• Ken Serdons, Chief Commerce Officer at Mollie


• 26.05.2023 06:15 am
#eCommerce

2022 introduced many challenges to the retail industry, whether that was labour shortages or supply chain issues created by geopolitical turmoil. This year, those challenges will persist, mainly driven by the economic downturn across Europe. Inflation is at its highest in nearly 40 years, which will result in reduced consumer spending across the board. This is especially the case for discretionary spending, significantly impacting sectors like fashion. 

While almost every industry is faced with economic uncertainty, online retailers, particularly SMEs, need to enact strategies that will optimise their potential and support them through turbulence. 

In order to survive and thrive, retailers need to adopt a growth mindset, grow with your consumer, and of course, find the right enabling partners.

Adopt a growth mindset

Use these leaner times to assess what’s really working and what isn’t in your business. Adopting a growth mindset - being more open to taking on challenges, learning from your successes and failures, and improving everything you do - is crucial. Businesses that adopt a growth mindset make more money, are more likely to reach international markets, and are more resilient. Operationalise learning across your organisation, and execute and test activities quickly to see what works and what doesn’t. The flexibility that a growth mindset allows will ensure that you’re successful no matter what comes your way.

An important part of adopting and successfully implementing a growth mindset is the people aspect. Talking to the people that matter - customers, colleagues, partners, other business owners - is the secret ingredient that really makes it all work. When you have tough, resilient, and flexible people, your business is tougher, more resilient, more flexible.

Grow with your consumer

With e-commerce companies having to fight for every sale and put a big focus on optimisation, being agile has never been more important. Online retailers will need to perfect the checkout experience and make sure they can meet the growing expectations of consumers for quick and easy payment methods, fast delivery, and free returns.

In a ‘post-pandemic’ world, e-commerce is evolving quickly. Across Europe, consumer needs, wants, dislikes, and ultimately behaviours vary. For example, UK consumers are the most likely to scale back online spending if the economic situation worsens in the coming year; Dutch consumers are more likely to go directly to a retailer’s online store. It’s important to be able to pivot between markets, such as offering local payment methods. But there are plenty of things consumers across the board care about that you can perfect to meet all of their needs.For example, 87% of European consumers say it’s important that retailers offer their favourite payment methods when they’re shopping online. Merchants need to strongly consider working with a payment service provider that will enable their e-commerce customers to accept local payment methods and offer transparent, flexible fees and sterling settlements. If businesses don’t offer a variety of local payment methods, it leaves significant amounts of revenue on the table and lowers checkout conversion rates. 

Checkout conversion has never been more important and is a key metric to measure the success of online businesses. Many e-commerce retailers wonder why potential customers abandon their cart in the middle of a checkout. Apart from a lack of payment options, there are several other reasons this happens such as not being able to save a shopping cart between sessions, not having a proper online storefront optimised for mobile devices, and technical problems including errors when redirecting customers to the payment provider. Having an on-brand checkout page inspires trust and drives conversion.

Find the right partners

In order to deliver on consumer needs, you need to be able to offer the right solutions. That’s why it’s so important to have the right partnerships in place to drive success. Work with companies that offer best-in-class solutions, integrate seamlessly with your other tech, and give you flexible terms including no lock-in and transparent fees. These tougher times have created more agility in e-commerce, so while in the past having all those USPs in one might have seemed too good to be true, as tech advances this is what every good partner should offer your business.

SMEs are often hit harder when it comes to the challenges of financing as well, and traditional loans can be difficult to secure, let alone time-consuming and saddled with high-interest rates. As the industry grows, there are new lenders entering the market offering fast and flexible financing to help support SMEs get the funds they need to drive growth, expand internationally, or just get through a tough time. It may benefit those businesses who are either struggling to make it through or who simply need a little jumpstart to explore those new opportunities as well.

However, just as the retail landscape is changing, so too is the industry’s investment in new tech. For those navigating the ongoing economic turbulence, headless and composable technologies - which are attracting new adopters daily - could be the answer. Headless’s API-first architecture grants e-commerce retailers full scalability and unlimited growth potential, making it an especially attractive choice for those who operate in multiple markets, across multiple channels, and across different currencies.

Resilience is key

A changing marketplace, with shifting consumer needs, is a tough place to navigate for retailers who are just seeing the dust settle on their post-covid adaptation plans. But there’s plenty that e-commerce businesses can do to see themselves and their customers through the eye of the storm - perfecting a growth mindset, growing with those changing customer needs, and doing it all with the support of the best partners is how online retailers can persevere and thrive.