Digital Commerce Newsletter Holiday Edition

Welcome to the Holiday edition of the Retail Newsletter, now re-branded "Digital Commerce Newsletter". This will be the last one for 2016. The themes that will be covered in this release are:

  • Online & Offline
  • Holiday season so far
  • Mobile
As we are entering the new year, let's have a look first at the 10 Key Digital Trends for 2017. Find below the E-Marketer's Predictions for What Will—and Won't—Happen Next Year
  1. Artificial intelligence won’t put marketers out of work-yet!
  2. Internet users still won’t change their behaviors despite hacking scares
  3. Some time in 2017, a live digital video stream will achieve a primetime TV-size audience
  4. Chatbots—lots of talk, not so much action
  5. 2017 will be the year of ‘authentically mobile experiences’
  6. Online grocery shopping will jump in 2017, with brick-and-mortar stores playing a starring role
  7. Marketers will make the move to more complex forms of attribution modeling in 2017
  8. Next year will be the tipping point for mobile messaging, as more than half of mobile users will use such apps
  9. Influencers will take a significant chunk of the ad market in 2017
  10. Virtual Reality won’t be a significant marketing channel until hardware becomes more widespread

Online & Offline

eMarketer study has found that 84% of female and 83% of male UK internet users who had made a recent ecommerce purchase always or sometimes preferred to reserve products digitally before heading to a physical store to complete their purchase.

The reserve-and-collect opportunity for retailers, is that the “collector” may be more inclined to make additional purchases once on-site.

Amazon launches a 1800-square-foot facility, located at the corner of 7th Avenue and Blanchard Street in Seattle and oriented around meal preparation. The store requires that the customer have a supported smartphone, an Amazon account, and the free Go app.

Amazon says if you pick up an item, it gets added to your virtual checkout basket. If you put the item back before leaving the store, it gets removed.

The Go store project is currently in beta, and only Amazon employees can use it, but the company says it will open to the public early next year.

  1. Buy online, pick up in-store. The customer can then pick up the purchase at the chosen location. This is among the most straightforward ways to get a shopper into the store. If the sales associate pulls a couple accessories that complement the purchase (socks to go with a pair of shoes, or a necklace to brighten a dress), they could add incremental sales.
  2. Make them winners. Retailers can promote online contests that require the winner to pick up the prize in-store.
  3. Place exclusives on shelf. Retailers can use their online stores to promote exclusive, limited-time products available only at brick-and-mortar locations.
  4. Make the shopper part of the experience.

A brick-and-mortar store opens more possibilities for omnichannel transactions, offline data collection, improved supply chain, and ultimately, better online and offline customer experiences.

The challenge of offline retail data is that it is transaction-rich but intent-poor. Ninety-two percent of sales go through physical retail channels, but you lose much of the intent data that you get from things like page views, search terms, and how many times somebody linked from a particular blog page.

Ultimately, however, the data collected — whether online or offline — is about shaping the customer experience. Marketers can use this data to consider how they want to present products through the customer-experience flow.

While offline data has traditionally been more difficult to accurately track, it’s easy to see that we are at an interesting point with technology in which we can better understand consumer behaviors in physical retail locations by combining online technology with in-store action.

Holiday season so far

Review the numbers of this holiday season so far.

Mobile had its biggest day in history this year, with Black Friday being the first day that mobile revenue surpassed $1 billion. If we look at Black Friday numbers though, there is still a conversion gap with a 19 percent different between visits (55 percent) and actual purchases (36 percent).

Retailers will need to address the challenges that shoppers currently experience when shopping via a mobile device, to ensure that this channels grows quickly enough to bolster e-commerce as a whole.

33% of the retailers in the report were tracking their customers in stores to note their behavior.

Consumer participation in “Giving Tuesday”—the Tuesday after Thanksgiving—is on the rise, which could represent a big opportunity for nonprofit marketers.

The holidays accounted for 33% of yearly donations in 2015, according to ADI.

Although Giving Tuesday sees spikes in donations, the day doesn’t get much social buzz, ADI found.

Black Friday paid search-driven sales grew 34% Y/Y in 2016, a solid improvement from 25% growth between 2014 and 2015.

From the start of Q4 through mid-November, Google PLAs produced 65% of retailers’ sales from non-brand Google search ads. That rate began to slip noticeably on Black Friday, mirroring seasonality from recent years. On Cyber Monday, PLAs produced just over 59% of non-brand sales.

Mobile sales continued to lag mobile click volume, as phones and tablets combined for 44% of Thanksgiving Day sales. Phone traffic has narrowed the conversion performance gap with desktop traffic though, producing 31% of 2016 sales.

Mobile

According to a study published by eMarketer in April: “Mobile is affecting traditional paths to purchase. Mobile commerce is growing faster than either ecommerce or retail and is transforming the way shoppers approach all three. Desktop may still have 84% of the U.S. ecommerce sale share, according to comScore, but 61% of all time spent with retail sites is now on mobile.”

From a May 2016 study conducted by Google, 76% of people who search on their mobile devices for something nearby visit the business within a day. Twenty-eight percent of these searches result in a purchase.

Building on the concept of mobile friendliness, Google’s open standards project, AMP (Accelerated Mobile Pages Project), was launched to streamline content delivery using a non-template-based system to augment any existing web page, regardless of the web technologies in use. Primarily aimed at publishers, AMP redefined the delivery of news content in search. With a click, news articles load lightning fast on any mobile device.

Google’s recent launch of Nearby extends the boundaries of current beacon technologies by making the experience more frictionless and will be an interesting development to watch in 2017. Only available on Android devices, Nearby will send a push notification to users alerting them of an app’s availability based on their location.

Apple and Google have launched paid search equivalents (CPC, auction) within their respective app stores to enable brands to promote app downloads. With a range of audience targeting capabilities already being offered, expect 2017 to bring further targeting and performance measurement enhancements to the mobile apps landscape.

Thank you for reading!

Have a great end of 2016!

Created By
Riccardo Composto
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Created with images by kevin dooley - "Magic bokeh!" • Gellinger - "aircraft holiday sun" • FirmBee - "mobile phone iphone" • Unsplash - "binoculars looking man"

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