Digital commerce is experiencing a pivotal moment, where a combination of art and science is necessary to differentiate oneself from the competition and motivate a shopper to purchase. That requires brands to embrace a new approach to ‘availability’ powered by data driven insights that fuel creativity, as this article details.
In the current e-commerce landscape, we have seen many significant changes from just a few years ago. Decisions once driven by relationships, are now data-driven. Shelf placement has transitioned from being static to dynamic, backed by algorithms that track the purpose behind every purchase.
In this new shopping environment, the algorithm reigns supreme. According to our agency’s calculations, retailers now demand that the average brand makes over 84 thousand optimizations per week to ensure that their products are discoverable on the digital shelf.
The pandemic resulted in the exponential growth of online shopping, with a further surge in worldwide retail e-commerce sales predicted from approximately $5 trillion to just over $8 trillion by 2026. So, what can brands expect in terms of e-commerce predictions going forward?
Succeeding in digital commerce will require synchronization across the entire value chain, encompassing availability, demand signals, and media. But that’s just part of the equation.
Given the abundance of distractions available with the mere swipe of a finger, capturing consumers' attention has never been more challenging. In this environment, brands are not just competing for share of wallet, but share of mind.
Therefore, how can you grow your brand online in such a competitive landscape? And what will drive that growth: attracting new customers to the category or improving the frequency and basket value of existing customers?
In a previous WARC article, I referenced Byron Sharp's book “How Brands Grow”, in which he highlights the importance of mental and physical availability to brand success. Sharp asserts that brands grow by reaching new customers, so marketers should target as wide an audience as possible and ensure their brands are readily accessible, both mentally and physically, in all purchasing situations - particularly in increasingly competitive spaces like the online realm.
However, one could argue that in the digital landscape, much like shopper marketing, physical availability holds more significance. I classify physical availability in an online sense as the breadth and depth of distribution in time and space. In a brick and mortar world, a brand needs to consider how to maximize its presence and value at the point of sale. The same rules apply to online retail.
To be truly effective, a combination of traditional omnichannel retail strategies and new growth models such as voice, social and visual commerce, including direct-to-consumer (DTC) approaches, is required. The broader and deeper the distribution, the better.
Heinz in the UK provides a compelling case study of a brand which has all its digital bases covered. Heinz has a great presence on leading UK grocery sites like Tesco and Sainsbury’s, as well as its own store on Amazon.co.uk (with everything from essentials to gift packs with merchandise).
It also has its own successful direct channel to market through, “Heinz to Home,” a site that started during Covid to service customers who were either reluctant to visit physical stores or were finding it difficult to get online supermarket delivery slots. These days, it’s not just a sales vehicle, but a site for New Product Development (NPD) and PR. Heinz also uses social channels to spectacular effect, announcing new products, pitching recipes, and teasing possible collaborations, such as tie-ins with the recent Barbie movie (“classic BarbieCue and KenChup”). Wherever you look online, Heinz is there.
Just “being there for the shopper”, however, along with functional and operational success, is necessary but insufficient. With commerce and media continuously converging in digitally driven environments in which attention spans are shorter than those of goldfish, one critical factor is necessary in helping brands and their distinctive assets stand out from shelf - whether physical, digital, or connected.
And that’s creativity.
The power of creativity becomes even more important as the drive towards AI-powered predictive analytics continues. The battleground has shifted to the clouds, where preference and shopper motivation are recalibrated using “clean rooms” to access commercial and consumer data and insights for better business understanding and more targeted advertising. The accessibility and growth of generative AI will also have a major impact.
My viewpoint, expressed with WARC, is that we need to expand the concept of brand growth from mental and physical availability to encompass digital availability. I see “digital availability” as a combination of mental and physical availability within the digital space. Digital availability must capitalize on not only the functional aspects that help brands stand out (strong digital and retail media presence, great CX), but also the emotional features of a brand (its distinctive assets and how it engages).
Let me illustrate both points with the following case studies.
On a functional level, one of Colgate’s primary retailers is Amazon. By leveraging both search and Amazon display (Amazon Demand side platform), the brand targets new brand customers to purchase and then repurchase Colgate. WPP worked with Colgate to focus efforts on a central strategic performance framework which supported Colgate’s overall objectives and could be successfully localised market by market. Return on Ad Spend (ROAS) nearly quadrupled year over year and Click-Through-Rate (CTR) went up double the category benchmark. By leveraging a data driven, insight led approach the brand understood the purpose behind the purchase and recalibrated its approach with a combination of brilliant retail basics as well as imaginative creative and ad serving to convert shoppers.
Beyond the functional to the emotional, Mondelez was focused on winning Back-to-School (BTS) in 2022. The objective was to make Oreo cookies relevant to families who were stocking up on non-food BTS supplies.
VMLY&R Commerce research showed that clothing brands were already using “Oreo” as a shorthand way to describe the most popular colorway in the shoe world – black and white. So, we hijacked popular culture and developed a two-for-one Oreo coupon offer, activated using Augmented Reality (AR) by scanning any pair of black and white shoes, to be redeemed in store at Target. The promotion had its own smart-scan microsite – Oreo StufScan – and was featured on social media (TikTok and Instagram) and through Target retail media (Roundel and Circle), as well as scannable out-of-home billboards.
Oreo StufScan delivered a great customer experience, which was “distinctively Oreo” in the way the brand was represented and engaged BTS shoppers with an exceptionally strong digital and retail media presence. Sales increased 16% year-on-year and conversion rates (scans vs redemption) hit 85%.
As Heinz, Colgate and Oreo demonstrate in their own ways, maximizing the breadth and depth of distribution in time and space online remains paramount. However, creativity is the core ingredient that helps brands stand out, regardless of the shelf - be it physical, digital, or connected. That’s why it’s time for the industry to galvanize around “Creative Commerce”.
At VMLY&R, we have recently launched Commerce-as-a-Service (CaaS), an insight led, data driven offering aimed at harmonizing the functional and operational elements required to fuel growth. That’s key to synchronizing audience signals across the digital shelf, but so is building the emotional connection brands need to engage shoppers.
As often cited by WARC, after brand size, creativity is the most critical component of marketing effectiveness. In the world of commerce, it’s the magical intersection of making a brand both discoverable and attention-grabbing. As we begin to infuse creativity across online channels, digital availability becomes the key to success.
- Gemma Spence is VP of Commerce Transformation at VMLY&R Commerce
Originally published in WARC
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