The occurrence of a pandemic was the last thing on anyone’s mind at the beginning of 2020. But then, it happened.
The effects of COVID-19 on our everyday lives are evident. Everything has changed: our lifestyles, health & healthcare, business, the economy, and politics, among others.
The eCommerce industry is no exception to this change. We are experiencing different buying patterns, different emotions driving purchases, different needs, and different interests. The psychological patterns and triggers in the customers’ decision-making processes are no longer the same.
For this reason, eCommerce managers must now come to terms with this new reality when it comes to crafting the strategy for the rest of 2020 and afterward.
In the midst of the COVID-19 pandemic, while a lot of retailers of non-essential products are forced to shut down, a lot of other online shops are experiencing a rapid surge in demand, having to re-write their operational flows overnight.
New times, new rules
Since the Coronavirus became a global pandemic, people are more focused on purchasing essential goods: food, hygiene products, babycare products, hand sanitizers, toilet paper and … bread makers!
As a result of the pandemic, sellers of non-essential goods have seen their sales drop by 40-60% on Amazon. Moreover, 42% of retailers cite concerns about consumer confidence, but they disagree about how great an impact there will be. Nearly 60% believe there will be some impact, and about a fifth expect a limited impact, while 22% believe the impact will be significant. (Source)
Companies that put customer needs under the microscope, taking a scalpel rather than a cleaver to the marketing budget, and nimbly adjust strategies, tactics, and product offerings in response to shifting demand, are more likely than others to flourish both during and after a recession.
Harvard Business School
This article will focus on three areas:
- Types of users during crises
- Website performance & user behavior
- Strategy Guidelines
- Types of User during Crises
Types of users during crises
Omniconvert’s data-driven team made a deep-dive into available data, researching how eCommerce companies and customers are behaving during this crisis period. Here’s what they discovered.
One thing should be kept in mind:
Psychographic segmentation is more important than ever.
As market conditions change, customer behavior also changes. In effect, demand changes according to how customers are interpreting and coping with the new reality.
Usually, during a recession, seen as a period of uncertainty, four types of psychographic consumer segments emerge:
1. SLAM-ON-THE BRAKES
This group feels most vulnerable and hardest-hit financially and tends to reduce all types of spending by eliminating, postponing, decreasing or substituting purchases. These consumers, who are more likely to be lower-income (but not exclusively) tend to display the following traits:
- Even essentials are jettisoned for lower-cost products or private-brand substitutes
- Rule out treats or expendables
- Will postpone whatever can be postponed, unless forced to make an emergency replacement.
2. PAINED BUT PATIENT
Generally the largest of the four segments, these consumers tend to be resilient and optimistic about the longer term, but are less confident about the prospects for short-term recovery or their ability to maintain their living standards. They usually exhibit the following tendencies:
- Try to economize in all areas, but not so aggressively
- Look for good deals when buying essentials, or seek cheaper, less-preferred alternatives
- Cut back on the frequency and quantity of treats, and focus on value
- Postpone major purchases where possible, repairing rather than replacing
- Have value and low-ownership costs uppermost in mind for postponables, with a willingness to sacrifice extra features
- Seriously cut back on expendable goods
3. COMFORTABLY WELL-OFF
These consumers, the top five percent in income, feel secure about their ability to ride out current and future bumps in the economy, and so they consume at close to pre-recession levels. Certain behavioral traits are evident:
- No change in pattern of essential purchases
- Slightly more selective in purchasing luxury treats
- They still buy postponable items, but may negotiate harder for a better quality/price ratio
- Rarely view any goods as expendable, but may reduce some conspicuous consumption
4. LIVE FOR TODAY
Typically urban and younger, this group carries on as usual, not worrying about savings. Their main characteristics tend to be:
- Continue to buy favorite brands of essentials and stick to favorite treats
- With postponables, may buy if there is a good deal; otherwise, may extend their timetable for purchase
- Reluctant to consider any customary purchase as expendable, although may not expand consumption to new types of purchases
Website Performance & User Behavior
Qualitative Research Actions
Consumer behavior is changing rapidly as the pandemic evolves day by day. It is important to monitor and catch all these changes early on in order to be able to adapt your strategy and offers in keeping with these new demands.
Here is a list of metrics that you should consider monitoring:
Are there any changes in where your traffic lands?
- You might see users landing on pages that up until now were not of interest.
How have visit numbers changed for different areas of your website?
- Learn if there are any products or services that have attracted more visits due to changes in behavior and needs.
Are there any shifts in traffic?
- Some of your paid campaigns might be affected, so make sure to tweak ineffective campaigns and leverage those that see an increase.
Are there any changes in the keywords visitors are using in website searches?
- This can bring very specific insights on how users’ needs have changed.
Are there any products or services that have maintained sales values or have even seen a growth?
- Focus your marketing and logistical efforts on these products/services.
