As more consumers shop online, many companies are pivoting their marketing strategies to focus on digital channels. But smart marketing now requires more than simply reallocating resources for e-commerce. Messages that worked last year may strike the wrong tone with consumers who are navigating health, social and economic uncertainty now.
To add to the challenges, consumers' customer experience expectations are rising for online shopping. At the same time, changing consumer behavior is confusing fraud-control algorithms, which increases the risk that customers will have a bad experience at checkout. And in many cases, digital experiences are the only way for brands to interact with their customers.
Clearly, the stakes are higher than ever for getting digital customer touchpoints right. To create effective messages and ensure a successful shopping experience, the key is to put people – your customers – first.
A rapid shift to digital marketing
Many small U.S. businesses are adapting quickly to the new market conditions. A June study by Viamedia of small businesses and local agencies nationwide found that 83% had changed their marketing in response to the pandemic, while 46% were offering promotions and incentives to drive revenue.
Overall, marketing budgets have increased to a record high during the pandemic as brands have sought to build awareness, empathize with consumers and retain customers. Marketing spend as a percentage of U.S. companies' budgets rose to 12.6% in May from 11.3% in January, according to a CMO survey from Duke University. Marketing spend as a percentage of company revenue increased to 11.4% percent in May, up from 8.6% in January.
These numbers are the highest since Duke began the survey in 2008, which suggests two things. One, marketing has become more important than ever. Two, companies want to protect their competitive position by being proactive with their marketing. As consumers turned digital, so, too, did marketing strategies, and a heavy share of the average marketing budget is now allocated to social media. Respondents said that 23.2% of their marketing budget was spent on social in May, almost double the 13.3% spent in January.
For all of this increased investment in marketing to pay off, brands need to ensure that their messaging is right. And after this updated messaging brings customers to their store, merchants must work to avoid accidentally rejecting their orders as fraud – an experience that can drive shoppers away for good.
Messaging is part of the customer experience
Trust and empathy always matter in marketing, but that's even more true now, as shoppers seek out the things they need to keep their households running, protect their health and avoid a fresh wave of e-commerce scams.
In a report from Edelman based on surveys of more than 12,000 people from a dozen countries in the Americas, Europe, Africa and Asia:
- 71% said that if they think a brand is putting profit over people now, they'll lose trust in that brand forever.
- 77% said they only want brands to talk about their products in a way that shows they are aware of the crisis and its impact on people's lives.
Again, the key to effective B2C marketing now is centering your customers, and that means meeting them where they are now: spending a lot of time at home or working outside the home under stressful conditions. As you update your marketing, consider:
- Your presence: Customers expect a seamless experience across all channels and platforms, so make sure the updated messaging on your site extends to your social, email and other channels. Review all the content in your marketing pipeline to make upcoming pieces align with your store's new messaging.
- Your language and visuals: Does your store feature images of big groups of people? Do you present products as perfect for parties, cruises or back to school? These elements need to be updated to show your customers that you're tuned into their reality.
- Your values: Does your brand have a special commitment to a cause? Share that in your marketing. People are looking for meaningful interactions with brands now, and shopping with a merchant who supports a cause they like is one way to do that.
- Your offers and promotions: The Edelman report's respondents said that offering discounts, free trials, free delivery, and other perks to help customers save money can communicate empathy and help create a stronger bond with your customers.
Accurate order screening is a key CX element, too
When your messaging consistently communicates empathy and trustworthiness, new customers are more likely to visit your site. If your messaging there is consistent as well, they're more likely to buy. But what happens during checkout can determine whether the money you've spent to acquire those new customers will pay off or be wasted.
Here's why. Most e-commerce merchants know that most shoppers never get all the way through the checkout process. About 75% of online shopping carts are ditched before payment, year after year. So, a customer who gets all the way through checkout is motivated to buy from you. They're also demonstrating trust in your site. If their order is approved and they receive their merchandise quickly, they'll be satisfied and likely to return, raising the return on your marketing investment.
However, many merchants' automated fraud-screening programs catch some good orders in their filters. How often does this happen? According to our data, as many as 65% of automatically rejected orders are actually good. When good customers' orders are rejected, 33% say they won't shop with that merchant again, according to a March 2020 survey of U.S. online shoppers by Sapio Research. That means the money spent on acquiring them was wasted. And 25% say they're likely to post something negative on social media about the merchant after a false decline, which can make it harder and more expensive to acquire new customers.
To avoid this scenario, keep good customers, and see a higher ROI on marketing spend, merchants have to increase the number of good orders that are approved and reduce the number that are mistaken for fraud. And this is where consumers' new shopping habits complicate things.
A typical e-commerce fraud-screening system may be set up to flag orders concerning the following characteristics that could indicate fraud:
- Brand-new customers with no online shopping history
- Past customers made on unfamiliar devices
- Known customers shipping to unfamiliar locations
- Customers who are suddenly buying in bulk
- Customers who’ve made multiple online purchases in a short time
The problem is that with so many customers bulk-buying household items, doing lots of shopping online, staying with friends or family, and perhaps even using their devices to place orders, many good orders now look like possible fraud.
Flagging suspicious orders isn't the real problem, however. That happens when the fraud-screening system automatically rejects those flagged orders. Good orders get tossed out with the fraud attempts, and merchants lose revenue, customers and marketing spend.
The alternative is to add a manual review of flagged orders by human analysts, either in-house or through a third-party service. This review allows merchants to approve more good orders while still stopping fraud. And if the results of each review are fed into the fraud-screening system's AI, the system can get better at distinguishing fraud from pandemic-era good orders.
Every rejected good order is a waste of the customer's time and goodwill as well as the merchant's marketing investment. Every good order creates another positive customer experience, a process that starts with marketing with empathy and ends with recognizing good customers for who they are. For marketing to be truly effective in a time of intense e-commerce competition, the customer experience needs to be excellent from the first touch point through every purchase.