How to Implement a Digital Commerce Strategy in Retail
We all witnessed and probably personally experienced the massive shift to online ordering as the COVID-19 pandemic set in. Despite the shift and somewhat surprisingly, 80% of sales still involve physical stores. As ecommerce continues to mature and consumers become more digitally savvy, these trends have emerged:
- Online sales continue to soar, with a 42% growth in online sales in 2020 compared to 2019.
- Customers are becoming accustomed to omnichannel transactions, with a 67% increase in buy online, pickup in store (BOPIS) in 2021 compared to 2020. Interestingly, 30% of customers actually prefer it.
- People are making more purchases on mobile devices, and 45% of online sales now occur on a mobile device.
- Voice commerce is also growing. 34% of shoppers between 18-29 have shopped using a voice-activated device at least once.
Meanwhile, a recent survey of ecommerce executives indicates these are priorities in the year ahead:
- Securing customer lifetime value.
- Capturing first-time shoppers.
- Achieving faster ROI for new technologies.
Given these shifting consumer behaviors and top-of-mind challenges, many retailers are trying to figure out where to invest money, time, and effort to sustain and grow their brands.
Our recommendation: Invest in digital commerce.
If you’re wondering where to begin, this blog post provides an outline for your digital commerce journey. Of course, some retailers might have a higher level of digital maturity than others, and some might have priorities that are different from the ones I mentioned. Even so, you can tailor this roadmap to fit your specific needs and highest priorities.
Modernize Your Ecommerce Website with the Agile, Cost-Effective AWS Cloud
Here are some recommendations for modernizing your ecommerce website.
Migrate to the AWS Cloud
If you’re still running your website on a legacy technology platform like IBM WebSphere or SAP Hybris, start your digital commerce journey by migrating to the AWS Cloud. A lift-and-shift migration can get your applications in the cloud quickly, so you can take advantage of on-demand scalability and zero-downtime—benefits that can immediately improve the functionality of your website and enhance the customer experience. With pay-as-you-go pricing, you can also reduce infrastructure costs.
Decompose Your Ecommerce Application with Microservices
Huge monolithic ecommerce websites are difficult to manage. Back in the early days of Amazon, when the company had one application and one database, it took 11 hours to run an update. That led us to microservices. We decomposed our monolithic application into smaller composable microservices, or pieces of business logic, that can be assembled in different ways with APIs, changed much more easily, and tested separately. This allowed Amazon.com to roll out innovative new ecommerce features very quickly. AWS offers many composable services that retailers can use to modernize their ecommerce platform to innovate faster. For more information about a microservices approach, see my previous blog post, How to Deliver Headless Commerce in Retail.
To drive home just how important microservices are to growth and innovation, consider this point from a June 2020 Gartner report: “By 2023, organizations that have adopted a composable approach will outpace competition by 80% in the speed of new feature implementation.”
Increase Customer Conversions
When people go to your ecommerce website, you want them to buy something. By adding relevant content that differentiates your brand and products from competitors, you can win more customers—with real-time interactions, immersive product experiences, engaging product discovery, and optimized navigation. Consider these AWS customer examples:
- Pomelo Fashion increased gross revenue 15% from webpage categories by adding Amazon Personalize.
- Morrisons implemented Amazon Connect in eight weeks so its contact center employees could work from home during the pandemic and seamlessly service a six-times increase in its weekly call volume.
- Trip.com delivered livestream travel content to 400 million customers during the pandemic with an engaging, entertaining #DreamNowTripLater marketing campaign.
Reach More Retail Customers
Here, I’m talking about marketing—connecting with potential customers where they reside with meaningful outreach. Depending on your current target audience or the customers you want to attract, your strategies might include curated social media content, digital ads, email marketing, and text messaging. When you enhance these tactics with personalization, machine learning, tracking, and analytics, you can reach the right customers at the right time with the right message. AWS provides underlying services like Amazon Pinpoint, Amazon Advertising, and Amazon Simple Notification Service (Amazon SNS) so you can create automated, intelligent marketing systems. We also work with a range of partners who can help you develop and execute strategic campaigns.
Deliver on Retail Brand Promise
This concept is all about making your customers happy by delivering the exact products they want as quickly as possible. And because returns are inevitable, it also means making the return or exchange process easy and efficient. Here you want to seamlessly offer multiple fulfillment options, like BOPIS and buy online, ship from store (BOSFS), and offer endless aisles so you can ship a product directly to a customer if it’s not available in a store. Depending on your products and customer profile, you might want to offer appointment scheduling and third-party delivery and returns.
In response to pandemic lockdowns, Party City worked with AWS partner Bringg, a delivery fulfillment orchestration platform, to launch a last-mile curbside pickup and delivery service to deliver the party to its customers.
If you’re ready to embark on a digital commerce journey, AWS is here to help. Contact your AWS account team today to get started.