The Impact of Ecommerce on Retail Brand Strategy For Future Growth


Consumer confidence has been harmed by rising inflation, rising interest rates, a potential bankruptcy, and the possibility of an economic slowdown. All these factors have stifled retail sales as government continues to implement measures such as Consumer Voucher Scheme in Hong Kong or CDC Vouchers Scheme in Singapore to stimulate the economy. Ecommerce businesses, which benefited from the pandemic in 2020, are also feeling the heat.

At the peak of ecommerce business, many companies were expanding aggressively from food delivery, grocery shopping, online classes and more. However, consumers are also slowly returning back to pre-pandemic norm. Hence, the massive layoffs came when many of these companies suffer major losses.

Shopify is the newest tech firm to layoff 10 percent of its 10,000 workforce in July 2022. According to the tracker, tech firms have laid off more than 62,000 employees so far. On the news, Shopify’s shares fell 17 percent in early trading. They are now about 83 percent below their 52-week average. Tobias Lütke, Shopify’s chief executive, wrote in a memo to employees that ecommerce adoption is still higher than it was pre pandemic, but the increase seen during stay at home orders is over, bringing the growth rate back to its previous high rate of the past 20 years. The apprehension was that the surge would hit a new high. Consumers have mostly returned to brick and mortar stores rather than continuing to buy some items online, as has been the case.

Retail brands need to recognise the new role they play by adopting Online-Merge-Offline (OMO) business strategy. The digital consumer generation expects to shop anywhere, at any time on foot or mobile devices. They are savvy to search for the best deals and expect instant gratification for their purchase from multiple delivery options. This presents an omni-channel retail opportunity for brands to adopt OMO business model. A model where online and offline integrates to provide personalised shopping experience through omnichannel touchpoints. However, the first challenge for an OMO strategy is to gain full understanding of your customers’ interactions and preferences; and that is impossible if your customer, order, inventory and campaign data are stored in separate systems.

Key Elements of an OMO Framework

1. Centralised master data – a robust data management platform will eliminate the challenge of connecting data silos from different systems to create a single customer view. Typically, data integration across systems can be done via sFTP or APIs. The focus is to consolidate and map all current and past customer profile, transactions and interactions from different sources.

2. Loyalty management – the role of a loyalty engine is more than just managing tiers and points. With OMO strategy, loyalty system needs to effectively support multi-tier and points calculation, earn rules, manage rewards redemption, create loyalty campaigns and more.

3. Headless commerce – one of the recent trends of ecommerce strategy has been the adoption of headless commerce architecture. Simply put, XGATE uses one codebase deployment for progressive web app, native app, online shop, member portal etc for ecommerce solution. Apart from the usual functions of an online shop, XGATE ecommerce solution has a built-in OMS to connect warehousing and shops for order fulfilment.

4. Retail clientelling – there has been an increased in the number of touchpoints (such as websites, apps, chatbots, email, phone and in-store) for interactions between customers and brands. However, the adoption of clientelling has provided a highly personalised retail experience that has been widely adopted by brands.

5. Marketing automation – with all the data in a single environment, marketers can create customer segments to launch CRM lifecycle programs (eg. retargeting, win-back campaigns) with personalised customer journey — discovery, research, purchase, support, customer service, returns; and building an ongoing relationship. XGATE marketing automation platform uses that data to automatically generate marketing content, recommend products, provide customer service, manage inventory and handle other related activities — all in real-time.

The future growth strategy for retail is to integrate online and offline touchpoints to create greater value for consumers and deliver exceptional customer experience. Planning and assembling the right stack of marketing technology platforms – CRM, loyalty, ecommerce, retail clienteling, marketing automation, BI & analytics – for your business are critical to build a long-term OMO transformation strategy. Afterall, the key point is for you to understand your customers’ intent so deeply that you can meet and exceed their expectations; and ultimately convert them to become your loyal customers.

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