On Internet Business

Online retail the real 2009 winner

Posted by Michael under Online Retail

UK shoppers, buying online, spent more than £5.4 billion, according to Interactive Media in Retail Group (IMRG). That’s an increase of over 17% on the same period to 2008 and a single month increase of nearly 4% on November 2009.

While that’s good news for online retail generally, the breakdown of figures is of particular interest to the online-only retail community as their index actually declined as the index for multichannel retailers rose.

Why did multi-channel retail perform better in 2009?

1. Good multichannel marketing allows the customer to choose how they interact with the retailer – this may make the difference between purchase and non-purchase with a customer who’s vacillating about making a financial commitment. Being able to buy in the way that suits them best, whether it’s a phone call to a living person or the impersonal efficiency of shopping online, can be the final impetus that triggers spending.

2. Seamless experience – the best multichannel retailers have managed to ensure that their entire team is focussed around supporting a customer’s desire to buying through the channel that they prefer – which means ensuring that they allow returns through all channels, offering loyalty rewards across channels and making voucher and gift purchases work as easily through every channel. This seems to have generated a more repeat sale buzz than online only, because customers learnt that they could, for example, make an initial purchase online, request a return over the phone (ie immediately they realised the product wasn’t what they wanted) and then use the resulting self-printed refund voucher in the nearest retail outlet.

3. Order capture – this seems to have been a biggie in helping the multichannel retailers boost their sales. Use multiple channels as back office ways to get stock from one store to another, or to help people order out of stock items for home delivery, or just to show them that they can drive twenty miles and pick up the item that’s out of stock locally, seems to have met customer needs in a way that the simple ‘out of stock’ message given by some online only retailers didn’t.

4. Multichannel staffing grew up – Web, catalogue, telephone and face-to-face marketing have different skill sets. The best multichannel retailers have found ways to ensure that staff don’t take a single skill set into each area of marketing: rather, they’ve created skill categories and trained staff moving from one channel to another to understand the customer needs they face in each channel. Confident buyers like online and face-to-face, for example, while those still needing to be persuaded often choose the telephone route so they can ask questions without worrying they will feel the pressure to buy that would be provoked by asking the same questions instore. Understanding the customer needs means that sales staff respond in a channel appropriate fashion and that drives sales, upselling and repeat business.

And the news continues to look good – IMRG chief executive James Roper says that ‘2010 looks set to produce another year of strong results for e-retail, with demand expected to remain high as consumers habitually look online for best buys, and a pipeline of significant improvements emerge, including wider product range availability, even better web sites and a greater choice of convenient and more reliable delivery options.’

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