From early November to the Boxing Day Sales, cash registers and delivery fleets go into overdrive as retailers and shoppers alike take advantage of peak season. In spite of persistent economic pressures, 2023 delivered another bumper season - particularly around sales phenomenons like the Black Friday weekend and Click Frenzy. But for every peak comes a trough, and that summer spending spree typically subsides when January and February roll around. However, that’s not to say retailers must batten down the hatches until November rolls around. Far from it, in fact.
For all the challenges, there are opportunities too, and even reasons to be optimistic for the retailers who strategically position themselves to thrive in this evolving environment. That’s because, like many markets, Australia is witnessing a significant shift in consumer behaviour - particularly online. Since 2020 e-commerce sales have increased 15.5% year on year, compared to just 3.4% amongst bricks-and-mortar retailers. Tapping into this demand presents significant opportunities for retailers, even during the so-called ‘slow season’.
Here are a few strategies retailers can adopt to turn slow into success.
Build an omnichannel strategy
Online growth is outsripping in-store sales, but there’s still a huge need - and opportunity - for bricks-and-mortar retail. That’s because, when both channels operate seamlessly together as one, integrated omnichannel commerce strategy, retailers can enhance their customer experience. Building an omnichannel strategy allows customers to transition effortlessly between multiple touchpoints, from a website, social media, and mobile app, to bricks-and-mortar shopping. When every channel is built on a consistent foundation, it creates trust and loyalty, both of which are essential today. Through SHOPLINE, retailers of all sizes can tap into a platform of tools to help them take control of the online element of their omnichannel strategy; from digital marketing and SEO to social commerce and point-of-sale (POS).
Unleash the power of data
If an omnichannel commerce strategy is the foundation, data is the thread that binds it together. Data courses through retail businesses, from Google Analytics, point-of-sale data, and social media behaviour, to loyalty programs, customer relationship management (CRM) systems and many other sources. Through it, retailers can remove guesswork and pinpoint specific areas of their operation that require improvement. By understanding their behaviours and addressing their concerns through qualitative insights, retailers can reduce performance issues, maximise efficiencies and deliver a more holistic customer experience.
Tap the tangible benefits of AI
Rarely since the inception of the internet has anything captured the attention of businesses to a greater extent than artificial intelligence. It’s still in the very early stages of its full potential, but already there are ways that retailers can feel its pragmatic benefits. One of the most impactful ways retailers can leverage it is by improving their personalisation. Retailers are making significant investments in personalisation. According to Amazon, roughly one-third of its revenue is based on targeted personalised recommendations, while Gartner research found that personalisation improves engagement and revenue by up to 28% and sales conversion by up to 71%. Through AI, retailers can unlock those capabilities. AI analyses vast amounts of data to understand customer preferences, predict behaviour, and provide personalised recommendations. By doing so, retailers can significantly increase customer engagement and drive conversions. SHOPLINE has AI embedded across its platform, so retailers can turn personalisation into a competitive advantage and incremental revenue driver all year round.
Build sustainable practices
Today, consumers are becoming far more conscious of their shopping patterns. According to research from McCrindle, 63% of Australians are more conscious of their purchasing impacts than 12 months ago. One of the central issues is sustainability. Shoppers today will prioritise brands that align with them on a deeper level, especially when it comes to environmentally friendly practices. While it doesn’t sound like an immediate revenue-generating strategy, investing in sustainability can have medium- to long-term benefits. Using sustainable packaging, reducing carbon footprints, and communicating openly and candidly builds loyalty today. In fact, McCrindle’s research also revealed that 54% of Aussies exclusively support brands that are transparent about their supply chains. There are sustainable gains to be made in sustainability.
Create a loyal customer base
Retailers often grapple with the dilemma of prioritising customer retention or customer acquisition. Retention is considered up to eight times more cost effective than acquisition, and loyalty schemes are a highly effective way of doing so. Just as receiving the eighth coffee or hair cut for free incentives you to return to the same cafe or hairdresser, it has the same impact in retail. Your loyalty scheme could be as simple as that, or you could tie it in with your personalisation strategy. For example, create customer segments of shoppers who shop regularly, then start sending them offers and communications - for example for end of season discounts or limited edition items - thanking them for their loyalty. InMoment research reveals that 61% percent of loyal customers go out of their way to buy more from a brand - which could make a big difference for your brand in 2024.
In Australia’s vibrant and highly competitive retail sector, it’s not always easy to compete on product or price. However, customer experience, meaningful relationships and an optimised omnichannel strategy can absolutely be a competitive differentiator. For the retailers who focus on this in the months ahead, there is every opportunity to thrive and grow, whatever the season.
By Jon Levy, Australia Country Manager at Shopline, a unified retail platform