Capturing the Soul of the online Consumer
Businesses all over the world are shifting their operations towards a customer centric strategy that defines the customer as the core pillar of success. This shift towards customer obsession is accelerated by digital transformation that has led to the adoption of advanced customer relationship management tools and other vibrant platforms that have give brands full visibility of the customer journey map. According to statistics appearing on Forbes, digital transformation and a focus on customer experience can generate a 20-30% increase in customer satisfaction and economic gains of 20-50%.
Understand different generations of consumers
Online businesses will attract different generations of consumers that exhibit extreme shopping patterns driven by micro and macro environmental activities that took place in their generation. Baby Boomers born between 1946-1964 enjoyed immense economic prosperity, post-world war 11 peace. Kenyans were involved in a unstable political environment while fighting for independence. They only use technology when it is necessary and may not spend a lot of time on different digital channels. Generation X born between 1965 – 1980 where influenced by campaigns to mainstream capitalism and consumerism culture. They are ambitious and adopt technology very easily as a tool to stay connected with their aging parents and tech savvy children.
Generation Y or Millennials was born between 1981- 1996 when technology and entrepreneurship was becoming a global phenomenon. They are a global generation since they share the same values in many countries thanks to globalization and their connection through the Internet. Generation Z was born between 1997-2010 when digital was mainstream, internet and mobile phones were readily available. They spend a lot of time on digital platforms, self-taught through tutorials and have a real time access to global news and entertainment.
Identify Target Customer
From all these generations of consumers, it is important to identify a target market that consists of consumers who exhibit similar characteristics like age, income, geographical location etc. It is also possible to have more than one target customer group segmented as primary, secondary or even tertiary customer segments. Primary customer is the core target of any business where more resources are allocated while the rest may get limited attention. For the purposes of this article and better understanding, we will have the millennials as our primary target customer.
Develop Customer persona
Now that we know our primary target customer is a millennial, we need to go deeper and create a persona that befits our target customer. Customer persona is a fictional profile that represents a target customer. You can also create negative persona to represent those you do not want as a customer.
Customer persona should be a vivid description that profiles the characteristics of the target customer. Let us name our Persona Niki, she is 34 years old a University of Nairobi bachelor of Commerce graduate currently working at eyeballs as a business account manager earning USD 30,000 PA. she lives at South C and is a single mother of two children. She loves to travel, hangout with friends and has started playing golf of late. Write down as much information as you can about the persona so that you are able to vividly envision the customer you are targeting. Most of the digital platforms will ask you to key in this details when developing an advert. Use this persona every time you are doing meetings to help the team have the customer in mind when developing creatives and other marketing programs. I encourage teams to have imaginary photo of the persona hanging on a boardroom wall and even go further and have a seat for the imaginary customer. Ask yourself, what would the customer say about your creatives, Marketing programs, website customer journey maps and key touchpoints?
The Middle of the pyramid purchasing power
Data from the Kenya National Bureau of Statistics indicate that 36.1 per cent of Kenyan households are classified as poor with the remaining 63.9 per cent or 30.39 million being non-poor. Domestic data put the low-income earners as those taking home 23,670 shillings (about 216 U.S. dollars) and below while those earning between 216 dollars to 1,094 dollars are classified as middle class.
Our persona Kiki is a middle class with a decent job and salary which translate to high status and peer pressure to live up to industry standards. As a business, you have to consider how much discretionary income Kiki has after spending on necessities like rent, food, clothing, transport, insurance, Mortgage etc. You will probably be fighting to get a share of the remaining 15% of Kiki discretionary income.
You also have to find out how many Kikis form part of the target customers in the target market and determine if the number is big enough to sustain your business.
Most tech -startups will target the middle class due to quick uptake of technology, smartphone penetration and ability to afford data, their disposable income and other factors that make this customer segment attractive. However, they later discover that that market is too small and only concentrated in urban centres. That is why most start ups will launch very fast in several countries in capital cities where there are middle class with disposable income.
Hyper-personalized Customer experience
Millennials are driven by the desire to get personalized experiences. They are willing to pay a premium for great experiences. To deliver hyper-personalized customer experiences, working on the customer journey map and identify key customer touchpoints. Marketers have been debating the relevance of the legacy marketing funnel that mapped customer journey from awareness to a purchase which was develop in line with legacy marketing channels. The modern customer has evolved and marketing channels are now fragmented thus the modern customer has multiple touchpoints that spread throughout pre-purchase, purchase and post purchase experiences.
