Online Shopping – The Right Channel?

By Jane Atkinson Student ID: 213438614 WordPress User Name: jmatkins68

Clicks or Bricks

retail_main_0815.jpg

Traditionally a place; which is making a product available via distribution channels for purchase in customer accessible places, (Iacobucci, 2014, p. 6) was made up of bricks and mortar establishments.

With the advent of technology, internet shopping has progressed rapidly, so instead of going to the local shops you now go to the virtual shop.

PJs_1

The place has now evolved to sitting in the comfort of your own home, in your PJs, on your favourite piece of equipment, surfing the great virtual galaxy of the internet.

The experience of the ‘home’ being the place of purchase is now common place, where customers find the ability to shop at any time and under their own terms, very appealing and ultimately a positive experience. (Chen & Hung, 2015).

Channel Surfing

The preference for online shopping does vary with different products, some customers may take the “try before you buy” approach and want to see, taste or touch the product before buying it. Moreover, customers are becoming more demanding and savvy in their buying habits and expect “integration in their shopping experience”. (Retail Customer Experience, 2012)

channel_surf2.jpg

The emerging trend is now for businesses’ to provide multi-channel shopping to engage their customers in both their physical stores and online channels. (Huang, et al., 2015).

Multi-channel marketing is making products accessible on multiple platforms, including e-commerce, various marketplaces, and bricks and mortar establishments. (Empire Flippers, 2016) A research study by (Montaguti, et al., 2016) concluded that multi-channels induce more customers and are more profitable than single channel businesses.

lead_960

Star bucks is an example of a company embracing a multi-channel experience for their customers; linking their retails stores to a mobile app, whereby customers place their customised order, select the store and pick it up minutes later. (Baird, 2016). The success of multi-channeling has attributed to 20% of their sales (Tode, 2015).

 

Last Mile

LAST-MILE

One of the greatest difficulties facing an online business is the home delivery service to their customers or the ‘last mile’; and the costs and challenges associated with ‘unattended’ delivery. (Punakivi, et al., 2016)

Most businesses for online deliveries use courier services as their ‘last mile’ distribution channel; distribution channels are basically a network of businesses that are “interconnected” to ensure the products are readily available to customers. (Iacobucci, 2014, p. 127)

upsfail.png

In Australia, courier services are a $4 billion industry but it’s rife with customer complaints. (White, 2015). Customers are commonly frustrated with the lack of flexibility, timeliness and lack of customer service of the ‘last mile’ deliverable. (Botsman, 2014)

Australia Post driver caught on video dropping a ‘Sorry you weren’t home’ note into a woman’s letterbox without even bothering to knock with her urgent package. (Eddie, 2015)

Shippit may have closed the service gap to the ‘last mile’, by offering flexible delivery options, a 3 hour deliver window and online tracking, (Tucker, 2016) so no more missed deliveries.

Recently, Shippit has just signed up a nationwide agreement with Australia Post, providing “transparency and consistency” to online shoppers.  (Turner, 2016)

The lazy dodgy postie maybe a bad memory of the past!

Returns Challenge

While online shopping can be a positive experience, it can also be discouraging particularly with returns.

download.jpg

According to Internet Retailer, only around 10% of the Top 500 US Retailers offer free return shipping (Rueter, 2014) with 81% of shoppers choosing online businesses who offer easy returns. (Evans, 2008)

Many businesses fail to provide a trouble-free return process for their customers. The return policy is a very important attribute of the purchasing experience for many customers. (Bonifield, et al., 2010) Most online shoppers want easy returns; that are clear, convenient, free of charge and flexible. (Whitehouse, 2014)

maxresdefault.jpg

So that the ‘one size fits all’ skirt you bought online finally arrives and you can’t even fit one leg into it!! Now has to be returned and it’s not so easy.

 

References

Baird, C., 2016. Capgemini Consulting. [Online]
Available at: https://www.capgemini-consulting.com/blog/customer-experience/2016/01/the-many-faces-of-loyalty-at-starbucks
[Accessed 15 May 2016].

Bonifield, C., Cole, C. & Schultz, R. L., 2010. Product returns on the Internet: A case of mixed signals?. Journal Business of Research, 63(9-10), pp. 1058-1065.

Botsman, R., 2014. The Australian Financial Review. [Online]
Available at: https://global-factiva-com.ezproxy-b.deakin.edu.au/ga/default.aspx
[Accessed 15 May 2016].

Chen , N.-H. & Hung, Y.-W., 2015. ONLINE SHOPPING ORIENTATION AND PURCHASE BEHAVIOR FOR HIGH-TOUCH PRODUCTS. International Journal of Electronic Commerce Studies, 6(2), pp. 187-202.

Eddie, R., 2015. Daily Mail Australia. [Online]
Available at: http://www.dailymail.co.uk/news/article-3331405/Australia-Post-driver-caught-camera-TWICE-not-bothering-deliver-woman-s-urgent-package-leaving-note-saying-tried-deliver-no-one-home.html
[Accessed 15 May 2016].

Empire Flippers, 2016. Empire Flippers. [Online]
Available at: https://empireflippers.com/multichannel-ecommerce-selling/
[Accessed 13 May 2016].

Evans, K., 2013. Internet Retailer. [Online]
Available at: https://www.internetretailer.com/2013/09/30/global-consumers-demand-more-e-retailers
[Accessed 15 May 2016].

Huang, R., Lee, S., Kim, H. & Evans, L., 2015. The impact of brand experiences on brand resonance in multi-channel fashion retailing. Journal of Research in Interactive Marketing, 9(2), pp. 129-147.

Iacobucci, D., 2014. Marketing Management. 4th ed. Mason: South-Western, Cengage Learning.

Montaguti, E., Neslin, S. & Sara , V., 2016. Can Marketing Campaigns Induce Multichannel Buying and More Profitable Customers? A Field Experiment. Marketing Science, 35(2), pp. 201-217.

Punakivi, M., YrjoÈla, H. & HolmstroÈm, J., 2016. Solving the last mile issue:reception box or delivery box?. International Journal of Physical Distribution & Logistics Management, 31(6), pp. 427-439.

Retail Customer Experience, 2012. Retail Customer Experience. [Online]
Available at: http://www.retailcustomerexperience.com/articles/the-four-benefits-of-multi-channel-retailing/
[Accessed 13 May 2016].

Rueter, T., 2014. Internet Retailer. [Online]
Available at: https://www.internetretailer.com/2014/01/21/2014-promises-more-free-returns-and-store-pickups
[Accessed 15 May 2016].

Tode, C., 2015. Mobile Commercial Daily. [Online]
Available at: http://www.mobilecommercedaily.com/starbucks-is-2015-mobile-retailer-of-the-year
[Accessed 15 May 2016].

Tucker, H., 2016. Business Insider Australia. [Online]
Available at: http://www.businessinsider.com.au/this-startup-wants-to-fix-australia-posts-biggest-problem-2016-3
[Accessed 15 May 2016].

Turner, A., 2016. The Sydney Morning Herald. [Online]
Available at: http://www.smh.com.au/technology/innovation/shippit-deal-ensures-australia-post-delivers-the-goods-20160330-gntwqz.html
[Accessed 15 May 2016].

Whitehouse, H., 2014. Entrepreneur. [Online]
Available at: https://www.entrepreneur.com/article/234921
[Accessed 15 May 2016].

White, L., 2015. My Small BUsiness. [Online]
Available at: http://www.smh.com.au/small-business/courier-complaints-4-billion-industry-but-customers-remain-dissatisfied-20151102-gkpa2q.html
[Accessed 15 May 2016].

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s