The high street is slimming down at an alarming rate, with more than one in 10 retail units currently vacant, but at the same time online retail is experiencing a relative boom. Online sales in December 2012 were up 17.5 per cent year on year in the UK, according to industry body IMRG. Without online, retail sales would have actually fallen.
Many bricks-and-mortar retailers have failed to capitalise on the growth of online shopping, leading to their demise. Jessops recently disappeared from town centres altogether, Blockbuster shed 129 stores after calling in the administrators and HMV is now likely to close around 100 stores after cutting 190 head-office jobs.
It’s now just as important for brands to make their products stand out in browser windows as in shop windows, and some companies are looking to social commerce to fuse consumer engagement with the buying process. Stella Artois, Doritos and Innocent have all trialled a new app called Slingshot, which runs on social networks such as Facebook. It allows users to add products to online shopping baskets on supermarket websites, directly from the brand’s Facebook page.
Stella Artois used the application following the launch of its new product Cidre Pear last year. The brand claims to have gained 6,000 likes and 300 shares for the Facebook page in the three months from August 2012, although it has not revealed how many of these have been converted into sales.
It is early days for this type of activity, and while it is certainly an interesting experiment for those bold enough to give it a go, there are many brands that need to take stock and get the basics of ecommerce right first in order to succeed in a very crowded online space.
White goods manufacturer Beko is one brand attempting to do this, in a category that is not well known for helping customers to make an informed purchase decision online. Manufacturers in this sector will often offer several subtly differing models at varying price points.
According to Beko marketing director Teresa Arbuckle, shoppers are often baffled as to why they should pay one price for a 1,000 RPM speed, 9kg washing machine and a different price for a similar model with a slightly better energy performance. Therefore, Beko has introduced an online comparison tool, making it easier to compare one of its models against another.
Arbuckle says: “Research showed us that consumers saw lots of similar products so it’s important to understand why one machine is so much more expensive than another. If you have a faster spin, for example, you are going to pay more for that.”
She adds: “We’ve changed the tone of the website; it’s much more friendly and approachable, rather than being laden with lots of technology speak.” Since unveiling of the website revamp, Arbuckle claims there has been a 50 per cent uplift in visitor numbers, with 140,000 clicks a month.
But one analyst argues that Beko’s example is by no means typical of either retailers or product brands. According to Rebecca Jennings, principal consultant at Global Reviews, many businesses are failing to make an impact online simply because they are not using their website as a marketing tool. “Instead, brands think it’s enough to provide information about what the product does.”
This is a classic but dangerous mistake, Jennings warns: “Many brands don’t differentiate themselves online. They don’t give customers a reason to buy from a company. They explain what the product does but they don’t sell it to the consumer.”
Many businesses don’t appear to understand how people shop online either, she adds. “With most purchases people are comparing something; it’s not a done deal, so brands shouldn’t act like it is. Brands need to create tools that let people make a choice.”
Customers often find it difficult to navigate their way through a vast array of products available online. This is something that has been a tough nut to crack for Notonthehighstreet.com, a website that sells handcrafted products on behalf of small businesses. It sells more than 50,000 products and has developed several tools to help customers find what they want to buy.
Dates in the diary
There’s a specific wedding section for brides and grooms to set up a gift list, which has been available on the site since 2008; but last year a gift calendar was added to enable customers to create reminders for special occasions like birthdays. Claire Durney, the company’s head of commercial explains: “By creating a calendar, [customers] can tag products they think would be appropriate for the occasion and be reminded well in advance that an event is coming up.
“From our perspective, it’s a great way of keeping us front of mind for all our customers’ gifting occasions.”
The brand also introduced a gift finder app last year. It has been created by mobile agency Grapple, taking three months to develop, using analytics available from the website to understand how people buy gifts.
But why develop an app when there’s already a gift list option and a mobile optimised site? Dave Thomson, head of product management for Notonthehighstreet, explains: “We’ve seen explosive growth in our mobile traffic and wanted to provide consumers with more options for how they can interact with us using their phones. We do have a mobile site but consumers often head straight to the app store and expect your brand to be there. We wanted to match that expectation.”
Introducing the app has also enabled the brand to collect data, which in turn has enabled it to track different buying behaviour. This information will be used to make changes to the way information is presented online.
Thomson adds: “We’ve also seen explosive growth in mobile and tablet traffic. This cohort has very distinct behaviour on-site which is quite different from desktop visitors. We are working on making our site more responsive to different device types so that consumers have a great user experience, no matter what device they choose to use.”
Working out why people buy certain products is something that many businesses gloss over because of a mistaken belief that price is everything in the online space. But one way brands can stand out, says Global Reviews’ Jennings, is to elevate their service offer.
Bike brand Giant, for example, has recently introduced a ‘home set-up’ service, offered through independent retailers on the high street. People can buy bikes directly from the manufacturer online, but Giant UK managing director Ian Beasant believes that connecting customers with its network of independent retailers will enable bike riders to form a relationship with them and get proper advice.
