An improving economy and stronger consumer sentiments are signaling toward holiday spending galore, with holiday sales in November and December expected to grow 7 percent compared to last year, reaching an astounding $800 billion.
While this growth bears good news for the retail industry, merchants are facing an uphill battle when it comes to converting first-time shoppers into returning customers, especially in light of various web browsers’ anti-tracking measures.
Safari’s Intelligent Tracking Prevention (ITP) and Firefox’s Enhanced Tracking Prevention (ETP) measures are preventing retailers from using third-party cookies to track shoppers. Meanwhile, Google Chrome, the most used desktop browser in the world, plans to phase out third-party cookies by 2023.
At the same time, social media platforms, which do not offer traditional cookie tracking capabilities, have become a major avenue for shoppers to discover new products and make purchases. Retailers’ tried and tested playbook of relying on third-party sources to capture data and tying it back to their customers to drive traffic and engagement has thus been rendered useless.
That means retailers must not only shift their strategy but also think holistically about their end-to-end shopper journey and how they can get the most return on investment. One foundational investment that retailers should consider is simplifying the account registration process as it can help them capture more first-party data that is tied to shoppers’ identities and also remove obstacles from the checkout experience, said Greg Greiner, vice president of product at checkout and shopper network Bolt.
In an interview with Retail Bum, Greiner discussed the key approaches that can help retailers overcome the challenges posed by anti-tracking measures and successfully turn first-time holiday buyers into returning customers.
Averting the cookiepocalypse
A lack of access to third-party data not only means that retailers must start to generate first-party data to better understand their customers, but it also shows that they must think of creative ways to keep them engaged in the long term on their channel of choice.
“That becomes even more important in this world where getting people to the site at all just became a lot harder,” Greiner said.
Encouraging shoppers to create store accounts is a great first step in that direction as it enables retailers to collect necessary data and better target customers. But unfortunately, shoppers are all too often required to go through a cumbersome registration process that involves far too many steps, prompting them to abandon the registration process, especially if it disrupts their social media streams.
This is especially true for holiday season shoppers — many of whom engage with new retailers when searching for gifts with little time to spare during the holiday shopping frenzy. Case in point: Bolt’s research shows that even outside of the holidays, nearly a quarter of shoppers choose to forgo the account creation process because they do not shop with a retailer enough. Meanwhile, another 11 percent say they skip the account creation process because it simply takes too long.
Optimizing the account registration process can help, but unfortunately, getting shoppers to create an account is just half the battle.
“When we talk to a lot of retailers, we see that their challenge is not just getting people to register in the first place, but it’s when they come back, they are not using that account,” Greiner said, adding that none of the marketing and personalization efforts matter then because the data associated with their transaction and their shopping is not being associated back to the shopper’s identity.
Taking an identity-powered approach to conversion
Fortunately, retailers are largely cognizant of the need to act fast in light of the anti-tracking measures and offer an account registration process that seamlessly integrates into the checkout experience. They also realize the need to offer an account registration process that does not burden shoppers with creating yet another online account and having to remember its password.
“The next step that needs to happen is an investment in the identity and accounts experience for the shopper,” Greiner said.
This is where joining a checkout and shopper network that utilizes Single Sign-On Commerce (SSO Commerce) technology can help. It unlocks a one-click checkout experience for shoppers and also enables retailers to collect necessary data. Moreover, it helps them securely deliver the personalization their customers crave and meet shoppers on their channel of choice without sacrificing their branded experience.
According to Bolt, customers that hold network accounts convert at a 75 percent higher rate than guest shoppers. What’s more, these shoppers also spend 41 percent more than others.
Perhaps more importantly, delivering an identity-powered checkout experience can help small retailers level the playing field with larger players like Amazon that are leveraging their database of hundreds of millions of shoppers’ identities to deliver personalized experiences.
“An individual retailer could never compete with that, but by leveraging SSO Commerce, they can basically compete at a level that wouldn’t be possible if they were doing this alone,” Greiner said.
Investing in such solutions can also help retailers better prepare for the anticipated surge in online shopping during the 2021 holiday season. According to a Quantum Metric survey, 81 percent of consumers did more than half of their holiday shopping last year online, and these shoppers plan to purchase the same amount, if not more, online in the months ahead.
It also opens a new door for independent retailers of all sizes to get ahead in the social commerce game. As more and more consumers are discovering new products through social media channels, being able to meet shoppers where they are and offering them seamless one-click checkout right then and there is becoming key to driving conversion and revenue. All that without the need for major technological investments.
Retailers have a massive opportunity to capitalize on another digital-first holiday shopping season and lay the foundation for success in a cookie-less and social commerce world. Those that miss on the opportunity stand to lose business to more prominent players in the space.