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The retail industry is evolving at an unprecedented speed due to unpredictable economic conditions, the proliferation of digital platforms, and a paradigm shift from generating sales to improving customer experience.
Indeed, budget-conscious shoppers may be more conscious about what they buy. But they also want memorable experiences that treat them as individuals. So where does this leave most e-commerce brands and marketplaces? Simply put, they’re eager to innovate.
Global management consultancy Bain & Company predicts that between now and 2030, “beyond trade” activities (outside the scope of traditional trade activities centered on generating revenue through the sale of goods) will increase in the industry. We predict that this will account for half of profits. In markets where experience matters, the race is everywhere to capture shoppers’ attention and encourage repeat visits.
Fortunately, efforts to improve shopper purchasing behavior are well-received by customers, and the return on investment is even higher. According to global management consultancy McKinsey, companies that are “great at demonstrating intimacy with their customers” generate higher revenue growth than their peers.
But the road to improving customer experience can be a bumpy one, especially in regions where retail is stabilizing after a steep decline. To help businesses deliver meaningful, memorable and engaging experiences that keep shoppers coming back, I interviewed four industry leaders ahead of this week’s E-Commerce Berlin Expo. I used the content as a reference. [Disclosure: In addition to my consulting work, I serve as an innovation track curator/moderator for the E-commerce Berlin Expo, a position for which I am not paid.]
#1 Use live shopping to connect with your customers
Delivering a great experience has a direct impact on your bottom line. His OTTO, one of Europe’s leading online platforms, has a total e-commerce revenue of €12.1 billion, and his strategy of enabling two-way conversations within the app and on his website is paying off. I’m giving it to you.
In 2021, the company has taken a page from the $1 billion live shopping boom in the East and adapted it for Western audiences who want a balanced combination of information and entertainment. “In Germany, people are embracing shoptainment, but they are also interested in understanding the brand story, how the product is made and the values behind it,” OTTO Innovations Evangelist Jorg Heinemann said in an interview. Currently, his OTTO Live streams reach up to 100,000 live viewers per show.
Shows with major brands exceeded targets. But another attraction was big-ticket items like laptops and his PC, which sold out during a live show produced by OTTO in partnership with Microsoft. “Live shopping allows viewers to ask questions of experts and explore products in ways they can’t in other situations,” says Heineman.
His advice: “Focus on providing truly helpful assistance and advice to shoppers who prefer to communicate with brands without filters.” Engaging customers on their preferred channels and platforms is also essential. That’s why OTTO released his Live Shopping app for Apple TV in January. The next step, Heinemann said, is “enabling conversational commerce through live chat on Replay.” This innovation will allow consumers to chat and interact with his assistant while watching shows on-demand, encouraging further interaction and driving further sales.
#2 Infuse a human touch into digital experiences
In his best-selling book Quantum Marketing, Mastercard CMO Raja Rajamanar teaches companies to build a combination of capabilities that serve first and sell second.That means injecting all Gain a deeper understanding of what consumers want and expect. His family business, Thomann, has followed a similar blueprint, making him one of Europe’s leading online musical instrument retailers. The company reported revenue of 1.4 billion euros in 2023, with online sales accounting for 98% of the total.
How did Thomann, headquartered in a small village in Bavaria, succeed in keeping global e-commerce giants at bay? The formula for success is a combination of deep passion and extensive knowledge. “Most of Thoman’s employees are musicians, and we are passionate about providing our customers with expert advice based on their experience playing and playing instruments,” Thoman’s Chief Data Officer CEO and Managing Director Christian Maas said in an interview. Whether customers walk into Treppendorf, Thoman’s only brick-and-mortar store, or video chat online, the customer experience is consistent.
“We sell emotional products, and that’s probably the hardest thing to do digitally,” Mars explains. His solutions, all developed in-house, have allowed Thoman to achieve a distinctly human touch. ” “Cymbal Bot” helps drummers test thousands of cymbals before purchasing, and “Cable Guy” tool takes the hassle out of cymbal selection. A growing playlist of cables, videos and tutorials suitable for stage equipment and electric guitars, the brand reaches and teaches his fans around the world. Currently, sales outside Germany account for nearly two-thirds of his revenue.
His advice: “Find your niche and dominate it through deep knowledge of the products and customers you serve.” This means retailers will invest more in personalized approaches to enhance customer service. This may be a strategy that requires But consumers will derive lasting loyalty from that extra effort, he says.
#3 Instant gratification requires instant commerce
Shoppers expect a memorable experience to accompany every step of their journey, from entering the checkout flow to the final click to complete the purchase. But once they commit to a purchase, they also want faster and more convenient shipping options.
This is the driving force behind the exponential growth of last-mile logistics, which global market analysts predict will reach $200 billion by 2027. This megatrend is also forcing companies to expand their portfolios and invest in new approaches to meeting individual customer needs. Lieferando, part of Just Eat Takeaway, is doing both.
Lieferando, best known as the popular food delivery service that one in five German consumers use to order food from more than 35,000 partner restaurants, is leveraging its “Delivery DNA to , paving the way for more partners to digitize their businesses and earn additional revenue through electronic services. It’s a commercial transaction,” Katharina Haucke, Lieveland’s managing director for Germany and Austria, said in an interview.
It’s a strategy Liefeland has followed over the past year to form partnerships with major companies including Germany’s leading consumer electronics chain MediaMarkt and global computer gaming and consumer electronics retailer GameStop. Consumers in his more than 2,500 cities in Germany can choose from hundreds of products and expect express delivery, usually within an hour, when they order via the Lierferando app or his website.
Her advice: “By seamlessly integrating online and offline retail all the way to the customer’s home, we can prepare for the transition to instant commerce.” It’s about giving consumers more of what they want at the moment of ration. More importantly, she says, it’s a key source of competitive advantage in a market where customers demand unlimited choice and instant gratification.
#4 Give shoppers a path to circularity
More and more shoppers are supporting the concept of circular economy. This is a system in which materials never become waste, and products continue to circulate through processes such as reuse, regeneration, and recycling. This is where Refurbed, the Austrian online marketplace for refurbished goods, established itself and passed an important milestone.
The company began selling refurbished smartphones, laptops, and tablets in 2017. Currently, the platform is active in 7 European countries and offers over 18,000 fully equipped devices. Through partnerships with major manufacturers such as Dyson, the platform also sells a variety of refurbished home appliances. This strategy has allowed the company to advance its vision of a better alternative to buying new products and generate sales of 1 billion euros, Refurbed co-founder Kilian Kaminski said in an interview. Told. “Renovations must become the new normal and we need to redefine how we define renovations.” new. ”
His advice: “Changing consumer behavior is important, but gaining consumer trust is even more important.” Kaminsky explains how purchasing refurbished products promotes sustainability and reduces e-waste. He says ramping up marketing and messaging that emphasizes savings is just the first step. Businesses need to raise awareness at all levels and do their part to “grow the retrofit movement.” For Kaminski, this is more than just a mission. That’s what motivated him to join EUREFAS, the European Renovation Association dedicated to creating standards for the industry and promoting sustainable consumption across Europe.
As these expert tips show, having a point of differentiation is key. Innovating to provide effortless convenience, a customized approach, and a superior customer experience can be challenging. However, its positive impact will resonate with shoppers long after the sale.
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