Internet Retailing Conference yesterday was pretty spectacular with a stellar line up of speakers from the online/offline world. Most were from larger high street retailers and it was interesting to hear their stories, what worked for them and more importantly what definitely didn’t work.
What do consumers want?
This is such a stunningly simply observation and one that every online retailer can use, whether they’re running a multi-billion pound empire or simply turning over a few thousands of pounds in their eBay shop.
Jeremy Fennell, Ecommerce Director at Dixons is an advocate of technology, but estimates he needs to spend around £40 million to get the systems he wants so it’s not going to happen over night. In the mean time he’s looking for short term wins that are easy to implement.
Jeremy’s top tip is to look at your website analytics (or eBay shop traffic reports) and find out what customers want. Most of us probably do that anyway and use our top searched for terms to decide which items to promote in our shop windows or website home pages. What Jeremy looks for is key search terms for stock that Curry’s don’t actually sell.
We all know Curry’s/PC World sell Fridges, Cookers, Washing machines and computers, laptops etc. However their one of the top search terms on their website is for “Sewing Machines” and that’s something they don’t and never have sold in the past. Jeremy assured us that Curry’s will have an introductory range of sewing machines in stock for Christmas, but what are your customers looking for in your shops that you currently don’t sell?
Sean Mckee, Head of Ecommerce at Schuh had some interesting insights. They’ve tried various forms of technology including nailing massive iPad type touch screens to walls in stores. They didn’t work. Or rather the technology worked enabling customers to find stock in any store in the country, find similar shoes in various colours and sizes, but customers simply didn’t want to use a touch screen wall.
Interesting Sean concludes there’s little point in Schuh investing in technology that at best will be refreshed every four years or so. Why not simply make use of the most up to date technology which consumers carry around in their pockets and are happiest using. It doesn’t matter if your an iPhone hippie, an Android lover or if you’re still crossing your fingers that Blackberry will survive, the fact is that most people get a new mobile smartphone every one or two years and Schuh simply need to utilise the technology that their consumers have invested in.
There was a lot of talk about the challenges of selling online and offline. Curry’s again admitted that pricing was a difficulty especially with pure play online competitors. They could easily compete on price, but it would cost them around £140 million a year in lost profits and the only make about £60 million a year so that’s not going to happen. However what they are going to do is put QR codes on everything to make it easy for consumers to compare prices.
They say that they know consumers will compare prices so why not make it easy for them? Whilst consumers may be able to buy cheaper online by showrooming, if they’re in the store and want the item today they may still make the purchase. Currys are also strategically lowering prices where they can to remain competitive.
Systems are a huge problem, Hotel Chocolat told how Red Technology designed a new system for them which had to be simple for someone placing a single order for home delivery, but combined the possibility of multiple purchases with multiple delivery address, reserve in store, pay online pick up in store, gift wrap one item for delivery to one address, pick another up in store on the way home and a forward reservation for a special purchase for a future delivery date. On top of all that if some deliveries are international (they have a US nexus so have to take into account US Sales Tax, EU tax and zero tax for rest of the world). It’s massively complicated, but these are the challenges retailer face.
Other retailers such as Fat Face also offer a blended online/offline experience and one of their challenges is returns. If someone buys online they’re happy for the item to be returned in store, but only if the customer paid with credit/debit card. If the customer paid with PayPal (and increasingly their customers are choosing PayPal), then they currently don’t have the ability to make a PayPal refund in store.
Only in Russia could they be in the middle of building a motorway to come back and find that 1km of road had been stolen. That’s the whole lot from the Arco barriers to the tarmac to the road signs, the whole lot gone.
Chris Mangham, IT Director of M.Video.ru spoke of the challenges of operating in Russia and how difficult deliveries are even in country, let alone for sellers based outside of Russia. Russia is a massive country and yet they have no universal courier or postal network which covers the entire country.
Whilst deliveries to Moscow, St Petersburg and Novosibirsk aren’t too bad the rest of Russia is pretty much serviced by each of M.Video.ru’s hundreds of stores also acting as local distribution centres. Even so talk of 18+ day delivery times inside Russia is pretty scary for ecommerce retailers and will have to be solved before selling to Russia becomes mainstream on eBay.