E-commerce boom: Four areas retailers need to address ahead of Christmas

Retail experts are encouraging businesses to prepare for Christmas trading early because the demand for goods via online shopping is forecast to hit record highs this summer.

A new report by Power Retail and Australia Post predicts the December 2021 quarter to be the biggest on record. In fact, the report states that e-commerce revenue this financial year will soar even higher than it did in the financial year ending June 30, 2021. In that year, growth in online goods spend grew 30.8% compared to the previous year, equating to $52.1 billion.

So how can retailers make the most of this surge in online spending? Insights from Power Retail and Australia Post reveal there are four areas retailers should address to succeed this holiday trading period. 

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Questions retailers should ask: What are reasonable shipping costs? Are my shipping costs communicated clearly and early? Do I offer flexible delivery options?

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Power Retail data show the two reasons shoppers are most likely to abandon their cart are unclear shipping fees and a lack of delivery options. 

A whopping 86% of online shoppers surveyed by Power Retail said they would abandon their cart if the cost of delivery is communicated too late in the shopping experience. 

When it comes to click-and-collect, shoppers desire flexibility. Australia Post insights reveal 63% of shoppers prefer to collect purchases from their local post office, while 15% prefer a 24/7 Parcel Locker. 

Nathan Brown, chief executive of Global Marketplace (which owns Power Retail), says those figures show businesses need to think about building trust with their customers throughout the transaction process. 

“The sooner you can inform your customer on the shipping costs in the transaction, the more trust you build, and the more likely you are to get a complete transaction,” Brown tells SmartCompany Plus.

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Questions retailers should ask: What Click and Collect options do I offer? How do they stack up against my competitors?

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Demand for click-and-collect options surged during the pandemic, with more consumers looking to buy online before collecting their purchase in person. 

Power Retail found that 31% of consumers would abandon their cart if click and collect is not offered, meaning retailers must think creatively when it comes to fulfilment. 

Brown says retailers should consider whether they should offer a variety of click-and-collect options to cater to consumer preferences. 

“There are lots of different ways to think of click and collect, from picking up from a store to collecting it from an Australia Post locker,” he says.

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Questions retailers should ask: What tracking options do I have? How can customers communicate with my business? Are my stock levels up to date on your website?

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Consumer behaviour has changed over the past two years, with more shoppers accessing parcel tracking services to follow their deliveries. 

In fact, customers are 20% less likely to contact call centres to enquire about their parcel if they use the Australia Post mobile app to track it. 

Shoppers also expect streamlined services, including the ability to easily communicate with a business and know whether the stock they want is available. About 54% of online shoppers have had their order cancelled by a retailer because stock wasn’t available. 

Natasha Sholl, insights editor at Power Retail, says these findings show that customers can easily become frustrated if they reach the end point of a transaction only to find out the product they want is not available. 

“It’s vital in the lead up to Christmas that businesses make sure their stock levels are up to date on the website,” Sholl tells SmartCompany Plus.

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Questions retailers should ask: How does my returns process compare to my competitors? How can I simplify my returns process?

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The Christmas period is expected to see record parcel volumes, which will in turn result in record returns. 

Scholl says retailers need to promote their return policies clearly because it helps build trust with shoppers and improve customer experience.  

“Returns are part of the consumer experience; it doesn’t end at delivery,” Scholls says. 

“The data shows that making returns easy doesn’t make a customer more likely to return the item, it just makes them have a positive brand experience,” she adds. 

Power Retail’s advice to businesses is to be aware of what your competitors are doing and make sure your returns policy is on par with similar businesses in your market.