How Smart Brands Are Analyzing Offline/Online Reviews to Optimize Their E-Commerce Presence, Part 1

As e-commerce is expected to account for 22 percent of global retail sales by 2023, all brands must find new ways to elevate their digital presence. Smart brands need to evaluate their go-to-market strategy so that they get a complete picture of their customers' shopping journeys by analyzing offline and online customer sentiment. These types of data-driven insights can help you understand the changing needs of a customer and adapt to any changes in market trends. For instance, during the lockdown, Revuze created an e-commerce consumer opinion analysis report which discovered that customers preferred fragrances that reminded them of the outdoors rather than herbal and citrus smells, which were popular before the health crisis.

Additionally, research shows that brands that used technology to improve customer experience increased customer satisfaction by 15 percent to 20 percent, enhanced conversation rates by 20 percent, and reduced acquisition costs by 20 percent to 40 percent. By using digital technology in all business areas to consistently change its operations and deliver value to customers, L'Oréal grew its online revenue by 52 percent from $3.34 billion to $5.14 billion in 2019. L'Oréal's revenue for the first half of 2020 shows that although its overall financial results have experienced a hit due to COVID-19, the cosmetics brand has experienced e-commerce growth of 53 percent. As the customer journey towards purchasing a product is multifaceted and is no longer just about the sale, L'Oréal focuses on building services that improve the customer experience.

Improve Customer Centricity Through E-Commerce Partnerships

Rather than tackling digital channels alone, L'Oréal has opted to work with several online retailers to keep the cost lower and reduce the complexities of selling products direct to consumers online. L'Oréal’s chief digital officer has advised brands to develop digital partnerships in China, as it has allowed the cosmetics brand to test out new products and ideas in that country first. L'Oréal has made this recommendation as it believes China is a laboratory for new online customer usage patterns and behaviors, where customers purchase products through any means. L’Oréal turns this testing data into best practices that can then be implemented in other countries.

L'Oreal used this fundamental knowledge when working with e-commerce retailer Tmall for Singles Day in 2019. To compete with other beauty brands like Estee Lauder on Tmall, L'Oréal used its existing knowledge of the platform and the Chinese market to create a unique shopping campaign to drive sales. This campaign combined a live streaming session with a Chinese social influencer in conjunction with an offline pop-up store that also had influencers greet shoppers at every section of the store.

Use Data to Drive Advocacy Marketing and Gain Influence in New Markets

As the popularity of video apps and virtual chat platforms have continued to grow during COVID-19, L'Oréal realized that even though consumers are now stuck indoors, they require new ways to express themselves. Being the first beauty brand to team with Snap camera, Snap Inc's free video desktop application, L'Oréal created special lenses for users featuring brands like Garnier and Maybelline. These types of lenses gave users the ability to virtually test L'Oréal's haircare, makeup and skincare brands, helping them to look their best while on video platforms like Google Hangouts and Skype. By analyzing historical offline data and current online data, L'Oréal's collaboration gave users a new avenue for self-expression of their beauty while at home during the lockdown.

This collaboration was no accident, however. In 2017, L'Oréal experimented with Snapchat for its new Pure Clay Mask and realized a 51 percent sales lift. This increase in revenue occurred as a result of real-life influencers promoting the new product heavily on the social platform. L'Oréal used data from its initial Snapchat campaign to spearhead further sales as well as customer advocacy.

Final Thoughts

L'Oréal demonstrates that smart brands can optimize their e-commerce presence by using offline and online data to understand customer behaviors and attitudes. This data-driven knowledge will help businesses revamp their go-to marketing strategy to create value for a new customer or industry. L'Oréal has optimized its e-commerce presence by forming online partnerships that help the brand test what customers need. This testing data is then transformed into customer experience best practices that result in increased sales.

Alon Ghelber is the chief marketing officer at Revuze, an AI consumer opinion tech startup changing how organizations consume customer experience insights.