Getting the most from e-commerce
The UK's foremost e-commerce experts offer advice on making the most of your online retail channel
There’s a lot more to selling products online than getting a flashy website. Here’s what some of the UK’s foremost ecommerce experts have to say about making the most of this potentially lucrative channel
Online retail is big business. It is expected to account for 14% of retail sales by 2012, and forecasts predict that, as a channel, it will grow by around 19% this year. According to Tony Stockil, chief executive of the Javelin Group, annual sales of goods online will rise from £18bn (in 2009) to more than £40bn in 2012 in the UK, as consumers become increasingly comfortable with shopping online. “The market’s growing and there’s still a huge amount to go for in the UK,” he says.
However, while many retailers are waking up to the money-making potential of ecommerce, those that have ventured into the world of online sales are frequently failing to make the most of this increasingly lucrative channel. Here’s our guide to making sure your online retail offering is working for you.
Joining the dots
The first step towards a strong online offering is an understanding of how the growth of ecommerce has changed consumers’ expectations of the shopping experience, as well as how they want to shop. “Customers now want different things from us as retailers,” says Stockil, whose business helps its clients create or hone their ecommerce offerings.
“They have less time and patience than ever before. They’re more demanding of information, service and speed. They’re becoming increasingly tech savvy, more competent and better informed, and they’re no longer willing to make sacrifices to shop from retailers who aren’t willing to make sacrifices for them.”
In other words, customers expect you to make life as convenient as possible for them. They are now shopping across channels in ways that were never predicted, and your online offering needs to acknowledge this. If you are a traditional retailer who’s considering a move into ecommerce, it’s not just the incremental increase in sales that you should take into account, but also the number of customers who’ll be driven to your shops or influenced in-store by visiting your website.
“People are going to the web as their first port of call,” says John Clare, former chief executive of the Dixons Stores Group, which owns Dixons, Currys and PC World. He points out that around 60-70% of customers visiting these stores have been online first.
“Many people want to touch the products and have them explained to them, but they come armed with some knowledge of what’s available, prices and what they’re likely to buy,” says Clare.
Ultimately, whether they are going to be buying in store or on the web, you want to give them enough information about your products to enable them to make their selection online. Focus on delivering a compelling multi-channel approach, for example, by allowing customers to return online purchases in store or ‘click and collect’, which Stockil insists customers love. “If you haven’t trialled it, I would strongly advise you to do so,” he says.
The right look
Many retailers underestimate the significance of the design and functionality of their ecommerce site. Having decent information about your products is paramount. “I’m sorry to say that most retailers today present product information online really badly,” says Stockil.
He sees many retailers falling into the same trap of presenting 2D pictures of their wares against a plain white background. “You click on the product and you get a bigger box that tells you pretty much what the smaller box told you: the price and the colour. This is actually a very poor customer experience,” he says.
On the other hand, Stockil upholds the fashion site ASOS as a paradigm of ecommerce virtue. “If you want to see the way to do this stuff, look at this site,” he says. ASOS displays all of its products photographed on real models. “Of course that’s expensive, but they can amortise that cost,” says Stockil, adding that the products are well attributed, so you can search by price, colour and size. He also points out that the ASOS site has well merchandised categories to enable cross-selling and up-selling.
ASOS also tells stories about its products, such as why they are fashionable this season and who’s wearing them. What’s more, it provides several photographs of each one, showing different views, and has its own catwalk video of almost every item. The secret is to make the product the hero of the site, not the brand, with big images and lots of details, according to Stockil.
In the past, supermarkets have invested millions into trying to understand the psychology of shoppers, how they walk around the aisles and where to position certain products for maximum sales. However, when it comes to the web, presentation is often overlooked. The key to finding out what works and what doesn’t is to try out different things.
According to Paul Frantz, industry head of retail at Google UK, tools such as the search giant’s free web optimiser allow you to try different layouts and positions of items on your web pages to see which has the highest sales conversion rate. This might sound incidental, but there are examples of large retailers making tiny changes to their online presence that have boosted their sales by millions. Google’s Insights tool will show you which keywords are popular at any time, and this may help you determine which products get prominence on your site.
In particular, Frantz advises businesses to examine their checkout process. “Around 65% of customers drop out at the checkout process,” he says, adding that this is often because it is too complex, slow or laborious. Frantz says that one major retailer increased its sales by £100m over the Christmas period simply by removing the line ‘Your money is safe with us’ from the checkout page.
Essentially, the more insight you have, the more powerful your online offering will become. “Test each category, and learn,” advises Frantz.
The key drivers of ecommerce success
Tony Stockil, chief executive of Javelin Group, has drawn up an essential checklist to help online retailers make the most of their internet presence
- Get the basics right: Have the right assortment of shopping options, and understand who your customer is, what they expect and what they’re looking for from your brand. Then make sure you give it to them
- Availability: Where possible, display your complete range online in a fully searchable format, offering good availability and delivery so that customers can get the product they want, when they want it
- Visualisation: Make sure your products are displayed in an engaging way, accompanied by all the information customers will need
- Integration: If you can, build in multi-channel functionality, allowing customers to pick up goods in store if they wish – or ‘click and collect’
- Infrastructure: Having the right technical and operational set up in place to support all this is arguably the most important aspect of a strong ecommerce offering, and should never be overlooked