By Michael Severn
There’s no getting away from it, online retailing is massive business. Across Europe the amount of retail goods that are purchased online as opposed to in-store has been rising year on year. This is especially true for the UK where the £67 billion of online purchases made during 2017 accounted for 17.8%of total retail purchases.
The growth of the online retail sector has been continuously ahead of the growth in the retail sector as a whole. Online retail in Europe grew by 18.2% in 2015, 15.6% in 2016 and is expected to increase by 14.2% in 2017. This is in contrast to average growth rates of 1.5% to 3.5% seen across the whole of the sector.
The interesting thing about this growth is that opinions are split as to whether it can continue at such a rate and whether online purchases will ever outweigh those made in-store. Some are of the opinions that with the emergence of new technologies, such as drone delivery to reduce delivery time, and the continued march towards more ‘on demand’ convenience, the online retail market will continue to grow to a point where we will see very few physical shops in existence.
However we still seem to be a long way from this vision, especially in the UK where all of the top 10 retailers are companies primarily focused on sales in physical stores. Another telling point is that Amazon, the largest online retailer in the world, doesn’t appear in the top 10.
One interesting change to the retail landscape is that while traditional bricks and mortar retailers are expanding their online presence, traditionally online retailers are starting to purchase physical stores and create a high street presence. Perhaps the biggest example of this is Amazon’s recent purchase of Whole Foods; this move will mean the eCommerce giant has taken over more than 350 stores worldwide. This is a massive change in the retail model that Amazon has been using to date.
In addition, Amazon has been experimenting with a number of other physical store concepts including a highly technology-based convenience store and a click and collect grocery outlet. Another example is Made.com, the online furniture and home-ware retailer, who in 2015 opened a flagship showroom in the Soho area of London. The showroom allows customers to experience the goods on offer, some physically and some through life sized virtual projections, and then order online whilst in-store. This hybrid of physical and online shopping is becoming ever more prevalent along with the click and collect model that is allowing customers to shop for goods and take them home the same day without having to spend large amounts of time in-store.
The Total Retail Report 2017, from PWC, shows that consumers primarily shop online for convenience, with 48% stating this as their main reason for shopping online. However, it also shows that the customer experience is paramount to where consumers choose to spend their money. The top two factors for a great customer experience were shown to be knowledgeable sales staff and accessibility of stock. Combining the convenience of online shopping with the customer experience received in-store is fast becoming the holy grail of retail.
The combination of customers demanding an exceptional customer experience while technology and buying trends gives them the option to easily shop elsewhere, means having a consistent, robust customer service set up for pre- and post-sales is more important than ever. Customers expect to be able to easily reach out to a company for advice and support during the customer journey and failure to provide this has been an issue for a number of companies in the past, especially when introducing a new online sales channel.
While it may seem like a good option to simply extend the role of an existing in-house customer service team, this may not always be the best solution. Firstly, the volume of enquiries from a new venture such as starting to sell online, or introducing a new click and collect service, can be considerably more than expected. The types of enquiry will also be vastly different, there is likely to be far more pre-sale enquiries and technical issues which are very rare when operating a solely in a physical retail environment.
An excellent option to ensure a smooth professional customer experience is to outsource customer services to a dedicated customer contact centre. These centres are able to draw on a wealth of knowledge and experience gained from years of working with companies from many different sectors. This allows them to take best practice from all areas of customer service and combine them into an exceptional customer experience.
There are a number of ways retailers can engage with customer contact centres to support their retail operations.
A totally outsourced solution sees the customer contact centre taking over all customer service provision. This will often be with a multi-channel contact approach combining incoming calls, emails, and instant messaging. The benefit of this model is that it allows for a very consistent delivery of service which can really benefit the customer experience. Agents are able to seamlessly move between calls, emails and messaging with the same customer building rapport, using the best communication methods.
By having all customer service provided by a single centre it enables the centre to become highly specialised in handling the sort of enquiries and issues common to the retail environment. A professional contact centre will also be able to produce meaningful reports and insight in to commonly occurring enquiries or issues, allowing the retailer to make adjustments to their websites, service or products and improve the customer journey.
While a totally outsourced solution can give optimum results it can be cost prohibitive, especially if a retailer experiences large seasonal variation in demand. A great solution to this is to engage an additional team of customer service agents from an outsourced centre to help meet demand during these seasonal fluctuations.
This model gives the retailer excellent flexibility to respond to the rise in demand at certain times of year, ensuring that customers receive a seamless experience even at the busiest times.
While a seasonal demand model is excellent for retailers who can easily predict times of increased demand, for some the level of customer support required can be greatly affected by external forces. In order to be able to respond effectively and quickly to these unexpected peaks in demand, a retailer can have a team of agents from an outsourced contact centre on standby, ready to take the overflow of calls or messages from their in-house team.
This will often mean that the agents are trained to work on multiple accounts, in a bureau style, and can be a very cost effective way to manage peak demand.
Whichever solution retailers look at for managing the demands made by customers in the current and future retail climate, one thing is for certain. Both online and offline retailers are going to have to put customer service and the customer journey at the forefront of their operations to be competitive.