In and Out of the Online Shopping Cart

Online product research has increased and is influencing the physical retail sales of groceries, fashion, medicine and toiletries, and furniture and hardware of as much as R294bn. This has emerged from the “2022 SA Digital Customer Experience Report”, written by Charlie Stewart, CEO of the Rogerwilco agency, Amanda Reekie, founder of online research platform ovatoyou and Julia Ahlfeldt of Julia Ahlfeldt CX Consulting.

The report is based on the responses of 2,000 South Africans. It says brands and businesses have made significant customer experience progress to keep up with the growing demand from savvy consumers. But it’s also customer experience that can kill a brand’s success in the market.

Seventy percent of respondents have pulled out from a sale at the last minute. They are mostly frustrated by payment failure, high shipping fees, clunky sites and slow delivery. Given this, the authors estimate that this year the cost of cart abandonment could be as high as R26.621bn.

The report says the pandemic has permanently influenced online shopping behaviour. It says social selling and the impact of online reviews also influence offline, or traditional, physical sales. Social selling is done directly via Instagram, Facebook Shops and WhatsApp.

Graph detailing why customers abandon shopping carts

Ahlfeldt says: “Online is far more complex than we had realised; selling can come from almost anywhere online. Brands need to grasp that new channels of trade are on the rise, and that even if purchases don’t happen online, that’s where many customer journeys begin. Brands may be missing valuable opportunities by limiting the channels they trade through.”

Take Facebook and Instagram, for instance: 48% of consumers buy through these platforms. Ahlfeldt says it’s not just small businesses that are leaning into alternative e-commerce avenues, but also global juggernauts like clothing retailer H&M. The report says brands may dismiss a Google review that potentially leads to an in-store purchase, but it is imperative they take note that any online activity — browsing, researching, comparing and looking at reviews — is done as a means to an end.

Woolworths says more than 60% of its online browsers claim to buy in store, which has reinforced its focus on omnichannel retail. Stewart believes brands need to reconsider their entire approach. “It’s dangerous to disregard other channels and transactions … These are no longer niche behaviours. Our research suggests it’s time [for brands] to rethink and broaden their definition of e-commerce to keep up with consumer behaviour.”

Another key finding is the emergence of consumer interaction with the metaverse — an embodied virtual reality experience. Close on 80% of those surveyed said they would engage with it in future.

The study says getting delivery right has become the new commercial battlefield. Those that deliver the fastest and at the best price will win, as consumers are now insisting on next- or same-day deliveries.

But, the report says, the financial reality is that while being first to drop and go is what the market wants, it comes at a high cost to a company. It says Checkers Sixty60’s margins are small, and one could argue that they don’t necessarily warrant the expense of a delivery.

The report also asks if Amazon’s opening in SA early next year will prove to be too much for local rival Takealot. Ahlfeldt says: “Regardless of size or product, no brand owns the customer. It’s certainly a dog-eat-dog world, which is why local brands must up their ante to guarantee that they can confidently stand against, or alongside, international apps, and offer a seamless customer experience.”

Infographic detailing the growth of online shopping from 2021 to 2022

This piece originally appeared in the Financial Mail

Featured Image:123RF