Site design shakeups are helping retail brands increase conversion, decrease return rates, and build lasting, fruitful relationships with their most loyal customers.
When’s the last time you updated your website?
While the rise of omnichannel retail has led countless brands to invest in in-person real estate and social commerce has driven investments in social media, some founders contend that retailers should focus on sharpening their own websites to increase conversion, customer loyalty, and lifetime customer value. “Platforms will come and go. What is consistent is your own channel,” says Janvi Shah, co-founder and CEO of the Boston-based e-commerce company Hue. “Even if a customer isn’t checking out from your own website, so many are doing a high level of research before they decide to purchase–so the halo effect of you investing in your own platform will spread to all the different channels you’re in.”
Innovations in artificial intelligence and site design present new opportunities for retailers to better connect with their audiences–and drive long-term benefits. Here are five ways B2B businesses are transforming e-commerce.
Improved product information
For beauty brands looking to increase conversion, Hue proposes a solution that isn’t new–user-generated content–but with a more seamless implementation. The company enables clients to embed video reviews of customers onto their website landing pages, product pages, and social media platforms to drive sales and increase engagement. Clients are also welcome to use Hue-sourced UGC in paid advertisements.
Hue handles the technology required for web integration, as well as video sourcing. The company manages a community of about 2,000 content creators who originate honest testing-and-review videos for Hue’s clients in exchange for free products. Video reviews are key to boosting customer engagement, says Shah, 30: On average, clients see a 127 percent lift in time spent on-site after integrating Hue. “What we see with video is that it’s a lot harder to fake,” Shah says. “People have a lot of scepticism about written reviews. And if someone is speaking to the camera and showing their skin, that’s not easy to Photoshop.”
New York City-based Surratt Beauty, a Hue client, embeds the company’s UGC on product pages for its foundation. Evadney Petgrave, e-commerce and digital marketing director for the company, says that that platform is user-friendly and has helped Surratt to replicate the in-store, shade-matching experience digitally. On average, Hue has seen sales on product pages with its embedded UGC increase by 23 percent. The company, which currently partners with more than 20 beauty brands and retailers, expects to triple its revenue in the next 12 months.
Smarter search functionality
Getting the right product in front of the right customer is a huge hurdle for retail businesses–even when customers have already made it to their site. That has driven Lily AI, a Mountain View, California-based startup, to make the search bar more human. “There’s language I have in my mind when I look for products, but that’s not the same language [a brand uses] when they’re sold to me,” says co-founder and CEO Purva Gupta, 35. “Let’s say a brand describes a product as ‘midnight French terry activewear’–a consumer is going to call it ‘blue sweatshirt.'” The issue, Gupta says, is that for many retailers, the merchandising process is incredibly manual, typically requiring junior-level merchants to attribute three to four attributes per product.
Lily AI aims to solve the problem with image recognition technology that uses artificial intelligence to attribute more accurate, customer-centric keywords to products, at scale. The technology can also accommodate customer searches that may be more subjective or nebulous–such as trends like quiet luxury or cottagecore. Gupta says that Lily AI helped clients–which include Bloomingdale’s and Macy’s–increase site conversion, as well as average revenue per consumer. One Lily AI client, ThredUp, attributed a 15 percent lift in sell-through rate to Lily AI’s enhanced product attribution.
Better personalization
New York City-based Psykhe AI envisions a world in which e-commerce sites cater directly to individual customers, serving them the products it knows they’ll most respond to. The company, which is currently in pilot testing with plans to launch in September, uses A.I. to merchandise category pages to unique visitors. By seeing which products a visitor engages with, it gathers information about their user preferences and serves them products that are likely to align with those preferences. For example, a shopper who interacts with classic, bright floral dresses that cost $100 or less isn’t likely to be served a more avante-garde, structural leather garment priced at $800. The platform–which is designed to work for both fashion and home décor brands–is trained on a data set that draws connections between personality traits such as neuroticism and agreeableness, style preferences, and three million aggregated products. The company has raised more than $3 million in funding.
Founder and CEO Anabel Maldonado, 37, who has a background in both fashion and psychology, says that the product is targeted toward large, multibrand retailers looking to improve discoverability. “It’s like a salesperson who sees you looking at something and from that is able to understand your aesthetic ecosystem,” Maldonado says. Pilot testing has shown a 5x increase in conversion rate, an 8x increase in dwell time, and a 25 percent decrease in return rates.
More engaging digital interfaces
While retail brands are increasingly investing in their in-person strategies, Neha Singh, founder of the New York City-based tech company Obsess, contends that it’s well worth elevating their online presence, too. Working with clients like Coach, Mattel, and Crocs, Obsess designs interactive virtual storefronts that operate on both mobile devices and browsers. “It’s really about engagement and brand-building,” Singh says. “It typically takes seven to eight touch points for a customer to make a purchase decision. Now you’re making one of those touch points much deeper or more memorable.”
Because virtual storefronts increase time spent on a retail brand’s site and customer engagement, they can also lead brands to secure new sources of first-party data. “We have a lot of capabilities in our platform around gamification and quizzes that enable brands to ask questions in a way that’s baked into the flow of the experience,” Singh says. “And what we see is that people are much more likely to answer questions in our gamified environment versus if you just put a pop-up on a regular ecommerce site.” That has an impact on a brand’s long-term success, as it can provide learnings on customer preferences. Obsess declined to share revenue, but Singh says the company has grown more than 100 percent year-over-year for the past three years.
Targeted conversion tactics
The best opportunity to upsell a customer is when they’re already likely to make a purchase, says Elizabeth Buchanan, chief commercial officer of the New York City-based ecommerce company Rokt. That’s why Rokt enables retail businesses to promote offers–for both their own brand (like membership programs and store credit cards) or other brands (for which they’d earn revenue based on customer engagement)–through the checkout process and on order confirmation pages. The key, Buchanan says, is the ability to use A.I. to promote offers that are relevant.
“If you think about a barista that remembers your order when you approach the counter–we try to achieve that same kind of seamless and relevant experience throughout the checkout flow,” she says. Relevancy has become paramount for brands to pull off upselling without alienating customers–to the point that, if Rokt’s A.I. determines that an offer will increase the risk of cart abandonment, it won’t present an offer to the customer, Buchanan adds. Especially as increased privacy restrictions have limited the ability of brands to track customers via cookies, the enhanced ability for companies to increase lifetime customer value through A.I. targeting can prove highly beneficial. One Rokt client, Panda Express, had a 7.8 percent positive engagement rate with post-purchase offers, which the company says increased revenue and customer loyalty. Rokt has a valuation of $2.4 billion and in the past financial year grew more than 45 percent.
Feature Image Credit: An Obsess interactive virtual storefront for the brand Laneige. Photo: Courtesy Company
