Internet and broadband penetration, advancements in logistics and technology infrastructure, digital payment revolution and consumers’ resounding demand for convenience have together created a US $1.9 trillion global online shopping market. As KPMG’s 2017 Global Online Consumer Report puts it, “millions of consumers are no longer ‘going shopping’ but literally ‘are shopping’ – at every moment and everywhere’.
For e-commerce companies as well as retail brands in general, it is no longer the store – online or offline – that is at the center of the shopping experience. It is the consumer. And we don’t mean millions of consumers in a broad stroke of mass marketing. But rather, each customer as an individual needs to be the centre of new age shopping experience. E-commerce brands have the potential and the technology to customize and personalize everything for this individual customer – from store experience to promotions, from advertising to recommendation engines. But to do that, they need to be cognizant and responsive to when and where consumers are making purchase decisions.
This is even more crucial because their purchase journey itself is no longer linear. In fact, 55% of product searches now start on Amazon, not Google. And 42% of active Amazon users still shop at Walmart. Amidst this complexity, consumers are making their purchase decisions continuously throughout their always-on shopping journeys. Understanding this journey and consumer behaviour at every point of it is crucial for e-commerce companies. Only then can they achieve the sweet spot of deep consumer insight and tailor their strategies for high-volume customer acquisition and retention.
The challenge here is that despite an urgent need for deep consumer insight, most e-commerce companies still heavily rely on consumers’ online behaviour, supplemented by some offline primary research
The problem is that the online and offline realms of e-commerce and its customers continue to exist in silos, despite being more interconnected than marketers realise. At the same time, not only are each consumer’s needs and shopping journeys different, your and my search histories and online clicks are not all there is to our personalities and lifestyle needs. When e-commerce companies base their full spectrum marketing and business strategy without recognizing the deep link between online and offline world of customers, their strategies are not backed by all the information that is available to them.
What are e-commerce brands missing?
Simply put, they are missing the deep impact that the physical world has on purchase decisions. They can take that into account by quickly incorporating the power of location data into their marketing and business game. At the same time, understanding the life and lifestyle needs and purchase journeys of consumers using segment data – with Lifesight Audiences for example – can empower e-commerce brands with a much deeper insight into their existing and potential customers.
In a 2014 Wharton study , marketing professor David R Bell and doctoral candidate Jae Young Lee find that location is as relevant in the world of e-commerce as it is in the physical world. The questions Bell poses for online sellers are: Why do you have customers in some locations and not others? How does the physical world affect what’s happening in the virtual world?
The only way to answer these questions is by applying location data to the entire spectrum of marketing & business – as identifiers for consumer personas, their life and lifestyle needs, to tailor their marketing & communication, to measure user engagement and marketing campaigns, and to revolutionize the web store experience.
Location holds the key for e-commerce brands to counter consumers’ habitual webrooming. Despite the staggering growth of e-commerce, a research by Accenture found that 91 per cent of shoppers still complete a purchase in-store, even if their product research starts online. The only way e-commerce brands can level up is by tailoring their communications and promotions to webroomers. How would they find these webroomers? Through location data, of course!
What location can enable e-commerce brands to do
Over at Lifesight, we spent the last few months understanding the business needs of e-commerce to develop our products for their specific use cases. With our location-based Audiences, platform along with PlaceSense Graph, ecommerce brands can –
- Deeply understand consumer personas based on their physical world behavior and the places they inhabit in combination with the wealth of online behaviour data that e-commerce brands already own. This not only helps serve contextual messages to existing shoppers but also helps e-commerce brands scale their reach to a high volume of offline shoppers with personas similar the customers making purchases on their web store
- Tailor UX and promotions with the single minded intent of competing with offline stores that get high footfalls for specific categories. This means that when e-commerce brands have some insight into which stores their existing and potential customers are visiting, they can offer discounted prices on similar products and contextualize their recommendation engines. In the longer term, this enables e-commerce brands to tailor their advertising and marketing strategy drilled down to each individual customer.
- Get an insight into what locations prompt shoppers to make purchases. An interesting insight we received from a pilot project for an e-commerce company was that at 6 pm on a weekday, when many middle- to high-income groups were stuck in their cabs in heavy traffic, they were most likely to close the purchases they had been planning in their shopping cart. A large number of grocery shopping instances occurred on Friday evenings. Serving reminders in high traffic locations at 6 pm helped our client increase the number of closures by a staggering 43%. Insights like these help e-commerce brands personalize and contextualize their messaging in a way that ensures purchase conversions.
- Measure advertising campaigns and understand whether or not they are able to convert the webroomers and the first time shoppers to die hard online shopping loyalists.
And the above use cases just about scratch the surface of all that’s possible for e-commerce companies that leverage location. But most importantly, these companies have the potential to accomplish all of this and much more through anonymized, opt-in location data. It’s now possible with Lifesight.
In a world where everything is personalized – from our Facebook news feeds to our cab rides – location data holds the key for e-commerce brands to truly revolutionize themselves with deep consumer insight, contextual, personalized, and relevant marketing, and effective, ROI-driven measurement.
Ready to join the location revolution? Lifesight has you covered! Shout out for a demo.