The future of retail: Omnichannel dominates retailers’ pandemic growth strategy
Loyalty programs, smart logistics, and a seamless online-to-offline experience are crucial as customers migrate online.
The pandemic has irreversibly changed the way consumers interact with retailers. Customers rapidly shifted online amidst widespread store closures, and retailers who did not have an ecommerce strategy in place were left flat-footed by this sudden and radical change. Now, almost two years into the pandemic, Retail Asia and Merchant Success Manager at Shopify, Frances Li, spoke with three Shopify Plus merchants to understand how they have thrived amidst the challenges of the current situation.
Meet the new shopper
“Due to work from home being the default for most companies, we see more customers are only going out to shop on Fridays or on the weekends whilst Monday to Thursday remain extremely quiet at our physical locations,” shared Trixie Khong, Founder & CEO of jewellery brand By Invite Only.
“Customers are also more sensitive to discounts or promotions when they are shopping, and are looking for items that would stretch their dollar or give them more value than before,” Khong added. “We have also noticed an increase of customers who are 55-65 years old, who are used to only shopping at our physical locations are now shopping online more frequently.”
This sentiment was echoed by Samuel Stephen Wright, Brand Manager of Crate & Barrel Singapore and Malaysia. “Our customers’ shopping experience has also changed; they are more confident in purchasing big-ticket items online now as compared to pre-pandemic,” Wright explained.
As a home furnishing and houseware brand, Crate & Barrel was particularly sensitive to changing consumer preferences as most shoppers were stuck at home. “With more time spent at home, more consumers took the chance to refurnish their homes,” Wright said. “We saw a much higher number of transactions online, and the average duration spent on our website per customer has also increased tremendously,” he added.
Pandemic disruptions have taken their toll amongst retailers. However, companies like Skin Inc., a direct-to-customer (DTC) company focused on providing personalised skincare, were still able to flourish as it saw a large increase in our dotcom business in Asia, US and the rest of the world. “Although we have been a DTC company for more than three years now, we saw an explosion in the areas of self-care, at-home care which has helped Skin Inc. grow significantly in the last two years since consumers worldwide were stuck at home and ordered directly from us or our retailers,” noted William Gaultier, CCO of Skin Inc.
A seamless online experience
To cope with changes brought about by the pandemic, all three brands had to implement new strategies to ensure that customers’ needs are met. For instance, Crate & Barrel pivoted quickly to focus on bringing traffic to its website and converting customers online. “We ran online-only promotions and targeted ads to help drive conversions online, and produced curated content to drive online engagement with our customers,” Wright shared.
Building brand loyalty also formed a crucial part of Crate & Barrel’s pandemic strategy. “With building brand loyalty as our key focus, we worked on increasing return traffic and organic referrals through our new loyalty program,” Wright said. “We launched a new customer relationship management (CRM) program so that customers can earn and burn points, enjoy additional perks when they shop with us and build brand loyalty amongst our target audience.”
“We refreshed our ecommerce site to provide a more seamless customer journey. We also implemented a virtual shopping experience, online interior design consultation, improved live-chat function despite moving our customer service team to work from home,” he added.
Khong and Gautier agree that building brand loyalty is crucial in retaining customers amidst the pandemic. “We’re doubling down on two aspects, and that is on our loyalty program as well as email marketing/owned marketing. As everyone is going digital, even the big brands or retailers, the cost of ad spend is inevitably going to go up. Instead of increasing our ad spend, we’re looking to divert our marketing dollars to re-engage and build loyalty with our existing customers,” Khong said.
“We worked with Shopify app partners in the areas of loyalty, warranty and subscriptions to improve the customer experience,” Gautier added.
Ensuring seamless delivery and providing dedicated after-sales services are also important. “One of the key challenges was logistics and supply chain and we were able to fine-tune our logistics to improve our delivery times. We saw an increase in customers wanting to get a better experience online which pushed us to take a step back and innovate,” Gautier said. “We launched better delivery services, better customer care online and really pushed ourselves to stay connected with our customers through our community and social efforts.”
An omnichannel strategy
Moving forward, retailers agree that ecommerce will remain a priority throughout the pandemic. However, even as customers migrated online, Wright stressed that the importance of physical stores cannot be understated. “We continue to focus on both ecommerce and our brick and mortar store, providing customers the same level of service both online and offline,” he said.
“By using Shopify POS, it allows us to have seamless online and in-store experience. Shopify Plus also has an established native integration with both CRM partners as well as other in-built apps which helped our business to pivot quickly during the pandemic,” Wright said.
Khong agrees, adding that the platform’s ease of use has greatly helped By Invite Only manage both its online and offline operations. “We love that all our data and reports are easily accessible and allow us to act quickly when things go amiss or when sales start to decline. Its ease of use for both the online backend dashboard as well as the POS makes sure all our data is in one place,” she noted.
“With the surge of orders coming into our digital platform, being on Shopify Plus has allowed us to handle the high number of orders without any downtime especially during mega sale events like 11:11 or Black Friday. This has been very helpful to us,” she added.
“The next challenge would definitely be reaching customers overseas. With travel restricted, we are uncertain about our expansion plans, especially on physical locations. However, expansion through the online domain now takes precedence due to the ease of setting it up through the Shopify Plus platform as it supports multi-stores under one dashboard, multi-currency and cross-border tax settings. The friction to expand overseas online is definitely reduced and will be our priority moving into 2022,” Khong concluded.
Omnichannel retail doesn’t require you to be everywhere, just everywhere your customers are. True omnichannel shopping goes beyond brick-and-mortar locations to mobile-browsing, online marketplaces, social media, and wherever your users browse online through retargeting ads.
Want to turn random channel hopping into strategic channel shopping? Download the Shopify Plus Omnichannel Commerce Guide here.