E-retail sales climb as UK consumers stay home
The current growth in the United Kingdom's online retail sales volume is expected to continue, despite the improving weather, according to Kara Trivunovic, senior director of strategic services for StrongMail.
It is perhaps an unexpected benefit of poor weather: many consumers stayed at home, even when they wanted to go shopping. As a result, a three-year high in online retail sales has been observed and widely reported in the media.
But, Trivunovic argues, this growth is not merely a reflection on the UK's bad weather, but it may be equally due to the advanced online sales techniques that retail web sites have been adopting, all of which are likely to prompt customers to continue to choose the sofa over the high street more often, whatever the weather.
Online retail sales reached some 5 billion in the UK in July 2010, a rise that was said to be a result of unseasonable rainfall. But everyone is looking for a bargain, and online shopping has made it easier than ever to comparison shop. The internet also has a number of advantages, including being absolutely immediate, always accessible, and not requiring parking. Even in poorer economic times, consumers still need to spend money, but they simply want to get more for that money. Factor in the rise of member-based, limited-time, designer sales web sites, and today's shopper can be forgiven for thinking they have found a virtual shopping heaven.
Retailers have reported success when offering exclusive designer sales for years. For example, H&M experienced overnight successes when designers such as Jimmy Choo, Comme Des Garons and Stella McCartney ran their exclusive sales in the store. Shoppers are desperate for the latest designers but at knock-down prices. And if they don't have to face crowds of people sifting through racks and piles, then that's even better.
Online shopping is a proven, successful channel for driving revenue for many retailers, but how can a retailer offer the same kind of bargains on only a small number of garments? After all, when the stock is gone, it's gone. This means that customers have to act quickly to get new bargains. This mindset of 'bargain hunting urgency' is not a negative, though. In fact, some companies have turned it into an entire business model.
Previously, retailers of this nature have been challenged by serious lag times in email distribution, which directly impacted customer satisfaction. For example, if the sales alert arrived to the inbox for some customers at 10 am and for others at 11 am or 12 pm - some of the much desired inventory could already be gone, limiting the equality for consumers to gain access to the inventory.
Some of these retailers have found a way to get these offers and sales notices to their clients faster - which means more real-time traffic to the site, and greater customer satisfaction - using what is know as 'burst email' technology. This method of email distribution enables companies to deliver millions of emails within a five-minute time frame, providing all customers with an equal opportunity to take advantage of limited-time sales events.
Hautelook is one such example, being a US-based fashion web site that starts up to 12 sales daily, each lasting 48-72 hours. Hautelook recently deployed email burst technology to manage its 60%-80% off designer merchandise sales and each of its 2+ million customers receive a personalised email, tailored based on their shopping behaviour and email preferences. To achieve this, HauteLook set up a dedicated email system directly connected to its customer database, allowing each email campaign to be generated 'on the fly' and sent out rapidly. The dedicated mail server guarantees that sufficient resources are available to send the emails out, rather than sharing resources with other companies on the email platforms that most service providers offer.
The necessity for this approach actually came at the demand of the consumer, which suggests that brands no longer fully control or drive the marketing experience. Consumers know that there has been a swing in power and they are taking full advantage of it to get the information they want at exactly the right time.
As consumers - and their expectations - become more and more sophisticated in the ways of email messaging and online marketing capabilities, the marketing programmes and brand experiences offered to them must be equally sophisticated. If not, retailers may find their share of the online market diminishing as their customers ride off in to the sunset with a competitor.