopping carts.
While these actions do not necessarily impact the business and marketing strategy that much, they could perhaps have to do with consumers looking for a more personalized shopping experience.
The reasoning behind this comes in that when consumers can find a product or service they can thoroughly engage with, and it is from a name or brand that they align with both socially and politically, it could mean they are more open to supporting these types of brands.
Better yet, having custom or personalized listings means that customers can find exactly what they are looking for faster and more conveniently.
Increased Click-Through Rate
Click-through or click rate refers to the action of users and online shoppers clicking a hyperlink of a specific website that they came across either through a third-party, or perhaps a Call to Action.
With personalized content, businesses can have better control over who visits their site, and when. More importantly, they can see where traffic is coming from, and how they can use similar experiences to increase the click-through rate in different target audiences.
Building Preferences Is the Way Forward
Considering how businesses have changed over the years, and how technology has driven this, online shopping is only taking a bigger cut from the retail market year after year as more consumers search online for their favorite products and services.
There are still a lot of business leaders and eCommerce entrepreneurs who can learn from building personalized experiences, but the data reveals that having these objectives within your marketing strategy would mean you are able to drive up sales, increase revenues and promote a personalized shopping experience.
