Survive 2014: 3 Tips Before You Expand Online

For organisations with an underresourced or ineffective online presence, it's time to get the ball rolling.

These are challenging times for retailers – but with a cohesive multi-channel retailing strategy you can seize opportunities to boost profits through new, online channels without cannibalising your old ones.

For many high street retailers, the figures are as chilling as they are indisputable. According to The Centre for Retail Research, more than 243 medium-to-large retailers have gone to the wall in the UK since 2008 – a figure that translates into the loss of 22,163 bricks and mortar stores and 209,264 jobs. Many for the lack of an effective multi-channel retailing strategy.

From The staff at Jessops would like to thank you for shopping with Amazon signs to the demise of Comet, and large chunks of Habitat, JJB Sports, Oddbins and HMV, online retailing is, for the most part, giving the high street a good spanking. According to The Economist, in the UK alone during a two-week period during June and July 2013, five retail chains with a total turnover of £600 million failed.

The money’s on mobile

With the much anticipated arrival of m-commerce starting to finally impact on retail sales - up 133% year-on-year, and the likes of Argos revealing that app driven mobile commerce now accounts for 17% of total sales - it’s little wonder that IMRG Capgemini reports 18% year-on-year growth in overall online spending. It would seem that the challenge to traditional offline retail has now gathered an inexorable momentum. For example, Citi Research predicts that British online clothing sales will double in the next six years. Says Robin Terrell, head of Tesco’s online business: “There are no glass ceilings on any particular category”.


Some 93% of people who use mobile for research go on to purchase a product or service even if they do not actually complete the purchase via their mobile. They also spend more while they’re at it. In 2013, people using their mobile phone during a shopping trip spent 61% more than the average shopper, according to this Econsultancy article. According to the article, “Consumers aren’t just price-comparing on mobiles. They’re also looking at product reviews for the specific item, and also comparing those reviews to rival manufacturer’s goods.”


Do you have a mobile payments strategy? Are you offering in-store only incentives via mobile? Are you offering click-and-collect?


Just take a look at the success of click-and-collect for Tesco. Customers are so keen on the concept that two-thirds of non-food online orders are collected at its 1,500 collection points. And Argos achieved 42% of online sales through click-and-collect in Q4 2012 – 31% of total online sales.

Think like a customer. Google/Nielsen reports that consumers spend at least 15 hours per week researching on their smartphone and on average visit mobile websites six times. Do your architecture and your user journey reflect this new reality?

Expand online now

For organisations with an underresourced or ineffective online presence, it’s time to get the ball rolling - sharpish. A clear, consistent and expertly supported reach, which provides the right breadth of online presence, is key to success.

Three tips before you expand online

1. Customer-centric thinking is the key...

. . . says Tesco boss Terry Leahy. “For the consumer, online and offline becomes invisible. They’re interested in the needs and interests that they have and whether you as a brand can help or not. Often they won’t notice how you do that, whether it’s on a mobile phone, on the computer at home or computer in-store or virtual display or real store, they basically want you to be ubiquitous but under their control so that if they want you they can use you.”

“The largest competitive force is not other retailers, but other ways our customers choose to spend their time,” says Rough Trade co-owner Stephen Godfroy.

2. Get the delivery right...

. . . says Toby Paxton, multi-channel supply chain lead partner at Deloitte UK: “Building a flexible delivery foundation that is convenient and relevant to the consumer, is now the Holy Grail for retailers who aim to have a seamless multi-channel offering.”

It can also rip into your profits if you get it wrong. According to IMRG, the cost of failed online delivery in 2012 was estimated at £851 million, with consumer group Which? reporting that 60% of online shoppers had problems with delivery in 2012.

Offering a range of delivery options to suit customer needs is a must. And drop shipping has been the answer for many online success stories - including John Lewis.

3. Consider partnerships

Hiring someone to handle your move online, specifically your order fulfilment, is appealing; especially if you are new to multi-channel retail or are revamping inadequate systems. Appealing, that is, until you start to notice that the more success you enjoy, the more cash you are handing over in fees and commissions to your ‘agent’.

Little wonder that so many retailers are keen to take control of their multi-channel retailing by implementing expert in-house multi-channel systems; scalable, future-proofed and flexible enough to handle the unpredictable nature of modern retail.

Could online marketplaces be the first step?

Already successful marketplaces such as Amazon, eBay or not only provide a simple and cost effective way of putting your brand and your products in front of new audiences (especially if you’re a new or ‘up and coming’ brand), but also a relatively risk-free environment through which to dip your toe into online retailing - perhaps moving into international markets, or testing new product lines.

You’ll need to support that reach, however. There’s little point in getting your products and services in front of people if you can’t follow through. How integrated are your processes? Customer services, promotions and after-sales service (like the handling of returns) don’t stand isolated, they are all part of the same endeavour. Are you running from pillar to post to complete straightforward tasks or are your multi-channel retail operations in harmony? Is your third-party logistics integration seamless? Are your CRM insights driving your marketing intelligently? If your system is not truly integrated, end to end, it’s well worth investigating new multi-channel software.

Action plan Before you expand online…

Make sure that you carefully consider purpose-built optimised mobile sites.

Make sure that your product information is up-to-date, organised and SEO friendly.

Are you equipped to cope? Do you have the systems to properly support your online efforts?

Think ahead. How might an in-house multi-channel retail system future proof your business?

Could online marketplaces be a good opportunity to dip your toe into online waters?

For inspiration on how you could unlock the potential of your business, download our free eGuide: Tomorrow’s World: discover the multi-channel retail business of the future


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