‘Trust is the main currency of the future of commerce,’ says Shopify MD

Spring, the peri­od of fresh starts, is a fit­ting time to ask Shopify’s Shi­mona Mehta how retail­ers can give them­selves the best chance to flour­ish amid upheaval. She’s well placed to offer advice, espe­cial­ly as the ecom­merce plat­form, of which she became man­ag­ing direc­tor for EMEA in Novem­ber 2020, is itself blos­som­ing.

The tech­nol­o­gy pro­vid­ed by this Ottawa-based multi­na­tion­al pow­ers “mil­lions of busi­ness­es in 175 coun­tries”, she says. Accord­ing to recent research by W3Techs, 440,000 of the world’s 10 mil­lion high­est-rank­ing web­sites use the Shopi­fy con­tent man­age­ment sys­tem, plac­ing it sec­ond behind only Word­Press in the pop­u­lar­i­ty league. Retail­ers and direct-to-con­sumer brands would there­fore be well advised to take care­ful note of any insights aris­ing from Shopify’s vast bank of data.

Mehta pre­dicts that non-fun­gi­ble tokens (NFTs), aug­ment­ed real­i­ty (AR) shop­ping expe­ri­ences and social com­merce – buy­ing and sell­ing direct­ly across social net­works – will play sig­nif­i­cant roles over the com­ing years for online mer­chants. Retail­ers must accel­er­ate their dig­i­tal trans­for­ma­tions to take full advan­tage of these trends, she stress­es. 

Data to sup­port her fore­casts can be found in The Future of Com­merce in 2022, a research report that Shopi­fy pub­lished in Jan­u­ary. This reveals one par­tic­u­lar­ly seis­mic find­ing. Per­son­al­is­ing the cus­tomer expe­ri­ence has been the holy grail for many mar­keters, yet 80% are like­ly to stop doing this by as soon as 2025.

The main rea­sons for the decline of per­son­al­i­sa­tion are that tight­en­ing reg­u­la­tions are mak­ing data-track­ing hard­er; inno­vat­ing with first-par­ty data is unlike­ly to pro­duce many last­ing cus­tomer rela­tion­ships; and the most promi­nent web browsers are phas­ing out sup­port for third-par­ty cook­ies.

“The biggest chal­lenge for retail­ers and brands is build­ing long-term rela­tion­ships with their cus­tomers when it’s pos­si­ble to shop across sev­er­al chan­nels from a mul­ti­tude of brands,” Mehta says. “New inter­net pri­va­cy reg­u­la­tions and the changes affect­ing third-par­ty cook­ies are push­ing up the costs of cus­tomer acqui­si­tion. This rep­re­sents a sea change in how brands have been think­ing about con­nect­ing with con­sumers.”

Mehta, who joined Shopi­fy in Jan­u­ary 2017 as head of sales enable­ment in her native Cana­da, argues that improv­ing cus­tomer reten­tion using “brand com­mu­ni­ties” will become key. This is where retail­ers – and busi­ness lead­ers oper­at­ing in oth­er indus­tries – should focus their dig­i­tal trans­for­ma­tion efforts. In much the same way that a clunky etail expe­ri­ence will lead con­sumers to aban­don their shop­ping carts, any organ­i­sa­tion will lose poten­tial cus­tomers if it offers them an unsat­is­fac­to­ry dig­i­tal jour­ney.

“There have nev­er been as many oppor­tu­ni­ties in this space, but there has also nev­er been as much com­pe­ti­tion. Cre­at­ing a seam­less cus­tomer expe­ri­ence is key for organ­i­sa­tions wish­ing to emerge from the crowd,” she says. “The most suc­cess­ful brands are trans­par­ent, authen­tic and read­i­ly avail­able to their cus­tomers, wher­ev­er they are. Trust is the main cur­ren­cy of the future of com­merce. Retail­ers that stand out online and retain cus­tomers build bidi­rec­tion­al, mean­ing­ful rela­tion­ships with them.”

But estab­lish­ing and main­tain­ing that sort of rela­tion­ship is nei­ther sim­ple nor cheap. At the heart of the process, though, is a dig­i­tal trans­for­ma­tion fea­tur­ing the adop­tion of tools with the capac­i­ty to empow­er mer­chants and make con­sumers feel com­fort­able using any chan­nel they choose.

