Critical for Black Friday and Cyber Monday: Contextual Commerce is Convenience, Context and Control

Written by: Sheryl Kingstone, Research Vice President & General Manager - VOCUL

The holiday season is right around the corner and so are the notorious shopping holidays of Black Friday and Cyber Monday. According to our Voice of the Connected User Landscape survey, 80% of respondents plan to spend the same as the previous year and the remaining 20% plan to modify their spending. Whether those modifications involve an increase or decrease in spending is difficult to determine based on trends with those respondents being almost evenly split – with 38% expected to spend more than last year and 45% expected to spend less.

With this in mind, we don’t anticipate how much people are spending to be of great interest, but rather where people are buying what they need this holiday season. According to our Global Unified Commerce Forecast, there could be nearly $6 trillion in global digital commerce sales by 2022 up for grabs. That is still a ways away, but digital commerce is still anticipated to dominate holiday spending shopping behavior with 42% of respondents planning to do most of their shopping online rather than in store – a 27% increase in online spending from last year. Additionally, 47% of high-income shoppers will do the majority of their shopping through digital commerce channels.

It is clear that online and digital spending will continue to increase but where these shoppers will spend money is determined by the online experience. Our calculations estimate that nearly $36 billion in potential sales were lost either through abandoned shopping cart experiences or check-out friction in the US alone. The industry must prioritize digital experience improvements to limit such losses.

Technology is quickly becoming the catalyst for one of the most profound changes ever to occur in the relationship between shoppers and retailers. Retail, in turn, is being redefined from a transactional relationship between people into a more nuanced, tangled relationship between shoppers and the automated systems and devices they use to obtain the products and services they want. At 451 Research, we recently launched Contextual Experience as part of 4SIGHT. Contextual Commerce is a subsegment that is growing due to the dramatic shift in the balance of power between many retailers and brands and their customers.

When it comes to stack ranking, the most important aspects of the shopping experience boil down to convenience, context and control.
  • Convenience: They want the experience to be fast, easy and frictionless (e.g., search and navigation and seamless checkout).
  • Context: They want personalized and tailored information (e.g., reviews, content, information). 
  • Control: They want to interact on their terms not be sold to (e.g., cross-channel, limited product selling). 
While the industry focuses much of its attention on mobile, personalization and cross-selling, the fundamental aspects of a shopper’s experience cannot be overlooked. In Figure 1, survey respondents cited search and navigation and product reviews as more important for an ideal experience. Mobile and personalization, however, fell to the bottom of the list. These results suggest that the best experience is not just a personalized one, but one that is contextually relevant based on that moment in time. 

Figure 1: The Ideal Online Experience
holiday commerce blog figure 1
Source: 451 Research, Voice of Connected User Experience, November 2018
 
Convenience, context and control are not limited to online shoppers. In-store shoppers also want this experience. Sales associates must be able to add value to the shopping experience by providing knowledgeable context rather than a basic sales pitch. Convenience can be achieved through overall speed of checkout because half of all consumers need this to be addressed (long lines in stores are a common complaint). While shoppers don’t necessarily care if there is self-service or mobile service, they do care about having a convenient experience. Additionally, one in four shoppers want cross-channel experiences and some level of control over price, making sure they pay the same cost as they would if they were shopping online. 
 
Figure 2: The Ideal In-Store Experience
holiday commerce blog figure 2
Source: 451 Research, Voice of Connected User Experience, November 2018

As the pace of technology, innovation and competitive pressures accelerates, business leaders that ignore this new reality do so at their own risk – even during the holiday season. Experiences, not products, will be the battleground of the future, and data plays a powerful role in improving the context of those experiences. Organizations must digitally transform their businesses to best attract, win, retain and support customers by leveraging the latest applications, analytics and infrastructure to deliver a differentiated experience. Doing so is not a luxury but a necessity for survival.
 
Learn more about Global Digital Commerce in this on-demand webinar.

·         Convenience: They want the experience to be fast, easy and frictionless (e.g., search and navigation and seamless checkout).

·         Context: They want personalized and tailored information (e.g., reviews, content, information).

·         Control: They want to interact on their terms not be sold to (e.g., cross-channel, limited product selling). 

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