Five ways brands can win in the new ecommerce world

In the new world of commerce, in-store sales continue to dominate, but the ecommerce opportunity cannot be overlooked. Catalyst’s Paula Hunsche shares five ways that marketers can succeed in this dual world to increase both online and in-store performance:

In-store sales still dominate

Ecommerce growth and online grocery sales have dominated pandemic news headlines, but by no means does that mean in-store sales are dead. In fact, in-store sales continue to make up the lion’s share of US retail sales.

eMarketer recently estimated that total US retail ecommerce sales make up less than 20% for all US retail; meaning over 80% of all retail sales are still happening in-store.

New data from Adobe has also shown that as retail stores have re-opened, ecommerce sales have been adversely affected, indicating that consumers are fickle and will return to the most convenient and immediate options when given the choice.

Despite many consumers’ preference for in-store shopping, many predict that ecommerce will be the downfall of brick and mortar.

However, there are also examples of the opposite – instances where ecommerce is bolstering in-store sales. When you take a closer look at certain purchase models, like those of online grocery platforms, you discover that seemingly online sales are actually in-store sales.

For example, take online grocery delivery juggernaut, Instacart.

While Instacart’s interface is digital, and the platform is mainly categorized as an ecommerce channel, it is actually driving in-store sales. When users purchase groceries through Instacart, the sale is attributed by retailers as an in-store sale.

Similarly, many online grocery partners who offer click-and-collect, such as Walmart, also attribute those sales to in-store.

Ecommerce comes of age

Though in-store shopping and brick and mortar sales still play critical roles in commerce strategies, ecommerce’s rapid growth and acceleration cannot be ignored.

2020 has been an utterly transformational year for ecommerce. Fueled by the impact of the COVID crisis, consumers are shopping online more than ever.

eMarketer predicts that ecommerce sales will surge 18% in 2020 and Forrester reports that 84% of US online adults say they have purchased products or services online in the past three months.

Amazon will also continue to grow the ecommerce category, driving 38% of US ecommerce sales projected for 2020, with food and beverage emerging as Amazon’s fastest growing segment.

Look for Amazon to continue to refine their Whole Foods and Amazon Fresh offerings to address some of the bumps they hit during the peak of the COVID-19 surge, including product availability and some warehouse staffing and safety issues.

Digital fueling in-store and ecommerce sales

How do marketers win in today’s dual world of commerce? It comes down to digital.

Wherever the purchase is ultimately made, one thing holds true: digital has an undeniable influence on both in-store and ecommerce sales, and that influence will continue to grow. According to Retail Dive, 58% of US retail sales will be digitally influenced by 2023.

Today’s customers float seamlessly between online and offline environments, and they expect brands to do the same.

Brands must be digitally present as a source of value and convenience to all customers at each stage of their shopping journey – regardless of where they ultimately intend to make their purchase.

Here are five strategies for succeeding in this new world of commerce and ensuring digital fuels your online and in-store performance:

1) Be where the consumer is — which is everywhere

The consumer journey is not linear; it’s more of a chaotic web across digital and physical, eventually resulting in a decision (usually at the point of purchase).

Think of digital as the new storefront spanning retailer websites, search engines, and social outlets, circulating brand information and influencing purchases.

Consider all touchpoints your consumers reference as they make purchase decisions, including places and platforms like Google, Amazon, Pinterest, Walmart, and more, and ensure your brand is front and center, be it online or at the shelf.

And, remember that convenience is key. According to Catalyst and Kantar’s State of Ecommerce 2021 research, 66% of online purchasers say that convenience is the main reason they chose to purchase at a specific retailer.

2) Acquire new customers with new approaches

Build a plan that identifies and captures new customers across in-store and ecommerce. Employ new customer incentives such as promotions, coupons and sampling, and employ digital tools that mirror those efforts on a geo-local level.

Know your current consumer and know the consumer you want to acquire. Don’t be hesitant to test and learn which audiences are most effectively driving your business.

3) Ensure both in-store and ecommerce channels can pivot quickly to achieve maximum inventory

Increasingly, a brand’s sales are limited by their ability to meet demand. While that’s a good problem to have, consumers will find alternatives in the short-term if their preferred brand is not available where and when they need it.

As digital channels continue to drive demand, plan for omnichannel inventory across in-store and ecommerce.

Most recently, availability has also become an important aspect (especially when thinking about household essentials), so consider an availability messaging strategy so consumers know where to find your brand. 

4) Measure, measure, and measure more

One of the biggest challenges most brands face is that their data is kept in silos, which creates challenges in understanding your commerce performance. This can also disrupt the ability to assess the impact of marketing efforts.

By capturing and analyzing a cohesive and complete set of data across sales and marketing, brands are allowing a more accurate picture to emerge, informing future patterns and identifying growth opportunities.

Therefore, invest in tools and partners that can assist in creating a complete and actionable view of your brand’s true position in the market, both online and in-store. 

5) Don’t be afraid to be a trailblazer

The most enduring brands understand the long game, prioritize data and insights, and embrace testing. Boldly experiment with new opportunities not only to gain sales, but to capture learnings that power future online and in-store strategies.

As we’ve experienced, consumer habits can shift quickly. A testing mentality helps brands more easily adapt in times of disruption and transformation.

Don’t have specialty knowledge or rigorous testing abilities in-house? Don’t be afraid to partner with external trailblazers. Engage expert partners who will help you push the envelope and foster innovation and expertise.

As the digital ecosystem continues to drive purchase behavior across in-store and ecommerce, there is no better time to evaluate strategies like these and seize opportunities across consumer touchpoints, advanced targeting, inventory management, and measurement to best prepare for future growth.

Paula Hunsche has over 20 years of experience across brand activation and commerce strategies. As a commerce lead at Catalyst, GroupM’s performance marketing agency, she creates holistic commerce strategies for brands and helps drive innovations for the future of commerce.