Digital customer experience is playing a bigger role in bottom line than ever. But for many businesses it’s a weakness, according to the latest South African Digital Customer Experience Report.
This year, social selling – how brands and companies leverage relationships as part of the sales process – was a highlight of the report, which probed the effect of combining social selling, reviews and of online sales over offline sales.
Collectively, the online experience has a massive impact on physical sales, which total around R294 billion (online and offline). The integration of online and offline cannot be underestimated: if online shoppers are unhappy with high shipping costs, they switch allegiances or abandon shopping carts.
With already low delivery margins, this is a challenge for online businesses.
The report, authored by market research expert Amanda Reekie, Rogerwilco CEO Charlie Stewart and customer experience professional Julia Ahlfeldt, surveyed 2,000 South Africans about the brands they interact with online. The 26-question survey was released via mobile and web apps in Q2 2022.
The report examines how the contribution of e-commerce to e-commerce should not be considered as a mere sale via a payment site, and the influence of the digital experience on purchasing behavior.
The pandemic is a game-changer
The pandemic has had a defining influence on consumer behavior and retailer expectations. This plays into how the delivery experience can affect purchasing decisions, but also “lock in” a customer.
Once burned, twice shy customers are likely to switch brand loyalty and real-world purchases if their online experience is negative.
“With the decline in confidence among all income groups, it is clear that these companies [that] taking the time to put the customer first and working hard to meet, or preferably exceed, consumer expectations, will be well positioned to weather economic uncertainty,” the foreword reads.
Online product research, reviews and discovery influence approximately R293.8 billion in retail sales of groceries, fashion, medicines, toiletries, furniture and hardware.
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Selling online – more simply a case of selling through a website or app – now refers to every interaction a brand has with customers, through a multitude of digital touchpoints such as social selling, places market, search engines, reviews, etc.
Many consumers use the Internet to browse, but do not make purchases online, preferring the physical store experience.
Social selling accounts for 10% of all e-commerce sales, through direct sales via Instagram, Facebook and WhatsApp.
Ahlfeldt says increasing levels of confidence have permanently changed behaviors.
“People have become comfortable [with online shopping].”
Citing the examples of Checkers Sixty60 and Takealot, Ahlfeldt says seamless experiences with trusted brands during lockdown encouraged consumers to explore different avenues to get the things they needed.
“We found that concerns about data security, privacy, and reliability are a top reason for cart abandonment. The top reasons for cart abandonment are lack of trust and shipping costs students.
“What we’ve seen grow significantly is the activity consumers do online in general: interacting with brands, discovering products, researching, comparing prices, reading reviews, etc. About 25% of purchases retail transactions made in a store are actually influenced by online activities.
Brands view e-commerce too narrowly, with a siled approach. Ahlfeldt says, “I’ve had so many experiences where I’ve bought something online and then I’m going to return it to the store and they don’t even know what discount or promotion their company is running online. . The left hand does not speak to the right; consumers feel this disconnect.
On the metaverse, 53% claim to have never heard of it and 23% do not know what it is. Only 1% bought something through the metaverse. But 79% of respondents said they would do so in the future.
Delivery is crucial
The last mile is the only mile: getting products to consumers shouldn’t be an afterthought. Good demand delivery is the “new business battleground” and those who deliver the fastest at the best price will win.
But delivery costs are high and margins are low, so for some it might not make sense to deliver. This is a mistake because customers expect it to be transparent and affordable. Amazon is a priority: Ahlfeld says that while South Africans know and trust Takealot, the American juggernaut will be a game-changer.
“It’s a suite of products and services. They have expanded far beyond simple e-commerce to become an ecosystem of products and services that touch on many different ways consumers consume media and groceries in the online and offline world. DM168
This story first appeared in our weekly newspaper Daily Maverick 168, which is available nationwide for R25.