How long has it been since your last online purchase? If you’re like most people, the answer ranges from minutes to hours. If you have a smartphone, you know that any moment can be a consumer moment. If you have any digital subscriptions, you might be buying something right now. These days, you can buy things anytime, anywhere, with a click, without a click and without even being present. It’s been a quick evolution, but ecommerce has evolved from an alternative way to shop to a reflexive part of consumer behavior.
Just as quickly as the internet influenced consumer behavior, consumer behavior is now driving ecommerce.
Retailers are racing to control the consumer journey all the way from awareness and education to purchase and loyalty. If you want a glimpse into the future of ecommerce, it’s right here in the race to win consumer attention and keep it. The future of ecommerce is in the omnichannel experience.
The Importance of eCommerce Strategy
Our advice to home improvement brands is simple: If you want to be part of the future, develop a comprehensive omnichannel strategy that leans heavily on ecommerce. In our experience, too many brands are still treating ecommerce as a retail stepchild rather than part of their holistic marketing strategy. These brands then get stuck in a cycle of taking two steps forward and one step back and putting in three times the effort. That kind of math is simply unsustainable and unprofitable. In our work with clients, we focus on developing a balanced brand strategy, one that acknowledges that nearly all retail sales start online.
A common mistake that home improvement brands make is to get stuck in revenue. When that happens, we miss the big picture. Remember, the big picture is not just transactions, it’s the whole consumer journey. If you look strictly at revenue, you might believe that ecommerce is big, but retail is colossal. In 2020, online shopping accounted for only 18% of all retail sales worldwide. So, let’s focus on retail, right? Wrong.
Understand the Big Picture
To see the big picture, let’s look at The Home Depot. Our friends in the orange aprons are the fifth largest online retailer with sales of over $13 billion in 2020.Every month, HomeDepot.com receives around 240 million visitors. By our math, that amounts to 8 million views a day. Talk about access to impressions!
What’s interesting here is that despite these massive numbers and rankings, the majority of home improvement shoppers are still choosing to purchase in person. Earlier this year, Craig Menear addressed The Home Depot investors speaking to this very complexity. “Sales leveraging our digital platforms increased approximately 80% versus the third quarter last year, and approximately 60% of online orders were fulfilled through a store,” said Menear.
Let’s break that down. In 2020, The Home Depot’s sales were $132 billion. Roughly 10% of those sales were transacted online at HomeDepot.com, which receives a whopping 8 million visitors a day. Yet, shoppers are still heading to the store to buy or pick up their products. We know that shoppers have adopted digital shopping. As Menear put it, “HomeDepot.com continues to be an engine for growth of our overall business, driving increased traffic online and additional footsteps to our stores.”
Why are people still choosing the store over their front door? In our opinion, it’s because the digital experience isn’t doing an adequate job of establishing consumer confidence. Consumers are doing their shopping and decision-making online then going to the store to validate their purchase. That’s a signal that ecommerce has room to improve.
Own the Consumer Journey
For a long time, the consumer journey was owned by the retailer. For home improvement consumers, that journey looked like this: A homeowner or professional shopping for a cordless drill would go to The Home Depot, Lowe’s, Ace or other retailer to make their purchase. In the store, they could learn about products, compare prices and seek the advice of a trained associate. In this scenario, the retailer owned the experience. Advertising and brand awareness aside, product manufacturers have a pretty passive role in the retail environment. They rely on retail personnel, shelf placement, product assortment, and POP to build awareness and communicate value.
This dynamic has shifted in the modern omnichannel world. Today’s creative manufacturers can influence the consumer journey in ways they never could before. The key pillars of this influence are attention, education and confidence. With the right tools, manufacturers now have a direct line to captivate, persuade and convince consumers. These tools, of course, are video, imagery, ratings and reviews. How you use these tools is the subject of past Porchlight posts, so be sure to check out Essential Tools and Photography Standards for ecommerce to learn how to optimize your creative to develop your online shelf presence, build your brand and secure consumer confidence.
The Online Opportunity
Surprisingly, we’re still seeing too many brands that are slow to adopt an omnichannel strategy, and who still focus much of their budget and effort on selling to stores and succeeding on the shelf. But, consider this comparison: The Home Depot sells approximately 35 thousand SKUs in-store and over 1 million SKUs online. The greatest growth opportunities happen online. We’ve seen this firsthand with our clients.
One client started as an online SKU at HomeDepot.com. We worked closely with this client for well over a year to develop a plan and build a robust ecommerce asset library which fueled social media and supported in-store POP. We designed a path to purchase and built on educational and persuasive touch points. Our client invested in ecommerce, and it paid off. Before long, sales grew. Online ratings and reviews soon placed the product at the top of its category. Our client went from an online SKU to an in-store test and is now sold nationally in-store.
What Happens In-Store Begins Online
The summary is simple: What happens in-store begins online. There’s no longer a line of demarcation between online and retail shopping. To succeed in retail, brands must adopt strategies that also start online. Consumers have learned to blend ecommerce and retail shopping to their advantage. Successful brands mirror this flexibility with omnichannel strategies designed to shorten and straighten the path to purchase. One of the easiest and most overlooked ways to get more out of your omnichannel strategy is by starting where the shoppers are. In our opinion, that’s ecommerce.