What 'Commerce Anywhere' will mean for retailers
With a proliferation of tablet computers and the growth of brands using mobile and social media platforms, consumer behaviour toward retail brands in particular is changing rapidly, according to Frank Lord, EMEA vice president for ATG, who examines the company's latest mobile and social commerce research findings.
UK consumers' online spending is growing, with e-retail sales reaching approximately £6.4 billion in December 2010, according to IMRG. A recent consumer study commissioned by ATG in the UK suggests some likely reasons for this continuing growth. The study, which asked consumers about their attitudes toward online shopping found that two thirds (65%) of UK shoppers rate their online experience as either "good" or "very good", with a quarter (25%) particularly favouring their ability to find what they want straight away, when shopping online.
One in five consumers (21%) like the ability to easily compare like-for-like products at the click of a button. A quarter (25%) of customers value the ability to choose their own shopping channel, whether it is online, in-store, from a catalogue or a Smartphone device, showing that cross-channel shoppers are increasingly becoming retailers' most valuable customers.
What this research suggests, according to Lord, is that brands - both big and small - are facing their most significant challenge since the advent of the internet, and how they deal with it will be critical to their future success. Long gone are the days when selling something simply involved a customer visiting a High Street shop.
ATG calls this new era 'Commerce Anywhere', and it not only requires taking into account the channel through which a customer accesses products and services, but the tools they're using to get there and even how they're feeling on that particular day. To give an example of the new levels of complexity the company has observed, a consumer today could easily research price comparisons for a particular item online using their desktop PC, search for customer reviews on social media sites using their mobile phone browser or iPad, ring up the customer contact centre to check for the nearest stockist, and then make their final purchase in store at their local shopping mall.
For retailers this could mean a huge logistical headache, and online purchasers are more frustrated by online customer service than they were a year ago, according to the results of another European study by ATG. This study found that 43% rate online service as just satisfactory or worse, a rise compared to last year's figure of 25%. The results also indicate that over half (51%) of consumers find the most frustrating aspect of shopping online is the difficulty they have reaching retailers by phone or online chat to answer questions. The second most cited frustration was trouble completing orders at the checkout (23%).
When asked which sectors offered the best levels of online service, 27% gave the highest ratings to the entertainment sector. Drilling down, the study reveals that the speed of service (22%) and the option to shop via their preferred channel (22%) is what consumers like most about buying online. The survey also found that 43% of consumers across Europe are willing to spend no more than 50 online in a single transaction. This was less than the previous year, when over half (53%) said they wouldn't part with more than 50 online.
So how can you provide a consistent brand experience across so many different channels? How can you ensure that the end-user gets the same quality of service no matter how they access your products and services? How do you cross- and up-sell, not to mention increase loyalty, when the customer is chopping and changing their habits and preferences so frequently and dramatically? These are important questions to ask in such a competitive market, and while it is technology that is enabling many of these changes in behaviour, it is also only through the use of technology that retailers and marketers will keep on top of them.
"In the new world of Commerce Anywhere, customer interactions need to be managed across any channel, any site, and any device. In order to do this effectively organisations really need to have one single engine driving the entire cross-channel commerce operation, choreographing activities across the web, physical store, contact centre, social media, and mobile commerce initiatives in a unified way," explained Lord.
At a basic level this can mean the efficient sharing of content and information from carts, catalogues, products, and promotions across sites and/or channels, while at a more sophisticated level this could mean synchronised marketing tools and personalisation options to ensure a joined-up customer experience.
The effective use of social media is also going to be vital to success, Lord concluded. A separate ATG study in the US, entitled 'Consumer Shopping Experiences, Preferences, and Behaviours', gave some insight into the trends that marketers can expect to come to British shores from 2011 onward. The study found that social media is becoming increasingly important to a broad range of age groups. For example, 29% of respondents aged 18-34 said they have discovered a product or service through a social network and 37% of those same consumers said it was "important" or "very important" that merchants provide an opportunity to interact through social networks.
The survey also revealed that older demographics are also demanding advanced shopping capabilities. While consumers over the age of 55 are less likely to leverage social media or use their mobile devices for commerce activities, the study showed that they have come to rely on more advanced on-site shopping tools such as live help and recommendations.
"The reality is that, without a considered strategy in place, most forays into social media are doomed to be at best interesting diversions - or at worst, expensive mistakes," warned Lord. "As any seasoned blogger or Tweeter will tell you, without something interesting to say or an overarching theme to offer your readers, you won't reach your audience. In essence, it's all about the value-add, and this is just as true in the e-commerce world as that of the bedroom blogger."
There is no point having a corporate Twitter feed that never gets updated, or a Facebook app that doesn't relate back in some way to your brand or product offering. Similarly there is no point in developing an incredible, interactive social media hub for your customers, if the experience they have when the go in-store is old-fashioned and formal.
In addition, a common problem for many businesses is being able to directly link social media activities to ROI. For this reason, it's important to establish what goals to set for a social media campaign.
"Where some analysts have noted that social media channels such as Facebook and Twitter aren't directly generating transactions, perhaps that's not the point," explained Lord. "Businesses should consider the overall role of social in the total buying process, and the influence that social channels can have in ultimately affecting purchase, even if it isn't driven directly from a social channel."
Social media is therefore just one part of the overall mix, sitting alongside other channels such as email, in-store and click to call services. Social media is clearly an exciting and interesting one, no doubt - but certainly not capable on its own of resurrecting a failing brand or ensuring long-term customer retention. Marketers need to remember that the roots of good business are the same whatever the channel, and that while social media technologies provide a great opportunity to improve customer service, it is consistency across every touch point that will really help raise your brand above the competition.
More brands than ever are keen to target new markets and engage customers through multiple channels, as mobile devices, social media and cross-channel interactions all represent a huge opportunity for retailers to expand their offerings, increase revenues and build their brand reputations. But this can't be at the expense of excellent customer service.
Success for retailers and brands alike now hinges on the implementation of functionalities that allow consumers to not only view and select products, but to share opinions and to connect with the brand and their peers in new and innovative ways that are far removed from traditional shopping habits. To avoid dissatisfaction and ensure success, it is crucial brands cast a critical eye over every interaction point they have with the customer and constantly assess how they can improve service levels. If they don't, the customer will simply go elsewhere - more quickly and more easily than they have ever been able to before.