#10things etailers should know about CX
Poor CX is costing etailers dearly at R11,95 billion in lost sales annually, says the latest SA digital CX report.Friday, 10 Sep 2021
The 2021 South African Digital Customer Experience Report is out and the key finding is that R30 billion is being left on the table by etailers with poor customer experience (CX), meaning the etail market has the potential to double by a further 100% to 5.6% in South Africa. CX refers to etailers’ trustworthiness, ease-of-use, security, delivery and after-sales support. The report was commissioned by Amanda Reekie from ovatoyou; Charlie Stewart from Rogerwilco; and Julia Ahlfeldt, a CX professional.
So, why are so many billions there for the taking being ignored? Poor CX is costing etailers dearly at R11,95 billion in lost sales. Coupled with a R20,4 billion loss thanks to frequent cart abandonment, this is a R30 billion opportunity cost – as a whopping 96% of respondents said they’d buy more online. These are the #10things that are key takeaways from the report…
1. South Africa’s ecommerce market has increased substantially since the start of the COVID-19 pandemic, but its potential to double by a further 100% to 5,6% of the total retail market is possible. “With improved levels of connectivity and an abundance of online shopping options, there’s no good reason why South Africa should lag behind other markets such as the US and UK. Customer experience is well and truly holding it back,” commented Ahlfeldt.
2. A staggering 96% of respondents in the report said they would spend more online if etailers’ CX was better. “The opportunity cost is pretty clear; consumers expect a higher level of experience from brands that they buy online from. This could in part be because they have become used to the CX of an Amazon or Takealot. These brands have set a high bar and local etailers need to up their online game if they are to convert the huge appetite among consumers for online shopping into Rands and cents,” said Stewart.
3. Online shopping has seen a sharp increase since the start of the pandemic and is one of the few sectors to find a silver lining. This has democratised its user base as the report reveals that a full 82% of respondents have made an online purchase. What is noteworthy is that 73% of those with with a monthly household income of less than R10,000 per month shop online, albeit slightly less than their wealthier counterparts.
4. There is a whole new cohort of shoppers – and this, taken together with an increase in the number of categories people are buying from, takes online shopping out of the niche that it was, added Reekie. Of significance, is the fact that 32% said that they’ve increased the number of online stores that they buy from; 31% have made online shopping a part of their shopping routine; while 20% report to be shopping more through social media.
5. eTailers need to address issues of cart abandonment, given that 76% of online shoppers said they failed to conclude their purchases (this is up from 71% in the 2019 report). Over half of those polled (51%) indicated that high shipping fees were to blame, with 32% noting lengthy delivery timelines were a deterrent.
6. Consumers also complained that there were too many steps in the purchase process – brands would do well to emulate Amazon’s famous one-click checkout – with slow websites and a lack of support being cited as other reasons for cart abandonment. Payment issues, either a complete failure in the processing of the transaction (cited by 26%); or an issue with a discount code (20%), continue to be significant impediments to closing the sale.
7. Building and maintaining trust is another key focus area for online brands, and, while it is an intangible, it can make or break a sale. Large stores like Amazon and Takealot have gotten the experience journey right. Stewart makes the point that good UX – as displayed by these two industry behemoths – minimises frustration, reduces second guessing and stops customers switching across to a rival site. “Retailers need to recognise that consumers are becoming more loyal to the experience than they are to the brand.”
8. Another factor is brand resonance. With 32% of respondents claiming that they buy at familiar category and branded stores – Nike, Samsung and Apple were just a few of the names mentioned; as were Clicks and Superbalist. While peer reviews go a long way in establishing trust, customers are also more likely to purchase from a brand that they’ve seen advertise. This insight must not be lost on startups which must factor the cost of marketing and brand building in when preparing budgets for their online stores.
9. Of course, the most important factor in the trust relationship between etailers and their customers, is security: 12% of respondents said they wanted online stores to make a clear commitment to keeping their personal information private and secure; while 11% expressed the need for a safe environment in which they could transact.
10. When it comes to making the all-important purchase a noteworthy, 55% based their decisions on social media posts, with 54% looking at reviews on the brand’s website. Third party review sites like HelloPeter are used by a further 35%. But of note, negative commentary would stop 64% in their tracks and result in a lost sale. Recommendations from family and friends are just as important as reviews (54%), followed closely by promotional information and brand advertising. 21% were persuaded by an influencer. “We can truly say that customer experience is brand experience,” said Ahlfeldt.
*For more: https://www.cx-report.co.za/.
Main image credit: 2021 South African Digital Customer Experience Report.
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