Both online and offline retailers plan to invest in technology in 2018. As part of its ongoing effort to help small businesses succeed, Kabbage recently surveyed more than 800 business owners, 25 percent of which were retailers (both offline and online). The data showed that online and offline retailers are highly optimistic of revenue growth in 2018, 73 percent and 68 percent, respectively, expect to increase revenue in 2018.
The survey sought to understand how retailers intend to invest in technology to reach their goals. The results showed online retailers plan to invest in more mobile efforts and technologies to increase productivity, while offline retailers will focus on technologies to improve consumer outreach and relationship management.
Sixty percent of online retailers plan on investing in technology that removes manual processing, reduces paperwork and improves efficiency, just beating the total average of 59 percent across all small business respondents. Given the digital nature online retail, it’s telling as automation mitigates risk by reducing man-made errors, provides better quality control and, more pointedly, improves the accuracy when measuring results of online sales and marketing efforts.
Online Retailers Look to Mobile
As retail becomes more automated, tailored and bespoke, retailers should capitalize by focusing on personalizing the customer experience through mobile technologies.
Some retailers are stepping in the right direction already. According to Kabbage’s survey, 48 percent of online retailers say they will invest in mobile technology to deepen customer relationships and acquire new customers. Separate research shows mobile devices now generate 51 percent of website traffic. With the daily average of mobile phone usage clocking in at five hours, retailers have a greater opportunity to push personalized messaging to capture customers on their personal devices.
Retailers can profit on this traffic by creating a mobile app, focusing on mobile search engine optimization (SEO) efforts, and improving their accelerated mobile pages (AMP).
With a properly designed mobile app, users get a better shopping experience, which in turns increases brand loyalty. A simple and easy navigation menu reduces the number of clicks for consumers to find products more quickly.
SEO efforts can be expanded in apps as well. Information such as product descriptions, about pages, blogs, etc., should be easily found and showcase the most important information first. Targeted keywords should be included in this content.
SEO also benefits from AMP, as it boosts website speeds and improves the user experience. Reducing the load time of an app or website increases time spent on said platforms, as consumers are 90 percent more likely to abandon pages that take five or more seconds to load.
Offline Retailers to Boost Online Advertising Investments
The Kabbage survey also showed 54 percent of offline retailers plan to increase social media advertising spend by 20 percent, outpacing their online counterparts at 44 percent. According to Statista, social media influences the purchasing decisions of 45 percent of shoppers. Retailers can capitalize on the opportunity by creating personalized ad campaigns and relationships with micro influencers.
With targeted ad campaigns, offline retailers can find the appropriate audience and tailor messages to their needs. Retailers should research demographics and psychographics to personalize social media ads, especially for Generation Z.
This next generation of shoppers will soon represent 40 percent of American consumers, having the buying power of at least $44 billion. These consumers desire deeper personalized experiences with small businesses. Leveraging videos and images to specific psychographics to tell stories captures attention and loyalty.
Micro influencers can help personalize brands through sponsored ads, showing how they use or wear products in their daily lives. They also come at cheaper costs, which can boost the return on investment of social media ads.
With less than 100,000 followers, micro influencers tend to be more effective for small businesses than larger influencers. Consumers relate to micro influencers because they have a more attainable lifestyle than users with millions of followers.
Plant Seeds Early for Future Growth
Technology continues to advance each year, and retailers recognize the importance of embracing it for driving substantial growth. Marketing investments — including the technologies that support it — is one of the primary needs for funding across all industries. Some require as much as $250,000 to make larger and more strategic marketing investments. The small businesses that plan to allocate funds to increase their technological presence have taken the right step in becoming industry leaders, expanding their customer reach and growing their businesses.
Constantina Kokenes is a SEO and content specialist at Kabbage, a fully automated online lender for small businesses.
Related story: The 2017 Retail Technology Report