By Ellie-Rose Davies, Content Executive at IMRG

In 2023, UK ecommerce leaders struggled in the face of rising costs and reduced customer sentiment, where the industry declined by -3.2% Year-on-Year (YoY) according to IMRGs Online Retail Index. Though they hoped for a more prosperous 2024, the results so far have shown a consistent downward trend for the total market. To combat these declines, this blog uncovers some quick wins ecommerce leaders can implement to accelerate growth. Specifically, this blog focusses on four key areas:

• Opportunities to improve and expand
• Tactful promotions and tailored offers
• Post-purchase customer engagement
• Optimising returns for loyalty

First, lets get into whats happening across the industry.

A difficult start to 2024

The total market reported YoY declines for each week of the year so far, most often between the -5% and -10% mark. January saw a decline of -6.9% YoY, representing one of the worst months in the history of ecommerce. February was slightly better at -1.2% YoY, with Valentines Day being a key helper here. While the total market has been down, mostly driven by product categories such as Clothing, some retailers have better weathered the storm. Health & Beauty has been the top performing category for a while now and, as of February, is in its eighth consecutive month of positive-territory growth. In the first week of March, this category experienced an astonishing +23.8% YoY uptick, and that is against positive figures recorded in 2023!

The average conversion rate (Unique Visitors) for the total market in January and February had mixed performance. January performed slightly worse compared to 2023 (4.43 vs 5.13), but February performed slightly better (4.26 vs 4.18), leaving us curious for what the rest of the year has in store. Traffic to online retail sites has been consistently down in 2024 so far, suggesting customers are not engaging with retail sites as much as we would have hoped. The rising trend of second-hand buying and selling may be a contributing factor here, among other things. To find out more about weekly ecommerce performance, tune into IMRGs Weekly Data Show which provides in-depth analysis of trends “ every Thursday, on Zoom, at 2pm GBT!

Opportunities to improve and expand

It is essential for retailers to consider opportunities that will accelerate their performance in 2024, especially as IMRG predict 0% YoY growth for the total online market this year. Burc Tanir, CEO at Prisync reflects on how 2024 is going by fast, and retailers are now trying to prioritise quick but long-term wins. But how? Burc says that one of the most effective ways to keep on track is to monitor customer feedback and stay abreast of market trends to ensure sustained success. In challenging times, simplicity often reigns supreme, and prioritising customer satisfaction can breathe new life into stagnating sectors, says Burc. A way to do this consistently and efficiently is to reduce manual tasking. Burc recommends retailers to use automation for competitor analysis, tracking competitor actions, stocks, and pricing to compete, using accurate data. In turn, they will be able to offer their customers fair prices and meet their needs. Knowing that traffic to online retail sites is down, and that conversion is proving difficult, retailers can consider how to expand their offering. Alexander Otto, Head of Corporate Relations at Tradebyte says, With every second e-commerce pound now spent on marketplaces, expanding a retailer's own .com offering into marketplace operations affords a huge opportunity to enter new territories, expand customer reach and increase revenue. He continues, However, in the face of current socio-economic uncertainties, its crucial to choose the right market, leveraging real-time market data, building an understanding of customer behaviour, and conducting competitor analysis to stay ahead of the game and enhance competitive advantage. Alexander reveals how Marketplace expansion worked well for UK fashion retailer Apricot, growing from their own e-commerce offering in 2021 to 10 different marketplaces in 2023. Diversification has helped Apricot adapt and thrive, achieving 566% GMV growth.

Tactful promotions and tailored offers