Recently, digital and marketing leaders at some of the UK’s most forward-thinking brands got together with composable commerce experts from Apply Digital, BigCommerce, Akeneo, and Klevu to talk about maximizing the value of eCommerce.
The UK is leading the way in eCommerce adoption, with 26.5% of retail trade happening online in 2022 (up 7 percentage points from 2019). The online shopping experience has become a critical part of strategy for UK brands, and in a tumultuous year for the British economy both customers and companies are turning toward eCommerce for ways to tighten the purse strings. Meaning digital teams are now doubly tasked with growing online revenue while also cutting costs.
To take a look at some of the ways brands can leverage digital to grow business, the day included a panel discussion of eCommerce leaders. The panel was hosted by Iris Schiefer of BigCommerce and the panel guests were:
Below is a summary of the panel’s key takeaways. All comments are paraphrased.
How do you provide value for online customers, especially for high-end brands?
Kelly Hussey, Dr. Barbara Sturm: A major focus of our online experience is to make skincare education accessible to everyone. We do this by creating helpful content, offering free virtual consultations, and we’ll soon be launching some exciting new digital learning products. While our primary line of products is in the luxury range, by creating this online world of skincare advice we’ve been able to introduce our brand and our ethos to a much wider audience.
Adam Wilson, Apply Digital: We started working with Dr. Barbara Sturm in 2020 and their main challenge at the time, like for many retailers, was how to engage customers and grow sales during the lockdown. We developed a conversational commerce app that can create over 8000 unique skincare regimens based on skin tone, skin condition, and lifestyle. It gives shoppers a personalized routine that includes product recommendations and instructions on how to use them, and we saw that when customers were given this guidance it led to a 200% increase in conversion.
How can AI help replicate the in-store experience online?
Rachel Tonner, Klevu: In a store, product discovery is guided by the shopper. They can head directly to what they need, or spend time browsing aisles, or get advice from an associate. That ‘choose your own path’ experience is hard to replicate in eCommerce. AI is helping retailers offer more personalized shopping journeys, at scale, to help people find exactly what they want. When shoppers take advantage of the AI-driven search and product recommendation tool on the Dr. Barbara Sturm website, we see an 8.5x higher per session value and a 61% click conversion rate from category pages.
How do site experience and user experience (UX) impact customer loyalty?
Rachel Tonner, Klevu: To keep customers coming back, retailers need to make it incredibly easy for shoppers to find what they need on the website. Search is a huge part of this. AI-powered search can help, but companies need to ensure that they have the data and content in place to make products discoverable. For example, shoppers on beauty websites often search for specific symptoms or problems so it’s important to have that information in product descriptions. Interestingly, our data shows that shoppers are more likely to convert when their search query is five words but that it takes several tries for them to feel comfortable inputting a longer query.
How do you use subscription models to drive customer retention?
Kelly Hussey, Dr. Barbara Sturm: Subscription models can be a bit of a paradox. On one hand, subscriptions are very convenient for customers and provide reliable revenue for the company. On the other hand, we want to encourage people to explore new products that can enhance their beauty routine. Our beta test in the US shows that customers are very interested in a subscription skincare service, and as we work on a global launch we’re looking at ways to keep the experience fresh for subscribers. Such as offering discounts and free delivery on new products, cross-sell and upsell opportunities, and fitting subscriptions into our larger loyalty scheme.
What factors should be considered when choosing eCommerce technology?
Adam Wilson, Apply Digital: When evaluating technology, consider where you want your business to be in three years and what capabilities are needed to enable that. This is especially true for core solutions like eCommerce platforms and content management systems (CMS), which can be difficult and time-consuming to switch out. With that in mind, we encourage our clients to strongly consider a technology’s scalability, composability, and compatibility with modern architectures like MACH (microservices, APIs, Cloud, headless) because these are indicators that the solution will be able to adapt as your business grows. It’s also important to ensure the technology provider can support you through the transition process, that the product is reliable and customer service is excellent.
What interesting trends do you see in customer experience?
Kelly Hussey, Dr. Barbara Sturm:
Social commerce: This is a significant focus for us. We have a substantial social media following, engagement, and brand awareness and we want to capitalize on that. This year, we’re exploring TikTok Shop and Instagram Shop as new revenue channels with product bundles that are exclusively available on these platforms.
NFTs and cryptocurrency: I think you have to look at these technologies with some skepticism, but there are a lot of innovative brands embracing them. We’re monitoring the trend and are in conversations with some trailblazers in Silicon Valley to explore future possibilities in this space.
Adam Wilson, Apply Digital:
Loyalty programs: As the cost of living rises, UK consumers are increasingly turning to loyalty programs to make their money stretch further. This indicates that more spend is going to go towards trusted brands, and less on impulsive purchases. Companies that can establish a robust loyalty program, with enticing incentives and rewards, have the opportunity to grow wallet share now and increase customer lifetime value overall.
Rachel Tonner, Klevu:
Search engine optimization: Global search behavior is rapidly changing due to Google’s algorithm updates, which will revolutionize digital marketing and SEO. There is a lot to learn and unlearn, and a lot of the advertising methods that companies have relied on will soon be obsolete. Brands that master this new world of search quickly have a huge opportunity to leap ahead of the competition.
Conversational search: The search bar on eCommerce websites will eventually become obsolete as people become more used to conversational search. Advanced chatbots, like Klevu’s MOI, can provide more user-friendly product discovery with a two-way conversation and the power to rapidly search through vast product catalogs and merchandising rules to find exactly what customers want.
Faced with an uncertain economy, it’s no surprise that companies and customers in the UK are becoming more cost-conscious. One of the most impactful uses of technology in this climate is to create experiences that keep loyal customers returning to your brand. From drawing in a wider audience through social commerce or free digital services, to building long-term relationships with loyalty and subscription programs. Customers get the benefit of good deals from a brand they trust, and companies can grow sales with less reliance on high-cost customer acquisition.
Any technology that companies invest in today needs to have the flexibility to adapt to the eCommerce priorities of tomorrow without an expensive and time-consuming replatform, especially as areas like search and personalization advance so quickly. Choosing tools that support a composable architecture can enable brands to pivot their digital strategy as business needs change. To connect with Adam or learn more about Apply Digital, please reach out to us at email@example.com.