For a £14.99 fee, the retailer will come to the customer’s home, set up the bike to suit the rider and provide an initial service within the first three months.
Beasant hopes that the new service will appeal to customers because it combines the ease of online shopping with the expertise of independent specialist retailers, which he says customers can miss out on if they order online.
Beasant says: “Twenty per cent of all sales in our industry are through online and independents are losing sales. But you only have to look at people riding their bikes at the weekend to see that there are a lot of people riding the wrong bike for them.
“Many people who are buying bikes online don’t necessarily want to go into store to collect their bike, so we have an infrastructure of around 200 retailers. The retailer will arrange delivery, assemble the bike and make sure it’s the correct bike for you.”
However, Beasant says it’s a challenge to stand out online, because when you type in the word ‘bike’ into Google, the same brands generally occupy the top spots because they are paying to be in the sponsored listings.
Kieran Elsby, marketing and PR executive at online gift shop Prezzybox, says search certainly provides a challenge, especially when some brands pay to be at the top of the search results. But Elsby says instead of competing with companies which have bigger marketing budgets, the strategy at Prezzybox is to “create compelling content” that helps boost the brand’s profile online.
“Through clever and innovative marketing, content and search engine optimisation work, we can achieve high and natural search listings,” he claims (see Prezzybox viewpoint, below).
While many brands are not able or willing to pay to be in a top position on Google’s search engine, every brand can step back and look at how it is presenting important information on its site.
Making things as easy as possible for customers to buy is something that has led Fat Face to promote its different delivery options on its homepage. It sounds simple, but it is in fact something that Jennings at Global Reviews says many brands fail to communicate clearly.
Fat Face head of ecommerce Paul Wright says daily conversations with customers and research carried out by the company have shown how quickly people are changing their shopping habits. Fat Face’s decision to provide a range of delivery options, such as online orders delivered to store, simply reflects those changes, he explains.
To keep on top of changing consumer buying habits, Wright says Fat Face is about to launch its own “complete overhaul of the web, mobile and tablet”.
Late last year, the fashion retailer revealed that 11 per cent of all its sales come online, and in the run-up to Christmas, the importance of online has become even more apparent. December sales online rose by 65 per cent year on year for Fat Face, while there has been a 35 per cent year-on-year increase in orders being placed online and customers going in to store for collection.
Fat Face is keeping an eye on customer behaviour because the “needs of customers are changing”, says Wright. He adds that customers will begin to see a difference in Fatface.com later this year, which will reflect this changing behaviour. Other brand guardians will have to watch online behaviour just as closely to protect sales and gain an edge on the competition.
Zak Edwards, founder and MD of online gift shop Prezzybox, on…
…developing the brand
We’ve been trading since 2000, selling an eclectic range of gifts. Over time we’ve seen how people have changed the way that they shop and noticed the wants and needs that people have when buying products from us.
There are a number of categories that our products sit in and you can manually merchandise them, but it’s cumbersome and by the time you’ve inputted the information it’s out of date because stock levels have changed.
We felt that we needed an automated system, and we tried to build one ourselves but it’s quite complicated. In the end we found a company called Locayta to help us.
A visitor to our site can view all of the gadgets if they want to, but then it is possible to view specific categories, like electronic cigarettes, for example. People can then view by brand, and will then be able to see a small image and customer reviews of each product.
We’ve also introduced a list system – a save-for-later tool – so that people can make a list as they browse the website and then come back to it, and we’ve seen high conversion rates from that.
…how people search on the website
Our research found that people tend to search by recipient and by price, so we offer a gift facilitator. For each product, we attribute characteristics such as whether it’s more of a male or female product. People are also able to search by age, by price and what interests the gift recipient has.
We can see how people use our websites by using an analytics system called Crazy Egg. It’s a page visualisation tool so we can see where people are clicking.
We have really seen the difference since we’ve invested in the website. December trading was up 70 per cent, year on year. It’s all about the conversion rate. We can see how these changes have made a difference to people coming on to the site and then going on to buy from us.
…changing shopping habits
Ten years ago people were happy to browse through a website, but people are more time-conscious now and we are in the process of introducing a quick view.
It might sound crude but it’s not rocket science. It’s just a shop: people come into the shop to look around and we want people to buy from it.
Five tips from Econsultancy
Offer a seamless multichannel experience, as 96 per cent of shoppers use the internet to research offline purchases.
- Optimise for mobile: scale web pages for smaller screens and separate mobile and desktop search campaigns.
- Some 44% of UK shoppers say they always check online before making a store purchase – make online product listings friendly.
- A third of people will go online to search if a store doesn’t have the product they want, so have an easily searchable digital store.
- Benchmarking your prices could make your mobile commerce platforms more effective, since 43 per cent of people compare products on mobile devices.
Sources: Multichannel Retail Report, How the Internet Can Save the High Street