Analyzing Q2'S Dramatic Ecommerce Shifts: Interview with Klickly, Digital Marketing Platform

The eCommerce game has changed a lot since COVID-19 made its appearance. Some businesses have seen buying trends shift in their favor, while others have had to pivot in order to survive.

And the reality is, no one quite knows what it's going to be like tomorrow.

This is exactly why we now need a trusted source that can provide us with frequent updates on the changes in eCommerce. We need to be able to make informed decisions and adapt to the new normal.

For Searchanise, such a trusted source has become Klickly.

Klickly is an eCommerce pure commission-based marketing platform that regularly conducts a nuanced data report on the state of eCommerce performance over the last quarter.

And again today we are talking to Bradley Wilkinson, who spearheads partnerships and content at Klickly. He will share with us the most valuable findings from the second research Klickly conducted on the impact of the COVID-19 on eCommerce, And this time they released a more robust report including on-site customer behavior data and key performance metrics.

So keep on reading. This is going to be very insightful.
Bradley, thank you for joining us. We are all impatient to hear the results of your new report. Can we start with a quick summary of your findings?
Bradley: I think one of the most telling stories was around the drawn out effects COVID — or a pandemic in general — had on the industry and the longtail trends thereafter. If you missed our COVID impact specific report, I highly recommend you check it out as it shows a shocking upward shift throughout eCommerce immediately following the height of the pandemic's "newness." This upward trend continued throughout April across all industries, but beginning the second week of May we see that trend flip and head on a downward trajectory.

Overall in Q2 we saw a nearly 15% decrease in Gross Merchandise Value (GMV) from June compared to April driven by poor performance in the latter two months of the quarter. There's a few likely reasons for this as mentioned before, but the sudden shift from brick-and-mortar and the stimulus checks probably had a lot of influence on the initial positive trends we saw. Once these incentives ran out and as the severity of economic impact from COVID registered, we saw a large dropoff. The majority of verticals followed this trend but there were a few outliers in the mix.
What happened across industries in Q2? Which were affected most?
Bradley: Surprisingly the Food & Beverage category took the hardest hit out of all with a dramatic 36% decrease in revenues. What seemed to show signs of continued strength from the increase post-stay-at-home, this vertical took a major hit in the latter half of May and throughout June. Possible reasons for this is the large dent online ordering can have on consumers pockets over time or the dropoff could be due to delivery apps like Uber Eats and Doordash stopping their no delivery fees.

Another notable vertical that took a major hit was Fashion & Apparel, which was down nearly 24% in June compared to April. Again, Fashion & Apparel was performing quite well in April with an overall positive trend across all metrics we reviewed. However, beginning in May we started to see week-to-week losses. It should be noted that these losses were relatively small (averaging around 3% decreases week-to-week), but Memorial Day Weekend shockingly saw a major decrease from the previous week dropping nearly 15%.

While fashion and apparel had a rough Q2, it's cousin Jewelry and Accessories had the most successful outcome of all verticals we looked at. This makes sense when you factor in the immediate need for scarves, bandanas, masks etc. New customers early on were the single biggest driving factor of the success of this vertical.

There were other verticals that experienced upsetting losses over Q2: Beauty & Skincare, Electronics, and Pets to name a few. However, several verticals we looked at didn't experience such dramatic fluctuations within their bottom line: Health & Wellness, Home Goods, and Babies & Children for example.
This time you included a customer orders heatmap which is pretty exciting.
Having customer behavior aggregated and visualized in such a super simple way is extremely helpful. Have you noticed any tendencies regarding what day and time people are shopping?
Bradley: Yes! It's one of the additions I'm most excited about as it's something you can look at and take immediate actionable steps toward testing. Previously, we looked at performance data, but now we've included this insightful information on how people are shopping.

Some of the data was in line with what you would predict, but there were certainly some outliers that were interesting. For overall eCommerce, while it does skew towards the weekend, it was somewhat surprising to see Thursday make one of the top spots (top spots were Friday, Thursday, and Saturday in that order). The majority of orders were made in the early afternoon (Eastern Time Zone) which perhaps means there's quite a few "lunch break" shopping happening.
Fashion & Apparel, which is always one of the largest industries, showed most orders happening late morning towards the end of the week. People are waking up and shopping for clothes — probably in hopes one day we'll get to show them off in public once again.

This isn't always the case for some industries. For example, Health & Wellness leaned more so to late evening purchases with Monday being the top performing day. Similarly, purchases for Home Goods were overwhelmingly made on Monday in the early evening.
Any location-based purchasing observations?
Bradley: It's kind of funny, this is repeated several times throughout the data report, but unsurprisingly states with large populations and/or large cities were the main driver for the highest order volumes. This was the case for quite a few but there's certainly some interesting nuggets we can pull — and some interesting standouts.

The main industries that stood out as having notable correlations were Health & Wellness, Beauty & Skincare, Home Goods, Babies & Children, Sports & Fitness, and Pets.

  • Health & Wellness appeared as though there were potential correlations between orders and states with high COVID outbreaks
  • Beauty & Skincare received orders from areas with strong fashion influence like New York and California
  • Home Goods tended to see great performance in midwestern states — the only vertical to do so
  • Both Babies & Children and Sports & Fitness leaned very heavily towards the west coast
  • Pets was the only vertical in which a state (Massachusetts) surpassed California as the top performer
Now, let's dive deeper in and look at the key performance metrics. What's the overall view?
Bradley: Putting it in one word: opportunity.

