As consumers continue to move online to fulfill their shopping needs, being able to offer personalised experiences has never been more important for retailers.
With that in mind we sat down with Matti Rönkkö, CEO of Nosto, to discuss the challenges retailers are facing and how they can provide a personalised, omnichannel experience for shoppers.
1. What are the biggest challenges facing online retailers at the moment?
There are four main areas that I see retailers are being challenged by. Firstly, focus, by that I mean retailers are being bombarded with millions of different solutions with which to improve their ecommerce on a daily basis as the ecommerce market is developing at such a fast pace. They are constantly receiving information from a handful of new technologies and need to sift through to find the right fit.
Secondly, a very competitive market. More and more brands are moving online and bigger retailers are offering great deals on aspects like shipping and discounts to name a few. Generally the ecommerce space is growing rapidly. Thirdly, the customer now has much higher expectations than before. Due in part all the previous reasons I already mentioned, online shoppers expect more in terms of overall experience - they expect the same user experience on all devices, as well as easier payment options, fulfillments, and much more.
Finally, customer loyalty and retention. Increased competition and a heavy focus on driving new business to the stores across the board puts more and more pressure on merchants in retaining their customers.
2. How important is it for retailers to provide a personalised shopping experience?
It is vital. Without it, it is almost like running a brick & mortar clothing store without a sales person there. Online shoppers expect personalisation. For example, banner advertising is dying as people are tired of seeing general banner ads instead of targeted, interesting products personalised to their needs.
Even if the majority of the budget still goes towards driving new traffic to the stores, increased competition means that retailers need to convert better, take better care of their existing customers, as well as adapt to the shorter time span of the modern online shopper. At all of these stages personalisation can be a key to their success.
3. What kind of things can retailers be doing to increase personalisation?
It is all about knowing your customers and using that data across all touchpoints and channels along the customer journey. A successful online retailer needs to be able to personalise the experience of their shoppers wherever or on whichever channel they might use to interact with their customers.
It ranges from standard options such as offering personalised product recommendations onsite to personalised emails and advertising across all channels - offering similar personalised experiences across all devices the customer is using both on- and offline.
4. Is ensuring a consistent omni-channel experience now a necessity
Customers expect the exact same experience across all channels and devices. The shopper can start browsing on mobile, move on to desktop to select their products, abandon their carts on their tablet and then complete their transaction the following day via an abandoned cart email they received on their mobiles. Any break in this experience is a lost customer. The same goes for brick and mortar, and online, it all needs to blend in together as one personalised shopping experience.
5. How do you see the retail industry developing over the next 12 months or so?
Needless to say that more and more businesses will move online and also especially to mobile. As a browsing device, mobile has already overtaken desktop, but in certain markets and verticals, it will overtake desktop in revenue as well.
This means for many retailers that they need to be even better at providing more attractive offerings their customers in a faster time as “micro-moments”, split second decision-making will appear more often and become even bigger drivers of the shopping decisions. Unfortunately, this might cause a drop of the average order values (AOV), which means that retailers need to make sure they have the means to keep their customers loyal in the longer term to increase their lifetime value (LTV).
With mobile in mind, retailers still need to make sure the experience in any channel is flawless because although mobile might take the leading position even in converting customers, this does not mean shoppers will not be browsing multiple available channels during the customer journey. In terms of advertising, personalised video could potentially become the driving channel and start taking more and more market share from traditional banner advertising.
It will also be very interesting to see if virtual reality (VR) & augmented reality (AR) can influence the ecommerce space but that may be a long-term trend to watch out for.
Image source: Shutterstock/wavebreakmedia