Out of site, out of mind: are retailers missing the e-commerce mark?
There are more smartphone subscriptions in SA than there are people (60-million[i]) which should tell us something about the e-commerce or m-commerce boom that has just happened. Despite this almost blanket penetration and its implications for connectivity, local retailers are still in the process of coming to terms with online customer strategies – let alone mobile-first strategies. Bar a few outliers, many have been slow to the party and remain focused on their bricks-and-mortar presence when they should be investing as much, if not more, time and money in mobile customer experience specifically.
Sure, e-commerce retail (e-tail) is but a sliver of the overall retail pie (about 2.8% or R30bn in value) but it is growing exponentially among an increasingly broad base of consumers. And there is a simple reason for that: almost everyone is on their phone; they’re reviewing, researching, shopping and searching. All in, this is about 4,38 hours a day of phone time, according to HMD Global[ii]. Why then are brands missing the e-commerce mark?
It could be a case of out of site, out of mind. Websites, mobi sites and apps live digitally, and when not used are quite literally gone from view, unlike stores. But, while sites and apps may not always be visible to CEOs, nor of perceived importance compared with the traditional retail with which senior managers may be more comfortable, they are constantly being used by millions of users.
A case in point is Checkers’ Sixty60 app. It is now the number one grocery app in the country. The relatively new channel has been evolving pre-Covid and, due to its huge popularity surge, is regularly making tweaks such as its live tracking feature[iii] to improve the experience for those who prefer to do their shopping via their phones – all 1.5-million of them.
Or consider wellness brand Faithful to Nature. While it has taken the Yuppiechef route and gone from online to offline with the launch of its first retail store, its online sales numbers are through the roof: in 2017 the brand filled 100,000 orders, and, for the first time in 2020, 20,000 of these orders were delivered in one month alone.
Without labouring the point, the Mr Price Group announced in May 2021[iv] that it had reported a 64,1% increase in online sales in the 53 weeks ended April 3 2021. CEO Mark Blair says: “The group’s investment in its online offering over the past nine years continues to generate profitability, particularly in a year where this channel’s importance to customers increased significantly.”
And there’s the kicker: Covid. There is no doubt that online shopping, through whichever medium, has been catapulted into the stratosphere. Home is the new hub, and it is where consumers spend a large portion (even most?) of their time, whether for work or for leisure. In fact, so democratised has online shopping become that the latest South African Digital Customer Experience Report reveals that e-tail has truly gone mainstream even among consumers with household income of less than R10,000 per month, 73% of whom reported having shopped online.
With so many eyeballs on screens, it baffles me that so few brands are taking their online/mobile/app experience seriously enough. So significant is this that the same report reveals that R30bn is being left on the table by e-tailers due to poor customer experience and cart abandonment. That is the same size as the entire e-commerce market, meaning there is potential for it to double when changes are made with respect to a site’s trustworthiness, ease of use, security, delivery and after-sales support. In fact, if online customer experiences were improved, a whopping 96% of consumers surveyed for the report said they’d spend more online (between 10% and 75%). What more motivation is needed?
While the online journey is an essential part of the e-commerce experience, the offline end-game is just as important. This is the delivery of the product and its unboxing, a key moment of truth for the consumer. So critical is this that consumers say these two elements were the most memorable part of their e-commerce journey, according to our report. Delivery doesn’t only refer to the actual drop-off at the consumer’s destination of choice, it also refers to the cost and timelines. Of course there is a financial business need to cover through delivery costs, but many consumers find them too high, while length of time delivery takes can make or break a sale.
Amazon Prime has got this right with its subscription model, but we can’t keep looking at international brands as our North Star, we need more local examples of brands that are doing it right. We have Takealot, which deserves a big mention, and which is repeatedly called out as an SA e-tailer that is hitting out of the ballpark. Superbalist, which is also a subset of the former, needs a shout out too. But these are few and far between. Even simple things such as transparency about shipping timelines and enhancing the unboxing experience by using nice packaging – this really is not difficult – can make a huge difference, especially when you consider that unboxing has become one of the most watched themes on YouTube!
When done right, consumers are dishing out the compliments: 78% say they would tell their friends and family about a good experience, while 56% would post it on social media. Don’t take this word-of-mouth, or mouse, lightly; consumers are on their phones for almost five hours a day. They are seeking feedback from their peers, reading reviews and watching unboxing videos before they buy. While the shopping experience exists online, so does its praise. It doesn’t take much to look at Tripadvisor or Booking.com’s recommendations and reviews on a mobile phone when arranging travel. What someone else has said about their experience will likely influence the outcome of reserving that room and pressing “pay”, just as a negative review would stop nearly two-thirds (64%) in their tracks.
Covid has changed our behaviour forever. Online shopping is here to stay, and brands need to get on board by making their customers’ online experience is as good as, or better than, it is offline. Out of site out of mind is simply not a good enough excuse.
Julia Ahlfeldt is a CX professional and co-author of “The South African Digital Customer Experience Report”.
The big take-out:
Online shopping is here to stay and brands need to get on board by making their customers’ digital experience as good as, or better than, it is offline.
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