By Alan Shannon
The holiday season has always been a crucial period for businesses, particularly those in the retail sector, as tills ring in harmony with the sound of cheesy Christmas songs on an endless loop. But, these days, the number of consumers flocking to the high street in search of holiday bargains is steadily declining, and the battle for wallet share is shifting online.
For small and medium enterprises (SMEs) in South Africa, the surge in online shopping during times like the holiday season has underscored the critical importance of a robust e-commerce offering not just as a supplement to traditional retail, but more so as the main driver of holiday sales.
As the 2023 holiday season is upon us, and SMEs are faced with the daunting task of carving out their share of the market amid stiff competition.
The key to success lies in a comprehensive e-commerce strategy. The festive season is a marathon that starts right after the sprint of Black Friday and Cyber Monday, which means that for SMEs without a strong e-commerce strategy in place for the holidays, there is little time to waste.
There are six key components of an e-commerce strategy with the best chance of delivering the experiences:
Prioritise strategic incentives over discounts.
It’s difficult, if not impossible, for SMEs to compete with massive stores and nationwide chains in terms of the discounts they can offer. Instead of getting into price wars that you can’t win, focus on value-adding incentives that cost you less but appeal to customers, like gift cards, free gift wrapping and free shipping.
Boost basket sizes – SMEs should focus their e-commerce strategy on boosting the number of items people add to their baskets or carts while visiting their online store.
The classic “Buy two – get one free” offer is a staple of many physical stores simply because it has proved to work, potentially leading to a larger total sale per transaction as people add other non-sale items because of the savings they are enjoying.
Communicate value – If you can’t compete on price, win on value. It is important to communicate that value to customers continually. Highlighting how a product enhances a customer’s life can often resonate more deeply than just offering a 10% discount on it. The perception of higher value for each rand spent is a powerful incentive for most shoppers.
Optimise for visibility – A sound e-commerce strategy also hinges on robust technology. Invest in search engine optimisation to ensure your shop, brand and products rank high on search engine results, thereby driving more traffic to your site and make sure your site is optimised for cellphone users who, today, constitute a significant portion of online shoppers.
Don’t forget the support – Customers expect to have access to support when they need it. Upgrade customer service with well-trained human consultants and tools like chatbots to provide immediate assistance.
Offer various ways to pay – Offering a variety of payment methods to cater to all customer preferences, from traditional card payments to digital wallets and QR codes, is a vital foundation for any successful e-commerce strategy.
Research has consistently shown that the main causes of cart abandonment are the perception of difficulties and a lack of choice when the customer reaches the virtual till point and there’s little point investing in getting people into your online store only to lose them before they buy from you.
Alan Shannon, the executive of Small Business Services and Private Clients at Nedbank.
BUSINESS REPORT