New data from Wunderkind, the leading performance marketing channel that scales one-to-one messages for retailers and brands, reveals that retailers risk leaving 1st party data capture opportunities on the table.
In-depth research of 99 UK ecommerce brands in its 2023 WunderkIndex Report, which analysed on-site shopping journeys and customer engagement – across both email and text channels – over a six-month period, showed almost two fifths of retailers employed no form of data capture during online buying journeys.
With 37% of the brands audited not seeking data capture, either when a customer first comes to the site, after browsing the site for several minutes, or at the point of exiting the website, retailers could be leaving valuable first-party data on the table. This risks impacting their marketing list growth and future revenue opportunities through email engagement, meaning they are potentially missing out on an estimated 6-10% additional digital revenue.
By the end of 2020, CPC (cost per click) across social media platforms had risen by between 20 – 60% YOY (year-on-year). Yet, despite these rising costs, some of the conventional paid media platforms used by brands to acquire customers, including Meta-owned Facebook and Instagram, were seeing a 30% decline in conversions. This prompted many brands to question the ROI of being overly reliant on ‘rented’ audiences on 3rd party channels, especially with the planned third-party cookie cull by Google, set to take place in 2024, added into the mix. This makes 1st party data now even more mission-critical to drive long-term engagement, revenues, and customer lifetime value (CLV) through cost-efficient owned channels – as well as to deliver ROI on marketing pounds, particularly given the continuing economic headwinds.
The WunderkIndex report also reveals common shortcomings in retailers’ data capture capabilities, with 93% of the websites surveyed failing to include explicit checkbox consent in on-site capture experiences, falling short of GDPR-led permissioning best practice.
Of the retailers audited with capture capabilities, 86% prompted visitors for an email address but just 6% were set up to capture mobile numbers, missing out on customer engagement opportunities via text – a rapidly growing and high-converting marketing channel. A recent Wunderkind survey of over 2,000 UK consumers found that, while 84% agree that email is still the most convenient channel for communicating with retailers when shopping online, a third (32%) say they now find text just as convenient – an increase of +6 percentage points year-on-year.
Looking specifically at value exchanges offered for customer data opt-ins, discounting was the most common, offered by 40% of brands, followed by newsletter subscription (32%) and other perks such as VIP events, sales access, and exclusive content (17%). This mirrors consumer demand for money-saving benefits, such as immediate discounting (58%) and free shipping (56%), topping Wunderkind’s recent shopper poll as their preferred value exchange mechanism when choosing to opt in.
Wulfric Light-Wilkinson, general manager at Wunderkind International, commented: “We’re seeing a seismic shift, not only in marketing channel performance but also in consumer behaviour, prompted in part by channel adoption but also driven by cost-of-living consumer behaviours, where the concept of value and that of value exchange are evolving. And that calls for a change in marketing strategy – balancing the scales and pivoting to maximising value from owned audiences and channels will be absolutely critical in 2023, as retailers work harder to win conversions from increasingly cautious shoppers. By owning and optimising 1st party data, brands can ensure ROI on marketing spend, while at the same time providing a better and more personalised customer experience.”
To find out more about the latest eCommerce benchmarks on first-party fitness and owned channel optimisation, download the 2023 WunderkIndex Report.