Correlate pandemic events to shifts in sessions and transactions:
- Learn from these trends and prepare ahead of time for similar future events.
eCommerce Strategy Guidelines
The world has already changed. Along with the shifting scenarios around us, new opportunities to adapt and prosper arise beyond website optimization. What, therefore, should change in your marketing and messaging?
We took a look at other possible initiatives that need attention in the current context, and have listed the motives behind them. Such initiatives relate to the following areas:
- Branding & Communication
Branding & Communication
What can you do?
- Relevant positioning
Keep partners, merchants, and customers, as well as website visitors, all updated. The aim is to be able to assure flow in fulfillment while adjusting for demand in time and being supportive. Use, as much as you can, surveys, live chat, phone communication with customers, and web communication. Since the supply chain can be a real challenge these days and the local economy also needs to be sustained, try finding local suppliers who can help.
- Under-promise, over-deliver
Customers who become fans are either those who haven’t encountered any problems and keep on buying, or are the ones that did have a problem and were pleasantly surprised by how well and how quickly it was resolved.
You should, therefore, make sure you under-promise and over-deliver during these challenging times, earning as many fans as you can through the quality of your messaging and support.
- Optimize on the basis of content demand
See the top pages that are getting more sessions recently, and ask yourself how you could improve on those. Add details, increase length, and/or create an FAQ page. Link related articles, related products, and reviews, and add customer-support phone numbers.
The same needs to be done for website search based on the volume of searches, including searches where users have exited (meaning an answer was not fully provided).
- Pandemic-dedicated communication
Avoid tone-deaf communication and let users know that you have their best interests at heart. Point out to them that everything they used to do offline is now available online, and to what extent.
- State the extra measures you have taken in your company for responding to the context
- Describe extra measures your suppliers have taken for keeping everyone safe
Describe how the delivery process will occur so as to keep clients and company personnel safe.
It would be a good idea to show the items above with actual pictures for better credibility. Also, try to add a positive vibe to your communication, and avoid emphasizing the negative effects of the pandemic. Returning to normal messaging can be very beneficial for brands that are not in high demand right now.
- Live website chat & callbacks
Respond to any questions that your content is not already addressing. Offer help with placing orders to those users with lower tech proficiency, who have been forced to move from offline shopping to online.
Some retailers have seen an exponential increase in WhatsApp and Facebook Messenger usa, despite live-chat functions being available on their website.
Consider testing these two options on the website.
- Communicate via Social Media
Keep your social media audience in the loop regarding your activity. Get a share of the focus while social media usage is now peaking. Even non-essential brands (e.g. beauty, fashion, accessories) should communicate with their community in order to encourage UGC (user-generated content) and empathize with their audience.
If, however, you cannot switch the whole company – as New Balance did – at least spread a message that will help the entire community, making sure your brand is an active one:
- Cherish your most important customers
For your most valuable customers, try doing something different to show how much you care about them, such as a special personalized email, as part of your remarketing. You could send them an SMS, or even call them, as long as your message shows authentic empathy.
These times are a great opportunity to give a helping hand in whatever way you can.
At Omniconvert, we have decided, together with our investors, to give away 5 mil. euro worth of technology credits to support particularly vulnerable eCommerce merchants with fewer than 100 employees.
What can you do?
- Heatmaps & pandemic surveys
Heatmaps and surveys are important in this new context for revealing new needs and website behaviors. Ask users if they have managed to find everything they are looking for, in order to discover new product-range opportunities, or navigation & information gaps.
- Look at the new conversion funnel and see where you need to improve it
One way of looking at data before and during a pandemic is to compare metrics such as website purchases, website checkouts initiated, website adds-to-cart, outbound clicks, and impressions.
Other useful insights can be gleaned from reports that compare organic and site searches, traffic sources, product & category interest, and user engagement.
- Drill down into customer motives
The reasons why customers are buying from your website might be very different in this new context from what they were before. Try to approach a number of different current customers via telephone and ask them why they’ve chosen your website until you get to the main motivational factors.
What can you do?
- Adapt your offer to the new demand
- Consider making new product categories available for purchase, and supplement current stocks based on new types of demand.
- Offer product suggestions and visibility that will be in focus during this period (e.g. sanitation, child entertainment, home improvement)
This will help balance any potential drops in normally-popular categories for the current season, but it might now even become the main growth engine.
- Move products from offline to online
Supplement online stocks with items found in physical stores. Yes, this can be quite a chore, but you have no choice if the demand has moved online, and you have no certainty over how long will this last.
- Be flexible in the provision of multiple payment options
Online payment using credit cards has seen an exponential increase lately, so make sure you make card payment facilities available and easy to use. You can also recommend them as a better safety option.
Installment plans can also be a good option, since a lot of people have become more cautious with their spending.
What can you do?
- Adapt your website for your new audience
As more users come online to solve their needs, you need to meet their expectations and behavior, which might be different from what you’re used to.
There’s a high chance those new customers who order online are not the usual tech-savvy users; you should, therefore, create a shopping-assist function or infoline that guides them through the order-placement process.
