Growing internet access and improvements in online security have allowed South African consumers to feel more comfortable with online shopping. Today, around 23% of local shoppers make a purchase at an eCommerce store at least once a month. With a wealth of information and options at their fingertips, these consumers are also becoming more selective about when, where and how they shop online.
Consumer behaviour is constantly in a state of flux, and brands wishing to stay competitive need to continuously adjust their eCommerce marketing objectives to meet customers’ shifting expectations. To help South African eCommerce websites identify the main factors that shape online shopping behaviour, this article –written in collaboration with PayU – summarises the key takeaways from a recent consumer survey by KPMG.
The data was gathered from over 18,000 consumers across 51 countries and the results present a unique opportunity for eCommerce brands to align their online strategies with the shopping preferences and behaviours of their target market.
Lower price is the biggest driver of sales
When asked what influences their decision to shop at a particular brand, 57% of those polled indicated they would go for the online retailer with the lowest price. The other major factors that would encourage them to shop from a website include enhanced delivery options (43%) and no-fuss return policies (40%). With regards to product availability, there appears to be generational differences in the data; only 28% of millennials surveyed perceived product availability as important, while the ability to see real-time product availability was more prevalent in Gen Xers (28%) and Baby Boomers (37%).
A secure online environment is key to consumer confidence
While online shopping offers almost endless opportunities for the customer, some may still be reluctant to complete a transaction, especially on an unknown eCommerce site. This is why winning the trust of customers and fostering a relationship of confidence are essential components of brand loyalty.
In terms of earning trust, consumers indicated that their faith in online brands is based mostly on a website’s ability to protect their data and information (according to 63% of respondents). Baby Boomers were most concerned with security issues (71%) followed by Gen Xers (66%). While a less concerning issue for Millennials (56%), data protection was still a key influencer for earning their trust.
Old school loyalty incentives are still trending
When today’s savvy consumer discovers an online retailer that meets their demands to their satisfaction, they normally stick to that brand and will not hesitate to share their brand experiences with other shoppers. How can South African e-tailers get these types of customers on board and drive brand loyalty in an increasingly competitive market?
It appears that traditional concepts such as customer support and reward programmes still matter. The survey reveals that excellent customer support counts as the biggest force behind brand loyalty, with 65% of the respondents agreeing. This was followed by 45% of participants saying that exclusive promotions and offers will motivate continued support while 37% of respondents voted for loyalty or membership programmes.
Online feedback is growing
Shoppers not only check out product reviews online before they make a big purchase, they also won’t hesitate to post online reviews if they’re very satisfied or unhappy with a product or service. Of those responding to the KPMG survey, 31% indicated that they posted a review online, with 47% of respondents in this sample saying they posted feedback directly to sellers’ websites, 31% said they posted on Facebook and 18% said they posted on the manufacturers or the brand’s websites.
“The implication for companies is that user-generated reviews are being posted on sites that are increasingly out of their sphere of control or influence. Companies need to integrate these social media sites into their marketing and customer strategy,” commented Dean Wallace, the industry leader for consumer markets and technology at KPMG in South Africa.
Consumers are switching between online and offline
The KPMG survey has highlighted the power of both online and offline in creating consumer awareness. Retail websites or online shops were the most common source of initial awareness among customers, cited by 59% of respondents. Offline channels came in second as a source of awareness, accounting for 52% of responses.
Over the last couple of years, we have seen online retail giants such as Amazon and Google establish an offline presence to keep up with consumer demand in this dynamic market. Even though online platforms offer more convenience and choices, brands are discovering the effectiveness of physical stores in providing a seamless shopping experience. As Wallace explained, “eCommerce is not an online-only affair. Both online and offline channels are effective in creating consumer awareness and demand, especially when used together.
Key takeaways for eCommerce site owners
- Consumers are increasingly on the hunt for lower prices and the best deals. By implementing the right pricing strategy (through cost and value-based pricing models and discounts), online retailers can increase profitability and stay ahead of competition.
- Exceed consumers’ expectations when it comes to convenience. Shoppers already know that the benefits of online shopping exceed that of offline retailing. Why not enhance the online shopping experience by giving them perks such as no-questions-asked returns, free delivery or delivery times that suit their schedules.
- Integrate a secure payment gateway into your eCommerce website – one that accepts multiple payment methods as well.
- Businesses need to look into loyalty incentives that add real value to their conversion rates such as VIP benefits and point-based reward systems.
- Enable and encourage customer reviews and feedback on your website and social media pages. Be sure to always respond graciously to any type of feedback.
- Expanding offline is an excellent branding opportunity for your online business since the vast majority of shopping still occurs in physical spaces.
If brands take note of the factors influencing shopping trends, they will always be able to provide an effective online experience and increase the number of visitors to their site.