Look Back to Make a Difference in the New Year
It’s hard to overstate the growth of eCommerce in 2020. According to McKinsey data, eCommerce penetration increased by a decade in the first three months 2020. This high-velocity growth was continued throughout the year. Digital retail sales exceeded $2 billion in 2019, and that was just two days after the holiday season. More than 130 days passed that mark in 2020. The year also ended with the biggest Cyber Monday ever. It’s not just B2C, it’s also thriving. In a Digital Commerce 360 B2B Survey looking at 2021, more than 80% reported that they were at least somewhat likely in the next year to purchase more online.
These statistics might make you nod your head. It may be time to reflect on what your company can learn from last years success. If your eCommerce business didn’t grow last year, we suggest taking some time to examine your customer experience and considering all the possible ways you can pivot. With 2021 now officially here, it’s time to plan your eCommerce strategies for next year.
How do you start? We recommend that you review the metrics and KPIs for 2020 as you look forward to the next weeks and months. These will highlight your wins and losses, and all things in between. This article outlines how to conduct a retrospective analysis on your 2020 commerce performance. It will help you grow faster and bigger this year.
Why not act now?
It can be a stressful time at the beginning of the year. You might be working closely alongside leadership to establish new goals, budgets and staffing plans, as well as identify key KPIs. You may feel compelled to put off analyzing last year’s eCommerce performance and determining the strategy for this year until there is less activity. Delaying can be dangerous and fatal to your goals.
Your eCommerce strategy can make or break your company’s financial results in today’s digitally-driven marketplace. Over a third (34.3%) of sellers sell their majority of products and services online. Forrester predicts that digital B2B sales could reach $1.8 trillion by 2023 and account for 17% all US B2B sales. This environment can make a huge impact on your annual revenue by being prepared to succeed during peak season sales.
You can help your company be successful throughout the year by conducting a detailed analysis of 2020 eCommerce performance. This will ensure that you have enough time to create the right content, digital marketing programs and launch them all on the right day.
Performance review for 2020
If you are focused on the right KPIs, and focus on customer behavior at each stage of the buyer’s journey, it is possible to quickly review your 2020 performance. Below is a framework that will help you identify both hidden problems and potential opportunities.
Your webstore’s ability to load pages quickly and process transactions is crucial for both your digital customer experience as well as your sales. Slow page loads can cause buyers to abandon pages. Frozen shopping carts or incomplete transactions can scare customers away and prevent them from returning.
Two types of metrics can be used to assess how your eCommerce infrastructure handles traffic and transactions surges.
- Availability. These metrics show you how reliable your site is. You should be able get an annual uptime/downtime report regardless of whether your eCommerce platform runs on-premises or on a third party cloud infrastructure. You might need to scale your infrastructure or request higher SLAs from service providers if you experience downtime during peak sales seasons.
- Speed. These metrics will tell you if your website works fast enough. These metrics include page loading times, transaction processing speeds, and average page load time. Slow-loading pages or long transaction processing delays are red flags that your infrastructure is in need of attention.
The Customer Experience
Customers are becoming more savvy about shopping online. Customers expect a personal experience, with well-organized categories pages, thoughtful content, product recommendations, and personalized offers. They want to be able to view all orders across all channels and get assistance when needed.
This type of customer experience will make them more likely to recommend your products and buy from you again. Accenture conducted a survey and found that 91% more consumers would shop for brands that are familiar with them and offer relevant offers. Research by BCG also shows that best-in class personalization can increase average orders value (AOV), by 10-20%.
Here are some tips to help you assess your customer experience starting in 2020
- Is your website updating content frequently (e.g. every day or every other week)?
- Is your website able to offer personalized content and offers based upon shopper behavior?
- Is your website able to offer product recommendations based on personal preferences?
- Do you use machine learning, AI or both to generate recommendations?
- Are you able to make recommendations in real-time?
- Are your recommendations effective with existing and new customers?
- Customers can easily view their order status.
- Is your website available for live chat?
- Is it possible to begin if so?
- Is it powered by intelligent AI or humans rather than a manual program?
You have the opportunity to improve customer service if you answer “No” in any of these questions. The following Magento blog posts will help you to understand the key elements of a digital customer experience that engages customers as you think about your functional priorities for next years.
Traffic and conversions
Conversions and traffic are where the rubber meets. You must ensure your website attracts the right visitors and converts. You should be looking at your conversions and traffic for 2020, as well as peak seasons and sales events. Here are some KPIs you should consider:
- Site traffic trends, including how traffic compares between this year and last year
- Which traffic types (mobile, desktop and channel referrals)? Which traffic types were most converted and which ones were the least?
- Which landing pages were converted the most?
- What seasonal promotions and offers were the most popular?
- What products were the most likely to be converted, and when?
Pay attention to both extremes of the spectrum, big successes and huge failures. And try to look at them from as many angles as possible. You may want to create new KPIs for the next year if you have many unanswered questions.
Look at your 2020 sales data and identify the days and times when traffic and sales are particularly high. These are known as peak seasons and it is important to plan for them. They often make up a large portion of your annual revenue. Peak seasons include Black Friday, Cyber Monday, Valentine’s Day, Easter, and late spring for swimwear businesses. Peak seasons can also be tied to customer years or quarters for B2B businesses.
Once you have identified peak seasons and other planned traffic, or sales events, dive deep into the strategies that worked and didn’t work in 2020. Then plan for next year’s most lucrative selling opportunities. This includes creating a clear eCommerce experience, identifying key performance indicators, and developing marketing and sales strategies. For help, check out the posts in Our Peak Season Performance blog series:
- Four P’s for Peak Season Performance: A Guide for Preparing Your Infrastructure to High Traffic
- Success in the New Face to-Face: How to Prepare Your Digital Storefront for Peak Season
- Your digital storefront is your salesperson of the year: How to create a customer experience that’s exceptional for peak season
What if you sell to other businesses?
Some B2B companies that sell via distributors or wholesalers might need to consider special considerations. Their sales are not necessarily tied to holidays, as they may be affected by quarterly budget deadlines or procurement cycles. Many businesses have cut back on spending due to ongoing economic uncertainty. This means that they must find creative ways of increasing revenues.
In 2021, two digital strategies that businesses might want to think about are:
- Upgrading their online experience. Many B2B companies that are not fully digitalized saw slow or no growth in 2020. It can help you grow your sales by making it easier for customers to buy online. B2B selling requires key features such as customer-specific product catalogues and pricing, online configuration and price quotes, automated approval workflows, and seller-assisted shopping. Learn more about the key factors for online B2B commerce by reading our B2B eCommerce Best Practices during COVID-19 and Beyond blog posts.
- Adding a direct to-consumer website. Some B2B businesses offer products that can both be sold to consumers and businesses. This is the case for many companies selling consumer packaged goods through grocers or through their websites. Consider adding a direct to consumer website to your eCommerce platform if your company has a product that you can sell to consumers. Magento Commerce is a great eCommerce platform that allows you to sell products directly to consumers.
You may be able to see areas where you can make changes immediately after looking back at the year before. Take this example:
- If your website crashes or slows down during the last year’s largest sales period, it’s important to prioritize infrastructure and address it immediately instead of trying to make updates in a hurry.
- You might consider redesigning your mobile experience if your mobile conversation rates and mobile traffic are low.
- If you notice that your conversion rates are falling overall, it is possible to look into the reasons–pricing and product messaging, page design, etc.–and then choose new KPIs for monitoring in the next year.