Amidst the COVID pandemic, the popularity of online shopping and business has skyrocketed. A prominent example of this is Walmart, the US retailer, which has seen exponential increases in online sales over 2020, doubling its digital business with 97% in sales growth posted at the end of Q2 2020.
These rapidly changing conditions have never presented a better opportunity to take your offline wholesale business online to realize its fullest potential.
1. The importance of creating a digital shopfront
Over the last decade, ecommerce platforms have slowly crept into our daily lives and changed them for the better. Technological advances and the widespread prevalence of internet connections have resulted in the exponential growth of the ecommerce industry.
Global ecommerce sales have gone from US$572 billion in 2010 to US$ 3.46 trillion in 2019. A striking USD 256.4 billion sales were made on Amazon alone. 2020 saw the adoption of online shopping accelerate, with both sellers and buyers forced to rapidly shift their sales online.
The growth of digital channels won’t be slowing down anytime soon. To understand why we’ll delve a little deeper into the underlying trends driving online growth.
In the last 10 years, consumer behavior has changed dramatically. Today, consumers prioritize
• convenience and ease of shopping over a first-hand shopping experience. The time-saving
• nature of online shopping and the flexibility to scroll through products on smartphone
• devices have reshaped consumer shopping behavior.
Ecommerce websites allow customers to shop at any time of day, from any device, making shopping more convenient and immediate. This has created a huge opportunity to generate comparatively more sales than offline models which are constrained by limited hours, locations, and sales staff.
Be where your customers are
A conventional bricks-and-mortar store has only so much to offer due to limitations such as ease of access, geography, accessibility, brand awareness, and most important of all, the addressable audience is not as broad as an online store. Selling through an online shop can vastly increase your potential customer base.
On average, an adult spends close to five hours a day on their various devices. Among them, 50% of their time is spent in messaging, social networking, and entertainment applications.
When companies started to realize the importance of this data, more and more online and digital campaigns were run. Today, this form of marketing has eclipsed traditional consumer marketing methods. Companies are now hinged directly to places where consumers are spending most of their time - online.
Customers are now making purchasing decisions on their various devices without even entering a bricks-and-mortar store. This has been one of the biggest drivers of the ecommerce industry in the last decade. Furthermore, the smartphone user population is increasing at a rapid pace, thereby heightening the imperative nature of mobile-first commerce (also known as m-commerce).
2. Purchase-funnel clarity
In a physical store, it’s almost impossible to track the customer's journey and it can be expensive and complex to keep a log of their purchase history. On the other hand, with an online store, each click of the customer can be tracked, providing valuable insight into their priorities and purchases. This customer behavior can also create marketing opportunities to target and nudge customers to buy your product.
The purchase funnel is important, as only 2% of the purchases are made at the first contact moment with a product. This percentage is even only 10% at the fourth contact moment. On average, a customer needs between five and eight interactions before a purchase is made. These moments of interaction together form the customer journey and this journey is different for every customer. That is why it is very important to respond well to this with your communication so that potential customers get the right information at the right time. The process towards a purchase is called the marketing and sales or purchase funnel.
There are countless models written for this by marketing gurus and experts, but certainly, the most used one is the AIDA model. This model contains the following phases:
1. Attention: the customer has a certain need, is aware of it, and knows your product or service
2. Interest: the customer begins to show interest in your product
3. Desire: the customer needs to buy your product
4. Action: the customer buys your product
Each stage of the model needs its own unique approach and messages. It does not make any sense to start communicating prices and packages when the customer is not yet aware of your product and certainly does not have the need to buy it.
Uncertainty and missing information are the top reasons cited by customers abandoning their shopping journey prematurely when online.
In some instances, the lack of a touch and feel shopping experience can also be a major drawback. Filling this gap becomes essential for any good online store. Studies have shown that 92% of consumers determine their online purchasing decision based on product imagery. A study by Nielsen Norman Group found that customers were more inclined to purchase a product after viewing clear, high-quality product images.
