With the so called ‘Amazon Tax’ currently being discussed as a solution to level the playing field, are long-standing High Street retailers doing everything they could be to protect their business?
The short answer is; it’s complicated. If you look at some of the big High Street names (Debenhams, WH Smiths, House of Fraser, New Look and Marks & Spencers) they all have the same glaring issue in common. They have failed to replicate their signature customer experience online.
Traditional retailers have treated the internet as a threat, not an opportunity.
Why are High Street retailers struggling to compete with online competition?
Let me give you an example. One retailer, who will remain nameless, was advertising a book online for £9.99. My wife had seen it and decided to pop into town on her lunch break and pick it up. However, when she got there, it was priced at £14.99. She was informed that £9.99 was an online only price, but if she wanted, they could order her one to the store at the online price. They were not prepared to price match their own website as that specific book had been allocated as store stock.
The retailer’s reasoning is that it’s cheaper for them to sell online – less overheads – so they can afford to sell the goods cheaper.
The logic behind this decision is bizarre. By pushing the customer online, the competition goes from being other High Street retailers within walking distance of your shop to Amazon. Giant online retailers are always going to be able to sell at a lower cost. Users also trust Amazon’s logisitcs, which will offer cheaper, faster and more reliable delivery options.
This is not the customer experience that has made these retailers household names. It is, unfortunately the type of experience that will be the final straw for these companies.
Is online retail the issue?
Lots of people point fingers at the Internet Giants (Amazon, Asos etc..) who are undoubtedly the replacements of the big High Street chains. But online retail is a much bigger marketplace than your average High Street. That means that, done well, online retail can become the biggest weapon in any company’s arsenal.
The key is to take your existing USPs and customer experience, and replicate these online.
How to take the ‘Bricks & Mortar’ experience online
At Andertons Music Co. we have spent the last 20 years trying to replicate our much-loved customer experience online. For us our key USP is giving customers one to one advice from an expert and helping them make the right decision for them. We’ve replicated this online by having a team of expert content writers. Our entire digital team is made up of musicians with digital skills.
Where some of these large retailers have gone wrong is to just bung their products online, because they think that’s what they’re meant to do. That shift from offline to online means you’re essentially starting from scratch in terms of UX, logistics and brand trust.
Owning the process from start to finish
I recently made a purchase from one of the big DIY stores. My order contained just two items. The online experience was bad enough (no indication of delivery times, poor category navigation and confusing stock and delivery messaging) but the main issue was the delivery itself.
As it turned out only one of my items was being dispatched by the retailer. The second was being fulfilled and shipped by a company I had never heard of. I ended up having to have a couple of phone calls with this company to organise a delivery, despite the fact that I hadn’t bought from them. My deliveries turned up over a week apart, from completely different couriers.
Let’s just break that experience down for a moment. I had to deal with a company I had never heard of in order to actually fulfil an order I had already paid another company for. That’s a pretty terrible experience.
What’s more, I paid a single flat rate for my shipping and yet two different couriers delivered my goods. From the retailer’s perspective, that is bad business. Imagine the impact it would have if Amazon had to pay two separate companies to deliver each of their deliveries. They just wouldn’t allow it to happen.
That is ultimately what this all boils down to. Traditional retailers don’t yet understand how to treat a customer that they can’t meet face to face. They don’t control the whole process from order to delivery and so they have no understanding of whether the experience is a good one or not.
What does the future hold for High Street Retailers?
It is possible for independents and larger chains to flourish online. We’ve seen it before, whether it be family-run businesses like Andertons or major chains like John Lewis. It is possible to take an established reputation online and compete digitally.
The bad news for some companies, is that it doesn’t happen overnight. You need to develop your customer experience and build new relationships with your audience.
Most importantly, you need to build a model that is at its heart, digital-first. Whilst physical shops still have a place, and can be a fundamental part of a company’s online presence, you need to create an experience that puts your online customers first.
My favourite analogy is to imagine your website is a market stall. Either side of you there are equally priced, equally convenient market stalls which can service your customers equally well. It is simply not enough to rely on your brand name anymore. The experience has become the fundamental difference between the success stories and the failures.
If the stall next to you can deliver the product to the customer within an hour, but you will take 3 working days, then you will undoubtedly lose the sale.
Controlling the experience from start to finish and not just treating the delivery (and beyond) as an afterthought is the difference between a good experience and a terrible one.