With prices in the UK currently exploding at their fastest pace in over 40 years, the cost of living crisis will also impact e-commerce. During this uncertain time, businesses need to focus on their brand, the technology they have integrated into their online journeys, and the quality of the customer experience.
Andy Mulcahy, director of strategy and insight at IMRG, the trade body considered the voice of online retail in the UK, has no doubts about the state of the market. “A lot of retailers provide us with their sales numbers so we can compare performance, and right now it’s down sharply,” he says. “It’s been extremely turbulent recently, but the difference in impact between the pandemic and the cost of living crisis is stark.”
The coronavirus crisis has been, he says, “the most disruptive thing we’ve ever seen”. But from an online retail perspective, it was a huge accelerator. Lockdowns have forced many businesses to enter the world of e-commerce for the first time. Those brave enough to embrace it have reaped generous rewards. Now, however, with all the low hanging fruit gobbled up and consumer purse strings stretched tight, it’s a different story.
“Growth today is weak,” says Mulcahy. “It’s negative, year over year, and the market is contracting.” Other measures analyzed by the IMRG raise concern. “People are spending more time making buying decisions online, and looking at the first quarter of 2022 – which is February, March and April, so that includes the first fallout from the invasion of Ukraine – compared in the first quarter of last year, checkout completion fell 22%,” he adds.
Paul Hornby, director of digital customer experience at Very Group, remains optimistic about his employer and the longer-term outlook for the industry. “Yes, retail has clearly been impacted,” he says. “But we are confident about the prospects for online retail in the UK.”
Supporting customers in difficult times
As a digital retailer with over 2,000 brands that boasts nearly five million active customers and a financial services provider offering its unique version of buy now, pay later (BNPL), Very Group is well positioned to thrive. in the e-commerce space. “As a multi-category retailer, our model is naturally resilient,” says Hornby. “Online is the place to be, and our flexible payment options are popular with our customers.”
Very Pay, which most customers use, according to Hornby, allows shoppers to pay for goods at three locations interest-free over three months. There is also a BNPL option, allowing consumers to spread the cost over a year. In the current context, the Very Group brings added value by offering visitors to the company’s website advice and tips to better cope with the cost of living crisis.
“We help customers by introducing money management content,” says Hornby. “We aim to be customer champions and natural problem solvers, so we will always think of different ways along the journey to help our customers.”
Matthew Parker, UK and Ireland country director at Vonage, a company that builds omnichannel conversations and transforms customer experiences, highlights the urgency for e-commerce organizations to invest in technology solutions; and even more in these tense times, to stand out in an increasingly dense market.
“I see post-pandemic cost reduction initiatives, but in some areas companies are doubling down,” he says. “For example, there has been an increase in technology around artificial intelligence and other tools that can bring a level of intelligent automation to the buyer experience, without losing human involvement.”
Double down on intelligent automation
Hornby reveals that the Very Group was an early adopter of conversational AI. The organization originally invested in a chatbot in 2016 to ease the workload for employees answering simple questions. “We very quickly partnered with IBM Watson to use their AI to help us understand customer sentiment, but also to generate the right responses,” he says.
The chatbot proved invaluable to Very Group customers and its contact center staff last Christmas as it was used almost 140,000 times, reducing phone calls by 17% from the previous peak. Hornby says the maturity of intelligent automation makes it a compelling business case for those looking to improve the digital customer experience.
“If a customer comes to the website or our smartphone app and asks a question that’s more complex than the chatbot can handle, they’ll elegantly escalate it to one of our customer service colleagues so there’s the appropriate level of human intervention,” he says. “We will definitely continue to invest in this technology.”
Mulcahy argues that e-commerce companies don’t have to spend a lot to improve the digital customer experience; sometimes a little goes a long way. “If you take two websites and they both offer exactly the same products at the same prices, you can generate more sales just by optimizing certain elements,” he says. “You can offer free shipping, for example, or it’s easier to navigate. There are a lot of things you can do, and now with expensive traffic to pay for and declining conversion rates, these things are essential to getting it right.
Hornby agrees: “Having friction throughout the user journey is a surefire way to send the customer into the arms of a competitor, so we need to obsess over the issues on our site and fix them. .”
Top tips for improving the digital customer experience
Vonage’s Parker believes the best way to improve the digital customer experience is to become a trusted retailer. “Trust comes down to four things: integrity, intent, capability and track record,” he says. “Brands that best demonstrate these four things, focus on customer needs, and don’t bombard people, will do their best.”
And for e-commerce players unsure of their future or where to invest, Mulcahy offers some soothing words. “Don’t panic. It’s a very different time, but it’s tough for most businesses. Those who focus on building their brand and simplifying the online journey will do well.
Hornby stresses the importance of keeping the customer at the heart of all digital design. Forget futuristic and hype concepts, like shopping in the metaverse or non-fungible tokens; what consumers want today, especially during this cost of living crisis, is a retailer they can rely on and that serves them well.
“You need to integrate the customer into all your thinking, which is easy said but hard to do,” he says. “The market will only become more competitive, so speed to market is key. This speed comes partly from the process and partly from the technology. But, more importantly, everything you do must really meet the needs of your customers. »
Retailers have had to deal with years of disruptive events. But, armed with technology and online savvy, they can now ensure a digital customer experience tailored to all of their audiences.
JYNNEOS vaccine side effects Possible side effects of the JYNNEOS vaccine include pain at the injection site, swelling, itching, fatigue, headache, nausea, chills, and muscle aches. Patients receiving...