We are currently going through what is considered in the retail and the e-commerce industry as the ‘golden’ quarter, when all over the globe consumers are preparing for Christmas and are in a spending frenzy.
With Q4 2020 well underway, Prime Day, Black Friday and Cyber Monday are already behind us, leaving just 12.12 (December 12) and Christmas on the horizon. Many sellers and retailers may be scratching their heads about why they may have struggled to hit the sales that they may have been hoping for this year.
As a global marketplace agency, we want to share our insight on what this year has been like from a trading perspective, discuss trends for 2021 and look at how sellers can utilise marketplaces like Amazon in the new year.
Retail has been changing for some time and more and more shoppers are choosing to buy online; the speed of this shift has been accelerated by Covid-19.
Since March 2020, the number of shoppers choosing to buy online has rapidly increased and is now at levels that were only expected to happen by 2024. This is due, in part, to the fact that you can no longer shop on the high street in the same way, but there has also been a fundamental shift in consumer behaviour during the pandemic.
The consequent shift from high street to online has accelerated by three to five years, and in a world where retailers were already struggling to keep pace with digitisation, this poses a big threat to their business – but it can also provide a huge opportunity for those prepared for change.
What’s next for 2021?
In 2021, we believe that the first three to six months will be an uncertain time for consumers and, in turn, for the retailer. As we all face different regional restrictions, and await the roll-out of a vaccine, it is inevitable there will be a knock-on effect on how we shop.
We believe that this continued uncertainty will lead to decreasing consumer confidence, footfall and spend on the high street.
However, this doesn’t mean that people aren’t shopping. The customer who had never shopped online, and never wanted to, has had to rethink during lockdown and has become more comfortable with shopping online.
A common trend across retail forecasts is that the food sector will grow while other sectors will show an average 15% year on year decline over the next few months. For retailers and brands struggling to keep the lights on, this is a real threat, as we are already seeing with the recent collapse of Debenhams and Arcadia Group.
With all the uncertainty, increasing restrictions and downward high street forecasts, retailers and the brands that sell through the pandemic and continue into 2021 need to rapidly adopt an online strategy to offset these challenges and face a new, uncertain world from a stronger position.
How can you be ready?
As a global marketplace agency, one of our best pieces of advice for sellers is to be present across as many sales channels as possible. We are starting to see a shift towards this with some clients already. We believe we are starting to see “Omnichannel 2.0” and a big shift from what Omnichannel was traditionally “many of your own sales channels” to simply “many sales channels”.
The big step change here is that brands need to be able to sell on Amazon, eBay and other marketplaces. Brands are now having to seek other sales opportunities and the biggest of these that they can maximise at the moment is Amazon.
With a desire to go D2C, but typically without the in-house knowledge of how to do so effectively, brands see Amazon (and other marketplaces) as the next best thing. We have onboarded four times more brands onto Amazon in the last three months than we have in the whole of the previous year. Brands that would never have sold on Amazon a year ago, now have it as priority Number 1 in their e-commerce strategy for the year ahead.
It will become more common for brands to sell in channels owned by others, as well as channels owned by themselves, to help make up for the lost ground with the reduction of high street spending.
To find out how Venture Forge can help your business achieve significant growth during key trading periods and in 2021, contact us at [email protected], through our website, or call us on 01422728435.