Argos.co.uk Tops Forrester’s Ranking Of Europe’s Online Retailers
In today’s mature market, Europe’s online retailers must differentiate themselves to acquire and retain customers. In a new report that ranks more than 50 of Europe’s high-traffic transactional Web sites, Forrester Research B.V. (Nasdaq: FORR) finds a common thread among the most successful Web retailers — customer advocacy.
“The Internet is an interactive medium, but most online retailers still use it as a catalog-plus-ordering process,” said Forrester Analyst Hellen K. Omwando. “And with 58 percent of Net users researching products online, a poor Web site leads to a bad brand experience, which will hurt sales both online and offline. Europe’s online retails should instead offer consumers a shopping experience. To achieve this, they must converse with consumers throughout the purchase cycle, from brand awareness to post-sales servicing, in order to pitch the right products and pull consumers to the right place at the right time — explicitly offering them the choice of buying the product offline, online, or via phone at a carefully chosen moment in the customer conversation. Forrester advises that they must adopt consumer advocacy — doing what is right for the consumer, not just focusing on the firm’s bottom line — in two key ways: build a shopping experience and use technology to support consumers’ goals.”
Focusing on customer advocacy, Forrester evaluated the online user experience of 51 of Europe’s top Net retailers, basing its rating on how well these retailers help consumers achieve their goals. The results show marked differences between the top 10 and those ranked 11 to 20. Overall, catalog retailers set the tone for multichannel excellence, US players boost local players’ performance, and grocers have some catching up to do.
With well-honed skills in distance-selling, catalogers know who their customers are and how to delight them. Topping the charts, Argos provides a range of multichannel services, such as store stock availability online, in-store returns of Net purchases, and home pickup of returns at no extra cost. Equally, having gone through the eCommerce learning curve earlier than their European counterparts, US retailers like eBay and Dell have made their online retail experience in the US work for them in Europe. If you can’t beat them, join them: SNCF decided to use Expedia for its travel site, and Waterstone’s and Virgin Wines gave their Web experience a boost with Expedia and Amazon technologies. By contrast, online grocers are still trying to figure out how to get past rock-bottom margins and demand. Even Tesco.com, the only profitable online grocer in Europe, ranks low because of its disruptive product range expansion — shoppers have one basket and checkout process for groceries, and another for devices.
“Whether it’s using new technologies or targeting new customer segments with new products, leaders know how to introduce these innovations without compromising the customer experience,” Omwando added. “German catalog retailer Otto expanded into categories like toys and travel while maintaining its high service levels: It allows users to pick any time within a 12-hour period for delivery, receive SMS alerts from the nearest delivery drop-off point, and enjoy 24-hour customer service. Argos managed to shift 7 percent of its customers to use in-store kiosks through iterations of the user interface. Also, leaders that operate multiple channels treat all their channels as one outlet — they share one view of their customer between departments, showing everyone all activities and sales for every touchpoint. Argos is able to let its customers return online purchases to the store because its sales clerks can call up customer and product information across channels in real time.
“Leaders continue to move beyond department-focused business processes. Most have a common marketing department that collaborates with the merchandizing department to launch campaigns across channels — as Wehkamp does. They also have common assortment and pricing schemes that drives cross-channel consistency — one of Tesco.com’s strengths.”