5 Drivers of eCommerce Success That Will Never Grow Old
Retail has undergone a dramatic transformation over the last decade. Once dominant retailers are today being given a run for their money amid a gradual decline in mall traffic and sharply growing consumer preference for shopping online.
Surfing this online retail wave is Internet behemoth Amazon, which is raking in 43% of all new eCommerce dollars, leaving other retailers floundering in its wake.
As it unfolded, this transformation has unleashed changes across many areas of retail, a phenomenon that’s been well documented by industry commentators in the media. Some of these shifts include:
Customer preferences: Customers today are spoilt for choice, both in terms of being able to quickly and easily compare product prices across websites, as well as consistently driving the demand for new and unique products from retailers.
Hyper-personalization: With shoppers increasingly relying on mobile apps, highly personalized shopping experiences are becoming the new normal.
Delivery: e-Retailers are competing on faster home deliveries, stretching themselves to guarantee same day delivery, or even (as in the case of hyper-local grocery retailers) within a few hours. Drones, anyone?
Payment Modes: Even the more tactical aspects of retail, like payment modes, have been forced to evolve. Starting with cash-on-delivery, this trend quickly spread to embrace card payments and digital wallets. These initiatives have posed significant technological and security challenges for retailers.
As with a forced move in chess, traditional retailers have had to evolve and embrace changes like the ones listed above, in order to survive the incredibly cutthroat world of modern retail. Similar challenges exist for up-and-coming eCommerce companies as well.
However, many pundits and retailers alike often forget that doing even simple, time-tested things correctly can go a long way in forging an effective competitive position, helping win both market share and customer affections. While digital transformation has altered how these strategies were routinely executed, the fundamentals remain as relevant today as they ever were.
- Smarter Pricing
With 80 percent of first-time shoppers comparing products prior to buying, the need for an eCommerce website to offer competitive pricing has become a mandatory cost-of-entry capability. While dynamic pricing poses a challenge for e-retailers to stay competitive, it also presents them with an opportunity to track their competitors’ pricing and exploit that information to optimize their own pricing.
However, e-retailers today are frequently forced to perform millions of price-changes every day in the eternal quest to either offer the lowest price or entrench a calculated premium price perception among shoppers.
For instance, as far back as Christmas season 2014, Amazon is estimated to have made a total of 80 million price changes per day. Similarly, today’s hyper-local grocery retailers offer differentiated and targeted prices for shoppers living in specific zip codes.
To achieve price controls on this level of scale demands sophisticated automated tracking of competitor pricing to facilitate timely, data-driven dynamic pricing decisions. This has, today, become a table stakes requirement.
2. Variety and Depth of Product Range
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