As department stores’ business grows online quickly, we look at the promises that this group of retailers offers to ecommerce and multichannel customers.
Department stores are seeing their business move online – and fast. In November 2018, 20% of department store sales took place online, according to figures from the Office for National Statistics, following a 73% increase in ecommerce sales compared to the previous month.
Shoppers may be responding to delivery promises and product presentation among an 11-strong group that includes John Lewis, Debenhams, House of Fraser, Harrods and Selfridges, and tends to outstrip the performance of the IRUK Top500 index. Indeed, department stores have featured heavily in the Elite category of the index over the years (see Elite and Leading Retailers), and the service that department stores offer is recognised across the IRUK Top500.
In 2019, department stores offered more flexible delivery, collection and returns promises.
Most department stores offered click and collect services. Some 88% of the group offered them - 28 percentage points ahead of the Top500 as a whole.
Next-day collection was more commonly found among department stores (37%) than among the Top500 as a whole (22%). Same-day collection was offered by 9% of department stores - ahead of the 5% of Top500 retailers.
The group was also more flexible when it came to delivery: 40% offered Saturday delivery (Top500: 30%), and 22% Sunday delivery (Top500: 13%). More than half enabled shoppers to name their delivery day (54%, Top500: 16%) and time (23%, Top500: 7%). The group charged £1 more for delivery, at £4.80, than the Top500 as a group, while delivering in the same 4.5 day time span.
Three out of four enabled shoppers to return items bought online to a store - that’s 27 percentage points more than the Top500 – while 42% enabled returns via a third party location (Top500: 20%).
Department stores were more likely to use extensive search filters on their websites, perhaps because they stocked wider ranges and more brands than the many Top500 retailers. Price was the most widely-used filter, with 91% of department stores employing the tool, contrasted with 76% of Top500 retailers. Other widely used filters were product type (89%, Top500: 85%), and brand (82%, Top500: 57%).
Recommendations of similar alternative products were common on department store websites (92%, Top500: 71%). But product reviews were less commonly used than the wider group: just over half (53%) of department stores used them - 5pp lower than the Top500.
More retailers in this group had mobile apps: 59% had an iOS app (Top500: 37%), and 46% (Top500: 30%) an Android app.
Department stores were also faster to respond to customer service enquiries, answering in just over three hours - or seven hours earlier than the median Top500 retailer.
It’s clear that department stores as a group offer well-planned ecommerce and multichannel services. In doing so, they appear to be responding to changing customer behaviour that is demanding flexible customer service. Department stores often lead in this index. That may be because they are often bigger businesses, whose larger footprint gives them a bigger presence and higher brand awareness than many rivals.
But it’s also likely that as retailers that usually sell goods from third-party brands and manufacturers, they must offer a highly competitive service as they look to stay relevant to the end customer and give them a reason to buy those goods from them – rather from than a rival, or from the brands directly.