Kevin Murray, managing director, Greenlight Commerce examines why ecommerce projects fail.
The following guest article has been written for InternetRetailing by Kevin Murray, managing director, Greenlight Commerce. Greenlight Commerce is an ecommerce solutions practice, with an absolute focus on building sites that grow your business. Part of the Greenlight group of companies, Greenlight Commerce is a full-service partner, giving businesses the expertise and technology to deliver real digital growth across all areas, in the one place.
Store closures, job losses, financial woes and the worst Christmas for sales in 10 years, the outlook for the retail industry continues to look grim. Just one look at the daily headlines reveals the downward spiral of once proud high-street brands. However, if we take a closer look beyond the gloomy stories presented in the mass media, it’s clear that the industry is, in fact, going through a period of unprecedented transformation.
Over the last decade we’ve seen a major shift from a store-based past to a digital future, with online channels steadily driving growth and traditional high-street shopping declining: retail is re-inventing. While there are many factors contributing to this, the strongest force of all is the pace of changing consumer needs and habits driven by the rise of digital technology, which will only increase with the advent of 5G phone networks across the UK.
In order to survive and thrive, retailers have had to digitally transform their businesses – spanning from the boardroom, right the way through to the warehouse. As brands look to bridge the gap between the online/offline world, retailers are ramping up their investments in ecommerce capabilities to deliver the exceptional experience customers now require. However, in the lead up to one of the busiest periods in retail, are online retailers able to keep up?
Answering this question with credibility can be a challenge, especially if there have been issues in the past that have impacted online trading. With the addition of Black Friday to the retail calendar, on top of the Christmas period and summer peaks, IT and ecommerce directors have been asked by the business: Are we ready for peak trading?
While the peak season will ultimately expose any stress points, it’s also an opportunity for retailers to shine by driving optimal customer experience. However, a new study by Greenlight Commerce found that many ecommerce projects are failing to delight customers and grow the bottom line, with 30% of UK retailers revealing that their ecommerce work will give them back no value at all.
The study also revealed that nearly all (99%) UK ecommerce decision-makers are experiencing some sort of ecommerce challenge, with the top concerns being customer retention (41%) and customer experience (39%). Providing a bad customer experience during such a pivotal period can cause irreparable damage, leaving businesses vulnerable.
The study further discovered that retailers are failing to measure many key metrics, with more than seven in ten (71%) failing to measure ROI, almost half (48%) are not measuring customer retention, and 47% are failing to measure the impact upon revenue. This leads me to question, how have UK retailers let themselves get to such a problematic place?
Defining value and measuring metrics are crucial to the success of any project, yet so frequently projects are stalling because they are mis-managed with measures being misaligned with the business strategy. In many cases, this is also left until the very end of the project, rather than being measured throughout. Perhaps the uncomfortable reality here is that all too often work is started with no clear goals in mind, and no defined benchmark to measure success against.
The most immediate factor, and one identified by nearly half of respondents (48%), is that too many projects are being rushed, with not enough care and attention being applied into defining what the project is actually going to achieve for the business. Retailers must not underestimate the level of commitment required at every stage of the project, right from the initial stage of discovery, all the way through to the user acceptance testing phase. By cutting corners, projects run the risk of higher costs, wasted resources, and a retailer’s worst nightmare: an abandoned shopping cart.
Meanwhile, another study by software and usability firm, Applause, has found that UK ecommerce sites are limping behind the US and Germany for customer satisfaction and functionality. The research found that more than 3,000 software bugs and user experience issues were found amongst the world’s top 52 retail sites. In terms of lost revenue, 65 bugs would cost top US retailers more than $60m in lost sales over the Christmas period. Yet, more concerning still, almost half (45%) of these issues were in fact found on UK sites.
Across all regions, over half of all bugs found in the study were classified as severe, which would significantly impact functionality on a website and potentially discourage customers from using the site to complete purchases. These online blockers are the equivalent to a store assistant ignoring a customer at the till and refusing to serve them. Senior management wouldn’t allow for this poor level of customer service in a well-managed store; however, it appears to be common place in the online sphere.
A seamless experience is so much more than consistent brand design and messaging, it’s about maintaining the same feel, functionality and customer engagement throughout the entire journey, regardless of the channel. Retailers should deploy testers who can mimic the buyer’s journey from start to finish to highlight any potential pain points or areas of frustration. By doing so, this allows retailers to tackle any bugs before new features are deployed.
During periods of increased traffic, retailers should work towards an agile delivery model, focusing on smaller improvements to the customer journey that can be tested, and the results evaluated immediately. For instance, how can you increase page load speeds by 2%? Then, how can you improve the average time on a page by 5%? Then, how can you increase checkout transactions by 1%? These small, but immediate improvements lead to upward shifts in KPI performance, and as a result, each gain rapidly multiplies to give a better combined gain in a more consistent manner that isn’t disruptive or risky during spikes of activity.
The days when peaks like ‘Black Friday’ would crash websites are behind us, but there is still a risk that something will go wrong during peak that will impact revenue. However, with thorough and diligent planning and proper measurement, risk can be minimised.
Whilst locking down a site during peak periods is an individual retailer’s choice, this should be something of the past for forward-thinking retailers. Proper measurement, and agile working practices allow for greater flexibility to quickly identify any issues that may arise, and successfully make changes accordingly without causing mass disruption. Where this isn’t happening, senior management must step in and ensure projects are being properly planned from the get-go, implemented and their actual delivery measured.
Rather than focusing on the competition and comparing themselves, retailers should take a step back and ask themselves ‘what are the core needs of my customers?’ Whilst it may seem tempting to implement the latest and greatest technology to keep up with customer demands and your competition, it’s more important to get the basics of customer experience absolutely right first.
Failure to do so can seriously compromise customer experience and negatively impact brands during a period of huge opportunity. M&S made the headlines for all the wrong reasons in 2014 when it was hit by online delivery delays in the Christmas run-up. This led to a fall in its shares by 2.8% - highlighting the importance markets place on online shopping.
It’s crucial for retailers to build a culture where they embrace constant change, and are willing to try, win and fail in quick succession. Only those that are able to transform and realise immediate benefits will remain in good standing in the long run. Whilst it’s impossible to stay ahead of customers and their ever-evolving needs, the decision and processes that retailers invest in today, future proof the business not only during peak period, but more importantly over the years to come.