Online retailers look beyond price to entice frustrated customers
New PayPal study uncovers online retailers insights into customer behaviourLarge and small e-tailers across the UK believe the future of online sales is no longer just about price and choice, as customers are now demanding the same, if not higher, levels of experience and service they would on the high street. Site speed, accessibility, after sales service and even the ability to exchange goods are all important factors as retailers look to maximise sales.
These findings come from new research unveiled today by PayPal, the online payment provider, conducted in partnership with providers Venda, the European market leader for eCommerce solutions, and RomanCart. More than 250 online retailers were surveyed, including larger e-tailers on the Venda solution like Monsoon, Superdrug and Wickes as well as SMEs.
The research forms the first stage of a major PayPal study looking at trends, issues and insights in online shopping, to be rolled out in the coming months. PayPal is the UK's preferred online payment brand and has a customer base of over 20 million online shoppers, which represents one in every three British shoppers. PayPal is a payment option on over 120,000 retailers' sites across Europe.
In general, retailers felt that an online retailer must offer a complete experience, from first click to delivery of goods, when trying to encourage customers to return to their site; however, top considerations included fast delivery times and strong after sales service.
The majority (68%) of large retailers felt that cost and wait times for delivery were the biggest frustration for shoppers. This was in large contrast to SME's with only 26% of smaller retailers identifying issues associated with delivery as a big frustration. Customers' lack of confidence in after sales service (47%) also featured strongly, and 39% felt that long online checkout processes caused major customer frustration.
Cameron McLean, PayPal's General Manager, Merchant Services, comments:
“We see our e-tailer customers grasping the opportunity to bring back customers for repeat purchases with better after sales service and shopping experience. This, combined with secure payment options, creates real brand loyalty online and is contributing to increased sales.”
Perhaps unsurprisingly, 67% of the retailers polled said that security concerns remain the biggest worry for the online shopper.
The study also looked at the concept of 'cold feet' where customers drop off a shopping site part way during the sales process.
Interestingly, 68% of SMEs' view customer registration requirements as the main reason for cold feet versus 48% of larger retailers. Poor site experience and unclear navigation are two of the bigger influencers of 'cold feet', citied by over half of online retailers (57%), alongside security concerns. Cameron McLean continued: “Online retailers recognise that today's online shopper is more demanding than ever before. If a customer doesn't feel they're receiving a quality experience there's always another retailer out there who can offer it to them. We predict that this focus on services will be more and more crucial in those markets where price differences are less pronounced.”
Dan Wagner, Chairman at Venda commented:
“Checkout experience, site navigation and security were all things that we expected to see in the survey results. Venda's unique community infrastructure means that as well as our standard checkout, PayPal Express checkout integration, faceted (or guided) navigation and adherence to the Tier 1 PCI compliance security level are all things that are part of our standard site builds at no extra cost. I was also pleased that accessibility and site speed were also mentioned as BBC Shop, a Venda client, was confirmed as the most reliable site in the UK over Christmas last year. Retailers need to address these issues now; otherwise they will struggle to get the sales.”
Major UK brands which have launched with PayPal in recent months include BBC Shop, Adobe, Toshiba, ITV Shop, Republic, High & Mighty, and all the Arcadia brands; Burton, Dorothy Perkins, Evans, Miss Selfridge, Topman, Topshop, and Wallis. By partnering with PayPal retailers gain an additional way to accept credit cards, debit card and bank payments online. In addition, with PayPal's Express Checkout websites have an average shopping cart conversion of 72%, compared to the industry average of just 50%.
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