Andrea Leigh of Allume Group: 4 Omnichannel Trends That Will Drive Ecommerce
Written by: Satta Sarmah Hightower
“The tension right now for all retailers and brands alike is figuring out: ‘How do we continue to service this divergent shopper and meet all of their needs and meet them where they're at, but do so in a sustainable way?’”— Andrea Leigh, Founder and CEO, Allume Group
The shopper wants what the shopper gets.
That pretty much sums up the current environment in which brands operate. But giving consumers what they want has become increasingly difficult in a fragmented channel and data ecosystem and with rising supply chain, labor, and advertising costs. Brands need to figure out not only how to serve consumers but how to do it profitably.
“The tension right now for all retailers and brands alike is figuring out: ‘How do we continue to service this divergent shopper and meet all of their needs and meet them where they're at, but do so in a sustainable way?’” says Andrea Leigh, founder and CEO of Allume Group, an ecommerce education consultancy.
Allume Group publishes a quarterly report called the “E-Commerce Insider Quarterly” that covers critical shopper, manufacturer, ecommerce, and Amazon trends. Leigh joined a recent episode of the “Unpacking the Digital Shelf” podcast entitled, “Q3 Data Recap,” to share what Allume’s most recent report tells us about the changes brands need to make to deliver a better, more profitable ecommerce experience this year (and beyond).
Here are Leigh’s insights.
4 Omnichannel Trends That Will Reshape Ecommerce
Trend #1: The Role of the Internet Is Changing
Consumers are using the internet differently for online shopping. It’s no longer just a place to conduct transactions, research products, and find information.
“Contrary to what seems logical, shopping online is actually becoming less transactional versus more transactional,” Leigh says. “A bigger role of the internet for consumers is for inspiration.”
Younger audiences, in particular, start their search from a place of curiosity, Allume’s research found. They don’t want to be spoon-fed products and sponsored advertisements.
Leigh says the implication for brands is that storytelling still matters. Rather than focus on getting consumers to the point of activation as quickly as possible, brands need to focus on how they communicate the unique benefits of their products and services.
Trend #2: Consumers Want To Be a Part of the Product Development Journey
Industry research Allume cites in its report makes this argument: “Brands have to make room for the new ‘C’ in their C-suite. Consumers are investing, co-creating, and voting for change alongside brands.”
Some brands are investing in Reddit and other social media channels to gather product feedback from consumers. Wise, an electronics manufacturer, has used Reddit to allow consumers to up or downvote new products it’s considering developing.
Leigh says social media offers brands a new avenue for collaboration (think of it as digital research and development (R&D). They can hear directly from consumers before — not after — they invest millions of dollars in a new product.
Trend #3: Move Over Omnichannel, It’s All About Omnicommerce
If you haven’t heard, it’s no longer about omnichannel. Omnicommerce is now the Holy Grail for brands.
Leigh says the distinction between the two is that omnichannel was focused on bringing physical retail and digital retail together on both the back and front end. Omnichannel was more of an operational play, but omnicommerce is about removing points of friction between brands’ varying offline and online channels.
While the goal is to make moving between these experiences seamless, Leigh says the next evolution of omnicommerce will entail differentiated — complementary — experiences across physical and digital retail.
Sephora is already doing this. Online, shoppers can access the beauty retailer’s robust reviews platform and have the ability to shop by skin type or condition. In-store, consumers can work with a beauty consultant to find the right products. There’s also a mini-aisle filled with product samples, allowing them to pick their own adventure.
“Sephora does a really nice job of this because as a shopper, there are different benefits to shopping in-store versus shopping online, but they both have clear benefits.” — Andrea Leigh, Founder and CEO, Allume Group
Trend #4: Amazon Is Dealing With Its Own Pressures
Allume’s report also does a deep dive into Amazon.
While brands and retailers are feeling the squeeze, so is the ecommerce behemoth. Amazon has had some painful hits to its profit and loss statement (P&L) because of how rapidly it expanded to meet demand during the pandemic. Leigh refers to recent reporting in The Wall Street Journal that also indicates customer satisfaction is declining, going from a high of 88% to 79% in 2022. However, Amazon’s ecommerce business is still growing, albeit at a slower pace.
“What we're starting to see from a theme perspective with Amazon is that they're starting to behave a little more like a grown-up company, versus the startup that we have always expected them to be. We've always expected super-strong growth,” Leigh says, adding that “the whole business is doing really well. They grew 15% last quarter year-on-year. So they're still delivering pretty decent growth, but they're starting to look more like a mature organization.”
Amazon is responding to changing shopper behavior by focusing on short-form, shoppable videos, and influencer marketing. Most of these activations are taking place off-platform because Amazon’s site is so transaction-focused. Leigh says it's all part of the company’s efforts to create “more of an inspired shopping journey.”
How Brands Can Use Omnichannel Trends To Navigate the Ecommerce Landscape
Given changing shopper behavior, ongoing price pressures, and shifts at Amazon, what can brands do to navigate these choppy ecommerce waters? Leigh says there are several ways brands can prepare for what’s next.
First, they need to increase their agility to more effectively respond to changing shopper behavior.
“Brands need to really create space and budget to change course quickly and find ways to gain flexibility,” she says, adding that this could mean flexibility around staffing, running different experiments with retail partners, or trying out new platforms to test product discoverability.
Next, brands need to focus on loyalty marketing to drive repeat business. Shoppers are exposed to more brands than ever before and have so many ways to find new products today. Brand switching also is at an all-time high, especially among price-conscious consumers. To win and keep their business, brands must give shoppers a compelling reason to stay. Offering them a good discount won’t hurt, either.
Leigh says brands also need to strive for profitable growth and find ways to invest in the future, even amid the current market and economic pressures. Some brands are focusing on tier-two ecommerce players to uncover new avenues for growth, while others are expanding their measurement capabilities to strengthen attribution and make more informed investment decisions. To that point, Leigh says brands should still carve out a budget for innovation, even though they may be paring back because of the current economic uncertainty.
“Find opportunities to plant some seeds for the future. Invest in that sustainable packaging that you've put on the back burner during COVID, or in that product development for the product that is really going to resonate with tomorrow's consumer,” she says. “The brands that can still find a budget and time and resources to innovate and invest and plant some seeds for the future are the ones that are going to win.”
To hear more of Leigh’s insights on trends that will reshape ecommerce, listen to the full episode.