Post-Pandemic ANZ Retail Outlook
Introduction: New Imperatives for ANZ Retailer
The experience of lockdowns during COVID-19 has led to a range of changes in general shopping behaviour. Central among them has been a consumer shift to online search, web and mobile transactions, and eCommerce.
Research recently conducted by IAB Australia and Pureprofile has found that marketers will need to shift gears as we move into 2022, to provide satisfying omni-channel shopping experiences that can meet escalating consumer expectations. The Australian Ecommerce Report 2021 also pinpoints local, sustainable, and ethical brands as the biggest winners in the year ahead, particularly for direct-to-consumer brand shoppers.
ShipStation, in conjunction with Inside Retail, have released a new research report, using input from a wide range of Australian retailers. The Making The Difference report identifies four key areas where ANZ retailers can capitalise on customer behaviour to increase sales and satisfaction: peak season, hybrid shopping, returns, and sustainability.
During peak buying periods like the current holiday season, retailers should think about the run up to that peak, and begin implementing the right business strategies and technology partnerships as early as possible.
With consumers using a hybrid mix of shopping channels, every omni-channel retailer should realise that it is quite important to 53% of shoppers, and very important to 36%, that they have a consistent experience irrespective of the channel they are using.
Improving the packaging and ease of online returns and reducing their cost to the consumer can offer significant gains to retailers, in an area that can make or break the customer experience.
With over 62% of younger consumers preferring to shop for sustainable and green products, and 82%of consumers as a whole preferring their parcel packaging material to be recyclable, sustainable practices for retailers and their supply chain partners are essential to success in today’s market.
(Source: Australian Ecommerce Report 2021)
Staying Relevant in the Eyes of the Consumer
At the height of the pandemic, supermarket employees in Australia and New Zealand became essential services workers, providing concerned shoppers with access to critical commodities at a time of great uncertainty. Retailers in general who emerged from this period with a positive profile were those that exhibited empathy and a willingness to give something to the community, thereby earning consumer trust.
Moving forward, an attitude of Corporate Social Responsibility and service above and beyond the core requirements of the retail function will enable organisations to stay relevant in the eyes of consumers who now expect more from the brands with which they engage. The Australian Ecommerce Report 2021 confirms that 56% of direct brand shoppers and 39% of non-direct brand shoppers are more likely to buy from retailers who have behaved well during the pandemic. Brands must now consider how to make a difference to society in a way that rises above their own self-interest.
In a world post-COVID, consumers will also expect retailers to be willing to disrupt, innovate, and be agile. Rapid innovation, timely responses, and inventive solutions to current problems will give retailers the energy and momentum they need to better serve society, and maintain the “never give up” mentality characteristic of Australians and New Zealanders.
Forming Strategic Alliances and Partnerships
The Australian Ecommerce Report 2021 also reveals that while convenience was named by 76% of online shoppers as the biggest driver of online shopping and one that was worth paying a premium for, it is no longer enough for retailers to simply have a presence online. With experience, personalisation, and timely fulfilment top of mind for online consumers, retailers must now continuously review and optimise the entire customer journey, from the research phase through to the delivery of goods, and options for refund or return.
This will require organisations to form strategic relationships with supply chain partners, service providers, and technology firms. These alliances and partnerships must empower retailers to deliver a seamless, consistent, and superior experience to consumers across all channels, and in the face of disruptions and changing circumstances. For example, in the area of supply chain, retailers should be ready to adopt a mix of local and geographically dispersed vendors and service providers, to guarantee business continuity.
Technology for the Future of Retail Operations
While cutting edge technologies like Machine Learning (ML), Artificial Intelligence (AI) and process automation can empower retailers to better handle the intricacies of the personalised and optimised customer journey, the technology stack is only part of the story.
These days, agility is a modern marketing approach that requires a balance of different components (including the technological infrastructure) in order to succeed. Agility requires continuous demand sensing and listening to the consumer, together with quicker operational decision cycles, and greater flexibility across diverse areas, including budgeting, media, and content creation. In this environment, technology architecture must be complemented by enough scale in data to fuel its success, the right use cases to drive results, and the correct approach to enable the organisation’s human element.
How Princess Polly is Using the Power of Social Media and Demographics to Elevate Its Profile
After its foundation in Queensland, Australia in 2005, Princess Polly went online in 2010, in response to the growing shift toward eCommerce sales. The fast-fashion retailer has become hugely popular with Generation Z (Gen Z) females. The brand maintains a unique “no Photoshop” policy for its modelling photography, an extensive range of popular brands, a strong stance on corporate ethics and sustainability, and a fiercely competitive attitude. As part of its sustainability initiative, Princess Polly recently launched Earth Club, a project focusing on equality, the ethical sourcing of materials, sustainable products, and protecting the planet.
In 2018, San Francisco-based A.K.A. Brands acquired 50% of the business, giving Princess Polly a foothold to break into the US market the following year. To expand its reach into this new territory, Princess Polly has put together a 200-strong team spread across Australia and Los Angeles. The brand's public relations division includes an influencer-marketing team, which scouts fresh talent to spread the Princess Polly message by posting about the brand on social media, displaying new styles, and sharing exclusive discount codes.
According to Princess Polly head of performance and marketing Kim Zorn, “We have expanded globally with a team based in the US and local HQ in Los Angeles, built on our customer service experience by offering almost 24/7 support to customers, established a dedicated Social Responsibility department, created our first loyalty programme, and have been recognised as one of the top shopping websites in the US.”
Since the digital shift accelerated by the pandemic, the brand has been capitalising on the rise of social commerce, and the power of its core demographic customer base. Among its major success stories has been the proliferation of “Princess Polly haul” videos across YouTube and TikTok. These streams draw upon Princess Polly’s partnerships with emerging creators who can easily relate to Gen Z.
On TikTok for example, Princess Polly works with micro-influencers (creators having fewer than 100,000 followers on the platform) and mid-tier influencers (those with under 500,000 followers). Due to the mechanics of the TikTok algorithm, these posts can go viral much more easily than on a platform like Instagram. This gives the brand an avenue to reach millions of new customers in a cost-effective manner. Fast feedback from social channels enables Princess Polly to more accurately predict demand.
The brand currently has a TikTok presence of over 240,000 followers, and collaborates with almost 150 active influencers on the platform, who drive engagement with its young audience. Among the small number of high-profile influencers endorsing Princess Polly have been YouTube superstar Emma Chamberlain, and diva songstress Ariana Grande.
Over the past two years, Princess Polly has become an online fashion powerhouse among US teens and Generation Z consumers, becoming the sixth favourite shopping website for the nation’s upper-income teens, according to the latest Piper Sandler Taking Stock With Teens survey.
Looking ahead and beyond the pandemic, Princess Polly’s Kim Zorn observes that: “I expect online retail growth to continue, user experience to become even more important and coherent brand storytelling to come out on top for social commerce. There will also be more personalised marketing and a rise in visual, augmented and mixed reality.”