SUMMARY
Product pivoting, personalised content and storytelling are some of the strategies used by ecommerce brands to succeed today
Improving the speed, quality and scope of data analytics by breaking data silos and pooling reports is crucial today for ecommerce businesses to grow
Going forward, ecommerce companies are likely to continue using the D2C model, with diversified supply chains and a stronger customer support system
The new normal that ensued in the wake of the Covid-19 lockdown disrupted businesses large and small across the country. Ecommerce, however, witnessed phenomenal growth. Already highly popular among a population with easy access to the Internet, ecommerce became the only shopping option amidst countrywide lockdowns and flourished as a result.
By 2020, in fact, the India internet economy is projected to grow to $250 Bn, backed mostly by ecommerce which is set to clock a record growth rate of 51%. And, IBEF predicts that India is likely to overtake the US to become the second-largest ecommerce market (behind China) by 2034.
Trends Observed In Ecommerce Post Lockdown
More buyers from smaller towns: Post-pandemic, ecommerce has gained popularity in locations other than metros and Tier-1 cities. Recent reports have shown that the rate of e-commerce adoption post-lockdown was the highest in lower-tier cities, at 55%.
Inclusive online space: Ecommerce has evened out the playing field for retailers by allowing everyone, regardless of size or geographical location, to cater to customers everywhere in India. Home-based entrepreneurs, local boutiques and even kirana stores have been using ecommerce with good results.
Record festive sales: The pandemic did not put a dampener on festive ecommerce sales, which hit a whopping $8.3 Bn with a 65% growth over last year. Apparel and footwear stores, in fact, saw a 400% growth in sales and clocked an average order value of INR 3000.
Demand patterns: Hand sanitisers, face masks and protective clothing saw massive increases in demand, as well as casual clothing and loungewear with most people now working from home. There was also an increase in demand for cooking ingredients and kitchen appliances as people began experimenting with their favourite dishes at home. Another sector that did well was durable goods, with increased orders for dishwashers, vacuum cleaners and washing machines.
Lower price consciousness: The Covid-19 pandemic sparked an increased preference for high-quality products that enhance wellness, with price consciousness being less of a factor. Organic food and wellness products, locally sourced produce, sustainably farmed goods and vegan/cruelty-free products are now more popular.
The Growth Of D2C Ecommerce
One major trend in the post-Covid shopping landscape is the growth of D2C (direct-to-consumer) brands. As consumer expectations about product availability and the shopping experience go up, brands that directly sell to their customers through a dedicated channel or app are likely to build a stronger connect than if they were to showcase their products on ecommerce aggregators like Amazon or Flipkart.
Going forward, ecommerce companies are likely to continue using the D2C model, with diversified supply chains and a stronger customer support system that absorbs and acts on feedback better. By 2025, in fact, D2C brands could be looking at a $100 Bn opportunity in India, according to a recent report by Avendus.
Strategies Used By Brands To Succeed
Product pivoting: Many brands took the lockdown as an opportunity to sell new product ranges that customers would want. For instance, garment manufacturers started selling masks and protective clothing for customers who needed to step out during the lockdown for essentials.
Personalised content: During the lockdown, people consumed most of their content on mobile devices. Brands thus started amping up their marketing strategies focusing on personalisation. Real-time data analytics and behavioural insights were useful to execute the campaign in this regard.
Storytelling: Amidst the uncertainty of the pandemic, customers valued brands that prioritised a humanistic way of marketing over hard selling. Stories about how brands were taking adequate safety measures as precautions while continuing to deliver the service that customers expect helped to maintain customer bonds despite the physical distance. This storytelling trend is likely to continue as customers become savvy about choosing brands that make a difference beyond just selling products.
How The Optimal Use Of Data Can Help Ecommerce Businesses Grow
Every day, large amounts of data are gathered as customers browse products and make purchases. This data, when examined holistically by different teams in an ecommerce company, can help to uncover insights that might not be spotted by one team alone.
Improving the speed, quality and scope of data analytics by breaking data silos and pooling reports is crucial, particularly as the volumes of data continue to grow.
This calls for the IT, marketing, product and customer management teams to work together on discussing data insights and implementing new products or features based on those insights. For instance, IT data on how a customer navigates through an ecommerce page can help the product team tweak their product display to be more effective.
The Road Ahead: What Brands Will Need
India is a large and diverse market with multiple demographics, languages, income levels and cultures. In order to cater to each of these customer segments, brands will have to relook their planning and fulfilment strategies with the help of appropriately sourced data. Working with an AI-powered ecommerce platform is an option in this regard, as AI can deliver high-quality insights from real-time customer data.
Choosing how much to sell via D2C channels and how much via marketplaces will be another important decision to make, as will decisions about product mix and social media marketing.
Having a smart inventory management system will help ensure timely deliveries and prevent stockouts, which were fairly common during the lockdown. Many brands may wish to opt for an all-in-one online shopping platform that sets up a streamlined storefront and also provides real-time data analytics on shopping behaviour.
Ultimately, the one thing that will set a brand apart from the rest will be the quality of its customer connect. Whether through digital media, offline experiences or simply better-quality products, both large and small brands will need to stay in tune with what the new wave of ecommerce customers want and deliver it optimally.
