The holiday season is on the horizon, but the big question is how and where consumers will shop.
Will consumers swarm malls and brick-and-mortar retailers, or will they embrace the convenience of e-commerce shopping to avoid large crowds given the health concerns about COVID-19?
It would not be surprising to see e-commerce dominate the sales landscape. The market has surged, supported by consumers who recently migrated to e-commerce and became more active.
eMarketer expects that U.S. consumers will spend US$709.8-billion on e-commerce in 2020, an 18% increase from 2019. Brick-and-mortar retail spending is expected to drop by 14% to $4.18-trillion.
There are some critical considerations facing retailers heading into the holiday season, including Black Friday and Cyber Monday. (Note: Walmart, Best Buy, and Target have announced plans not to open their doors on Thanksgiving Day—some for the first time since the 1980s).
The holidays are a good time for retail brands to acquire new customers. Attracted by discounts and promotions like free shopping, new customers are low-hanging fruit.
According to Total Retail, e-commerce retailers see 50% more transactions by new customers during the holidays. That’s a hard-to-ignore statistic, which is why retailers work so hard to get new customers to jump on the bandwagon.
At the same time, retailers need to pay attention to existing or repeat customers.
When Total Retailer looked at transaction amounts, the number of items per order, and repeat business within a year rate, existing customers are more valuable than new customers.
A powerful way to engage new or existing customers are emails that capitalize on personalization.
Our work with the leading brands shows that retailers see the most significant improvements in open, click, and conversation rates when effectively personalizing for new customers.
The leading retail brands see the highest lifts in open, click, and conversion rates when effectively personalizing for the audience of new customers.
There are a few things to consider when it comes to personalization:
One, personalization must be ‘effective’ at predicting outcomes based on limited data.
Ideally, you want to present email campaigns aligned with a customer’s needs and interests; it is challenging when there are not many data points to leverage.
In some instances, there is only one transaction associated with the customer. For example, if a customer buys a pair of shoes, that is the only data point. The recommendations within an email would then be “more shoes.”
Second, the email channel has multiple signals that can shape the content that interests and engages a customer. If you send emails, use the data generated on each customer’s tastes from tracking opens and clicks.
By analyzing the available signals in your email marketing program, it is easier and more effective to predict the content that resonates most with each segment of your audience.
Personalization encourages customers to make purchases, but, as important, relevant, and personalized content is a great way to establish and build brand loyalty that will generate sales beyond the holiday season.
At Coherent Path, we leverage the power of artificial intelligence to determine the optimal email “diet” for every customer based on their specific tastes and interests.
We believe retailers should reinforce what consumers have already purchased and offer personalized content about other products that they would like.
This approach can be a powerful way to engage customers by making it easier for them to discover products aligned with their interests and needs.