Back by popular demand! We’re showcasing the best of TheCustomer, featuring the most popular articles from the past quarter. This article was originally posted on April 14th, 2022.
How can sellers keep the online consumers they’ve won over the past two years?
After two years of disruption and navigating much of daily life through screens, many people are ready for a return to something resembling pre-pandemic life. As more countries reopen or reduce their restrictions on dining and shopping, there’s a question of whether shoppers will return to brick-and-mortar stores and, if so, how much of their online spending they’ll redirect to in-store purchases. For omnichannel retailers, this is a question of resource allocation. For pure-play eCommerce merchants, the stakes are higher.
by Rafael Lourenco
How can sellers keep the online consumers they’ve won over the past two years? ClearSale’s most recent survey of online shoppers in the U.S., Canada, Mexico, Australia, and the U.K. offers some answers. The online survey asked approximately one thousand adults in each of those countries about their shopping behaviors and attitudes in March 2021. One of the questions – asked before the Delta and Omicron waves swept through many regions – was, “Now that stores are starting to open back up, what elements would be important to keep you shopping online instead of in-store?”
Of the nine elements they could choose from, four were important to half or more of the survey participants: price, shipping, convenience, and selection. Here’s how online merchants can use this information to audit their competitiveness and adjust, if necessary, to keep their customers loyal.
Price matters most for many online shoppers
77% of surveyed consumers listed price as a factor that would keep them shopping online, with little variation across age groups and monthly spending levels. This highlights the need for merchants to price items to compete with online and physical competitors. However, competing only on price can be a race to the bottom that everyone loses. The alter
native is to add value for the customer that compensates for a slightly higher price.
For example, eCommerce merchants can offset some of the pressure to compete on price by reducing friction in their store. One recent study found that 43% of online consumers said they’d pay more for an item if they could find it “in just a few clicks.” This highlights the need for online retailers to streamline their website navigation by making it easy to find the most popular pages and categories, offering menu tools that are mobile-friendly, and ensuring that pages load quickly so customers can find what they want without having to wait.
Another option for mitigating price pressure is to focus on sustainability. An October 2021 global study found that 34% of online consumers are willing to pay an average of 25% more for “sustainable products or services.” Among U.S. online consumers, the study found that 42% are willing to pay 37% more for sustainable purchases.
Fast shipping and delivery options
The online shopping element that drew the next most responses in our survey was shipping speed and options. 65% of consumers across all countries said this is important to their decision to shop online rather than in-store. The importance of shipping varied by country. Only 60% of U.K. shoppers said it was important to them – the lowest among all the countries surveyed. Meanwhile, 76% of Mexican shoppers said shipping speed matters in their decision to shop online – the highest percentage among the country groups.
These findings highlight the fact that, as EY notes in its recent consumer index report, “online consumers no longer will tolerate slow or missed delivery window expectations.” They also expect choices, so that they can pick a more expensive option when they need rush delivery and choose free or lower-cost methods when the timetable is less urgent. Regardless of which shipping options online merchants provide, it’s wise to include package tracking to reduce customer stress about deliveries, reduce the risk of package theft, and create a data trail that can prevent chargebacks based on fraudulent claims of non-delivery.
The convenience of online shopping was a deciding factor in where to buy for 61% of the shoppers in our survey. As mentioned above, many online consumers are willing to pay more if they can find what they’re looking for fast. There are other ways merchants can update and streamline their site and customer experience to make it more convenient—and more competitive.
One option to streamline your CX is to start providing digital wallet options or expand the number of digital wallet options available to customers. 71% of online consumers in our survey said they use a digital wallet instead of a credit card when shopping online. Only 28% said they always have their credit card handy while making an online purchase. In many cases, it can be faster or simply easier to navigate to a store that accepts digital wallet payments than to get up, find the credit card, and key it in.
Merchants can also review their checkout to look for friction points they can remove to increase conversions. 35% of our survey participants said they’ve given up on an online cart because checkout took too long or was too complicated. 32% said they’d left a cart online because the site required them to create an account.
Convenience extends beyond clicking on “buy now.” If the customer’s order is rejected in error by overly rigid or fully automated fraud controls, what had been a convenient, positive experience turns negative. Customers are not especially forgiving of this. In our survey, 40% said they’d never come back to an online store after a decline. 34% would complain about it on social media. The solution here is to fine-tune fraud rules to fit the merchant’s typical customer behavior and to manually review flagged orders to reduce false declines.
Focusing on price, shipping options, and convenience may seem like simple or obvious steps for online merchants to take. However, they’re more important than they’ve been in the past two years as in-store shopping returns. Using consumer data to understand the nuances of what makes a price seem reasonable, what shipping options shoppers want, and which aspects of the online buying experience can be more convenient, eCommerce merchants can keep and grow the customer base they’ve built even as those customers have more shopping options.
Rafael Lourenco is Executive Vice President and Partner at ClearSale, a global card-not-present fraud protection operation that helps retailers increase sales and eliminate chargebacks before they happen. The company’s proprietary technology and in-house staff of seasoned analysts provide an end-to-end outsourced fraud detection solution for online retailers to achieve industry-high approval rates while virtually eliminating false positives. Follow on LinkedIn, Facebook, Instagram Twitter @ClearSaleUS.
Photo by DESIGNECOLOGIST on Unsplash.