I prefer the bowtie data insights marketing funnel that gives complete visibility of the customer journey from pain point to loyalty. It presents a deeper understanding of customer acquisition, conversion and retention touchpoints that can be optimized for higher conversion.
Map out Niki purchase decision making journey and touchpoints throughout brand discovery (eg Search engine, Social Media, TV etc), interest in your product ( website, Email, call etc) consideration ( audit your competitors digital assets) Conversion ( How will kiki pay once she decides to make a purchase) loyalty ( how will she give feedback? Either through reviews and ratings on website, social media comments or even email) Optimize the ecommerce platform and creatives to the liking of Kiki. The images, videos and content should be tested on Kiki to increase conversion rate.
Retention Optimization
Retention refers to the percentage of users who come back to buy your product after their first purchase within a certain timeframe eg if 200 users buy your product today, and 40 of them come back the following month, then your one-month retention is 20%. Online businesses focus a lot on daily active Users (DAU) or Monthly active Users (MAU) as a key metric to analyze stickiness and retention rate. This is determined by the industry you operate in.
A study by Invesp shows that acquiring a new customer can cost five times more than retaining an existing customer and increasing customer retention by 5% can increase profits from 25-95%.The success rate of selling to a customer you already have is 60-70%, while the success rate of selling to a new customer is 5-20%.
Create power user curves by focusing on specific segments, determine what drives their actions and purchase behavior. Some users have longer sales cycle or lead generation cycles while others are shorter. Power user curve can help you better under engagement per cohort, determine user actions and determine what should be changed based on their purchase patterns.
Implement omnichannel customer support services that allow consumers get support through channels of their convenience and preference like website, social media, email or even face to face. Collect customer feedback and complaints and genuinely make attempts to incorporate or communicate effectively and in a timely manner.
- Published in Mobile, Networking
Techniques to boost online sales during the Holiday Season
The holiday season is here after three years of consumer distance-shopping patterns occasioned by COVID–19 pandemic. Although the global market is experiencing high inflations and economic uncertainties, consumers are expected to take a break, go on holiday or shop for family-get-together celebrations. In fact, consumers started shopping as early as October in preparation for the holiday season. E-retailers and travel organizations will take advantage of different big shopping dates during this holiday season including Black Friday held on 25th November, cyber Monday on 28th November, Giving Tuesday on 29th November, Jamuhuri day on 12th December, Christmas on 25th December and New year on 1st January. These are major holidays celebrated globally and specifically in Kenya.
The Deloitte’s annual holiday retail forecast anticipates eCommerce sales growth of 12.8% to 14.3%, YOY, during the 2022-23 holiday season. Retailers need to put together a progressive plan that will lead to higher conversion rate during the holiday season.
Create holiday Season goals
Be specific about the holiday season goals and define how to approach each holiday as a retailer based on your geographical location and target customer. Analyze historical data, sales performance and pitfalls then generate insights that will lead to increased sales conversions.
Create SMART goals specific to the holiday season. Eg increase gift basket sales by 15% from last year in our Nairobi outlet in the next 1 month.
Prepare your online creative assets and Message
- Develop a creative direction and messaging that will be used during the holiday season. Your creative assets should be slightly different to align with the excitement and holiday celebration. You can have holiday specific themes for the different celebrations.
- Develop attention grabbing message that will make your assets stand out of the clutter.
- Focus on dynamic creative optimization to develop contextually relevant assets for targeted audience based on location, browsing history and time. There are different creative units that resonate well with different platforms like single unit creatives, carousal or scroller units, etc. identify the right unit to use for your adverts
- Carryout AB testing on different assets for conversion rate optimization
Online store optimization
Your online store look and feel should reflect the holiday season
- Design a creative holiday theme for your landing pages, align your content, images and videos to the holiday season. You can have holiday focused category and product pages with optimized pop-ups and forms.
- Consider holiday gift cards that can be personalized through customization. Create a sense of urgency and where necessary have a countdown to quicken decision making.
- Set up a seasonal shipping arrangement and a flexible return policy that may expire immediately after the holiday.
- Check on browser and cart abandonment rates and retarget through email or WhatsApp.
