This holiday season can be a make-or-break one for retailers and brands, so industry experts expect companies to double down on marketing and customer engagement tactics to drive conversions. They will also leverage AI to optimize omnichannel capabilities, noted Meghan Stabler, senior vice president of marketing at BigCommerce.
Here, Stabler shares insights about these trends this holiday shopping season and the challenges facing brands and retailers.
WWD: What are some key trends you are seeing this holiday shopping season?
Meghan Stabler: With the holiday season upon us, trends are emerging in response to two driving forces — the retail industry’s shift toward technology-driven, customer-centric experiences and its response to incentivizing shoppers during uncertain economic times.
Increasingly, we continue to see brands and retailers pivot from a multichannel strategy to an omnichannel strategy — meaning brands that have not previously interacted directly with shoppers are now putting the shopper in the center of the story. This omnichannel strategy aims to provide a seamless and integrated customer experience across all channels, with the goal being to create a unified and consistent customer journey.
Take the rise of social commerce as an example. With revenue generated from social commerce expected to reach $6.2 trillion by 2030, brands continue to turn to social channels like Facebook and Instagram to boost sales. BigCommerce’s customer data underscores this by revealing that social commerce gross merchandize value increased by more than 9 percent, as reported in the Feedonomics and BigCommerce 2023 Merchant Trends Report. This surge can partly be attributed to an influx in big-ticket purchases, with an average order value of social commerce purchases increasing 63 percent year-over-year.
In addition to social commerce, you’ll continue to see brands double down on other omnichannel marketing strategies that harness the power of AI. Through AI-driven product categorization, companies like Feedonomics, a BigCommerce company, can syndicate and optimize a brand’s product catalog across over 150 leading marketplaces, social commerce and advertising channels.
For example, working with Feednomics, The Natori Company experienced a 10 to 15 percent lift in the luxury fashion retailer’s main key product indicators, including overall volume growth, increased click-through rate and decreased cost per click. Improving accuracy enables brands to target customers more effectively, resulting in a greater return on ad spend, boosted revenue, and expanded reach.
The uncertain economy is the other factor driving trends this holiday season. Simply put, brands are pulling out all the stops to incentivize customers to shop.
From consumers’ expectation of free shipping — which was echoed in research conducted by BigCommerce and RetailDive that revealed that 81 percent of consumers cite free shipping as the most appealing promotion — to a longer-than-usual surge in discount pricing, retailers are responding to consumers’ commitment to discount shopping sparked by COVID-19 and last year’s supply chain woes. Uncertain economic times are also leading to an uptick in flexible payment options like buy now, pay later transactions, which have BNPL loans growing 970 percent in recent years.
WWD: What is the value proposition of BNPL for consumers? And also, for retailers and brands?
M.S.: In turbulent economic times like these, the BNPL value proposition for consumers is straightforward — BNPL provides financial flexibility and helps to alleviate the immediate financial burden, ultimately promoting inclusivity by making high-quality, bigger ticket items more accessible to a wider audience.
Retailers and brands benefit significantly from BNPL as well. Namely, flexible payment options have increased cart conversion rates and average order values by reducing purchase barriers. In fact, product feed management company and BigCommerce company Feedonomics recently reported a 10.45 percent increase in GMV and a 7.7 percent increase in average order value for shoppers utilizing BNPL options.
Moreover, customer data collected through BNPL transactions provides insights into customer behavior and trends retailers can leverage further to build brand affinity through highly tailored customer experiences.
Overall, BNPL has proven to be a win-win for all parties involved — offering consumers affordability and flexibility while providing brands with a powerful tool to drive sales and enhance the shopping experience.
WWD: Do you expect consumers to pull back on spending this season?
M.S.: All signs are pointing toward an increase in holiday spending this year over last — especially in the e-commerce sector, where sales are expected to jump between 7 and 9 percent year-over-year, according to a recent report released by the National Retail Federation. While this expected increase comes at a slower pace than in peak pandemic years, such as in 2021, which experienced an increase of 12.7 percent, the expected 3 to 4 percent increase for 2023 is in line with pre-pandemic levels, which hovered around 3.6 percent.
WWD: How does BigCommerce help drive conversions for brands and retailers?
M.S.: BigCommerce is committed to driving an industry-leading checkout conversion rate for brands. According to an independent study, in the third quarter of 2023, sitewide checkout conversion for enterprise customers using BigCommerce’s native checkout and flagship payment processors averaged 61.4 percent, a rate that is substantially higher than competitors.
Several critical factors contribute to the higher conversion, including the composable platform’s frictionless, one-page checkout experience, its wide selection of best-in-breed payment providers, optimal integrations and unmatched customization capabilities for a SaaS platform.
Not to mention, for business-to-business conversion, BigCommerce’s B2B Edition’s Buyer Portal and recently released Invoice Portal streamline the B2B buyer purchasing experience by meeting the needs and expectations of today’s digitally native buyer.
It’s clear that both direct-to-consumer and B2B brands alike seek a straightforward, fast and secure checkout process, making it a vital priority for driving conversions.
