With Australian consumers predicted to spend more than $48.1 billion this Christmas (according to research from the Australian Retailers Association) it is crucial that all retailers ensure customer orders are fulfilled efficiently and customer loyalty is sustained.
As the volume of online shopping transactions increase during this silly season, so does the potential for problems to occur. Customers demand a flawless online shopping experience, leading them to be increasingly intolerant of poor service and delivery.
Here are my top five tips for retailers to take on board during this Christmas period.
1. Solving problems with online orders
The latest JDA Consumer Pulse Report revealed that over half (51 per cent) of European online shoppers experienced a problem with an order during the last 12 months. Our surveys over the past couple of years have shown this number is slowly increasing.
This would suggest that fulfilling orders online is still a challenge for a good proportion of retailers out there.
From a supply chain perspective having accurate and timely forecasts incorporating all sales channels is critical for ensuring placement of inventory at the right locations. Knowing where demand is coming from (i.e. online versus bricks and mortar) is equally as important as where the demand will be fulfilled (i.e. in-store or home delivery).
2. Click and collect
The report also showed that click and collect is growing in popularity with 49 per cent of European customers saying they had used the service in the last 12 months. This is up from 43 per cent in 2015. The move to this fulfilment method would suggest customers are looking to convenience and cost-efficient online buying.
Australians have also been embracing click and collect with more retailers now offering this service to their customers. It does away with the ‘missed delivery cards’ that are too often seen in letterboxes and the following frustration of trying to pick up your package at a time and location that may not be convenient.
Retailers need to ensure their workforce is able to handle click and collect customers. Inventory visibility is a critical factor in ensuring the right decisions are made with regards to inventory movements. Visibility is also important to share with customers when placing orders online.
3. Customer intolerance and growing expectations
As online shopping in Australia begins to mature, I believe customers are seeking multiple touch points with retailers and brand owners—they want more than just an online shopping experience. As a result, pure play online retailers are looking for new ways to engage the customer.
SMEs in particular need to provide a seamless shopping journey that connects their physical and digital channels. Inventory visibility and the ability to execute on the fulfilment methods offered are essential in meeting customer expectations. Having a supply chain that is flexible enough to cater to those expectations can be the key to ensuring a profitable outcome for the retailer.
New store formats are also including digital with the use of interactive mirrors, beacons and self-service kiosks for online orders. The seamless interaction between physical and digital provides customers with a brand experience that creates return visits.
4. Issue resolution
As retailers improve their online offerings and their fulfilment methods, customers’ expectations are increasing. There is much less tolerance for issues with orders. Customers believe the retailer is responsible for resolving delivery problems.
Successful retailers will be those who can ensure that when there is a problem they have real-time visibility. This means knowing where the order is and maintaining a positive engagement with the customer.
Retailers must ensure that the customer can engage in any channel and receive the same brand experience across all channels. This means ensuring consistency of pricing and promotions, having visibility of inventory across the channels and ensuring that when they are in the store the right associates are in place to engage and enhance the customer experience.
According to our survey, only 34 per cent of shoppers do not return any items in an average year for non-grocery items, while 30 per cent return one to two items and 25 per cent return three or more.
This means returning items is an area of concern for most retailers. To assist retailers overcome the heavy cost of returns, they need to start adopting a more segmented approach to dealing with the different behaviours customers have around returns.
Product information is absolutely vital online and more effort needs to be put into how items are described. This could generate significant cost savings to retailers and deliver a better online shopping experience to customers.
Patrick Viney is the head of retail industry strategy at JDA Australia.
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