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Omni-channel strategy essential for eCommerce survival in new mobile connected South Africa

May 7, 2018 • Mobile and Telecoms, Opinion, Southern Africa, Top Stories

Omni-channel strategy essential for eCommerce survival in the new mobile connected South Africa, says Deseré Orrill, CEO of the Ole! Media Group and Managing Director of HoneyKome

Omni-channel strategy essential for eCommerce survival in the new mobile connected South Africa, says Deseré Orrill.

By the end of 2017, two billion people globally used their mobile devices to shop online.

While not all online shoppers make purchases with their mobile phone, 95% of mobile Internet users look up local information on their phone before calling or visiting a business. According to Google, “some 85% of online shoppers start a purchase on one device and finish on another.”

According to Africa Business Insight, the trend provides a clear message from consumers: 2018 will be about integrating online platforms and devices. It won’t be enough to have a presence on multiple channels; these devices will also need to be connected so consumers get the feeling they’re dealing with one entity and not many separate parts of it.

Aspects like design, branding, tone of voice, advertising and social media content all need to be tied together. Businesses will need an omni-channel strategy to survive in the coming years and a solid back-end to connect consumers to their brand, no matter which device they’re using.

Mobile will reach 70% of eCommerce traffic by the end of 2018 and more and more people will purchase using their mobile devices. According to Goldman Sachs forecasts, mobile commerce revenue in 2018 will equal the total eCommerce revenue for 2013, some $626bn.

And in South Africa, eCommerce is set to increase in popularity and consumer uptake. As consumers become more tech-savvy and trusting of transacting online, then it’s reasonable to expect them to buy more online, even convenience items. This has also been fuelled by the increase in the number and type of products and services that are now available to them.

Optimise the supply chain to deliver a superior shopper experience

Digital transformation has pushed eCommerce and mobile shopping into the mainstream. Now that digital shopping is the norm, companies need to optimise the supply chain to deliver a superior shopper experience.

Online buying patterns are changing too. Until recently, consumers had to accept slow deliveries or simply go to a shop if they wanted something quickly – but eCommerce has caught up. Today and in the future, getting items at speed, in real-time, will be more practical.

Visual shopping, together with voice search, is now also demanding a bigger segment of the market. Image analysis automation is a fundamental feature of mobile devices where consumers take a picture of a product and do a reverse image search on Google or receive product information via visual search apps.

Online merchants must consider optimising their products for image search as well as establishing a stronger presence on image-based networks such as Instagram, Pinterest and Snapchat (even if Kylie Jenner is no longer using it regularly).

Consumers will also be spoilt for payment choice. While EFT payments and the ability to process card payments online remain popular, payment gateway providers this year will be looking at diversifying their payment methods such as cryptocurrencies, blockchain, one-click payments, subscription payments, and even buy-now-pay-later options.

It really is all about pleasing consumers. The priority for retailers no longer lies in increasing the number of consumers who shop online, but rather improving their experience.

Knowing the key techniques to improve conversion rates is vital to any eCommerce marketing strategy. A deeper understanding of the consumer, their online habits and their purchasing habits has become critical. No retailer can ignore the fact their consumers live in an integrated online/offline world and they need to make sure they have an appropriate presence on the channels where their consumers are.

Asian eCommerce market is the fastest growing

To get a sense of where we might be headed, let’s look at the Asia Pacific that contains both the largest and the fastest-growing eCommerce markets (China and India, respectively). Today, total online retail revenues in just five markets in Asia Pacific — China, Japan, South Korea, India, and Australia — surpass the combined figure for online retail in the US and all of Western Europe.

According to figures from eMarketer, China and the US are by far the world’s leading eCommerce markets. Combined, they account for more than 55% of global internet retail sales in 2014. China’s growth over the next five years will widen the gap between the two countries, and China will exceed $1 trillion in retail eCommerce sales by 2018, accounting for more than 40% of the total worldwide.

Besides the sheer size of the China Internet economy, which is expected due to the country’s billion-plus population, the Internet economy in China is also ahead in features. Consumers in China can now use the Internet, specifically WeChat, to accomplish an extraordinary number of things.

Apart from the usual messaging, voice, and video calls, WeChat also has integrated news and public service announcements, gifting, ride-hailing, food delivery, doctor/dentist bookings, and even visa applications.

And the reason there are so many services, is that China is far ahead in online payments integration. Instead of having dozens of competing platforms with limited adoption, Chinese consumers pretty much have two, Alipay and WeChat Pay, with 77% market penetration.

The US will maintain its position as the second-largest retail eCommerce market in 2018, totalling nearly $500 billion that year, while the UK will account for about one-quarter of that figure, landing in a distant third place.

Frost & Sullivan, an American market research and consulting company, estimates that the African eCommerce market will rise from US$ 8 billion in 2013 to US$ 50 billion by 2018. A McKinsey & Company report (July 2014) indicated that eCommerce could account for 10% of retail sales in Africa’s largest economies by 2025, which would translate into US$ 75 billion in annual revenue. In part, this will be the result of a decade of expected rapid economic growth on the continent, with consumer spending projected to exceed US$ 1 trillion annually by 2020.

New technologies present huge opportunities

Digital marketing levels the online playing field and offers equal opportunities for all kinds of businesses. It evens the odds, giving little and medium businesses the opportunity to compete against the established businesses and draw in their share of traffic.

Retailers can take heart knowing that new technologies present enormous opportunities for an effective digital marketing strategy to foster deeper and more loyal relationships with new and existing consumers.

By embracing these tools, retailers will be able to turn consumers into product and brand advocates much sooner and hopefully reap the rewards from their investment in new media channels.

By Deseré Orrill, CEO of the Ole! Media Group and Managing Director of HoneyKome

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