Connect DIGITAL, a two-day International Housewares Association virtual event exploring digital and e-commerce strategy, concluded Wednesday with sessions on content optimization; micro fulfillment; global marketplace expansion; and a direct-to-consumer holiday forecast.
Connect DIGITAL was moderated by Aaron Conant, co-founder and managing director of BWG Connect. BWG Connect is a networking and knowledge-sharing group used by brands to advance digital business knowledge base and collaborate on partner selection. Read the Connect DIGITAL Day One Report.
The New Demands of the Digital Consumer and How to Minimize Spend and Maximize Performance
Cynthia Maller, head of CGI, Walmart, Art.com and Hayneedle; Alex de Vigan, CEO, Nfinite; and Adam Colasanto, director of consumer insights, Vizit
Brands must understand and measure visual content to stand out from the ocean of products on the digital shelf, panelists agreed.
“Humans process images 60,000 times faster than text. Grab attention in a second with the right image in front of the right person,” Colasanto noted.
“Covid sparked a revolution in visual content development and analysis,” de Vigan added, pointing to research revealing 83% of buyers say product image is the most influential factor in purchase decisions.
“Customized visual content based on the right data for each audience boosts sales by 100% and increases average cart value (ACV) by 30%,” de Vigan added.
An asset database of computer-generated images (CGI) can be infinitely customized. Maller explained the importance of educating clients on the value of new technology to encourage adoption. “Some people may think CGI is for Hollywood dragons and avatars, but we use it to sell everyday products,” Maller said.
Key considerations during the session:
- One size does not fit all. Customize visual content for each target audience.
- Products in all categories— including housewares, beauty, CPG — benefit from digital visual merchandising and analytics.
- Brands should own content quality and not outsource image creation to influencers.
- Brands must make proactive decisions on image creation and selection.
- Real-time analysis measures reactions to subtle changes in image placement and detail.
- Consumers trust images, not reviews.
Exponential growth in photorealistic content development will sharpen competition, and a tsunami of immersive commerce is coming, panelists agreed in advising brands and retailers to prepare for the next wave of content innovation to reach their consumers.
New Era of Fulfillment: Why Drop Shipping and a Digital Age 3PL is Now Table Stakes
Corey Apirian, CEO, Davinci Micro Fulfillment.
Apirian, among the pioneers some 15 years ago of creating drop-ship operations for key housewares brands, said micro fulfillment is the next wave of logistics for brands seeking the agility and proximity to fulfill online orders quickly and efficiently.
What is micro fulfillment? Apirian describes it as a network of miniature, hyper-local fulfillment centers (MFCs) close to urban centers from which consumers can receive online orders in two days or less. Davinci, for example, has five MFCs (in northern California, Denver, Dallas, northern Kentucky and Central, NJ) capable of 100% fulfillment via two-day ground; 70% one-day fulfillment; and same-day delivery within 95 miles. Apirian said he expects Davinci to double its number of MFCs by sometime next year.
He said micro fulfillment solves the primary, 1-to-2-day consumer online buying need. “When you have such agility and proximity, you have a hand in the consumer experience,” Apirian said.
The availability and integration of comprehensive consumer shopping activity data drives decisions about what and where to place inventory in a micro fulfillment network, Apirian noted.
“Brands can pull levers” for real-time adjustments of mix and location as needed, he said, adding the goal of micro fulfillment is not long-term product warehousing but constant throughput.
Advocating an “Amazon and” theory, Apirian said micro fulfillment can support the growth of “Fulfilled by Merchant” Amazon programs while enabling diversification of e-commerce drop-ship opportunities across the full eco-system of online sales channels. He cautioned brands to mitigate potential dilution of online their distribution and brand message by allotting sufficient inventory availability for each online channel without duplicating assortments.
Beyond Amazon: Reviewing the Opportunity of Marketplaces Outside of Amazon and the Tools to Maximize the Potential
Chad Epling, found & CEO, Mamenta
Epling laid out recommendations for how brands can expand their global e-commerce presence effectively and efficiently.
Mamenta is a data exchange network that connects brands and more than 250 online marketplaces across the globe. The company effectively serves as a gateway for optimizing online cataloging, pricing, ordering, messaging and fulfillment optimized to the preferences and requirements of each global channel and online marketplace.
Epling cited the importance of determining relevant products by region and cultivating the appropriate product and brand scope in each region based on consumer buying patterns.
Brands are best served on global marketplaces by the creation of their own official stores featuring localized website design and copy for an authentic “local experience”
The process of such e-commerce globalization starts, Epling said, with making inventory available in targeted markets through any combination of brand-owned warehouses; distributor-owned warehouses; fulfilled-by-Mamenta warehouse affiliates; and fulfilled-by-marketplace warehouse networks. Technology enables programs to scale effectively in each region and on each marketplace, he added.
Despite the importance of programs and operations tailored to specific regions, Epling said practices that work well in the U.S. apply around the world, including an emphasis on high-caliber content, product review optimization and targeted advertising.
DTC Data and Holiday Predictions for the Housewares Industry
Udayan Bose, founder & CEO of NetElixir
With Q4 and the holiday season just around the corner, data, sales metrics and shopper behavior insights are increasingly important, Bose said.
The pandemic has changed the consumer, Bose said, and three new online shoppers have emerged: The frugal consumer focusing on needs rather than wants; the socially conscious consumer spending money on brands that align with their core values; and the new-to-online shopper that emerged due to the circumstances of the pandemic.
Citing data compiled by NetElixir, Bose noted several online shopping trends that emerged during the pandemic:
- Purchases were quicker and more intentional.
- The average order value went down initially but then back up during the holidays.
- Mobile phones drove more visits and purchases to websites.
- Amazon dominated with an estimated 68% of all product searches.
- E-commerce channel advertising is growing rapidly.
- Primary channels including Google, Microsoft Advertising and Facebook are applying AI to help marketers target and engage customers.
2021 Holiday E-Commerce Forecast
Bose suggests slower than usual e-commerce sales growth of 6% year-over-year this holiday season. He said sales gains will be driven by new-to-online shoppers, an earlier-than-normal start to holiday shopping and an increase in online shopping because of the Delta variant. Two negative factors, Bose added, are ongoing supply chain challenges and a drop in consumer confidence.
To drive growth, brands must know their high-value customers. With better customer insights, brands can use more effective targeting, waste fewer ad dollars and achieve better ROIs, Bose said.