Survey: Retailers Are Investing in Mobile, Personalization and Customer Experience to Drive Online Revenue
In what areas are e-commerce professionals making investments, and what are their top initiatives and priorities? To learn more about where retailers stand with their e-commerce efforts and what’s to come, SLI conducted a survey of 276 retail industry professionals from across the U.S., Europe, Australia and New Zealand to see how they feel about the state of e-commerce.
Findings showed retailers have more aggressive estimates for gains in e-commerce revenue compared to similar research conducted in 2017. Specifically, in the U.S., 59 percent predicted modest e-commerce revenue growth of 1 percent to 10 percent, and 12 percent estimated growth of over 21 percent.
While it’s clear e-commerce confidence is strong, how retailers across industries and markets planned to achieve that growth and satisfy their customers’ needs differed. Following are highlights from the research that detail this further.
Mobile Continues to Be Key
Retailers recognize the importance of the mobile channel for connecting with consumers. When it comes to expectations regarding small-screen transactions, respondents are optimistic.
- With regards to spending on mobile, 50 percent of respondents maintained their 2017 financial commitment, while 41 percent increased their monetary investment for 2018.
- Housewares/home furnishings retailers are more invested in mobile compared to other verticals, with 65 percent reporting an increase in spending related to mobile. For comparison, only 22 percent of sporting goods retailers reported an increase in mobile spending.
- Looking at revenue expectations from mobile, 80 percent of those surveyed anticipated revenue from mobile sites and apps to increase. With regards to specific verticals, 95 percent of those in food and beverage, 94 percent in housewares/home furnishings, and 93 percent in apparel anticipate an increase.
When it Comes to Engagement and Conversion, Personalization is Critical for Many
With increasing threats from mega-brands like Amazon.com, retailers recognize consumers expect a very high level of customer service — and that delivering a personalized experience is a big part of that. Survey responses showcased which areas of personalization are hot, the ways businesses are planning to personalize their interactions with shoppers, and the expected impact of making communications more relevant.
- One-third (33 percent) of retailers said their companies already provide customers a personalized online experience, and almost half (49 percent) plan to do so in the next year.
- Sixty percent of respondents said increased conversion rate is the expected top benefit from using personalization, followed by increased customer loyalty (16 percent) and increased average order value (8 percent).
- Offers triggered by online behavior is the No. 1 way retailers plan to personalize for consumers (42 percent). Emails triggered by online behavior and category page results based on online behavior tied for second (both 38 percent), followed by recommendations based on online behavior (36 percent).
- Retailers in housewares/home furnishings were the most aggressive with their personalization plans; only 18 percent reported currently using personalization, but 71 percent expected to leverage it within the next year.
Customer Experience Reigns Supreme
Addressing customer needs and desires is a top priority for retailers. With regards to their most important initiative, 25 percent of respondents said customer experience, 16 percent noted advertising or paid search, and 15 percent chose replatforming. This reflects a change from Q3 2017 research conducted by SLI when the top three initiatives were replatforming (17 percent), customer experience (16 percent), and inventory, logistics and fulfillment (15 percent).
Despite retailers feeling confident when it comes to their expectations for online revenue growth and their plans for helping to drive it, they still have concerns regarding competing with Amazon. In fact, 41 percent of the survey’s respondents considered the online colossus to be more of a threat to their online businesses compared to Q1 2017.
To help ensure that retailers’ anticipated growth becomes a reality in this highly competitive arena, they must focus squarely on their customers’ experiences and needs and the myriad of ways that consumers find their brand and connect with their products. Otherwise, they risk not achieving the revenue increases they’re predicting.
For complete details on the survey’s findings, download the H1 2018 E-commerce Performance Indicators and Confidence (EPIC) Report via this link.
Chris Brennan is the CEO of SLI Systems, a global software company with solutions that help online retailers achieve higher sales and repeat customers.
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