eTail Digital Summit Webinar with Daniel Baptiste-Pilkington
Speaker 1: Hey everyone, this is Ken Suh from Honey. In today's episode, you'll be hearing from Daniel Baptiste Pilkington, he's the Director of Partnerships at Honey. This is from this year's eTail EU summit, and it's called, Rethinking Consumer Engagement, for the new normal marketplace. Enjoy.
Daniel: Hi everyone, I'm excited to be with you all today. To talk about some of the key emerging trends and opportunities our team at Honey, is seeing as a result of COVID- 19. And how it has rapidly reshaped people's lives, and the way merchants and consumers are experiencing this changing environment. As we know, capturing customer's attention isn't always on challenge, even during non- pandemic times. But with the onset of the pandemic and the abrupt closing of retail stores in the UK, people have quickly had to move nearly all of their shopping, online. Today, we will cover three trends that have surfaced in the three months since COVID disrupted consumer's lives. First, the acceleration of E- commerce and as a result, the need for a healthy ecosystem. The change in how consumers are thinking about, and spending their money. And the swiftly evolving media landscape. Let's look at this first trend, the shift by shoppers to E- commerce out of necessity. Due to the closing of all non- essential retail stores, across the country. According to a recent statistic study, UK retailers, online year over year revenue growth is up 200% as of mid April. And Order Volume in categories such as toys, is at nearly a hundred percent year over year. Tesco, saw a 200% increase in basket size since the pandemic forced people into lockdown. This now near complete dependence on online retail, has revealed challenges in the online shopping model, at every stage of the consumer journey. That has in many cases resulted in less than optimal shopping experiences for customers. The accelerated shift to online only shopping, has really put a spotlight on Crux and the current E- commerce infrastructure. Amazon prime shoppers in Europe, for example, are faced with the retailers struggles, to deal with a surge in orders for food and household essentials. It has very quickly brought into focus, the fragility of the current model, of one platform serves all. And in fact, what we're seeing here at Honey, in real time, is how the current model no longer stands up to the COVID driven spike in online shopping. Consumers can really benefit when they have the opportunity to engage online, more directly, with the Brahms they love and discovering new brands more organically. We believe it's important to create a healthy ecosystem. Where online retailers have the ability to engage shoppers in a more authentic and reciprocal manner, that's consistent with our brand values. Instead of solely relying on one distributor. We believe it's also really important to blind value for all consumers, no matter where and how they choose to shop. We also believe, consumers and Commerce get more value, when multiple players thrive in a healthy ecosystem. We as shoppers, and as Commerce leaders, need to spend our pounds to create this and build it in the companies we work for, undelete. Now, let's take a look at the second trend we were seeing, the shift in how consumers are thinking about and spending their money. In the last three months, we're seeing consumers impacted in unprecedented ways, with needy 10% of UK workers facing unemployment. It's more important, now than ever, for brands to provide value for shoppers, wherever, we can. We've seen several key shopping behaviors emerge as a result of staying at home, and the anxiety about the economy. COVID has affected shopping in virtually all categories. From travel and beauty, to entertainment and apparel, in a record short amount of time. The goal here will be to uncover, how best to meet consumers needs and miss new marketplace. Let's look at the challenges and opportunities that the data reveals, and then, I will discuss ways we can optimize value for consumers and the increased demand for goods and services. Okay, so first, some good news. Our data shows that two months into the closure of all retail stores, 70% of Honey members continue to shop their favorite brands online, like they had before COVID's here. Highlighting that their loyalty to specific problems didn't waiver despite economic uncertainty, armed with their access to physical stores. In fact, what we're also seeing in the months since pandemic, is that 21% of those members who are shopping their favorite stores, are actually browsing and shopping more than they have historically. All Honey members who shop more frequently, they increase their shopping in beauty, food and gaming categories in March and April versus January and February of this year. Now, we are expected to jump in some of these categories, they sort of naturally correlate with increased time spent at home. For example, we can infer from this, that people are looking to upgrade beauty and grooming products. As an alternative to literary services they would otherwise get at a salon or a spa. With increased online shopping, and shifting buying habits, new opportunities have emerged for retailers. We will dive into this a bit more in a moment, but I want to quickly put a fine point on this. If retailers can move beyond reacting to these new trends, and begin creating strategies around them, then they may be able to provide value to shoppers and grow their business. I'll get into how we can do that in just a moment. A small subset of shoppers in the study, are shopping last, and it's clear that in reaction to the pandemic, they have restricted spending across all categories. With some of the more obvious and logical ones, leading the downturn. For example, we're expected to see the drastic decline in car rentals and a 64% decrease. Given that the categories and interconnectedness to travel, which its self is seen in dismal 59% decline. Sports and out- doors, and deals in experiences, round up the top declining categories. And more, all four of these categories have in common, is that they require large numbers of people coming together. Which in the time of social distancing and lockdown, this has been completely forbidden. Let's now examine the third trend we're seeing, the exponential speed at which the media landscape is transforming. We'll first, take a look at what seasoned industry art buyers, are predicting as immediate shifts and how advertising budgets will be allocated going forward. Then, we'll look at why some of those reallocations fail to fully maximize the experience, for shoppers and the retailers bottom line. And finally, we'll explore some solutions that, even in this time of COVID, have shown to help increase customer loyalty. By delivering immediate value to customers, without increasing advertising budget. So, a recent business is at a survey, interviewed 16 top media buyers, at agencies, both big and small. Almost spending on behalf of advertisers. They were asked, how it will change considerably, as a result of the pandemic. Many project, that Ad spend will return