Craig Lubbe, CEO of bidorbuy, discusses emerging e-commerce opportunities and what entrepreneurs abroad are doing that their local counterparts could be doing.
In May this year, the UN Conference on Trade and Development (UNCTAD) released a report that showed e-commerce’s share of the global retail trade grew from 14% in 2019 to 17% in 2020.
The huge increase, representing tens of trillions of dollars, was directly attributable to Covid-19 enforcing lockdowns, leaving businesses little option but to trade online as consumers transitioned to digital purchasing amid stringent virus mitigation measures.
In South Africa, e-commerce grew by a whopping 66% in 2020 as Covid-wary consumers avoided malls and turned to home deliveries. A study by World Wide Worx shows that online sales topped R30-billion – some 50% higher than what was projected by analysts.
The e-commerce explosion also saw the coming-of-age of the online marketplace. The unprecedented circumstances triggered by the pandemic were tailor-made for platforms where vendors and consumers could be brought together and where users could make orders and payments without leaving the system.
Bidorbuy CEO Craig Lubbe noted that with people needing to save money given the tough economic climate, they needed to be certain the online platform they chose was not only secure, but would offer a wide selection of goods at bargain prices. Online marketplaces often meet these requirements.
However, as e-commerce records continue to tumble, traders are quickly realising that it is not good enough to simply create an online retail platform. Online shoppers’ requirements have evolved at a rapid rate, with convenience and choice becoming the key factors in digital retail.
Advancements in computer and mobile technology are no longer only the preserve of wealthier consumers, so it is beholden on online marketplaces and e-tailers to ensure their platforms keep up with the latest digital trends.
Some exciting things are happening in this regard overseas, and South African e-commerce platforms will no doubt be taking note of what these latest developments are to further optimise their own offerings. From a consumer standpoint, these innovations will also undoubtedly revolutionise their online shopping experience.
Artificial intelligence-driven personalised recommendations are becoming huge in the e-commerce space.
Not only do these suit the needs and tastes of a particular customer, but they also allow the marketplace to help grow loyalty to its sellers’ brands. It also goes without saying that by employing machine learning and data analytics, the platform is able to offer customers more of the items they want.
According to research by global consulting giant McKinsey, brands that excel at personalisation deliver five to eight times the marketing return on investment. International brands like Levi’s have already used AI-enabled chatbots to assist customers to find the perfect fit. This technology is able to learn about customers’ fashion preference and size requirements.
Another big innovation in the e-commerce industry is what is called ‘social commerce’. Again, this has grown out of the arrival of lockdowns. Because people have been starved of social interaction and entertainment, they have sought out e-commerce platforms that offer more than your standard select-click-pay process.
According to the Wall Street Journal, sellers and brands can further engage consumers by making associations with influencers and blending content into social posts, livestreams and videos. And because friends often share the same interests, the platform essentially becomes a ‘meeting place’ where they can shop, be entertained and chat to one another.
‘Customers can quickly go from ‘like it’ to ‘buy it’ without leaving the hub of friends, news and entertainment,’ the publication said.
Something South Africans are starting to see more of, in the e-commerce space and beyond, are chatbots. This technology is set to become standard in the months and years ahead.
Chatbots essentially act in the same way as in-store sales assistants, an essential requirement when so much trade is being conducted online. ‘Chatbots are all the rage today for customer support,’ said Shane Barker, the founder and CEO of an e-commerce thought leader blog. ‘They’ll become one of the most important marketing tools.’
Chatbots will become even more personalised as analytics technology improves. No longer will there be standard-issue responses, but assistance that is highly focused on individual needs.
A crucial part of the e-commerce experience going forward will be the variety of payment options offered. Particularly with this rise of mobile, more payment options mean bigger conversion rates. And when details of payment information are saved onto the platform, it creates greater convenience for consumers since they will be able to check out faster.
Platforms are also able to tailor delivery options to the needs of a specific country. Some online platforms, for example, enjoy partnerships with smart last-mile logistics services for e-tailers, banks, telecommunications operators and others that offer what is termed Click & Collect.
Click & Collect is an alternative delivery method whereby online shopping is delivered to the customer’s choice of pickup point instead of a door delivery address. There are various pickup points at popular retails, petrol stations, stores and other sites nationwide, from major cities and business districts to rural areas and townships.
Last but not least, consumers can expect to see far more video content on e-tail and online marketplace platforms. Barker said the importance of videos cannot be understated, since they can help showcase products better than still images ever can. Video accounts for a huge amount of social media traffic, so it stands to reason that it would grab attention when it comes to online sales as well.