Monday, December 17

Raising Expectations: Online Retailers

Online sales are expected to increase this year. Online shoppers are also increasing their already high expectations. Now that almost half of all online retailers are offering free shipping, more consumers are expecting free returns too.

In fact, one recent survey conducted by Harris Interactive for Shoprunner, which is a shopping services network, shows as many as 81 percent of online shoppers say they are not likely to make additional purchases from websites that charge for returns. Sixty-nine percent also say that the process for returning online purchases is too complicated.

There are hundreds of decisions companies make that impact brand.

While most marketers invest significant time in attempting to increase sales, far too few are concerned about customer life cycle — the potential for one client to make multiple purchases for months, years, or even an entire lifetime. Some invest everything into incentivizing purchases without ever considering the other touch points related to the transaction.

The reality is that everything counts. Customers are looking for ease of purchase, speed of shipping, cost of shipping, shipment packaging, product performance, return policies, and cost of returns. The impact any of these touch points and others have can make all the difference.

How much? According to the study, customers paying for their own returns decrease spending with retailers between 75 and 100 percent within two years. In contrast, customers who receive free return shipping will increase their spending with the retailer by 158 to 457 percent in the same period.

The survey goes a long way in suggesting that customers are more inclined to consider their entire experience as part of the brand relationship as opposed to product performance alone. (The same can be said of offline purchases too, where customers have become weary of less than stellar customer service.)

There are several other areas where many online retailers can step up their game. 

• 67 percent of online shoppers would purchase more online from mobile devices or computers if they are already already familiar with the same secure, easy check-out procedure.

• 77 percent said they would spend more online if retailers offered free 1-2 day shipping (but also admit that faster shipping options gives them more reason to procrastinate).

• 80 percent of consumers say they like the option of picking up online purchases in person, a concept recently included in a New York Times article covering how online and in-store shopping have changed.

But improving policies and technologies isn't the only area where retailers can step up. Customers are keen on seeing technology improve in-store purchases too. Mobile isn't only the answer for consumers. It is quickly becoming the answer for retailers too — everything from offering free Wi-Fi to finding out more product information to giving customers immediate access to inventory that is not readily available in the store can increase sales and improve customers retention in person or online.
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