The penetration of the internet and the wide use of smartphones over the years have revolutionized the retail industry. Ecommerce, in full electronic commerce, is the activity of buying and selling products over the internet.
Although ecommerce facilitates seamless transactions, it is more complex than a brick-and-mortar retail enterprise. It requires constant interaction with customers and assurance of product or service delivery.
The internet made the world a global village, allowing businesses to operate anywhere without a physical office. It offers a low entry barrier making it easier for new entrants to spring up. According to different statistics, there are over 20 million ecommerce websites globally.
The competition is becoming stiffer daily. Companies ahead of the competition understand the need to engage customers and personalize their shopping experiences through merchandising.
Digital merchandising, also called ecommerce merchandising, includes a series of activities involving strategic product display on a website to make it easier for customers to find and eventually increase revenue. It is the practice of optimizing customers’ journey on the site irrespective of where they are coming from, whether referral, search, or direct users.
History of Merchandising
Merchandising became more prominent when many firms shifted their focus from wholesale to retail.
Thousands of years back in ancient Greece, open markets called agoras witnessed different tradespeople offering various product samples to attract customers.
These sellers entice buyers by offering them free samples to taste, use or smell. Giving customers a feel of what they are bound to enjoy if they buy your product takes them from the stage of awareness to decision.
Today, merchandising is more sophisticated. According to Fast Simon, a shopping optimization platform for merchants, ecommerce merchandising is now deployed using data insights and an advanced understanding of human psychology.
Benefits of Ecommerce Merchandising
There are five stages of customers’ buying journey: Awareness, Consideration, Purchase, Retention, and Advocacy. Ecommerce merchandising help businesses guide customers through this journey seamlessly, ensuring transactions are completed in a few minutes.
Below are some benefits of ecommerce merchandising that help to increase revenue:
- Unique customer experience: No two customers are identical; they may only share similarities. Merchandising helps sellers to display items individual visitors on their site are more likely to purchase.
- Increased engagement: Ecommerce merchandising strategies, such as displaying similar products to the searched item by a customer, can increase engagement.
- Improves retention: Sellers spend on digital adverts and SEO to get customers to visit their ecommerce store. A study has, however, revealed that 98 percent of customers do not make a purchase during their first visit to a site. Creating a well-tailored experience to increase engagement will improve retention and encourage them to return.
- Decreases bounce rate of first-time visitors: There are lots of websites selling similar products. Whenever customers visit a site for the first time and are not impressed by the landing page, they will likely leave to check out other websites. However, merchandising ensures they are impressed, thereby reducing first-time visitors’ bounce rate.
- Increase store conversion: The end game of merchandising is to increase sales. Using data-driven merchandising solutions helps websites increase conversion rates and eventually improve revenue.
Emerging Technologies Influencing Digital Merchandising
Like the general technology industry, digital merchandising is evolving, and it will continually experience improvement as new technologies emerge.
Below are some emerging technologies influencing digital merchandising:
Retailers can no longer rely solely on designing a fancy website and placing products in locations where customers can easily find them. Consumers are spending lesser online. It is paramount for sellers to maximize time to engage and make them complete a purchase.
AI can analyze shoppers behavior to suggest the most suitable products they can purchase along with the ones they are interested in.
Customers also want personalization at every step of their purchase journey. Sometimes, they may need to talk to a customer representative to clarify things like delivery. AI-powered customer service solutions compile data from purchase history, browsing behavior, and preferences to provide customized responses to individual queries.
Virtual Reality (VR) helps to merge the physical store and online experience. It allows customers to view products in its real-life, 3D application.
Imagine the possibility of placing different furniture in your home to choose which one fits best.
VR has also allowed shoppers to try out different outfits without wearing them. Some companies also use this technology to take customers through the journey of production so that they can appreciate the meticulousness put into the manufacturing of the item.
Internet of Things
IoT has enabled manufacturers to gather data from the daily usage of their products. The data collected can be used to deduce features customers are more interested in. This can be leveraged in digital merchandising to get customers interested in an item.
The convenience of online shopping and delivery encourages many internet users to buy online instead of driving to a retail store.
Delivery robots are significantly improving this experience. They are very convenient for customers, delivering parcels to their doorstep at preset time. Using delivery robots allows for timely delivery as it does not suffer human delay.
In conclusion, the future of ecommerce is inevitably linked to the advancement and implementation of emerging technologies such as Artificial Intelligence, Virtual Reality, Internet of Things, and delivery robots. These technologies are revolutionizing digital merchandising, providing personalized and immersive shopping experiences that increase engagement, improve retention, reduce bounce rates, and boost overall sales conversion.
While the digital merchandising landscape is constantly evolving, businesses must strive to stay ahead by utilizing these innovations, thus ensuring they meet the increasingly sophisticated demands of today’s online shopper. Undeniably, a unique, customer-centric and tech-driven approach to ecommerce merchandising is the future of retail, promising a transformative impact on the industry.
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