[NEW DATA] Shopper expectations in online retail

By Jacky Broomhead

This article will share some results from the report ‘What’s important to online shoppers?’, and reveal online retail shopper expectations and preferences around:

  • product description
  • delivery options
  • service and proposition
  • ethical goods

You’re a busy person. Maybe you’re stuck in an office or work the night shift and you’re simply not available during what are considered the normal hours of the day.

But you really want that cashmere jumper you saw on Instagram and getting to the shops isn’t easy. So, what do you do? You order it online and use the retailer’s convenient click and collect service.

And you know what, you are not the only person doing this.

Sales growth in retail is increasingly being driven by online shopping as companies expand the number of channels to better serve the modern shopper.

This all sounds great for retail and even better for customers. But while sales are going up, margins are heading in the opposite direction. Retail profits are being hit by higher operational costs of a more varied distribution network, more fulfilment options and the expectations of increasingly demanding customers.

To better understand the challenge of growing sales but lower margins, last year we produced a report on managing the omnichannel cost-to-serve. Our research highlighted that while omnichannel customers can have a lifetime value three times higher than those who shop via a single channel, they also have a significantly higher cost-to-serve.

The report also found while retailers have a good grasp of their costs at an intake margin level, new areas such as cost of delivery, returns and support at a product and channel level were not being measured – hindering a true view of net margin.

And while customer-centricity does make for successful retailing, it wasn’t always clear whether omnichannel investments were aligned to what the customer really wants.

To help retailers decide where to invest when it comes to service, our next step was to truly understand what is driving customers when they shop across channels. We wanted to find out what is important to them and what they are looking for when browsing, selecting and purchasing fashion online.

This led us to partnering with Drapers to carry out market research and ask a pool of 2,000 UK fashion customers what they really value when shopping online.

The findings paint an interesting picture and reveal some key trends around trust, quality, convenience and cost, with variations across the age and sex of customers.

Painting an accurate picture

Communicating product information like colour, description and size is a basic component of online retailing, yet it seems we’re not always getting it right.

Less than 20% of customers surveyed said they often trust the information about products they see on a retailer’s website.

And customers pay attention: research from Shotfarm found that customers notice discrepancies in product information across different websites and that it impacts how likely they are to purchase. How products are depicted and described online – in particular the quality of that information – is therefore key to converting the customer.

Failing to provide accurate product information also leads to costly returns for retailers and damages customer retention. More than 70% of those surveyed said they would return a product that didn’t match the online description and almost 30% said they would avoid shopping on that website again.

To provide a better customer experience, personalisation has become a key focus for a growing number of retailers. However, just 15% of customers said they would share data in return for personalised information and as many as 60% said they would not feel comfortable sharing data at all.

A saving grace for retailers investing in this area was fast 1-click checkout facilities, which proved a comparatively popular reason for sharing personal data as 23% said they would provide information for this reason.

Age, unsurprisingly, was an important factor when sharing data. Almost 76% of those aged over 55 said they would not feel comfortable sharing data for any reason, compared with around 40% of those aged 18-24.

More haste, less speed: efficient delivery services are key

When it comes to receiving goods, customers expect a wide variety of delivery options and more control over how and when items are delivered.

More than half of customers now expect to see next day (58%) and click and collect (55%) as standard, while only 1 in 10 looks for same day delivery, 60-minute or named-hour services.

39% said it should be “cheap”, 32% said “convenient” and only 21% “fast”.

We also saw were variants across the age brackets. 43% of 18-to-24-year-olds chose “cheap”, compared with 33% of 35-to-44-year-olds, for whom convenience was the top priority.

And it is crucial retailers roll out new options and partners carefully as the research found online retail shoppers are more likely to blame the delivery company when it goes wrong (68%), but many will also blame the retailer (47%).

This means no-one can hide from errors, even if you weren’t the one responsible for the delivery.

A customer is for life

As the amount of online sales continues to increase, it is vital that we understand what customers value from their shopping experience so retailers can continue to count on their custom.

When we asked customers which area of the clothes shopping experience is most important to them online, the most popular answer at 39.4% was they want “a clear representation of the product”, followed by good delivery options at 13.7%.

44% of women said clear representation was the single most important aspect of online shopping, compared with 34% of men.

Price and affordability was another important consideration for customers when asked which statement they agreed with most about their favourite retailer at 53.2%. The oldest age group, 55 years and up, felt most strongly about this at 57%.

Fit was the second most popular answer when customers were asked to think of their favourite retailer, at 49%, across all ages but was more of an issue for women with 55% saying it was most important. Furthermore, 37% said a poor fit that did not match the description was a big bugbear.

An extensive range was as important as affordability to younger shoppers at 51% for each response. While for all other age groups, they desire a combination of affordability, followed by fit.

Are customers more ethical today?

Today we’re seeing more companies invest in sustainable initiatives and are using their online channels to promote this.

But at the end of the day, does it really impact the customer? Our research suggests this is far down the list of priorities.

54% of those surveyed were not aware fashion retailers are increasingly publishing their sourcing principles and supplier lists online. Fewer than 10% were aware and had considered it and 22% were aware but had not looked into it.

The results were consistent across gender but differed dramatically when we factored in age. 17% of 18-to-24-year-olds were aware that retailers are publishing their sourcing principles and had considered it, compared with 6% of those aged 55 and over.

When drilling down into this topic further, we asked customers how important certain aspects were to know about how their clothing product is sourced. Good working conditions and fair pay were the top two responses at over 30%. Good working conditions were particularly important to women, 37% deemed them very important, compared with 24% of men.

Meanwhile, the carbon footprint of a company was more important to those aged 18-to-24, at 23%, compared with an average of 18%.

Improving the online experience doesn’t have to cost the earth

What is abundantly clear is there are significant opportunities to grow your business by making it easy and enjoyable for your customers to shop online.

Delivering on these requirements can involve a significant amount of investment in resources, process and systems, but it doesn’t have to. While the options for how you present and fulfil your product can be vast, our survey results show customers still value the basic elements when it comes to shopping.

 

By Jacky Broomhead, Market Development Manager - Apparel, GS1

Download the report What's important to online shoppers? 

 

 

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