Leveraging the Tools That Fuel E-Commerce Growth
April 24, 2020
E-commerce technologies have been innovating fast. It’s no surprise, considering e-commerce in North America grew by 15% in 2018, to reach a market value of more than US$500 billion.
Today’s e-commerce businesses need to stay ahead of the curve if they want to be the consumer’s choice, as convenience and relevance remain king.
Companies can stand out in this competitive environment by deploying some of the latest technologies that assure their customers receive the highest-quality products and services possible. These include artificial intelligence-driven personalized experiences, augmented reality try-it-out tools, and last mile delivery innovations.
Here’s a look at how brands have been leveraging these technologies to keep their customers happy and drive growth.
Online shoppers’ data is invaluable to e-commerce companies, and it should be treated as such. Online retailers can gain important insights about consumer affinities, trends and preferences shedding light on what can be marketed to them, and what is not likely to interest them.
Leveraging AI to analyze the browsing behavior of consumers and then forming segments of the customer base can power some seriously effective marketing strategies for e-commerce businesses.
For example, a consumer insights platform can help brands uncover the audiences they should be targeting through data analysis of thousands of social media users’ psychographic, demographic and behavioral attributes. This type of analysis gives light to crucial consumer insights and trends that e-commerce brands can leverage to better connect with their customers.
Consumers who have been targeted with personalized marketing and products are more likely to buy, and their relationship with the brand is likely to deepen as they perceive it as more relevant to them. In fact, businesses that adopt personalized marketing experience an average 19% boost in sales and 34 percent of online shoppers are most likely to recommend a brand that shows them the things that are relevant to their interests.
There’s nothing stopping online retailers getting creative with this data. For example, Adidas has a strategy of offering customers discounts on personalized product ranges, while ASOS automatically presents its site browsers with the section relevant to them when they land on the homepage.
E-commerce brands can explore the possibilities that AI can bring them by deploying an AI-powered chatbot to provide answers to customer queries. By opting for an AI driven chatbot over a traditional rule-based chatbot, brands can deepen their relationship with their consumers and increase the likelihood of sales by ensuring the chatbot can understand requests made in conversational language and provide the relevant answer.
AI-based technologies thus increase both the top line and bottom line for online retailers.
Augmented and Virtual Reality
Most e-commerce businesses are familiar with the gargantuan cost of returns. In the U.S., it is estimated that return deliveries alone will cost $550 billion by 2020 75.2% more than in 2016. However, augmented and virtual reality are here to drive down those return rates significantly for many e-commerce businesses.
While not yet widespread, tools now exist that allow shoppers to visualize what items look like in real life. Google recently added 3D augmented reality models to its search results, allowing users to check out an item in the “real world” before deciding to buy. It already has begun working with New Balance, Samsung and Target.
Similarly, Ikea has launched an app that allows their shoppers to visualise what pieces of furniture look like in their homes.
E-commerce brands that sell accessories and clothes now have the option to deploy a “virtual mirror” on their website, so shoppers can try on before they buy, getting as close as possible to a brick-and-mortar shopping experience. Being able to picture what items look like in person promises to reduce return rates and drive revenue for e-commerce brands.
Virtual reality for e-commerce brands is set to spread into other territories, including cosmetics. Along with the fashion industry, online retailers should expect virtual mirrors to become a reality for their businesses very soon.
Last Mile Delivery Technologies
Consumers want faster fulfillment and convenience, and demand has risen for fast even same day delivery, facilitated by last mile technologies.
For example, Amazon has partnered with supermarkets to expand its “click and collect” service the courier drops the package off at a specific location and the customer later comes to pick it up making it easier for customers to get their orders quickly and when it suits them.
In Europe, online retailers have joined forces with car manufacturer Skoda on a system that allows customers to pick up their orders in the trunk of their own car. Couriers simply have to unlock the trunk within a specific time slot, using the app to drop off the order.
Thinking outside the box about how to get orders to customers in the fastest and most convenient way possible holds great promise for e-commerce businesses that want to stay one step ahead.
The future is ripe for innovation in last mile delivery. In the short term, McKinsey expects electric vehicles to flourish, along with an increased presence of unattended delivery technology, which promises to deliver on cost-effectiveness for businesses and convenience for customers. For example, robot delivery is being tested in San Francisco. However, it needs to be accompanied by a human in case something goes wrong, which somewhat diminishes the point.
Further, Wired recently reported that the technology for drone delivery services is “finally almost here.” An offshoot company of Google, Wing Aviation just secured government approval as an airline, legally giving it the authority to begin dropping products to customers.
While some of these technologies may seem out of reach for many small e-commerce businesses, there are ways to leverage them economically. Rather than taking on the responsibility of developing AI-driven data analysis, cognitive chatbots, or virtual reality technologies to drive business growth, e-commerce companies should turn to experienced yet cost-effective partners.
Subscription based companies are offering online retailers the opportunity to make use of these innovations, to ultimately improve customer experience and drive business growth online!!
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