T M Praveen CEO Opus Consulting Solutions
Consumer expectations around the purchase experience continue to rise. Merchants who embrace technology and personalization will be poised to win big with consumers by providing personalized contextual commerce options.
Frictionless purchasing options have become the name of the game. Enabling consumers to purchase when, where, and how they please is not a novel concept. Yet, merchants have been slower than predicted to adopting contextual commerce strategies that go above and beyond to serve customers.
As we continue to see a tangled web of digital touchpoints, expectations and demand for contextual commerce options will only increase. The lines have blurred when it comes to browsing and buying, making the whole internet an on-demand marketplace.
Merchants who are prepared to take advantage of this serendipitous convergence stand to win big. Contextual commerce presents new sales opportunities, though they do come with challenges. As consumers get more comfortable interacting with and buying from brands across all digital channels (social media, apps, devices), merchants must be sure they have well-defined paths that remove friction and bolster security.
Understanding the trend
According to a recent edition of the Digital Consumer Report, a PYMNTS/Samsung Pay collaboration, more than half (58%) of consumers are engaged in contextual commerce. Of that segment, more than three quarters (81%) reported using social media as their contextual commerce channel of choice.
This trend of engagement will only become more marked as more digital channels emerge and gain momentum. Wearables have continued to rise, with global smartwatch shipments increasing 56% to a record-breaking 18 million units in Q4 of last year. Apple, Samsung, Fitbit, and Garmin continue to hold leader board positions. Just this year, Discover penned a deal with Garmin International Inc. to enable contactless payments via Garmin Pay. While wearable purchases tend to lean towards small-dollar purchases, those purchases add up.
Voice assistants are also a big entry point for contextual commerce, especially as the projected growth rate between this year and 2023 hovers around 25%. Jupiter research estimates about 3.25 billion voice assistants are used today.
The firm also projects that voice commerce will reach more than $80 billion per year by 2023, though a good amount of those purchases won’t be physical purchases. Instead, we’ll likely see that the majority of voice commerce will be digital purchases.
In any event, it’s clear that consumers are looking to pay where they are, whether via a wearable, smart T.V., mobile phone, home voice assistant, or social media.
Getting contextual commerce right
Contextual commerce is heavily focused on customer experience above all else. This means making it easy to buy by weaving purchase opportunities into everyday activities and natural environments. These opportunities should be presented as seamless, unified, and personalized for each shopper. Adhering to best practices provides a solid framework for executing contextual commerce most effectively.
Know your customer – Data collection is an integral part of customer experience so far as it allows you to understand who your customer is and what they want. This requires unified data that can remain unified throughout the marketing stack.
Provide relevant content – As part of a clear path to purchase, merchants need to be delivering relevant, personalized content that connects across channels and meets consumers’ needs. User generated content (UGC) is an important component of this as it typically wields more power than brand-made content. Shoppers prefer to consumer reviews and comments made by other shoppers and are influenced by this type of content.
Frictionless, seamless, omni-channel commerce – Commerce must be a mobile-first, seamless experience. Most consumers do research on their smartphones, use social channels to make purchase decisions, and follow-through with the actual on a desktop. That said, mobile commerce will account for 44.7% of global commerce transactions. A focus on all digital channels to build relationships is essential.
Conclusion
Contextual commerce will continue to expand via mobile, smart devices, NFC, POS, digital wallets, IoT, and more. Merchants must look at being where their customers are and addressing their top pain points via seamless purchasing opportunities across channels. With knowledge about their consumers’ behaviour and give merchants the opportunity to elevate the consumer experience without even being asked.
Along with providing the right opportunities at the right time, merchants should focus on providing a fast payments experience. Speed matters. According to the PYMNTS Contextual Commerce Report, 59% of consumers who have participated in contextual commerce say they were compelled by a “much faster buying experience.” In the end, the big winners will be those merchants that can rise above consumer expectations to provide the quickest, easiest, most seamless purchasing experience possible.
About the Author
T M Praveen is the CEO of Opus Consulting Solutions. He has been with Opus Consulting for over 18 years and was recently appointed as the CEO of the company. Praveen has held various key positions in the delivery organization at Opus. His deep technology expertise coupled with the vast experience of working with payments industry stalwarts has helped him understand the payments industry really well. He has completed management programs in general management, business strategy and leadership from INSEAD, IIM (Lucknow) and IIM (Bangalore) respectively, having previously earned a Bachelor of Science degree in Physics. Praveen is based out of Atlanta and is a fitness enthusiast who spends his free time working out in the gym and driving sports cars.