- Provide different assistance for different needs
Because the over-60 segment is the one most affected by the current situation, you can provide special treatment for this segment, such as faster delivery, personal delivery, special hours when they get priority, etc.
- Maximize any and all buying intent via email
Adjust and review cart abandonment & browsing abandonment campaigns. Personalize them as best you can. If possible, offer extra benefits or discounts in order to close the sale sooner.
- Stop all irrelevant or sensitive ads
Don’t forget to revisit all the automated campaigns, since they might not be appropriate for this situation:
- Grow & document your user base
Benefit from people who are moving from offline to online and kick start or extend loyalty programs. You could start with collecting leads for newsletter subscriptions. Those who are now having a positive experience with your brand will definitely look you up after the COVID-19 crisis if you play your cards right.
- Test your traffic acquisition campaigns
Depending on your audience, positive messages vis-a-vis cautious ones may be tested. You can use inexpensive traffic to test and plan ahead. In order to validate your hypothesis, you can run tests such as search-and-display ads, video watch times, homepage CTAs, value propositions, email pop-ups, quizzes or landing pages.
You might consider checkout and cart abandonment emails also.
Even brands not in high demand right now can benefit from this situation only by testing their messaging. Switching your sales approach from “BUY NOW” to a message filled with optimism can create a buzz around your products/services.
- Adapting to a home audience is vital. You must create new types of content around your products & services.
Because these are stressful times for everyone, bringing comfort and a positive attitude can definitely be useful. You should tailor your communication to the current situation by highlighting how your products or services can ease the effects of staying at home and of social distancing. You can also front-load — or even create — products such as books, DIY activities, toys, soaps, hygiene, candles, plants, and self-care. These can compliment your current list of products and place them in a new, relevant light for the home confinement most users are facing.
- A/B-test different types of benefits, offers and giveaways
With most online shoppers now being price sensitive, you should definitely test your offers and benefits on ads, emails and your website. You can try site-wide discounts or bundles, buy-now-pay-later campaigns, free delivery -v- fast delivery, and so on. Since this might be a delicate strategy for first-time clients, you should also consider your retention strategy as well.
You might also adapt your offers in accordance with on-cart value or product value viewed.
Product giveaways are another motive for shopping online. This helps by getting people hyped during this period, creating engagement with your audience, and putting a positive spin on things overall.
What can you do?
- Collaborate with people from Offline to help you with Online activities
Some workloads have decreased or even ceased – in areas such as in-store activations and cash registers – but others have been steadily increasing: supply-demand, online and phone-customer support, parcel preparation, deliveries, and so on. Thus, it makes sense, in order to keep things running smoothly, to deploy workers from low-workload areas to other, more demanding roles.
The same can be applied to professionals who are out of work due to the current pandemic.
- Logistical help
If demand for delivery is very high and cannot be satisfied completely by courier services, try some outside-the-box solutions: consider using employee’s personal cars or even Uber, or the city’s public transport.
- Extend your offer by using local producers or small merchants that are only offline
In order to assure stocks of products that are in high demand, use smaller local producers to complete the missing stocks. This way, you also help the community, becoming a bridge between consumers and small businesses.
- Introduce Eco & other new benefits
There are many Eco benefits you could consider: less packaging, reusable packaging, recycled wrapping, minimizing waste during the fulfillment process, and green delivery. Paying attention to responsible packaging & delivery reinforces positive market perceptions of conscientiousness during the pandemic.
Eco benefits can also be used as differentiators or substitutes for other benefits currently unavailable.
CSR (Corporate Social Responsibility)
What can you do?
- Help the community
Historically, corporations have taken a step back during crises. However, as the role of business in society continues to evolve and stakeholder capitalism becomes mainstream, businesses are rising to the challenge. It is encouraging to see how, even in the midst of challenging times, corporate social innovation is here to stay.
Corporate social innovation encompasses the many ways that businesses can have a positive impact. Through philanthropy, corporations provide direct donations or in-kind support; through advocacy, they have the capacity to shape public policy; through CSR programs, they use their many resources for the benefit of society; and, through shared value creation, firms develop profitable new products and services that address unmet societal needs. Corporate social innovation integrates these four pillars into a coherent strategy that creates a positive impact on society as well as on businesses’ bottom lines. (Source)
Your actions may include donations to the medical system or to those in need, and could take the form of product donations, a percentage of orders placed or turnover earned on certain products, or simply giving users a feeling of empowerment and a good reason to connect with your brand.
There is some doubt that the eCommerce industry as a whole will be net positive and help customers change their consumption patterns. Also, many traditional players can leverage changes in consumer behavior for driving their digital transformation in order to help maintain the connection with their valued customers. (Source)
Tough times don’t define, they refine.
If you are more of a visual person, here’s the whole strategy outlined for you>
Too much on your shoulders?
We can help!
If you want to level up your eCommerce game with our award-winning technology in a way that can help you understand your customers, make use of the data you have already captured and adapt your strategy according to these challenging times.
Contact [at] omniconvert.com