Kogan, Shopify and Woolworths capitalise on demand for superior online retail experience

The pandemic has delivered long-lasting change and lessons for retailers, executives from Kogan, Woolworths and Shopify say.

The Covid pandemic has brought with it a seismic shift in consumer behaviour, The Australian’s E-Commerce Summit has heard, with players like Kogan, Shopify and Woolworths capitalising on widespread demand for superior online retail experiences, as well as personalisation.

“Covid has seen a huge transition in behaviour over the last couple of years,” Kogan’s chief financial officer David Shafer told the summit.

“For the first part of Covid we saw a rough doubling of our businesses. Customers came online and basically fitted out all of their home office equipment and their home kitchen equipment, and since then we have seen a transition back to brick and mortar, which is a work in progress.”

The managing director of Woolworths’ digital arm WooliesX, Amanda Bardwell, said the pandemic has meant digital technologies now are a key driver of traffic to the supermarket’s physical stores as well as its online platforms, in a way they weren’t previously.

“One of the things that I think has been really interesting is actually mobile, even despite the fact we’ve had so many people in isolation working from home, seeing the rise of mobile continue during that period has just been really interesting for us,” she said, adding about 80 per cent of Woolworths’ online traffic is now from mobile devices.

Shaun Broughton, the APAC managing director for Canadian e-commerce giant Shopify, said that the rapid rise of QR codes was proof of how quickly new technologies can change the face of e-commerce.

Spending patterns have also changed dramatically, he said, with consumers now also demanding more from the stores they frequent.

“That’s driven a lot by technology, and by also what consumers now are really interested in, like ‘is this brand local?’, or ‘what does your brand stand for?,” he said.

Mr Brought said up to about 80 per cent of people pulled through Shopify’s surveys are concerned about the environment when they shop, and that it influences their spending decisions.

Personalisation is meanwhile going to be a ‘megatrend’ for the year ahead, Ms Bardwell said, particularly given ongoing pressures from inflation on consumers’ hip pockets.

“How we bring our offers to life for customers in a personalised way has taken a massive amount of investment in data science, AI and machine learning,” she said.

“There’s also a big focus on automation, particularly for e-commerce so we can more efficiently serve that immense volume that we’re now seeing.

“We are incredibly fortunate to have so much data, but we’re really focused on how we get it to be insightful and actionable, so that it really matters for customers in the moments that matter most to them.

WooliesX managing director Amanda Bardwell at The Australian Ecommerce Summit. Picture: Nikki Short

“We’re going to no doubt talk a lot about in the coming year inflation and the impact of inflation, and so how we use our data and insights to be able to help customers save money, budget better and make better choices. It is a great opportunity for all of us, given the data that we have.”

Mr Shafer agreed with the high value of data, but added the caveat that “more is not necessarily better.”

Kogan commonly describes itself as a statistics company masquerading as an e-commerce company.

“It’s all about how you use data,” Mr Shafer said.

“We have a saying internally that bad data is worse than no data, because it can often lead you down the wrong path. And too much data can also lead to analysis paralysis.

“So you have to be clear about what you’re trying to achieve. Are you trying to achieve a better consumer experience? Are you trying to allocate capital in a more efficient way? Are you trying to declutter a website and make the shopping flow more seamless.

“Once you start with the objective, then you can work out what’s the relevant data to analyse and take it from there. And then it’s really important to report on your objectives after the fact and to check back in and debrief as to whether you met your objectives using the data.

“Too much data can lead you in the wrong way. It’s all about how you use the data to achieve what objective for the business.”