Ivan Lim, co-founder of online furniture retailer Brosa, says technology is a key part of his business. Photo: Josh Robenstone
A new generation of "want it now" shoppers are being left disappointed by Australian retailers that fail to meet expectations, new research shows.
Products are being returned because they don't look like the pictures on the websites and a lack of shipping options is leaving consumers disillusioned with the online experience.
We're as much a technology company as we are a furniture company.
Ivan Lim
Consumer expectation gap
Sisters Emma Cronin, left, and Fiona Pearse are the founders of online delivery service Want it Now. Photo: Louie Douvis
Published in February, the research commissioned by Temando has found 91 per cent of shoppers have returned an item because it isn't as described, the sizing is incorrect or the goods don't look like those online.
The 2016 State of Shipping in Commerce has surveyed more than 1000 consumers and 200 Australian micro, small, mid-sized and enterprise retailers to explore shoppers' demands.
It has found 70 per cent of shoppers abandon shopping carts because the cost of shipping is too high, or shipping costs are communicated too late in the purchase (47 per cent). Recent price hikes by Australia Post have exacerbated the problem.
Consumers want multiple shipping options, but only about half of Australian retailers (54 per cent) offer those choices.
Temando chief executive Carl Hartmann say the results confirm that choice at the checkout is a necessity, not a feature.
Only half of retailers are offering the full services that customers expect, which opens up a potentially huge competitive advantage, Hartmann says.
"The gap between consumer expectation and retailer capability is growing. The future belongs to retailers who capitalise on this opportunity, and use shipping and fulfilment as a retail weapon," he says.
Increasingly, shoppers are fuelling a rise in innovation regarding delivery in Australia. Want it Now has 140-plus retail partners, and offers a same-day courier service and a mobile app for tracking. And online retailer The Iconic offers three-hour delivery in Sydney.
Push for seamless retailing
E-commerce firm SAP Hybris' business development manager, Stuart O'Neill, says online retailing in the future needs to be seamless as shoppers choose the channel of their choice to purchase.
"We're global customers who travel and shop overseas, and we expect the same capabilities when we return home or shop elsewhere for the experience," O'Neill says.
Online retailers need to bear in mind that an online store can attract many more customers than a single bricks and mortar store.
Online shoppers should expect to see advances like virtual fitting rooms that allow you to upload a photo of yourself, he says.
"In the future, continual evolution and innovation will become the norm. Just as a physical store can look tired and need updating, an online site needs to look fresh and attract new customers," O'Neill says.
While the cost of building commerce sites will come down, retailers will be prepared to pay a premium for added features to set themselves apart from increasing competition, he says.
The rise of the "want it now" shopper is forcing online retailers to re-engineer their offerings.
Technology company
Premium furniture company Brosa sells items online with an annual turnover of $10 million, but also acts like a technology company.
Brosa has built its inventory management and warehouse technology which manages everything that goes into making its furniture.
"From the moment a customer orders, through to it being made, arriving in our warehouse and being dispatched for delivery, our technology manages the supply chain and optimises for efficiency," Brosa co-founder Ivan Lim says.
"This enables customers to get a great experience and we can continue to deliver that consistent experience as we grow.
"We're as much a technology company as we are a furniture company. Without technology driving innovation, there would be no way it could grow into a big business."
Online retailers need to tell a story about their products using great imagery and videos to build trust, Lim says.
"We put so much effort into making sure all our photos are beautiful, detailed and inspiring," he says. "We even produce product videos for nearly all our products, because customers want to get a real sense for what they're purchasing."
Key figures
- 96 per cent of consumers want to be able to easily track their deliveries, but only 64 per cent of Australian retailers offer this service.
- 94 per cent of consumers would shop in-store and ship heavy goods home, but 66 per cent of retailers do not offer this service.
- 85 per cent of consumers expect to see multiple shipping options, but only 54 per cent of Australian retailers offering such choice.
- 34 per cent of Australian retailers are ready to support hyper-local delivery, but 63 per cent of consumers want it.
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