Without a doubt, the retail landscape is changing. Large, global e-commerce communities are disrupting the retail marketplace by bringing together vast numbers of buyers and sellers in frictionless transactional environments. Inspired by their success, brand marketers are rethinking go-to-market strategies to better integrate digital advertising with personalized shopper engagement and more effective conversion programs.
In a new study released by the CMO Council, Ingenuity in the Global E-Commerce Community, fully 56 percent of brand marketers surveyed say these e-commerce communities are revolutionizing the global retail marketplace, noting these communities are forcing them to rethink every facet of their go-to-market strategy (46 percent) and accelerate their own evolution across all channels and touchpoints (43 percent).
Consider that while 10 percent of the $5 trillion in total annual sales are attributed to digital channels, 50 percent of the nearly $500 billion spent by North American online shoppers alone is being spent at digital shopping destinations like Alibaba, Amazon.com and eBay.
These e-commerce communities have empowered the connected consumer, providing them with a wider range of choices, 24/7 convenience, pricing transparency, and quick and assured delivery. Yet brand marketers can also find significant benefits in leveraging these communities. Forty-six percent of marketers point to large numbers of active, pre-disposed buyers with whom they can seamlessly transact. Another 37 percent point to the optimized infrastructure for order processing, fulfillment and interaction at scale.
However, brand marketers have yet to realize the value that these communities have in revealing insights across a shopper’s total journey. Just over one in four marketers see value in the ability to segment and target audiences based on the rich shoppergraphic insights that these communities can uncover. Furthermore, only 11 percent see the value in accessing how these communities understand the full-funnel path to purchase. For brands that have tapped into this rich insight, the rewards have come in the form of expanded reach and advocacy extension.
This shift points to a bigger evolution for brand marketers, prompting the evolution of the old model of the four Ps of marketing (product, place, price and promotion) into a new model of the four Ps of marketing engagement: precision, personalization, persuasion and perfection.
Already, 27 percent of marketers are recalibrating and allocating digital marketing spend in order to better compete and differentiate themselves in these marketplaces, as well as reach customers with more targeted and relevant information. They're looking to stay ahead of the innovation curve by differentiating their brands and elevating their visibility across the retail marketplace.
Forty-two percent said they'll differentiate their brand through the development of richer, more visually engaging content that will deliver better experiences to help exploration and discovery thrive. Some 36 percent of respondents indicated that they will leverage community intelligence to power their differentiation, while 34 percent plan to develop more compelling and persuasive narratives.
Thanks to this focused innovation and improvement, marketers expect that the revenue generated from e-commerce will increase over the next two years. Currently, 76 percent of marketers estimate that less than 20 percent of revenue can be attributed to e-commerce. However, over the next two years, marketers anticipate that they'll see continued improvements in e-commerce revenue (55 percent), with 65 percent believing that they'll realize a more cohesive and integrated multichannel digital retail strategy that will yield bottom-line results.
Sally Ann Lopez is content editor and program manager for the CMO Council, a peer-powered network for senior marketing decision makers.