Study the holiday shopper cycle and patterns
While we might have a standard approach to holiday shopping, we have to study consumer shopping patterns. There are consumers that will start shopping as early as October while there are consumers who will shop during the holiday season. Also, consumers have interesting shopping behavior during the festive season eg Understand where and how consumers shop between 24th December and 31st December. How do you connect with consumers that have travelled from their traditional shopping centres, who are they with that time and what are they likely going to buy?
Consumers with higher purchasing power will make impulse buying and spend more on gifting than lower income consumers who will spend on needs only. These calls for a well targeted promotional campaigns directed to specific consumers with the right product, price and place.
Some consumers may decide to shop early in anticipation of price increase, shipping lead time and Product unavailability during the holiday season.
Offer Flexible Phygital Shopping Experience
COViD-19 taught consumers convenience through omnichannel shopping experience. During the holiday season, retailers should offer phygital shopping and fulfillment options that suit consumer interests and convenience. According to the Deloitte holiday retail survey, 63% of shopper will shop online with 34% using social media while 35% will go in-store.
Use different options including BOPIS (buy online, pick up in-store), curb-side pick-up methods and order online from instore etc. Allow the consumers to choose from different options convenient to their shopping needs.
Full funnel visibility
While holiday shopping is a seasonal business activity that generate spike in consumer acquisition and sales, it can have a long-term impact on customer relationship and brand image. Sales lead magnets and competitive promotional activities can have a long-term impact on customer onboarding process and retention. Retailers should recalibrate their marketing funnel and design activities that may not have long term negative impact on the brand and consumer journey.
It may become hard or even impossible to retain customers who shopped during the holiday season when retailers where giving crazy discounts. Such consumers might only afford a product when it is discounted or on offer. Marketers have to generate different activities to protect their brand during the holiday season.
Effective customer Support
Intense marketing activities during the holiday season generate a lot of interest that lead to exponential customer support calls. Customers will look for decision making support during the shopping process, make enquires about a product feature or shipping details or generally get clarification if the offer is legit.
Retailers should optimize customer care platforms and retrain or upskill customer care teams to provide exceptional customer support during the holiday season.
Make sure to define your average response time in all the channels that you establish to connect with your customers. Test all telephone numbers in your marketing collaterals and website to make sure they work. Your social media and emails should have a dedicated resource throughout the holiday season.
For high traffic retailers, support from different tools will go along way in effective customer support. Set up an omnichannel customer support platform, chatbots, live chat support, self-service options etc
Connect and operationalize customer data
“The average retailer uses 44 different systems to engage with customers across digital and physical touchpoints. Data-driven organizations are 23 times more likely to add new customers and 6.5 times more likely to retain them.” State of Marketing, Seventh Edition, Salesforce, 2021.
Marketers that centralize data from different silos are able to anticipate their customers’ needs and preferences, personalize shopping journeys and makes it easier for customers to find the products they want which can increase sales. A good example is Intelligent product bundling where customers who buy wrapping paper might also need tape, ribbon, and gift tags. By analyzing past purchase behavior, you can pre-configure product bundles that increase units per transaction.
Such bundling of products can be made easier buy using customer shopping data and analyzing all the key touchpoints throughout the purchase journey.
Seasonal Outsourcing
High demand generated during the festive season require extra hands on the deck to deliver value to customers. Retailers will hire seasonal workers for a short period and are not obliged to retain them post-holiday season. However, they have to train and manage them every time they hire making the exercise more expensive.
The Ecommerce value chain is at an advanced stage where key players provide specialists expert services. Retailers can outsource customer support services, last mile delivery, Marketing, Talent management etc. This gives the retailers time to focus on strategy to increase efficiency and conversion rate during the holiday season.
Sustainability Marketing
According to a salesforce survey, a whopping 78% of consumers say a company’s environmental practices influence their spending decisions. And for holiday shopping, the number is even higher: 83% of consumers say they’ll seek out sustainable products and shipping options. To advance a net zero focus, retailers should reward loyalty members when they engage in environmentally friendly behaviors. At Starbucks, for example, loyalty members earn points when they buy with reusable cups.
Retailers can also identify programs and initiatives to support during the holiday season. This will capture customer hearts and minds and strengthen their relationship.
- Published in Mobile, Technology
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