Previously published on LinkedIn, Sept. 3, 2021
It’s fascinating to see how much the High Street has changed over the past 18 months. Some companies were forced to make quick adjustments to their business model because they had almost no e-commerce capabilities. Some had an existing platform and plans for improvement - which have usually been accelerated.
Either way, it’s clear that retail, e-commerce, and direct-to-consumer (D2C) is not just going to revert back to 2019. Some consumer behaviours adopted during the pandemic will remain in place because the customers just prefer the new normal.
Hotel Chocolat is a good example. With over 140 shops they have traditionally relied on customers seeing their chocolate in a store before buying, but now more than 50% of all sales start online. This doesn’t mean that over half of all sales are online orders that require a delivery, even many in-store purchases start out as a customer seeing something attractive online that inspires them to visit the store.
Hotel Chocolat has responded to this change by dramatically improving their app, so customers can stay fully up to date when tracking a delivery all the way to their home. They have focused on reducing any friction from the purchase and delivery process - from the moment you click BUY, to the delivery, you are receiving progress updates.
This reflects a similar experience at IKEA. Everyone knows IKEA stores because they are so big and so full of ideas for how to decorate your home, but IKEA believes that over 80% of all purchases on all channels start online first. Even customers buying in-store found the details of what they plan to buy online.
Customers that buy both online and in-store almost always spend more than customers that are online-only or only ever buy inside a store, so it’s useful to focus on how to bring your e-commerce closer to your in-store experience. This is especially true for a brand like Hotel Chocolat, which is at the luxury end of the market. Don’t luxury goods require real experiences?
Yes, but that no longer needs to mean in-store experiences. Creating a fantastic omnichannel customer experience needs to be a priority in the post-pandemic environment because of the change in shopping behaviour. Recent research in the UK shows that three quarters of all British shoppers intend to buy more online even as the pandemic restrictions are now relaxed. 76% of shoppers say that convenience is their number one priority when choosing a retailer.
These are important stats to be aware of. The shift to a focus on convenience is also driving much of the e-commerce and D2C traffic. If a customer can order online and quickly receive their order then they may not want to bother visiting a town centre.
Retail brands that want to succeed, especially specialist retailers, need to think about how their stores and online channels can work together. Customers search online for information before visiting physical stores so the question is not e-commerce or stores, it is really how is your combined approach making it easy for customers to find and purchase your products.
As Hotel Chocolat demonstrates, you can have a fantastic product and beautiful stores, but if your app does not keep the customer constantly updated then you might lose that customer. Think about online and your physical estate, and consider how they can support each other.
Let me know your thoughts. Is it time to start redesigning e-commerce and D2C to reflect their increased post-pandemic use and how can the in-store experience support e-commerce? Leave a comment here or get in touch via my LinkedIn.