Secure your e-shop performance with e-commerce market 2021 insights
Online sales market changes were rapidly accelerated by the pandemic. The impact of COVID-19 on shopping habits including the types of products purchased online was dramatic. Delayed purchases for non-essential product categories on one side and skyrocketing of other categories related to health, masks, sanitizers, and food on the other. Time is money, and the convenience and safety of shopping online, especially for groceries, is a new standard. Regardless of the category, the shopping experience needs to keep up with customer expectations from shopping at traditional brick-and-mortar stores.
Brand and store loyalty are decreasing and the cart abandonment rate in the industry is at 75%. It is pivotal for e-shops to utilize customer data for better insights into shopping behavior, personalize their offers, and win the battle for the customer.
COVID-19 accelerated the e-commerce growth, the amount of data, and the requirement for insights, and there is no sign of this slowing down. There was a 5% leap of e-commerce’s global share of retail sales in 2020 to 18%, which should continue to grow to almost 22% in 2024 (see our report for more). The largest segment in online retail remains in fashion – shopping online is getting easier with personalized offers, and retailers enabling smooth and easy returns. How many leggings, sweatpants, or home exercise gear have you bought since the covid pandemic started?
The expectations of customers are evolving and pushing the demand for personalized experiences. Lack of personalization is often the reason customers shop elsewhere, and it is just one click away, so data-driven personalization is a must-have for businesses to stay competitive nowadays. Although, in reality, many e-shops fail to deliver real personalization to their customers. The efficient use of data is often the underlying problem, whether they are lacking a single customer view, data integration issues, or the inability to deliver smart insights from advanced analytics.
Machine learning and Artificial Intelligence is helping to analyze customer data
The amount of data now being generated is immense and humans can hardly keep up with analyzing them. This is where advanced analytics using machine learning or artificial intelligence is stepping in. These emerging technologies are helping with getting customer insights from the transaction history of a customer. Market basket analysis for instance is looking into what products are typically purchased together, which can be utilized for store organization, stock efficiency, and improvement of upsells and cross-sells, all directly influencing the bottom line. An example of such analysis can be found in our recent case study for a bike retailer.
Benefits of using customer data in your e-shop
Data-driven decision-making is a mantra for marketers. The benefits that customer analytics is bringing to e-commerce include:
Higher marketing efficiency, measured in increased conversion rates, higher ROI from the investments into marketing.
An improved performance, which can be measured as increased average order value (AOV), higher upsells or cross-sells, or category expansion.
Better customer experience thanks to using customer data for personalization and hence increased customer loyalty.
Getting ahead of your competitors
Understanding the online marketplace and how to work better with your data is crucial – based on data from Statista, Simplity has prepared The State of E-commerce 2021: Secure Growth Using Data report. This report gives you market insights into the current situation including the effects of the pandemic. Industry benchmarks, major trends, and recommendations on how online retailers can utilize customer data better to gain market advantage. Download the full report here.