New research reveals that, following a successful 2020 for online retailing, two-thirds of online retailers are increasing their ecommerce budget this year to drive business further.
CouriersPlease (CP), which commissioned the survey, discovered that 66 per cent of online retailers will put more resources and money into enhancing, growing and maintaining their online function this year. Among this group, 44 per cent will increase their ecommerce budget by more than 20 per cent and 18 per cent by more than 40 per cent.
CP also sought to understand how online retailers performed last year, before the October to December peak retail period. Two in three (63 per cent) experienced an increase in sales between 23 March (when social restrictions were enforced) and 4 September 2020. Specifically, a third (31 per cent) saw an increase of up to 30 per cent, while 21 per cent experienced an increase of more than 50 per cent. However, 22 per cent said their online sales were the same as before the shutdowns.
CP also asked if, and what, retailers tried to increase online sales last year from a list of seven action categories. Interestingly, 32 per cent of online retailers did not make changes. This suggests that those retailers experienced an organic increase in online sales or cut costs throughout the business.
Among those that did make changes, 49 per cent increased their sales and promotions, 45 per cent boosted their social media activity, 35 per cent improved their ecommerce sites, 31 per cent communicated more with customers, 30 per cent incentivised customers, and 21 per cent spent on advertising.
The findings also reveal that 60 per cent of online retailers shifted their business focus last year to increase sales. A decline in sales during the shutdowns was the most common factor that influenced businesses (26 per cent) to shift their focus. A potentially long recession was the reason for 25 per cent, the lack of an online presence was the reason for 10 per cent and the need for an effective customer acquisition strategy was the reason for 8 per cent.
“Consumers are becoming more comfortable shopping online and the retail sector is continuing to grow,” Paul Roper, chief commercial officer at CP, says.
“As such, online competition will grow alongside customer expectations and retailers are best to refine their ecommerce strategies ongoing to ensure they are performing. I believe key areas for improvement within e-tailer online strategies are the customer experience, from product search on the site right through to the last mile delivery. As part of this, retailers could also review and enhance their returns process, which includes choosing a delivery partner that aligns with their 2021 goals.”
