How Ecommerce Retailers Adjust To A Post-Shut-Down World
June 5, 2020 | Merchants | Guest Post
By Mike Cassidy, Storyteller, Signifyd –
There is nothing normal about the “new normal” for retail as COVID-19-inspired restrictions begin lifting in communities across the country.
Brick-and-mortar commerce is taking halting steps to invite customers — but not too many customers — back into stores. Ecommerce continues to punch well above its pre-pandemic rate with online sales up about 50% since the days before the World Health Organization declared COVID-19 a pandemic.
New Verticals Adapt to Ecommerce
Of course, the magnitude of the shift online varies by verticals. Some industries show more than 50% growth, according to data provided by Signifyd, a company that helps retailers optimize revenue by protecting them from fraud and consumer abuse.
“What we’ve seen is just astounding growth,” said Signifyd Vice President, Operations & Corporate Development J. Bennett. “In general the growth of physical, shipped goods is across-the-board higher.”
That’s good news for ecommerce retailers. Even better are the numbers that show first-time ecommerce shoppers are flocking to online stores at a rate rarely seen. It makes sense when you consider that physical stores were closed for long stretches. When they reopen, they will showcase a decidedly different customer experience.
“We are seeing the highest level of new users shopping online that we’ve ever seen before, outside of the 2019 holiday period,” Bennett said.
In fact, the number of shoppers that Signifyd is seeing on its Commerce Network for the first time, was up 143% as of May 1, compared to Feb. 24, a shopping day that serves as a pre-COVID-19-pandemic baseline.
Surge To Online Grocery Shopping
For some verticals, the rush of new online shoppers was even more eye-popping. Not surprisingly Grocery & Household Goods saw a tremendous wave of first-time digital shoppers as stay-at-home orders rolled around the world. During the second week of March, the number of new shoppers buying groceries online increased 481% from the week before.
Signifyd’s data shows 341% more new shoppers buying in the Fashion, Apparel & Luggage vertical in the first week of May, compared to the last week of February. The bump for Home Goods and Decor over the period was 325%. Shoppers in the Leisure & Outdoor category increased by 295%. New Luxury Goods shoppers were up 249%.
The rush of new online shoppers is a big opportunity for ecommerce retailers, but they need to shine — even in difficult times — in order to capture those shoppers as fans who will keep coming back even once physical shopping options return.
How Big An Opportunity?
Signifyd has tracked a 51% increase in overall ecommerce spending between the last week of February and the second week of May as part of its Ecommerce Pulse project.
And while the overall figure is impressive, the numbers in some of the verticals are stunning. Online spending in the Outdoor & Leisure vertical is up 152%, owing to indoor exercise equipment, puzzles, hobbies, and video games being in the category. Electronics is up 88%; Commodities & Collectibles, which includes precious metals, is up 76%; Auto, Parts & Tires is up 75%; Alcohol, Tobacco & Cannabis is up 70% and Grocery and Household Goods is up 58%.
Of course, a lot of that spending is from veterans of online shopping. Consumers will certainly continue to buy online even post-vaccine, when physical stores begin to look more like what they did in February. The question is: What will become of the wave of new shoppers who out of necessity are trying ecommerce for the first time?
Google, Facebook, and Amazon Seek Out New Shoppers
At a time when customer acquisition costs through digital platforms like Google, Facebook, and Amazon are generally on the rise, these new shoppers are extremely valuable. Furthermore, Signifyd’s data shows that roughly 40% of new shoppers are returning at least once to shop again at merchants on Signifyd’s network within 30 days. In short, these new shoppers are building a habit.
“The acceleration of that behavior will change the way the consumer spends,” Bennett says.
So, what can online merchants do to ensure those new online shoppers latch on to their ecommerce sites as a go-to shopping site? It all starts with flawless customer experience. That means top-flight merchandising, site search, personalization, checkout, delivery, and customer support.
Signifyd’s Major Ecommerce Tools
Signifyd can help with a crucial part of that buying journey. They ensure orders are not hung up in lengthy fraud reviews and that legitimate customers don’t see their orders falsely declined for fear of fraud or abuse. Signifyd’s Commerce Protection Platform combines machine learning, big data, and human expertise to maximize ecommerce conversion, automate customer experience and eliminate fraud and customer abuse.
Its Revenue Protection solution instantaneously sorts fraudulent orders from legitimate orders and provides a financial guarantee that means merchants are made whole for any approved orders that turn out to be fraudulent. More importantly, it ensures that legitimate customers won’t see their orders declined for fear of fraud. There are few experiences more damaging to the retailer/customer relationship than accusing your customer of being a criminal.
On the post-purchase side, Signifyd’s Abuse Prevention solution automates the management of non-fraud chargebacks and provides a financial guarantee that protects merchants from losses when a customer claims an item was not received, for instance.
Creating a memorable customer experience is always an important part of attracting loyal fans and building customer lifetime value. Never has it been more important than in the midst of the COVID-19 pandemic and the shelter-at-home lifestyles it has prompted.
Shoppers are building new, lifetime habits and retailers will want to make sure they are part of that new normal today and into the future.
June 5, 2020 | Merchants | Guest Post