The first quarter of 2021 has ended without having given us any kind of pause. Although the scenario we fact remains uncertain, the dynamism of the world’s economies seem to be starting to accelerate.
Many speak of a new reality in the market, one in which a large number of companies have ceased to exist and have given way to new players that are managing to meet the same needs as before but with proposals appropriate to the new market context. Others have adapted to survive despite external shocks and today are going through their reintegration process. Finally, there are those who reinvented themselves and achieved unprecedented growth by leveraging technology. They have modernized certain industries in favor of consumers and the companies themselves.
It is incredible to see many companies questioning their raison d’être and challenging their value proposition in the face of a new consumer with more options, more references, more information and less time. Likewise, it has been extraordinary to see those same companies integrating or strengthening themselves with technological solutions to sell more, at lower costs and/or to increase their productivity, in B2B, B2B2C and B2C models.
It is incredible to see many companies questioning their raison d’être and challenging their value proposition in the face of a new consumer with more options, more references, more information and less time
Undoubtedly, the recognition of these technologies has been democratized thanks to the context, to the efforts of technology and digital companies to publicize their solutions by taking advantage of the momentum the pandemic has provided, but above all to the change of mentality regarding the need to re-learn, update and innovate.
One of the industries that has grown the most in the last year is e-commerce and has accelerated its market share massively. Both digital natives and traditional companies that were prepared with a digital sales channel have managed to capitalize on the pandemic’s restrictions in their favor. Likewise, new actors or companies that through different digital platforms have found a new sales showcase on the web.
This first foray into e-commerce was not as easy as it seems for many of them. They had to break with their own paradigms, go back to school, find enough humility to let themselves be advised by an external advisor, be willing to change their processes and policies, take the risk of investing in something totally unknown at financially complicated moment and develop and operate a new sales channel with all its implications.
However, for those who have already taken the first step, what follows is the professionalization of the channel to continue growing in a competitive environment with an online offer of products and services that is growing rapidly every day.
Success in this new environment requires adaption. Let’s discuss the three main pillars on which to build the market’s newest version.
Large e-commerce can grow quickly by taking advantage of each and every one of the data they have in their base and translating it into information that allows them, firstly, to understand in detail if they are growing or shrinking. Secondly, they can understand why this may be happening and, finally, can define the possible commercial levers that activate its optimization in the short and medium term.
To get there it is important to identify the key metrics of the business, to set objectives by using the data that is in the base, to ensure neatness in the database and to have a visualizer that facilitates the cross-referencing of information for decision making.
Likewise, there are tools based on AI models focused not only on analyzing data and making projections but also on helping in the operational performance of the online store.
Obsession for the Best User Experience
For a long time there has been talk of putting the customer at the center, but it is only recently and with the help of technology that this idea has been viable in real time.
By taking advantage of all the information that can be collected from every single user, it is possible to optimize every touch point in the customer journey on a continuous basis, in favor of customer satisfaction and sales, from acquisition campaigns to delivery.
Success in this new environment requires adaption
There are four key points, which can increase the probability that the user will buy:
Sufficient information for decision making. It is essential to have complete information so that there are no doubts and the user can proceed with purchase. Product description, purchase conditions, insurance, complete visibility of costs and times, as well as the return policy, are just some of the points to be considered when making a purchase.
Omnichannel. It is a priority to have several communication and sales channels open and interconnected to achieve a continuous and appropriate dialogue with users’ preferences.
Accessibility to multiple payment methods. It is important to achieve the greatest flexibility of payment options to meet the needs of as many users as possible, including: Debit/credit/service cards, cash, Paypal, payment options in other currencies, among others.
Timely delivery. Achieving a good logistic planning and execution is transcendental for fulfilling the service promise, decreasing the rate of returns and increasing the probability of repurchase. Therefore, it is very important to have a logistics partner that will take you to the next level.
To achieve e-commerce traction, it is necessary to acquire new buyers, but it is even more important to achieve sustainable growth, to ensure their repurchase that will result in solid customer lifetime value and lower acquisition costs. Although there are many ways to achieve this, there are three that we recommend:
Loyalty. While this concept is built by ensuring an adequate assortment at an affordable price and impeccable service, there are tactics used by major industry players that facilitate it. For example, memberships that require an annual commitment from users offer those users benefits including free shipping.
Recommendation. About 60% of the users that come to a digital platform are by recommendation. Therefore, it is very important to facilitate this process through tools that trigger the network effect.
Representation. Integrate a community of specialized key opinion leaders who share the cause of e-commerce and wish to become commissioning partners in order to generate a win-win model, transforming digital content related to the online store, in sales.
This last year has uncovered the opportunities we have in some Latin American countries to facilitate the growth and penetration of e-commerce. However, in the eagerness to continue contributing to its own economy and that of its employees and its entire value chain, private initiatives have managed to transform and adapt to the different rules of the game in each of the markets, taking advantage of the best of technology.
Today, we can see an incipient recovery in consumer confidence, driven by the reincorporation of many people to their daily lives. This will undoubtedly help stabilize market outlook, but it will also bring with it new challenges, while creating the need to reinvent ourselves and discover the next ‘version’ of ourselves as entrepreneurs and as humanity.