Ecommerce retailers have a wide range of tactics at their disposal to attract and retain customers — such as sales, discounted shipping or customer service. But if they’re smart, they can also leverage the digital experiences they provide to their customers.
A recent SAP Consumer Propensity report outlines three ways for ecommerce retailers to go above and beyond for consumers through digital experiences. These include contextual offers and recommendations, supply chains and logistics, and embracing new technology.
To effectively deliver contextual marketing, Scott Hirst, Senior Vice President, SAP CX Centre of Excellence says retailers require a holistic strategy for managing customer profiles, preferences and consent. Otherwise, offers and recommendations will fall flat.
Hirst cautions that contextual marketing is an area that customers are very sensitive about. “Customer data, preferences and consent are paramount, and if you disregard customer consent then contextual marketing is just creepy.
“You need to be managing customer consent throughout a customer journey, from anonymous consent banners, through light registration — such as newsletter sign-up — through to full registration with passwords, preferences and social logon.”
However, the unfortunate reality is that most contextual marketing does not hit the mark. “While 95 per cent of consumers recall seeing suggested recommendations, only 22 per cent of them are interested in these recommendations at least half the time.”
Instead, Hirst says, the real opportunity for retailers is to build on the foundation of trust with contextual marketing that mines everything they know about their customers.
This means a deeper look into in-store and online buying history, complaints, returns, loyalty, as well as previous payment methods used and the retailer’s performance. He says “You can then use this information to feed predictive models that output propensity scores and intelligent product recommendations.
“The secret sauce is to put these tools in the hands of your marketing team, that they can use in a simple way to personalise the customer experience in real time.”
Supply Chains and Logistics
Integrating supply chain and logistics capabilities into ecommerce is more than just a technology exercise. Hirst explains, “This requires close collaboration between customer experience and supply chain teams and may require reworking strategies for warehousing, delivery, exchange and returns.”
The SAP Consumer Propensity report argues that retailers must be conscious of supply chain and logistics decisions that impact availability and delivery, and need to integrate these systems into their ecommerce platforms and tools to remove barriers to purchasing.
Hirst says the foundation for successfully linking supply chain with customer experience is product content management. This ensures category managers, merchandisers and marketers are all working off trusted product data that is consistent with supply chain systems.
“Essentially, this ensures that the product on your site is the same product your customer will ultimately receive,” Hirst tells Which-50.
He notes that the next important foundation is product availability. “Often, availability and logistics issues arise when commerce sites are linked to dedicated fulfilment warehouses.
“Enabling global stock availability, with intelligent sourcing strategies across all warehouses and in-store stock, means that you can support delivery or ‘click and collect’ fulfilment reliably and cost effectively.
“The last piece of the puzzle is order management — that ensures once the customer places an order it is accurately picked from a warehouse or in-store. This also extends to split orders, delivery tracking and returns.”
Embracing New Technology
Hirst says the easiest way for retailers to deliver great digital experiences is through embracing new technologies. “It is relatively easy for retailers to use new individual technologies to augment their existing digital experience.”
The authors of the SAP Consumer Propensity report explain that advanced data management and analytic tools allow retailers to gain insights on consumer behaviours.
These components help businesses make in-the-moment decisions about pricing, stock determinations, promotional offers and marketing campaigns.
“Delivering a great experience on a mobile device, including a self service instore product scanner, providing an intuitive product configuration tool or offering additional payment methods for ’buy now and pay later’ are all capabilities that consumers value highly,” Hirst tells Which-50.
One take-away from the report is that retailers should focus on what is new and valuable for consumers. For instance, the authors of the report reveal that almost a third of customers say they will complete their purchase online if they receive rapid response to a query.
“In this example, the customer need is a rapid response to a query, and the technology to enable that could be web chat, video chat, social messaging, or an AI-powered chatbot.
“A modern commerce platform provides a valuable foundation for adopting new technologies in-store too.”
However, with these digital experiences come a few hurdles for retailers delivering them.
“Some retailers have split their IT departments into separate customer-facing and back-office teams in order to deliver a more agile environment for digital customer experience delivery,” says Hirst.
“In many cases this approach had been successful — liberating digital experience teams from the processes and governance of back-office IT and, to borrow from Gartner terminology, has resulted in ’bi-modal’ IT operations.”
However, Hirst warns it is not good enough to deliver innovation in isolation. “Indeed Gartner has clarified the pursuit of bi-modal IT and emphasises that both modes play a crucial role in innovation.
“Customer experience teams need to be reaching out across the digital divide to embrace their colleagues in supply chain and logistics to ensure that they can deliver on their promises to consumers.”
About the author
Athina Mallis is the editor of the Digital Intelligence Unit, of which SAP Hybris is a corporate member. Our members provide their insights and expertise for the benefit of the Which-50 community. Membership fees apply.