3 Digital Commerce Disruptions Driving Revenue Opportunities for Brands
COVID-19 is the ultimate change agent, and implications have hyperaccelerated shifting consumer behaviors, catching brands unprepared. In 2021, marketers must implement digital innovations to drive commerce now and into the future. Here are three consumer-centric digital commerce disruptions brands must pay attention to for revenue generation and fostering loyalty.
Evolving Consumer Attitudes Are Fueling Flexible and Contactless Payment Adoption
The pandemic’s economic impact has accelerated mindful consumerism, where shoppers are more intentional about spending. The motivator for purchases is necessity vs. desire. Economic uncertainty has made consumers cautious. As a result, the buy-now-pay-later (BNPL) model from Klarna and others is growing in popularity. The benefit for brands is averting cart abandonment and increasing conversion rates, especially for discretionary products.
Younger U.S. consumers are eschewing credit cards, gravitating towards options offering financial flexibility, as opposed to interest charges. BNPL allows shoppers to reap the benefits of enjoying their purchases upfront in addition to a streamlined, seamless experience, increasing loyalty and satisfaction.
Contactless touchpoints and curbside pickup have exploded, and tap-and-go payments such as digital wallets and near-field communication (NFC) credit cards allow shoppers to safely and seamlessly purchase in-store, while reducing checkout time. Similarly, e-commerce customers use digital wallets for expedited checkout, and mobile payment options such as Apple Pay and Samsung Pay are driving mobile commerce.
An uptick in digital payment technologies is part of a consumer shift from physical currency. In the U.S., popular apps like Venmo are becoming mainstream. Elsewhere, the pandemic is accelerating noncash payments for in-store transactions, given shoppers’ fears of transmitting the virus through surface contact.
Offering alternative digital payment and installment methods goes beyond transacting. It’s also about aligning with shifting consumer attitudes and behaviors. As shoppers delay high-value purchases, they're decreasing discretionary spending, and are more inclined to interact with contactless touchpoints.
Direct-to-Consumer and Social Channels Are Necessary for 1-to-1 Engagement
The need to meet shoppers where they are is urgent, as the traditional linear customer journey — embodied typically by a single channel, limited awareness, and minimal choice — is becoming more fragmented. Our homes are the hub for daily activities, making commerce omnipresent, omnichannel and on-demand.
Yet, consumers are bombarded with myriad distractions, making it difficult for brands to break through with direct messaging. Brands must establish one-to-one consumer interactions via direct-to-consumer (D-to-C) channels. The hoarding trend seen during the initial shock of the pandemic caused severe supply chain disruption, leading to a domino effect of out-of-stocks when shoppers needed stability. In turn, they were forced to try new products, dealing a massive blow to brand loyalty. Brands must now work twice as hard to win back shoppers and maintain loyalty for the long term.
Delivery companies such as Shipt are bringing snacks, alcohol and other consumer packaged goods to doorsteps, giving consumers a better experience than shopping through a third-party site. D-to-C engagements allow brands to create unique communities with relevant, dynamic content. Consumers engaging directly with your brand are your biggest advocates. Therefore, leverage user-generated content to convey the authenticity consumers don’t get through other saturated channels.
The most important benefit of establishing a D-to-C channel is that it affords brands the ability to own and control customer data. Brands must amass customer insights in real time and provide appropriate messaging while the consumer is still engaged. In turn, customers receive more relevant, personalized experiences that drive loyalty. It’s a win-win.
Social media is another critical, underutilized commerce disruptor brands can no longer afford to ignore. Social has been viewed as a source for discovery and research for shoppers, with commerce relegated to a poorly integrated afterthought. However, a consumer-centric approach to social entails a seamless purchase path at the moment of engagement. Consumers have become immersed in all forms of social media for news, entertainment, and other content during quarantine, and the potential customer reach is undeniable. Platforms are adding shopping capabilities to better enable themselves as friction-free commerce touchpoints. Similarly, fast-growing TikTok is laying the foundation for its entry into e-commerce, further fueling the imminent convergence between content and commerce.
Emerging Technologies Such as AI, QR Codes, and Virtualization Are Driving Experiential E-Commerce
The inevitable mass consumer shift to digital in 2020 means differentiation is critical in 2021. Features such as artificial intelligence (AI) and augmented reality (AR) add value to the customer journey, enabled by greater proliferation of the increased speed, latency and reliability of 5G technology. Stay-at-home orders conditioned consumers to become digital-first — and they're coming to your e-commerce site with preconceived notions of the customer experience. These notions are formed from previous digital engagements, anything from watching a movie on Netflix and ordering takeout on Grubhub to collaborating with co-workers via Zoom..
Immersive experiences are no longer a trend but rather a consumer mainstay. Consumers have spent more time interacting with emerging technologies at home — growing accustomed to Alexa’s inherent machine learning component and voice search capability, or engaging with novelty Snapchat filters evoking AR. These activities filled the void of in-person experiences, maintaining a sense of connectedness consumers crave during isolation.
Technology innovations have been a lifeline for physical brands forced to shutter temporarily to help slow the spread of the virus. The travel industry, restaurants, museums, and similar nonessential categories have smartly integrated these technologies to sustain customer interaction, stay relevant, and create the experiential moments consumers crave. QR codes have enabled experiences that are both physical and digital, as consumers use the labels to embark upon compelling virtual journeys in lieu of real-life adventures.
Consumers have been through months of anxiety, inconvenience and chaos due to the pandemic, so feelings of skepticism and impatience are understandable — and their need to feel safe, physically and otherwise, is paramount. The more we can do to save consumers time and money along with providing the right environment, the happier they will be and the loyalty they show will be worth the effort you spend.
Kylee Magno is principal digital commerce analyst and Renata Akers is digital commerce analyst at Astound Commerce, the world’s most trusted independent digital commerce specialist, empowering success through experience-driven ecosystems that fuse technology, data, design, and storytelling to propel business growth.
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Kylee Magno is principal digital commerce analyst at Astound Commerce. As part of the Astound Insights team, Kylee Magno is instrumental in overseeing the development of Astound Commerce’s proprietary research.
She has over 20 years of analytical experience in the digital space coupled with an in-depth knowledge of retail merchandising, marketing, consumer buying trends and the love of everything digital.
Kylee possesses a passion for retail and a drive to succeed, and sees the ever changing digital landscape as a challenge she’s always willing to meet head on.
Renata Akers is the Digital Commerce Analyst for Astound Commerce, the world’s most trusted independent digital commerce specialist, empowering success through experience-driven ecosystems that fuse technology, data, design, and storytelling to propel business growth.
She has eight years of analytical experience in the digital commerce space, coupled with 15 years of hands-on retail operations knowledge.
Astound Commerce is a global digital agency focused on developing innovative commerce experiences. We combine experience design, technology development, and marketing strategy to help brands engage with their customers at every stage of the buying cycle.