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One of the most underused tools at a retailer’s fingertips is the ability to monitor how customers interact with its website, according to director of online trade at John Lewis, Mark Felix.
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Speaking at the 2015 Internet Retailing conference, Felix explained that retailers are good at tracking how customers move through stores and adapting layout accordingly to drive sales – but many are not using online in the same way.
“As an industry we underestimate the opportunity to really understand how customers shop.” Felix said.
Felix said retailers should use multiple channels to drive sales by making sure they are fully aware of their product offering, and how customers choose to interact.
Many retailers focus on the front page of a website without thinking about the rest of it in enough detail, said Felix. As a result they do not realise some customers will never visit the homepage – especially if they are visiting off of the back of a social media or search engine click-through, because this is more convenient.
He likened this to a store which puts all of its energy into a front window display without realising that most customers enter through the back doors of the store because it’s closer to the car park.
Felix said John Lewis had embraced innovation across all its channels, having just opened a superstore in Birmingham, while online sales count for 30% of overall sales across the business.
John Lewis spent £40m in 2015 giving its Oxford Circus store a “facelift” by introducing new technologies, alongside refurbishment, to help shop assistants connect and interact with customers.
“We’re also seeing a big change in what customers are buying and – most interestingly – how they’re buying,” Felix said.
“The majority of customers, when they’re doing research, really want to blend the channels between online and in store.”
Changing customer behaviour
Felix said many people browse on phones in the morning, desktops during working hours and tablets or dual screen in the evening. He said these changes in customer behaviour had led to the retailer’s “fulfilment mix” changing rapidly.
Felix said 30% of sales at John Lewis are online, and half of these online sales will be fulfilled through click and collect. Of these click and collect orders, 60% will be delivered through Waitrose click and collect, which allows customers to pick John Lewis goods up from local Waitrose supermarkets.
Research recently found UK retailers ahead of the US in offering click and collect. In early 2015, John Lewis announced it would trial micro-location technology to make improve its click and collect service.
But, although customer behaviours and fulfilment are rapidly changing, the purchase cycle has stayed the same – moving from research, to browsing to selection and then to buying a product. But there has been a notable difference in how the customer then receives the product and continues to interact with a brand, due to an increase in social channels.
As mobile devices increasingly become a customer’s first port of call for advice and interaction, the amount a retailer should target customers during the “research and inspiration” phase of the buying process is increasing.
“Mobile is the glue between our channels,” Felix said.
“To me mobile is really becoming the glue that is binding and bringing the omni-channel journey together.”
In January 2015 mobile purchases grew by 47%, indicating customer demand for convenience – but many believe retailers are failing to cater to this growing audience.
But mobile retail is not without its cruxes and shopping online poses the problem of not being able to test or try items before purchasing.
“One of the biggest challenges of shopping online solely is about product.” said Felix.
Store refit with technology
This is one of the reasons that John Lewis has refitted its Oxford Circus store, and now has mixed the shop floor with technology to cater to customers who are dual screening while they shop.
For example, in the bedding section, customers are able to feel types of bedding, then scan a code using the John Lewis app if they like a product and want to purchase it later.
The store has equipped sales assistants with tablet devices, allowing them to use technology to guide customers.
“We know our customers love the brilliant assistance they get from our partners in the store,” said Felix.
But he said winning in the omni-channel world comes down to four things – knowing your product; applying standards and best practice across all channels; allowing customers to seamlessly switch between online and offline; and helping customers along.
“As part of their omni-channel journey, we need to guide them to the next best action,” said Felix.
“You need to also create the environment in store for customers to have a fantastic omni-channel experience.”