Listen to any podcast or scroll through a popular social media site and it won’t be long until you see or hear an advert from the likes of Squarespace, Shopify or WooCommerce (amongst many others) outlining just how easy it is to set up an online shop and get selling whatever wares you desire.
While it’s true that in this day and age, almost everyone is able to access incredibly clever e-commerce technology wrapped up in a neat and easy-to-use package, it’s only the start of the e-commerce journey – it doesn’t guarantee a successful outcome.
While the aforementioned e-commerce platforms may be geared more towards new businesses and small-scale dealers and service providers, the appeal of a savvy online shopfront is extending to more and more small-yet-established high street retailers as the pressure mounts on them to compete in the online arena if they want to thrive – or simply survive – in today’s retail climate.
Worryingly, a new study commissioned by digital commerce experts Greenlight Commerce found that retailers in the UK expect 30% of all their e-commerce work to give them back “no value”.
The study, which questioned 100 UK-based e-commerce decision makers within the retail sector, found a staggering 99% of retailers are facing some sort of e-commerce challenge. The main challenges were noted as customer retention (41%), customer experience (39%), and measuring metrics (33%).
These challenges are leading to UK retailers experiencing many failed e-commerce projects, with over two-thirds (68%) experiencing at least one failed project in 2018.
And these failures are expected to continue in 2019, with respondents predicting just under two thirds (66%) of their organisations’ e-commerce projects will hit all key objectives outlined by the business. This leaves the remaining third of projects either missing some (20%) or all (15%) of the key objectives.
PCR asked Kevin Murray, managing director at Greenlight Commerce, to expand on the reasons why so many retailers are having such a tough time getting their e-commerce projects to achieve the desired goals.
“Each failed project is as unique as the next, and there is no way to foresee every delay or control every situation that does crop up. However, by understanding the most common reasons for projects stalling, retailers can ensure they help mitigate problems before they arise,” says Murray.
“Often retailers fail with their e-commerce projects because there isn’t a clear and defined strategy of the overall project from the very beginning. This can lead to failure because the business doesn’t see any tangible benefits or doesn’t understand what return the investment will provide.”
Murray advises retailers to ensure they map out the wider benefits and goals and include these in the business plan. “Retailers must also be realistic when defining the scope of the project, by identifying what the non-essential objectives are, and excluding them from the plan. This can significantly improve the project’s chance of success,” he says.
“There are no two ways about it, physical retail space is becoming less cost-effective” Michael Schirrmacher, Bloomreach
“Often, when planning an e-commerce project, retailers set unrealistic deadlines, and rush to get it completed as quickly as possible. However, by moving too quickly, this can cause projects to stall as the business is unable to keep up with the ambitious deadlines set out at the very beginning. Those that rush projects often have to spend more time and money dealing with unexpected complications, compared to those retailers who assign enough time to get things completed the first-time round.
“Another reason for failure is that retailers are neglecting to measure many key metrics,” adds Murray. “Our recent study reveals retailers aren’t measuring website traffic (55%), revenue (53%) and customer retention (52%). All too often, organisations are not determining the profile of success for their specific business. Being able to demonstrate a project’s success is critical to getting budget for the next project.”
Having a clear vision
Despite the struggles many retailers have faced when implementing an e-commerce project, the situation remains the same – many businesses feel they need to attempt to compete with the big guns online.
If the British Retail Consortium’s latest retail footfall and vacancies figures are anything to go by, there is more pressure than ever for physical retailers to ramp up their omni- channel approach as fewer people make the effort to visit high streets and shopping centres.
The findings indicate that vacancy rates climbed to a four-year high last month, while high streets, along with shopping centres, suffered a year-on-year fall in the number of shoppers.
“There are no two ways about it, physical retail space is becoming less cost-effective. Retailers are battling a tough economic climate and a decline in high street footfall, and these rising vacancy rates tie into that volatility,” comments Michael Schirrmacher, UK managing director at Bloomreach.
“Fewer people are entering bricks-and-mortar stores every month, so the pressure to maintain profit increasingly depends on the virtual world. This raises big questions for management around how they can make the most of both spheres,” he explains. “In the online world, people can easily find and buy what they need in just a few clicks, yet customers still head back to the high street for certain purchases. The distinction between the two is usually the experience involved. The reality is that customers won’t pay for experiences they don’t value, so retailers need to take stock of what they’re trying to achieve with the different elements of their operations.
“Rather than viewing physical stores as under performing points of sale, retailers should instead focus on using their shops to deliver the human experiences that cannot be mimicked online, and to ensure brand recognition is not diminished in the shift to online. That means redefining physical stores as a marketing expense, and is exactly why digital giants like Amazon, Apple and Alibaba are still refining or growing their bricks-and-mortar stores.”
“Before starting an e-commerce project, retailers must have a clear vision of exactly what it is they want the business to achieve from the project” Kevin Murray, Greenlight Commerce
So, what should retailers do to make sure they don’t fall into the same traps as previous businesses when it comes to implementing an e-commerce strategy?
“Before starting an e-commerce project, retailers must have a clear vision of exactly what it is they want the business to achieve from the project,” advises Murray.
“More often than not, retailers rush into a project and before you know it, the end goal has been lost. It’s therefore crucial that retailers must fully understand the business outcomes they wish to achieve, and always have that at the forefront of every stage of the journey.
“It’s also understandable to feel pressure to implement an all singing, all dancing platform, investing huge amounts of time and money into implementing the ‘next big’ technological advancement to disrupt the market. However, right from the get-go, retailers must take a step back and think ‘what are the core needs of my customer?” he warns.
“The key to success lies in getting the basics of customer experience absolutely right. Customer expectations have changed so drastically that one poor experience can put even the most loyal of customers off. Laying the foundations of a quality, seamless customer experience can be the difference between a successful project, and a failed one.”
It’s not safe to go alone
Murray also advises that retailers should work with experts in the e-commerce world if they really want to get ahead of the game.
“Don’t go it alone. An e-commerce project is rarely a straightforward one. Bumps in the road are natural, timelines are stretched, and unexpected complications spring up when you least expect them. But, by choosing a partner you trust – one who is invested in your success to accompany you on this journey – can make all the difference,” he says.
“At Greenlight Commerce we are dedicated to ensuring projects run as smoothly and seamlessly as possible. That’s why we’ve developed The Greenlight Code to address this market need. Risk can be minimised if a measured and due diligent approach is taken.
“The Greenlight Code is a measurement-based set of core principles that combine our technical and business expertise with a focus on growth and success. It’s an approach we’ve used successfully across a wide range of e-commerce projects for some of the world’s leading brands. At its core is a focus on measurement – which is how we maximise results, and minimise risks, on your e-commerce projects.”
THE GREENLIGHT CODE:
• Stop: Take the time to honestly understand what you want to achieve.
• Think: Consider what you want the outcome to be.
• Simplify: Create what you need, not what you want. Don’t hide behind jargon.
• Collaborate: Bring together the relevant people, data and technology.
• Challenge: Ask the difficult questions. Don’t take assumptions at face value.
• Do Detail: It’s usually the difference between project success and failure.
• Set Metrics: Agree then measure what matters. It shows where real value is added.
• Be Open: We are. We need you to be too.
• Green Light: Be brave. Go when it’s good enough – don’t wait until it’s perfect.
• Evaluate: Make sure you have achieved what you needed. And that it’s making a difference.
• Stay the Distance: Even after project launch. We stay the distance to support.
Read the latest edition of PCR’s monthly magazine below: