Interviews, insight & analysis on digital media & marketing

A raft of new research finds brands failing to capitalise on ecommerce potential

Despite retail brands in the UK suffering more than most counties as a result of the coronavirus pandemic lockdown, new research has found that the majority continue to fail to offer customer online loyalty programmes to generate returning revenue.

With retailers in a sudden rush to improve their ecommerce offer in a bid to offset the dramatic footfall decrease instore, 80% have failed to offer customer loyalty programmes to drive first-time buyers to return with rewards and incentives, research from marketing automation platform Dotdigital claims.

According to the digital marketing research, which involved 100 UK ecommerce brands, while most online retail companies were found to be failing in terms of customer loyalty reward offerings in order to drive repeat transactions, almost half (43%) were also not collecting key customer data, which would prevent the creation of effective personalized messaging.

Almost the same number (40%) chose not to publish reviews by customers post-purchase, while over a third of shoppers (39%) described their view of loyalty as five or more purchases from one brand, it was discovered.

Testing loyalties

By failing to incorporate such consumer marketing techniques, these brands are potentially failing to convert lifetime customer loyalty.  Mark Jervis, marketing director for Dotdigital explained the need for more work to go into driving loyalty by focusing on ensuring the customer felt valued.

 “Retailers should move beyond the traditional ‘points for purchase’ model and tailor their programme to build an emotional bond based on customer insight.  Shoppers want to earn credit by taking actions other than making a purchase, so offer points for reviews and interactions with their social channels,” he continued.

The research also found that once loyalty had been established with a consumer, 35% would then spend more, even if they found items cheaper elsewhere, while over half (56%) would refer the brand positively to others.

Of the 60% of UK brands which requested post-purchase reviews, over half were found to use independent platforms, such as Yelp, Angie’s List, Which? or Trust Pilot where customers were more inclined to share their opinions and experiences.   

However, most retailers (90%) were found to send a welcome email to new registrants and over half (57%) offered a cart recovery feature while within 60 minutes over a third of retailers would send an email to those customers who had abandoned their carts without purchase.

Failing relationships

Jervis continued to explain that despite the UK being a leading omnichannel marketing nation, retailers were still missing out on opportunities to build closer relationships with consumers and driving loyalty. “Therefore, retailers are losing out on a significant chunk of revenue potential in the market and customer loyalty remains fickle,” he added. 

As retailers enter their most important season – described as ‘the Golden quarter’ which includes major sales focuses such as Black Friday, Cyber Monday and Christmas, another report has discovered that as marketers have adapted their strategies around the pandemic to meet the shift in consumer behaviours, one-third of ecommerce leaders were choosing to opt-out of peak season campaigns, an increase of 6% on the previous year, despite over one third (34%) stating their intention to increase spending during peak seasons.

The report, from customer conversation platform Yieldify which spoke to 400 leaders from ecommerce brands and 2,000 consumers from the UK and US, concluded that if retailers were dialling down peak season campaigning, there was an opportunity for brands to increase their customer engagement and increase market share as a result.

Less than half (45%) of respondents from ecommerce businesses felt positive about their chances of outperforming last year, with a quarter (25%) claiming that lower consumer demand was driving the decision not to ramp up marketing engagement.

Waleed Al-Atraqchi, chief executive officer at Yieldify, said that the opportunity to disrupt at present could present “a golden advantage” for ecommerce leaders who choose to market during peak season.

 “Consumer appetite is bigger than ever and the competition for this demand may be quieter than this year: with tactics such as strong personalization in place, the potential rewards are huge,” he added.

The research also claimed that over half (52%) of consumers planned to remain loyal to platforms discovered in recent months during the online purchase drive.

Meanwhile, British consumers have been found to use mobile apps for their grocery and local shopping needs in comparison to the US, France and Germany, according to data from a survey commissioned by digital agency JIN that focuses on attitudes that reveal the level of digital adoption across these countries.

With 1,083 people from Britain responding, it claims that 72% shoppers in the country have been using online more than prior to the beginning of the pandemic in March, with Tesco, Sainsbury’s and Asda the top three retail brands they turned during recent months.

While almost two-thirds (62%) of people said they now owned an online grocery shopping account, with 16% stating they had created the account during the pandemic and would continue to use it although 37% of Brits said they owned an ecommerce account, the lowest of the four countries polled.

Research

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