Why Brands are Focusing on Digital First

When it comes to commercial potential, a digital-first approach means that your business has the chance to reach a global audience as well as to scale fast to meet the enormous demand. 

There has been a direct shift in digital sales proportions, whereas total sales are significantly changing. For example, the average sales for a US brand in 2019 was 10-15% in digital sales, and in 2020 it increased to 34%. Today, many brands are at about 50% digital sales, and the trend is even leaning higher. 

 It has never been more critical to nurture your digital sales growth and increase your customer base.

Post-pandemic Expectations

Throughout the past year, consumers shifted spending to physical goods, with much of last year affected by restrictions with dining, entertainment, and travel. This included a wide range of goods, from clothing, furniture, garden wares, toys, comfort items, and even entertainment. 

And now that mask mandates are being eased, consumers are increasingly optimistic about getting back to normal. However, given the pent-up demand for in-store shopping, restaurant reservations, concerts, and vacations, retail data shows that digital sales will only continue to increase. 

The Amazon Effect

Amazon continues to be the top dog when it comes to digital sales, with $60.44 billion in revenue in the first quarter of the year – an increase of 42.3% from $42.48 billion last year (2020). 

As other retailers see the potential for growth and revenue sales, the Amazon effect is trickling down and encouraging other businesses to compete online. So as Amazon sales continue to increase, it’s a sign that digital retail isn’t going anywhere in the near future. 

I Wanna Be Like Mike

Another new eCommerce star that emerged from the past year is Nike. They took the leap and focused on digital sales, which now comprises over 40% of their overall sales. And they believe that more than 50% of its business will come from digital this coming year. And although the pandemic boosted their digital sales, they had already strategically decided to focus on digital retail back in 2017. 

Here’s a few things we can learn from their digital success: 

  1. eCommerce as a channel: Nike plans to become a 50% digital business that includes both its own digital channels and those of retail partners like Foot Locker.
  2. Keep customers interested: Even throughout the pandemic, Nike continued to launch new products and kept their customers wanting more. 
  3. Extend beyond the usual: Nike’s robust ecosystem provides many entry points to its business outside of its core footwear products.
  4. Innovate: They’ve adopted the right technology to support their growth, both within eCommerce and in store.

Wrap Up

The time is now. It has never been more critical to nurture digital sales growth and increase your customer base. Meet your customers where they are. The more places your target market sees your name, the more likely they will become acquainted with your brand. Online marketplaces and department stores are a puzzle piece in the full ecosystem and a requirement for transforming digital sales.  

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