Traffic has increased overall. Keep in mind our report is looking only at traffic as it pertains to merchant's websites, so this does not take into account other channels like Amazon, Facebook, etc. Different verticals are experiencing varying shifts in their on-site traffic, but the majority are seeing an increase — Fashion & Apparel and Jewelry & Accessories seeing the greatest positive increases.

However, this increase in traffic hasn't translated to higher click rates which have decreased across nearly all industries with the exception of Jewelry & Accessories and Babies & Children. The average click rate across all industries dropped 22% over the course of Q2.

This increase in traffic paired with lower click rates has also resulted in dramatically lower conversion rates. We saw an alarming 32% decrease in conversion rate.

There are more window shoppers than ever before, but we can view this as a major opportunity moving forward.
This increase in traffic paired with lower click rates has also resulted in dramatically lower conversion rates. We saw an alarming 32% decrease in conversion rate.

There are more window shoppers than ever before, but we can view this as a major opportunity moving forward.
Which industry saw more customers?
Bradley: Across the board all eComm verticals were negatively impacted — some more than others. To give you a sense, in aggregate the number of new customers decreased 31% and orders decreased 20% from April to June.

While Fashion & Apparel saw dips in both orders and new customers (34% and 38% respectively), the subset of Jewelry & Accessories was the only industry that saw a positive trend when looking at June numbers compared to April. They saw a nearly 23% increase in new customers and a 9% increase in orders overall.

Hit hardest in terms of the delta change of new customers was Food & Beverage. While this industry may appear to be the hardest hit, we also must remember that this industry had one of the largest shifts of brick-and-mortar to eCommerce. There was incredible lift in the early stages of COVID through the first half of Q2. It wasn't until the latter half, that we began seeing a dropoff.

Health & Wellness was a bit more neutral: there was a slight decrease, but the percentage is in the single digits for both new customers and amount of orders. Similar to Food & Beverage, Health & Wellness had a very strong upward trend early on. It appears this has leveled out as we close the quarter.
What are your findings regarding the average order value (AoV)?
Bradley: Average order value is one of those metrics that are going to experience natural fluctuations week-to-week. While we may have seen a dramatic decrease in customers/orders over the quarter, we did see a slight increase in AoV overall at 5% — meaning fewer people were purchasing higher priced carts.

While the majority of changes in verticals were miniscule — many hovering +/- 2% — there were three that saw dramatic increases. Babies & Children and Sports & Fitness saw increases of 40+% while Home Goods saw an increase of 30+%.
Sports & Fitness Q2 performance
It's interesting to note that this is nearly a direct inverse correlation to the decreases in conversion rate and orders. These three verticals experienced dramatic shifts (negatively for conversion rate and orders and positive for AoV), whereas the gap for other verticals wasn't quite as considerable.
Has mobile remained the preferred device in all industries?
Bradley: This probably isn't a shock to anyone in the industry at this point. Mobile has been on top for quite some time, and it doesn't look like our newfound homestead lifestyle has moved the needle any differently.

Short answer: mobile is, indeed, still the preferred device to make purchases.

The cases where this doesn't hold true are for products that often require more research. Categories such as Electronics, Home Goods, and Sports & Fitness tended to show a more even split between the two.
Bradley, what would be your recommendations to owners to prepare for the rest of the year?
Bradley: This year is (already) going to be one for the record books. We've already seen a major shift to eCommerce — April and May alone have already outperformed November and December 2019. It's uncertain what will happen throughout the rest of the year, but many industry leaders are predicting some interesting trends for Q4. Specifically, the timeframe for Black Friday/Cyber Monday is going to extend.

With this extension, you can likely expect traffic levels to remain at the high levels we've seen as per this report. A lot of this traffic are window shoppers, but that means more opportunity.

The two main things I recommend focusing on are:

  1. Make sure you pair acquisition and retention strategies. Retention certainly shouldn't slow down, but you want to make sure you have a solid strategy to capture the increase of online shoppers. Then, when they've shopped once, you can put loyalty-building tactics in place so they contribute to long-term revenue

  2. Evaluate the strength of your conversion strategy. Conversion rates have declined over the course of Q2, so you want to take a look at how your current conversion strategy stacks up. It is best to pay attention, now, to the existing gaps and optimize your website for higher conversions. Test early to make sure you're geared up for the holiday season.
Thank you, Bradley, for the insightful conversation and the data initiative. I am sure store owners will find a lot of value in your research and it will help them make decisions for the rest of 2020.
If you want to make the best use of Bradley's advice and start optimizing your eCommerce website for better conversion, we suggest you start with improving your site search.

Your site search is the key interaction point for your customers right in the beginning of their buying journey. Thus, you can take advantage of your potential revenue by optimizing it for better customer experience.
Searchanise is an advanced smart search tool designed to drive higher conversions in eCommerce stores. Read our clients' success stories to learn how our clients are using Searchanise to improve their site search and increase conversions.
As always, we welcome your feedback and questions. Feel free to contact us at feedback@searchanise.com

About Bradley

Bradley Wilkinson is a Partnerships and Marketing specialist at Klickly, a 100% commission-based advertising platform. Bradley works with entrepreneurs, strategic partners, and ecommerce stores to help grow their brand. With 8 years experience in results-oriented marketing and content, he has helped startups, mid-level ecommerce merchants, and individuals with branding and strategy including PR, social media, and content implementation.
Ekaterina Kopylova
Marketing Manager at Searchanise
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