gradually, and on a case by case basis. And that when it does return, performance based solutions will be front and center. As advertisers will demand to know that every pound they spend is working. For example, Jessica Brown, who is the Director of Digital Investment at Group M, agencies out. The whole pandemic is forcing these changes to happen faster, than some clients are comfortable with. While a few of the Ad buyers feel that publishers and platforms like Discovery, even Brahms like, HGTV, and the Food Network, would be well positioned to talk to our budget, because of their full slate of relevant programming. Most of the advise they spoke with, feel that Facebook and Google are still best positioned to capitalize on their existing domination of digital advertising. Because they're at foremost consistently, before. And consumers are using their services, now more than ever, as a result of the pandemic. While these platforms continue to perform well for advertisers, reach to consumers, where they spend a great deal of time online. There are always ways to further capsize and shifting consumer spends, at spending attitudes and behaviors. Our data shows, incentives and deals from Brahms consumers, care about our increasing engagement and this changed landscape. We're seeing, that merchants who have Honey Gold, which is our Loyalty Program. So, a 221% year over year jump in user clicks on their sites. Those same merchants, saw an average 74% increase in orders. These data points highlight, that the strategy of providing value, back to users, is a key lever in helping to drive engagement, purchases and loyalty. This also presents a prime opportunity to rethink Ad spending, to create the most value for both advertiser and consumer. Meeting them at the most contextually relevant moment in their shopping journey. So, what if we could reimagine how we spend our budgets? Three key principles we can explore here. What if we could meet the consumer, when they are in a shopping mindset? What if we could focus on results and help increase return on Ad spend systematically? And if by doing so, what if advertising is redefined as a shared value model between the merchant and consumer, in a reciprocal way. I'm talking about solutions here, where advertisers would be able to engage with shoppers in an authentic way, while maintaining control of budget and customer experience. What I'm envisioning, is a solution, that helps reduce fire and uncertainty and drop- off. And in turn, builds loyalty and can increase sales, a few key principles to explore here. Principle one, in most advertising models today, consumers discover brands that may be relevant to them. We could stop pushing our brands to consumers so much, and instead, focus on putting them in, with offers that are contextually relevant to their habits, and behaviors at different times of the day. For example, a customer receiving a discount email at 10: 00 AM on a Wednesday at Spam. And if they receive the same discount, in the form of a reward, while ordering pizza online, on a Friday night, you've made their day. And we know, that consumers get delight when they get an unexpected benefit back from a brand. Principle two, Media that can drive measurable results, well, and should be invested in. Understanding incremental value and return on Ad spend and being able to optimize for its metrics. At Places worth spending your time and effort will prove most valuable. At Honey, we're super passionate about getting rid of the inefficiencies in advertising. And I've recently launched a product called Honey Offers. That allows for return on Ad spend targeting, showing incremental conversion lift, and decreasing cross site shopping. Taking a second look at how, publishers, platforms and major outlets can measure and optimize to drive your desired results, is the key here. Principle three, so, how does this next generation shed value Ad model look? We've seen, with loyalty and rewards trustees, how advertising budgets translate not into disruptive messages throughout consumer's day. But into delightful moments for shoppers when they really want to meet them. Since these strategies help advertisers to optimize for performance, we're able to create value across the entire network. By helping to drive sales for advertisers and sharing value back with consumers. So, to recap, what we've discussed today, Econ trends are accelerating and a healthy ecosystem is very important. With UK retailer, online year over year revenue growth up 200%, at Order Volume in several categories up nearly 100% year over year. It's clear that customers haven't slowed down their desire to purchase. How people are thinking about and spending money has changed. With nearly 10% of UK workers facing unemployment, it's now more important than ever, for brands to provide value wherever we can. And finally, immediate landscape is transforming rapidly, in order to keep up, maximizing channels that drive performance, is most important. We believe, and have created a platform, that also creates reciprocal value with consumers, that goes beyond traditional Ad models. Potentially, driving greater benefits and loyalty with shoppers. Thank you for letting us share with you trends missing in the marketplace, it's been an absolute pleasure to be here today. We'll send the stack and I'll follow up with you all, to provide more details on how our solutions can help increase, for us, for retail and advertising partners, like you. Thank you very much, everybody.
Speaker 3: Danielle, thank you very much for a really insightful session. We still have a couple of minutes, so, I'm going to ask you two questions. That the audience have sent us, during your session. So, the first one is, what is your audience demographic?
Daniel: We have a very diverse audience here at Honey. But I'd say the majority of audiences, is the millennial user. Our platform is designed to help consumers save, time and money, however and wherever, they choose to shop. And we see that our product resonates with a wide variety of audiences, that are looking to save time and money when shopping online.
Speaker 3: Thank you. The second question is, what sort of global rate does Honey have?
Daniel: We have 20 million, monthly active users globally. Our home market is the US, so, a majority of our user base is there. But we have audiences in the, UK, Canada, Australia, France, Germany, Italy, Spain, and various other countries around the world. So, we have a pretty global reach, and that's continually growing.
Speaker 1: Thanks for listening to the Honey for business Podcast. To learn more about how Honey can help drive your business, reach out to Honey- Partner- support @ paypal. com. And be sure to follow us on, Apple music, Spotify, or wherever you listen to podcasts.
This week our episode is with Daniel Baptiste-Pilkington, the Sr. Manager of Partnerships in the UK & EU at Honey. This is from the webinar “Rethinking Consumer Engagement, for the New Normal Marketplace.” Listen now to learn about emerging trends and opportunities that have resulted from COVID-19.
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