By Paul Murphy, Head of Commercial Development, OpenMarket for Fourth Source
The much-discussed ‘death’ of the High Street has perhaps been overstated, but while many consumers still head there on a regular basis, it is no longer the only option. Instead, we do our shopping whenever we want and wherever we want: in-store, online, via mobile or a mixture of the three. An increasingly tech-savvy consumer-base has made omni-channel retailing a reality, one which brings with it greater convenience and choice for shoppers. In this new retail environment, retailers are now faced with the question of how they maintain control over their brands while simultaneously providing a high quality customer experience.
E-commerce – which is set to grow by 18.6% in the next year to £156.67 billion in the UK alone – has allowed shops to sell to a more varied audience, but has also placed greater emphasis on providing a seamless experience for the customer: from browsing to payment, to delivery and in certain cases returns . This isn’t easy. Modern shopping has so many moving parts, that putting the product in the consumers hand has become much harder, especially as more goods are bought online. Greater importance is being placed on delivery with missed or late deliveries, making headlines every holiday. In fact, earlier this year UPS announced its intention to add a surcharge to deliveries over the holiday period in response to what it called the ‘unpredictability’ of online shopping habits.
Missed deliveries not only cost companies financially – in the region of £6.50 each time – but harm the retailer’s brand too by failing to deliver on the promise of convenience which online shopping is based on. Retailers must find a balance between a financially viable approach to deliver and keeping customer experience consistently high from the moment an item is bought until the moment it is received. One solution retailers can explore is making sure that the customer is aware when their parcel is due to arrive, providing the option to reschedule delivery at their leisure and arranging collections when necessary. At the same time, letting customers know in good time when their parcel is delayed is much more preferable to waiting in all day for a delivery that doesn’t come.
One of the biggest recent developments in retail over the last year has been the ‘Click & Collect’ service. The service has become something of a phenomenon of late with John Lewis, seeing it overtake home delivery over Christmas, making up 56% of the company’s online sales. This approved to be a great success in getting shoppers back in store, increasing the chance of making additional sales. It is also good for consumers too, allowing them to pick up their shopping from a store of their choice at their own convenience. Yet, it has brought its own challenges with it. Convenience is still the key here. Retailers don’t want customers sat waiting for their items becoming frustrated while staff search through warehouses. Therefore retailers must ensure that, once consumers are in store, they are not waiting around for too long for their item and are also able to browse the store comfortably while they do wait.
Effective communication from retailers – and third-party logistics companies where relevant – is the key to mitigating these challenges. As simple as this may sound, it isn’t. An omni-channel retail landscape, by its nature, offers a variety of ways retailers can interact with their customers and vice-versa. Choosing the right one of these is half the battle.
This requires an understanding of the modern shopper: time-starved and always connected. In the examples outlined earlier – home delivery and ‘Click & Collect’ – communication must be prompt, reliable and direct.
While email might be well suited to the delivery of certain information – electronic receipts, marketing communications and order confirmations – it is not perfect for every instance. When it comes to deliveries, email alerts can be easily missed. Similarly, a ‘Click & Collect’ shopper is unlikely to check their email as they browse a store while they wait for their item to be ready. In fact, email open rates for the retail sector currently are 23.6%, making them too unreliable for this application.
SMS by comparison has an open rate of over 95% and is available on virtually every mobile handset in circulation (mobile phone penetration of the UK adult population was at 92% last year), making it a more immediate and relative option in the urgency of these situations. For shoppers who are on the move – which is particularly relevant to ‘Click & Collect’ – text messaging is the most effective way of communicating status updates. Likewise, for home delivery situations, text messages are far more likely to be seen, resulting in fewer missed deliveries.
As more and more of the retail landscape changes beyond recognition, timely and relevant communication will be fundamental to ensuring that customer and brand experience is consistent. At the heart of this will be a successful omni-channel retailing strategy – Interactions will become more efficient and reliable than ever.