For instance, the product ‘Photograph Bella’ on Zilingo shows the color palette, the draping, the front, back, and the side angles of the garment. The range of images aids in giving the customer a sense of the product and drawing attention to the small features such as the button or a sleeve detailing
Product Pricing and Promotions
Price is the paramount factor that drives the purchasing decision of a customer. Shoppers are smart - and you have to be too - ensuring you have compared your pricing to similar products and to those of competitors to determine an appropriate and appealing price range.
Generally, a customer’s purchasing decision is based on a combination of logic and emotion - price usually taps into the former for everyday items and commoditized goods. Thus, if a consumer's purchasing decision is based on logic, research indicates that a specific price always works better.
Once you’ve factored in competitive and category analysis and found a pricing range, you can set a specific price for your product. According to the University of Florida, customers think that retailers make rounded prices artificially higher. For example, pricing your product at $77.90 is more appealing to the customer than round pricing such as $80.00. Specific pricing works well for all products and particularly for tech products.
Even if your consumers don't exactly know what the pricing strategy is, they will interpret that the product price isn't a made-up number thanks to specific pricing.
Providing efficient customer service is essential to facilitate more engagement and recurring sales for an online store.
Even though the internet has become the chosen place for people to shop, there is a lack of personal interaction between consumers and companies. Consumer frustration grows when they run into issues and can't easily find a representative to talk to. Adding insult to injury, many online businesses do not respond to customer concerns or their responses are very slow. However, response time is crucial because three out of five customers never complete their purchases due to poor customer service.
It costs seven times more to attract new customers than to retain existing customers. Providing excellent customer service not only increases sales and profits but helps companies stand out in the marketplace. Even without face-to-face interaction, there are so many ways to offer exceptional service online.
In any business, everything revolves around the customer and their needs. Knowing your customer is the first step to a successful customer service strategy by defining their priorities and needs. You can then focus on satisfying these needs to ensure you can retain each hard-earned customer and their ongoing revenue.
As an online store, you have a distinct advantage, as customer satisfaction information and feedback can be easily collected via surveys, online suggestions, email marketing, blogs, and social media channels.
Once this information is collected, you can put it to good use by planning ahead.
One of the most common problems for customer service in an online store is planning, or rather the lack of it. To avoid these issues create a plan of action that addresses the following priorities for customer service.
Answering customer queries
Identify which channels you will use to respond to customer queries, including email, social media, live chat, or phone, and who will respond. Generally, customers expect a response within around 24 hours for email, a couple of hours for social media, and immediately through the phone. You can decide which combination of channels works best for you based on your resources and schedule. Managing customer expectations concerning the hours that customer service is manned and the turn-around time for responses is essential to ensuring customers are satisfied.
Ensuring information is on hand
It is important to make sure that all customer service queries are replied to with the relevant information required such as warranties, shipping times, and returns policies. Having a clear stance on the criteria on which you will accept, compensate, or exchange products in case of a fault, dissatisfaction, and change of mind will ensure a clear policy can be communicated.
It may seem time-consuming to have a plan for your customer service approach, but you may soon end up managing a challenging situation, and that may cause you to lose a customer. It’s best to have an upfront policy to manage expectations and outcomes. It’s also recommended that you check the local law in your country to ensure that your policies comply with the customer’s rights.
How Can We Make Your Transition Easier?
Although these are simple steps to taking your business online, there are a wide array of challenges and hurdles you may face with setting up an online store.
Zilingo is proud to introduce our latest offering, Zilingo Trade for Enterprise, to help you overcome these challenges, and set you up for success. We aim to provide comprehensive services to you while setting up your own online business, including:
1. State of the art technology that focuses on sales and security
2. A customized and branded online store presence
3. The ability to list your products across multiple stores (such as Tokopedia and Lazada) in many categories and countries
4. The ability to plan and set pricing and promotions, and
5. Customer service, marketing, finance, and logistics services
We believe that taking your offline wholesale business online will unlock your growth, potential, and success. Find out how to get started today, and speak to a member of our Success Team.