Covid Accelerates the Shift to Digital
We’ve seen the shift in B2C happen over the last decade, primarily in verticals that were impulse purchases, such as consumer goods like apparel and electronics. Where we had not seen the shift historically, but Covid rapidly accelerated behavioral change was in the need-based purchases like CPG and grocery, as well as in B2B where sales reps couldn’t physically travel or visit their customers.
As a result, digital channels surged, filling the gap that situations like shelter-in-place created for consumers and B2B buyers and sellers. Many of those changes are here to stay. In fact, per Forrester, 93% of buyers say COVID has changed their behavior toward shopping and that they are primarily buying online as much as possible.
Digital Accelerates the Shift to Direct Sales
Buyers across B2C and B2B pivoted to digital when researching and purchasing products or services. Unsurprisingly, online marketplaces were a favored destination for both researching and purchasing across B2C and B2B buying scenarios. However, manufacturers’ direct websites saw a surge as well. Research and purchasing behavior on manufacturer’s sites increased dramatically. This indicates a need or desire by consumers and B2B buyers to develop direct relationships with product or service providers in addition to retailers or wholesalers.
For manufacturers, digital heavily influenced direct sales opportunities during COVID:
- Digital became the fastest growing channel
- Digital made the biggest contributions to annual revenue
- Digital contributed the biggest percentage of sales volume
- Digital became the most important channel for driving customer engagement
Of those companies surveyed in the report, 83% of decision-makers reported double-digit growth in digital revenue in 2020. In 2019 only 9% experienced such growth. These figures further validate the rapid growth of digital in buying expectations among B2C and B2B buyers.
Buyers Experienced Disappointing Experiences
In contrast with the dramatic shift in consumer desire to purchase directly through manufacturers, only a third were actually satisfied with the research and purchase experiences presented to them. Per the Forrester report, buyers found product discovery difficult, didn’t readily have access to customer reviews to inform their purchase decisions, and found site navigation challenging.
Manufacturers consistently missed the mark on providing consistent and detailed product information. Especially in B2C buying scenarios, consumers expect ample product images, clear pricing, detailed product specifications and real-time product availability (especially in BOPIS / BOPAC buying scenarios). Only a third of manufacturers offer detailed product information today, a clear miss in meeting consumer demand.
Stitching Technology Still a Hurdle
While technology providers continue to innovate in providing compelling experiences within key areas of the customer journey, stitching together best-in-class technologies still remains a hurdle for many merchants. If you’re interested in more on this topic checkout Chris Rothstein’s “Stitching the Future Experience” recently featured at the AB Tasty Experience-Lead Summit for Commerce.
Historically the remedy has been for large software companies to acquire smaller niche software companies to fill gaps in their own software offerings. Unfortunately, in many cases that strategy didn’t result in more seamless experiences across the journey. As a result, an increasing demand for headless technologies has resulted with a high focus on API connectivity and less on the robustness of the feature set offered.
Some of the key proof points that consumers expect seamless integrations include the need for rich navigation and search capabilities, supporting content and product information, and seamless transitions from different digital touchpoints. In fact 79% of buyers would change suppliers based on poor experiences in these areas per those surveyed in the report.
Digital is Driving Budget Prioritization
In this new environment, B2C and B2B organizations are forced to rethink where they invest their budgets both now and in the future. Traditional commerce and marketing expenditures are rigorously being reviewed for return on investment. Budgets are also being reviewed to look for opportunities to shift spending towards digitally-enabled initiatives to match the rapid shift in consumer demand towards digital channels.
What You Can Expect
Prioritize digital into your organization’s growth initiatives. Just because a one-time event like COVID accelerated the shift in consumer demand, their expectations and behaviors aren’t going back to what they were before.
Roadmap your digital prioritizes into executable chunks both short and long-term. Look for quick wins and iterate often. Use incoming data from owned commerce channels to inform adjustments to the roadmap.
Understand that digital channels are now the hub of the customer experience. Digital influences and impacts every other sales channel, online and offline, so investments made there can and will flow through every area of the business.
Now is the time to own the customer journey, and digital is the path to get there. Download your copy of The Bloomreach State of Commerce Experience 2021 today.