Don’t Let Economic Uncertainty Get You Down: 3 Ways E-Commerce Businesses Can Continue to Thrive
For the last few years, retailers have been bracing for the economy to take another downturn. With talks of a recession looming and layoffs permeating nearly every industry, it’s important for retailers to understand how to protect their businesses and persevere through financial uncertainty.
Fortunately, even if inflation continues to rise and spending drops off, consumers will still shop, even if they’re more hesitant. As a result, retailers must promote compelling reasons for consumers to choose their store over the competition. Let’s dive into three ways that brands and retailers can maintain conversion rates amid economic slowdowns:
1. Emphasize value over savings.
It goes without saying that money-conscious shoppers can be swayed by flashy deals and promotions. However, these deep discounts can be a nightmare for margins and can actually depreciate the brand’s image over time. The best way to woo wary consumers without overdiscounting is to focus on promoting the right merchandise at the right time.
Brands and retailers must emphasize the value that their products offer by showcasing items that address the shopper’s current needs. This can be done through strategic merchandising tactics like using badges that highlight consistent best-sellers and durable investments rather than trends or single-use products. Similarly, brands and retailers can scale back site-wide discounts in favor of unique deals for loyalty program members. Exclusive promotions can increase loyalty program engagement and create long-term customer relationships.
2. Pair recommendations effectively.
During times of financial uncertainty, it’s critical that brands and retailers find creative ways to increase profitability. Upselling and cross-selling are effective ways to expand basket size and grow the value of a customer relationship, but only if the recommended items are appropriately targeted. For example, recommendations should take the financial environment into consideration.
A shopper’s previous interests, price points, styles and shopping journeys should be taken into account when sharing recommendations. For one shopper who has shown previous interest in accessories, a low-price add-on like a scrunchie might be the best upselling opportunity. Yet for another shopper with a historically wider price range, they might be intrigued by a luxury jacket that matches the shirt they added to their cart. When a recommendation engine takes previous behaviors into account, the suggested items provide more value to the shopper and drive greater revenue for the retailer.
3. Do more with less.
A strong user experience is critical to keeping the shopper on your website. Consumers are shopping more cautiously today and even the slightest inconvenience in the e-commerce experience can cause them to change their mind and abandon their cart. Unfortunately, for companies experiencing hiring freezes and layoffs, it can be difficult to allocate sufficient resources to perfect the online journey.
Fortunately, artificial intelligence and machine learning can be used to create an exceptional shopper experience without requiring as much valuable time. For example, the merchandising process can take the marketing team a lot of time to configure, but elements of this strategy can be easily automated. AI and machine learning tools use algorithms to boost conversions based on data-driven insights about customer history, stock availability, and bottom-line profitability.
These tools can also be used to alleviate irrelevant search results and mitigate clunky checkouts. By giving AI the reins, brands and retailers can free up employee hours to enhance the shopping experience in other ways.
Being There for Your Shoppers
Consumers today are overwhelmed by rising prices, layoffs and more. When they’re shopping, they’re looking for an easy journey that helps them find what they want, when they want it at the price they can afford. The retailers that bring comfort and consistency to the shopper experience during this time will see the greatest return on their investments.
Jason Ferrara is the chief marketing officer at Searchspring, a search, merchandising, and personalization platform built exclusively for e-commerce.
Jason Ferrara brings 30 years of marketing experience building high-performing teams, applying core fundamentals and KPIs, as well as driving progressive company cultures. Ferrara brings his extensive knowledge in growing brands to the company, leading go-to-market initiatives including communications, demand generation, and branding.
