Customer Expectations Are High This Holiday Season: How Can Retailers Excel?
By Erik Morton, CommerceHub
For retailers, customer experience has become the holy grail. According to recent research from Deloitte, improving customer experience and investing in new ways to engage customers is critical to ongoing success for retailers. With e-commerce sales expected to reach between $144 billion–$149 billion this holiday season, retailers who are able to create a seamless, convenient experience for customers have the upper hand. To do this effectively, they’ll need to bring together physical and digital while offering an amazing product selection that’s readily available and can be delivered fast.
Here's a look at how retailers can stay on top of their game this holiday season.
Embrace The Physical + Digital For More Consumer Convenience
With the adoption of cloud-based software and smart mobile devices, retailers’ ability to connect their physical and digital presence has become significantly easier, as shown by the rise of buy online, pick-up in store (BOPIS) and buy online, return in store (BORIS). Every consumer has a different purchasing pattern – which is largely driven by convenience – meaning that retailers need to focus on having the right products in the right places.
Because convenience plays a large role in customer satisfaction, retailers need to act. According to a recent survey, 68 percent of consumers said they preferred BOPIS when making purchases. When consumers elect to pick up their purchases in-store, retailers are not only able to reduce their shipping costs, but also to sell even more product, as these same consumers (85 percent) tend to make additional purchases once they come in-store to retrieve their orders – something that could easily feed into holiday sale buzz. In fact, Target CEO Brian Cornell recently noted that moving the company’s digital fulfillment from distribution centers to stores cut costs by 40 percent and that Target is now planning on fulfilling more than two-thirds of digital orders from physical stores. What’s more, BOPIS caters toward consumer’s desire for instant gratification, a concept that isn’t going away.
Additionally, BORIS has continued to gain momentum, among both retailers and consumers. For consumers, many choose BORIS (58 percent) to help alleviate the hassle and fees often associated with returns. For retailers, embracing BORIS not only reduces return shipping costs, but also provides upsell opportunities, potentially leading to higher sales numbers and orders on items that may have a shorter shelf life because they are available and can be returned easily.
Put An End To Cancelled And Out Of Stock Messages
“Right time, right place” in today’s consumer speak means “right here, right now,” something that is only becoming more ingrained in retailer’s strategies. It’s not uncommon for consumers to have experienced the frustration of hopping online to purchase the perfect gift and getting hit with the “out of stock” message – a challenge that typically ends in an abandoned cart and searching for the product elsewhere.
Retailers stand to miss out on nearly $1 trillion in sales because they don’t have what customers want to buy. And while this problem stirs agitation and causes stress for consumers, it is something that retailers can easily avoid with the right approach.
By tapping into virtual inventory – the expanded assortment of products enabled through drop shipping – and executing on proper resource planning and logistics execution, retailers could potentially have no sell outs at all, enabling them to keep customers happy and maintain their brand promise.
Meet And Exceed Delivery Expectations
A final key to success this holiday season will be perfecting shipping and delivery. Gone are the days when getting packages a week or longer after an order is placed is acceptable. New and improving technology is giving retailers the ability to strategically expand inventory assortments, fulfill orders faster than ever before and track deliveries to better meet customer needs and expectations. By implementing these advanced back-end processes, communications between retailers and fulfillment/shipping centers have never been more seamless.
Technology is also giving retailers more visibility into fulfillment processes, which is enabling them to create routine efficiencies and capture data to drive their businesses forward year after year. What’s more, these insights can help drive real-time decision making, allowing retailers to keep consumers aware of the status of their orders and stay ahead of delays in ways that couldn’t be managed before, which supports retailers’ growing need to stay ahead of customer expectations.
Retailers need to ensure that the customer, and their satisfaction, is at the core of every strategy this holiday season. Whether it is a newly implemented or enhanced approach, a retailer’s ability to carry out a seamless crossover between physical and digital retail, minimize out-of-stock cancels and meet and exceed delivery expectations is essential to their success. And with this success comes happy customers, who in turn, will only be coming back for more.
About The Author
Erik is responsible for product, strategy and corporate and business development at CommerceHub. He has 15+ years of experience spanning technology, public markets, finance, strategy and operations. Erik joined CommerceHub in 1999 and returned to the company in 2012 after founding and running ecommerce software provider Initiate Commerce and serving as head of products and services at Merit Pages.