This is a guest post from the Linnworks team.
Takeaways from Linn Academy 2021 Keynote with Linnworks CEO Callum Campbell
We’re living in the middle of the effortless economy, and convenience is king.
The retailers who come out on top are the ones who understand their customers (including how they discover and buy products) and set up their back-office operations to facilitate convenience for the best customer experience.
Since the COVID-19 pandemic, changes have occurred at an unprecedented pace. Brands have had to rewire their operations over the last 18 months while operating at full capacity, with no idea of what was around the corner.
While some of the initial chaos has subsided, the greater commerce acceleration is still settling in. The decisions businesses make in the next 12 months will determine how successful they’ll be over the next decade.
In this article, we’re taking a closer look at some of the biggest shifts we’re seeing.
The great commerce acceleration is here
The eCommerce industry is experiencing a massive change which started as a result of the pandemic and has led to global supply chain challenges of unprecedented levels including skyrocketing container prices, product shortages, and shipping delays. It’s in a watershed moment, which can be unsettling for organizations.
However, it’s in moments like these where the biggest opportunities exist.
Commerce is accelerating on all fronts: the market, the enterprise, and the ecosystem.
1) Market acceleration
The rise of the effortless economy is changing the way consumers (and the market as a whole) access products. Everything revolves around customer experience and convenience.
While you used to have to drive to a brick-and-mortar store, where you could only buy what was in stock there, today, you can browse a nearly endless selection of products on your smart device and have something delivered the same day — often without even visiting more than one website.
This is commerce as you go, and we’re seeing an acceleration of the market in this direction, from Amazon to social commerce.
In fact, in a recent study Linnworks conducted earlier this year, 76% of respondents said convenience was now their top priority when selecting a retailer.
2) Enterprise acceleration
Another shift we’ve observed is the acceleration of the enterprise. In an effort to stay relevant, the enterprise has to transform in response to what’s going on in the market layer. This means a deeper investment into digital channels.
The pandemic and the second-order effects due to global supply chain challenges and new consumer expectations have created a heightened sense of urgency among brands and retailers. They’re moving fast to invest in this new infrastructure so they can stay connected with their customers, remain relevant, and not miss out on revenue opportunities. After all, whoever is closest to the customer wins.
This means investing in two key areas;
This starts by establishing total commerce control, which means having a clear picture of your entire inventory and order management pipeline regardless of which warehouse a product may be housed in, how long it has been in stock, and whether it was sold on your website, Amazon, Walmart, etc. This enables you to provide a more seamless and convenient customer experience.
Brands are now an eCommerce businesses best competitive weapon against generic alternatives and cheaper options. Building a reliable brand means building a loyal customer base, which provides more business resilience. Brands can also earn a higher margin when they cut out the middleman and sell directly to consumers, and they are able to gather more first-party customer data, which reduces customer acquisition costs and makes them less reliant on third-party marketplaces and paid ads.
3) Ecosystem acceleration
The third trend we’ve noticed is the acceleration of the ecosystem in the form of huge investments into the technology and service providers that support the market and enterprise.
This is particularly true when it comes to anything tied to personalization (i.e., first-party data collecting) or reducing friction at checkout. So, we’ve seen an explosion in buy now, pay later payment apps as well as technology designed for multi-channel selling or optimizing product/customer data.
A total commerce approach drives growth
All of these factors converge to what Linnworks coined as Total Commerce. Total Commerce is all about empowering merchants to sell wherever their customers are and giving the business a seamless way to connect orders and inventory in every sales environment.
This means Linnworks Total Commerce is at the center of your business, enabling multi-channel distribution at scale, so that you not only have a single source of truth for inventory, shipping, and order management across all of the channels you sell on but you also have access to more first-party data about your customers.
The greatest stories of the 2020s will belong to those retailers who don’t give in to fear, and instead embrace the changing market, enterprise, and ecosystem dynamics, including:
- Embracing the effortless economy
- Investing in total commerce to provide a seamless customer experience
- Reducing customer acquisition costs with first-party data
- Personalizing the buying experience
- Reducing friction at checkout