Mehta, who moved to Lon­don, Eng­land (rather than Ontario), when she became head of Shopi­fy Plus for EMEA in March 2019, stress­es the impor­tance of invest­ing in dig­i­tal trans­for­ma­tion to ensure that online and offline cus­tomer expe­ri­ences aren’t dis­joint­ed. Pow­er­ful tech includ­ing arti­fi­cial intel­li­gence and big data ana­lyt­ics can pre­dict like­ly spikes in demand, enabling greater effi­cien­cy in sup­ply chain man­age­ment. All data points should inform strat­e­gy. 

“There are more con­tact chan­nels than ever, be they web­sites, mobile apps, social plat­forms or the point of sale in a phys­i­cal store,” she says. “An omnichan­nel approach is about aggre­gat­ing these var­ied touch­points. Oper­at­ing an omnichan­nel busi­ness requires a lot of long-term plan­ning and future-proof­ing strate­gies to absorb new tech­nolo­gies and avoid offer­ing dis­joint­ed cus­tomer expe­ri­ences.”

It all comes back to engag­ing with con­sumers and learn­ing from them to bet­ter serve cus­tomers and enrich the brand com­mu­ni­ty, says Mehta, who adds: “The emer­gence of social com­merce rep­re­sents a par­tic­u­lar oppor­tu­ni­ty for busi­ness­es to regain con­trol of their brands in dig­i­tal chan­nels.”

She cites Lounge Underwear’s “hybrid approach” to influ­encer mar­ket­ing as an exam­ple. “To spread aware­ness, the brand has used both big names and micro-influ­encers. It believes that the lat­ter have a bet­ter con­ver­sion rate, as con­sumers find them more authen­tic and relat­able.”

Shop­pers are increas­ing­ly using social chan­nels to dis­cov­er brands, con­nect with them and make pur­chas­ing deci­sions, Mehta reports. 

“More of our mer­chants are unlock­ing the pow­er of social com­merce through our inte­gra­tions with Tik­Tok, Face­book, Pin­ter­est and Insta­gram. This is not about adver­tis­ing or per­for­mance mar­ket­ing – con­sumers are engag­ing with brands and increas­ing­ly com­plet­ing check­outs direct­ly via social chan­nels.”

Linked to this, livestream sell­ing – inter­ac­tive videos through which view­ers can buy the goods being demon­strat­ed – has explod­ed in pop­u­lar­i­ty. Shopi­fy mer­chant data cov­er­ing August, Sep­tem­ber and Octo­ber 2021 indi­cates that the num­ber of down­loads of livestream sell­ing apps was 40% up on the total for the pre­ced­ing three months. 

Also on the up are AR-enabled mobile apps. Cloth­ing brand All­birds, for instance, has found suc­cess by using Shopify’s cus­tom store­front tool to cre­ate a more immer­sive shop­ping expe­ri­ence through a vir­tu­al try-on fea­ture. 

“AR can make a big dif­fer­ence for cus­tomer expe­ri­ence, although it isn’t for every brand,” Mehta says. “If mer­chants want to exper­i­ment with it, we offer a plug-in that enables them to test things cost-effec­tive­ly. If they don’t work, they haven’t wast­ed a ton of invest­ment.”

When retail­ers – and busi­ness­es in oth­er indus­tries – embarked on their dig­i­tal trans­for­ma­tions, they would not have con­sid­ered NFTs. And here is where the ben­e­fit of part­ner­ing to boost dig­i­tal capa­bil­i­ties can prove tru­ly use­ful, accord­ing to Mehta. 

“NFTs are cer­tain­ly an inter­est­ing way for firms to stand out and build rela­tion­ships with con­sumers,” she says. “As more mer­chants build fun, engag­ing expe­ri­ences for their com­mu­ni­ties, I believe that inter­est and excite­ment from their fans will con­tin­ue to grow.”

Over­hyped or not, it could be a gam­ble worth tak­ing, giv­en that brands as var­ied as the Chica­go Bulls, Martha Stew­art and Super­plas­tic have com­plet­ed suc­cess­ful NFT ‘drops’ through Shopi­fy. After all, it’s a win­ner if it builds that all-impor­tant brand com­mu­ni­ty and improves the cus­tomer expe­ri­ence.

Mehta con­cludes by offer­ing advice on how retail­ers can thrive by accel­er­at­ing their trans­for­ma­tion. “My main tip is to start now; don’t wait for the ide­al moment. Brands with­out a strong mul­ti­chan­nel pres­ence will miss out on a huge oppor­tu­ni­ty,” she says. “For retail­ers at the start of this jour­ney, focus on build­ing for the long term. Choose tools that enable you to devel­op your own ecosys­tem for com­merce – and meet your cus­tomers where they are.”