Ecommerce is everywhere. How should retailers, particularly smaller retailers, decide which channels are the most important?

Kirsten Green

Founder at Forerunner Ventures

When deciding which channels are most important to invest in, it's important to have a clear picture of who your customer is, how your product fits into their lives, how your customer goes about making purchase/brand decisions and where they might expect to find your brand and interact with your product. These pillars can provide strong direction around how/where to prioritize your marketing and distribution efforts. Beyond specifics to each brand, the following are some key findings from our research at Forerunner about where and how consumers want to shop:

• Many customers turned to online shopping in droves during COVID, but a large percentage expect to return to in-store shopping in a post-COVID world. Offline retail still holds importance among consumers. This is true across demographics.
• Marketing is important as a means of prompting purchase, but high impact channels vary by demographic. Older adults are likely to be influenced by friends and ads across all categories we measured. Meanwhile, Gen Z (ages 18-24) are more frequently prompted by both friends and influencers; this digitally native generation grew up on social, informing their preferences by what they see online with influencers they feel they know — almost like friends.
• We asked where people prefer to purchase from, across multiple categories. Among older adults aged 25+, there is a strong preference for either small businesses that are local to the community, or large big box retailers and large online marketplaces. Digitally native brands were more popular shopping destinations for Gen Z, and DTC was a top channel for purchasing. The shopping channels among Gen Z were a lot more distributed.
• We asked early-adopters where they expect to be able to shop. Most people say livestream video and SMS are not [yet] important, but social media is considered "table stakes."
• When asked what brands would be more influential in the coming three years, older adults selected Amazon, Netflix, Google, YouTube and Walmart, which speaks to a preference for big marketplaces as well as an opportunity to be influenced by ads (Google, YouTube). Meanwhile, Gen Z said YouTube, Amazon, Netflix, TikTok and Instagram, highlighting how critical social is to younger audiences.

Jose Luis-Gomes

Managing Director, Retail & Consumer at Google Cloud

COVID-19 supercharged the shift to ecommerce and omnichannel. Google consumer surveys have shown that 50% of shoppers now intend to shop both in store and online together, which is more than double the historical average. Even before the pandemic, online presence was important for retailers with the vast majority of shoppers saying they begin product searches on digital channels. Smaller retailers should invest in their digital presence first and foremost — for example, making sure features like online search functionality are providing good customer experiences.

Retailers lose more than $300 billion to search abandonment each year in the U.S. alone, and for smaller retailers, leaving money on the table can be devastating. The data shows that customers have a low tolerance for bad search results on retail websites, and it's never been easier for consumers to switch between brands. The online experience is critically important to driving brand loyalty and converting purchase intent into sales.

Jeff Titterton

Chief Operating Officer at Zendesk

It's obvious our shopping habits have changed over the past year, with ecommerce experiencing seismic shifts and unparalleled growth. For smaller retailers in particular, it can be difficult to determine the right customer support channels to invest in that will work best for their particular business — every decision to focus resources in one place means there are fewer for something or somewhere else.

To prioritize, start with meeting your customers where they are, which according to the latest data is increasingly on mobile devices and social media. This year's Customer Experience Trends Report showed that the popularity of social messaging apps has risen faster than any other channel, and I expect that will continue to boom.

For example, the introduction of new shopping features on social and messaging platforms such as Instagram, Facebook and WhatsApp has allowed consumers to not only discover new products, but also engage with brands directly when and where they need support. With access to real-time customer service, shoppers can keep browsing and buying without interruption or having to annoyingly switch between apps, making it feel like one ongoing conversation just like they would have with their friends or family.

Retailers need to choose the customer service channels that will allow them to be agile and adapt to constantly changing needs and demands of their customers. In a digital-first economy and a remote-first world, this will make all the difference between those that survive and those that thrive.

Kaz Nejatian

VP, Merchant Services at Shopify

Without question, growing a brand requires a presence across multiple channels. And it's up to retailers to show up where consumers are spending time. Most recently, that's been social. Social commerce is among Shopify's fastest growing sales and marketing channels, and over the course of the last year it has become the digital Main Street.

For digitally native brands, whose resources and ways of working were built for the internet, testing and experimenting with new channels might feel like second nature. But the last year has seen a migration to ecommerce of established brick-and-mortar brands who are now selling online for the first time. For these merchants, understanding what channel is best, and when, will be paramount.

The first step is to become a user. Browse. Investigate. Eventually, you'll start to see how similar brands are using different channels. For example, Snapchat and TikTok are great resources for targeting Gen Z. But the content has to feel organic. Younger consumers want commerce to be integrated, not disruptive, which is a departure from the traditional marketing and advertising model. Shopify's Microsoft Advertising channel is better suited for targeting older shoppers. Pinterest is great for mass awareness, where polished lifestyle images perform best. Generally speaking, Facebook and Google are typically best at driving conversion.

Above all, the single channel that is most important for any brand is the online store. Commerce is happening everywhere, but it all starts with the online store. Without it, selling seamlessly across multiple channels becomes next to impossible.