Looking at the last two years, the online landscape has transformed and shifted. While we may not see the same level of online adoption as in the early stages of lockdown, there's no going back to pre-pandemic days. We spoke to Ayaan Mohamud, Regional Vice President, Marketing - APAC at impact.com, about the future of e-commerce and what the future may look like in uncertain times.
As most retailers are acutely aware, the lockdowns of the last few years significantly accelerated the acceptance and adoption of online shopping in Australia. However, at the same time, consumer behaviour has also changed in relation to how they are influenced and persuaded into making a purchase.
Particularly in the digital world, consumers are no longer receptive or engaged by disruptive, irrelevant and intrusive advertising. This is in part due to being irritated, but also down to a lack of trust in how their data is used alongside declining trust in media and brands. Consequently, instead of relying on video and banner ads, retailers are now looking to partner with influencers, publishers and like-minded brands who consumers trust and are more comfortable receiving recommendations, reviews and offers from.
Put simply, people today are buying based on what other people are saying, not what the brand is saying, so retailers need to make sure that they show up in these conversations. In fact, 73 percent of consumers will make a purchase based on a trusted recommendation. These people, services and technologies that consumers trust can be leveraged by retailers to generate revenue through referral traffic. We call it the ‘Partnership Economy’.
Online shopping has certainly increased in the last few years. Do you expect this trend to continue in the future?
We are certainly going to see the continued rise of online shopping – however, retailers will have to continue to adapt their marketing strategies to meet consumers in the places and within the platforms that they prefer to shop.
For example, we expect to see the popularity of ‘social selling’ – that is the sale of goods via social media platforms continue to rise, with a surge in live stream events hosted by both brands and influencers. Publishers will also extend their offer to brands when it comes to content commerce via product reviews and recommendations with the introduction of ‘headless commerce’; the ability for consumers to make a seamless purchase without leaving the publisher’s site at all.
In time, we will also see online shopping extend to the metaverse. Luxury brands like Gucci, Burberry and Dolce & Gabbana are already selling millions of dollars’ worth of clothing there. It is certainly going to be a growing area for retailers targeting Gen Z going forward and we expect it to become an integral part of the Partnership Economy.
The majority of online shoppers (53 percent) said that they prefer to shop using mobile platforms. What can retailers do to make sure they are creating the right experience for mobile users?
Aside from creating an optimal user interface, mobile commerce enables retailers to demonstrate the power of in-the-moment marketing. This can be driven by things like incorporating geo-data like weather into marketing strategies (if it’s raining where the consumer is, offer discounts on umbrellas etc.) as well as introducing mobile partnerships. These collaborations engage mobile users to drive app installs, in-app actions or mobile web conversions, and they can be ingenious.
Let’s say you’re listening to your favourite artist on Spotify. Then, you notice they’re playing at a concert near you, and you have the opportunity to buy tickets through a ticketing company. This relevant, seamless partnership experience is a win for everyone, including the music lover. The ticketing company drives higher conversion rates, and the streaming music company earns a commission for every ticket sold.
Is loyalty dead in the wake of widespread e-commerce adoption?
Not at all, but the world of cross-border e-commerce means that brands and retailers have to work harder to both earn and retain loyalty.
Broadly speaking, consumers are loyal to a brand because they associate it with a positive experience, whether that is great customer experience, feeling a sense of alignment with its values or the fact that it has a superior quality. Widespread e-commerce adoption hasn’t changed that – it just means that there is now a lot more competition and choice. To continue to drive brand loyalty, aside from ensuring the fundamentals of customer service and online purchase functionality are in place, it means making sure you show up where your customers are and where they get their influence and inspiration from. This means augmenting traditional advertising strategies with influencer campaigns, mobile partnerships, brand-to-brand partnerships, publisher content commerce deals, as well as more traditional types of affiliate activities such as cashback and coupon sites.
In 2021, 61 percent of respondents said that 1-9 purchases they made could be directly attributed to influencers. This figure has since dropped to 56 percent in 2022. Do influencers have the same pulling power that they once did?
Absolutely yes, if the data from our customers, including Booktopia, Zero Co, LVLY, The Big Red Group and Canva is anything to go by!
I think the shift we have seen is from a focus on aspirational celebrity influencers (although these still have their place) to embracing a wider cohort of micro-influencers. Personal connections and a sense of trustworthiness are among the top reasons consumers will purchase a product that’s endorsed by an influencer – but the message has to be authentic.
For retailers it’s important to have the right technology and tools in place to best manage these creators. The impact.com partnership management platform allows brands to discover and manage a diverse range of influencers big and small and then work with them to optimise their performance. This can be done through boosted commissions, incentivised payouts, giveaways, and more, all of which can generate more engagement from users that interact with their content daily.
We have also seen from our customers that the best way to improve both the relationship and outcome with influencers is through offering exclusive content and deals. This shows a level of faith in their skills as a content creator, fueling their motivation to work with your brand again in the future, but also generating the best results. This exclusive content can be anything from promos, limited-time products or giveaways.
What does the future of online retail look like to impact.com? Have Australian brands been slower to embrace the Partnership Economy than other global markets?
You will always find early adopters and innovators, like Canva and LVLY, but it takes time for some things to take hold across the mass market.
For many, traditional affiliate marketing consisted of coupons, cashback, loyalty, and comparison – which many big businesses cover, but in the eyes of some brands, without the ability to measure the real value of those types of partners, the relationship has at times felt a bit one-sided or almost like a tax, rather than a partnership.
At impact.com, we are really grateful to have such vocal customers like Booktopia and Brand Collective who not only have the vision and the sway in their business, but also use their voice in the market to encourage innovation and influence others to always seek new ways to improve what they already do.
Not only does impact.com lead the way with our Partnership Cloud platform, we are also building the ‘Partnership Economy’ ecosystem so that all players – brands, agencies and publishers – have the right technology to make this channel more commercially appealing than it used to be.
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