10 quick wins to turbo charge your digital retail strategy.
In today’s climate, retailers need to ensure that their digital investments are firing on all cylinders whilst delivering the best possible customer experience. In reality, however, many ecommerce and omni-channel initiatives are underperforming with retailers missing out on significant sales.
One case in point is a European retailer who is chasing a short-term incremental revenue opportunity worth c.€900m, through a programme of simple fixes across common customer experience problems.
So, where should retailers focus their efforts? And which areas offer the best opportunities?
Recent Javelin Group research, in which 500 digital retail criteria were analysed across the customer journey for 40 retailers (UK and international across all the main sectors) in 2016/17 resulting in a summary performance score out of 10 for each capability, has identified the principal areas for improvement for digital retail initiatives. Here are the top 10 opportunities.
1. On-site search
On-site search is consistently one of the lowest performing areas with retailers scoring on average just 5.7 out of 10 on desktop and 4.7 on mobile (but with many individual instances as low as 2/10). Search users often have a clear purchase goal in mind and therefore convert at a much higher rate than other browsers – so optimising on-site search is a clear quick win.
Many retailers recognise this and have invested in advanced search and navigation software, but are still exploiting only a fraction of the capabilities on offer. Defining the right business rules and configuring the search tool effectively are important, but success also requires a re-think of how omni-channel product information is managed across the business to facilitate effective product search and selection.
2. Product detail
Too often, retailers’ product pages do not provide all the information the customer needs to make a purchase decision, and the quality and depth of information is inconsistent across products. Winners in this area demonstrate that success is not just about good product descriptions, but also an understanding of how customers typically shop each category and the information and tools they require to convince them to ‘add to basket’.
A picture is worth a thousand words, and a video even more, but full image and multi-media optimisation across devices is an essential that is still overlooked by 70% of retailers. The cost of producing high quality content remains a barrier, but retailers who do not invest appropriately (especially for higher-contribution items) will find themselves overtaken by those that do.
The incorporation of social, user generated content is now essential. It is this general failure to weave in social and editorial content that leads retailers to score poorly on ‘Inspiration’, with an average score of 3.6 on desktop and notably lower at 2.7 on mobile.
Due to the importance and sensitivity of ecommerce checkouts in the customer journey, even small improvements can have a disproportionately large impact on the overall conversion rate. Too many steps, long pages and burdensome data-input requirements significantly increase customer loss. These factors are responsible for low scores, especially across mobile checkouts, where 58% of retailers scored poorly, suggesting untapped conversion opportunity. With conversion rates on mobile devices being 30-50% lower than desktop, fixing these basics will pay dividends.
5. Mobile optimisation
Only 13% of retailers scored well for overall mobile customer experience, with the other 87% still not covering many of the basics. Despite many retailers claiming to adopt a ‘mobile first’ design approach, in reality mobile experiences are still far weaker than desktop (even after accounting for the limitations of a small screen). Almost all of the retailers in the research scored lower for mobile than for desktop experience, illustrating latent opportunity.
6. Customer service
While in-store service scored highly across retailers (6.9 out of 10), online customer service remains a weakness (average score of 5.0) with only 10% of retailers covering all the basics well. In many cases, opening hours and contact channels are still not aligned with modern shopping habits, and ‘live support’ service channels (such as social media and live chat) are still poorly supported. This is a clear indicator that many retailers must do more to deliver good online service.
7. Delivery proposition
Three quarters of retailers fall behind consumer expectations when it comes to their online delivery proposition. Expectations are high and although some retailers offer customers both choice and flexibility in delivery at reasonable prices, many are still struggling to provide true convenience, despite the recent growth of innovative fulfilment partners and options.
8. Digital marketing
Digital marketing optimisation represents another area where 80% of retailers fall behind the mark (with an average score of 5.5). The main gap is in customer retention, where few retailers employ meaningful segmentation, targeting or joined-up CRM. Re-targeting and social marketing remain relatively immature and offer further opportunities for retailers to tailor and target campaigns based on a better understanding of their customers.
The research identified many quick win revenue opportunities in areas such as customer database marketing, search engine optimisation, pay-per-click and reassignment of investment based on a detailed view of product and customer profitability. Given the scale and dynamic nature of digital marketing campaigns, the ROI here is not only significant but also rapidly achievable.
It is well documented that customers who shop across channels typically spend far more – often twice as much or more – than customers using only one channel. Despite this, the average score for ‘in-store collection’ for omni-channel retailers was just 4.9 out of 10, indicating significant opportunity to improve processes. Really good (fast, reliable, convenient, informative) click-and-collect is now a basic expectation, anything less will drive valuable customers away.
10. Digital in-store
One very low scoring area is digital engagement in-store, in which the retailers in the research achieved an average of just 3.1. Many retailers remain poor in the use of digital content in-store and in their execution of in-store ordering. There are big gaps in cross-channel marketing of omni-channel services, such as endless aisle and personal shopping. Scores are further suppressed by the many instances of broken or seemingly abandoned in-store technology, and evidence that staff are still under-trained or poorly incentivised to help customers shop across channels. Even the highest-scoring retailers scored just 6.0 out of 10 here, illustrating that there is still much room for improvement.
These ten essentials are the most frequently repeated shortcomings and represent a significant opportunity to improve business performance at relatively low cost. The review, definition, and prioritisation of digital improvement opportunities is a rapid exercise, with the solution often being simple fixes to existing initiatives that can drive significant growth and achieve return on investment within a timeframe of 6-12 months.
Is your business leaving significant value on the table by not executing the basics of digital online and omni-channel retailing?