With Mark Taylor, Managing Director of Retail Solutions and Josh Bolland, CEO of J B Cole
As consumer behaviour evolves, so must retailers. And 2020 has seen significant evolution. Lockdowns have pushed once reluctant internet shoppers online, frequent users have become even more demanding, and retailers have been forced to respond.
For those that respond well, the spoils are there to be won with COVID-19 expected to add an extra £5.3billion to the UK eCommerce market in 2020.
But what’s next? And can we expect to see this growth continue in what is set to be an unpredictable final quarter of the year? To understand the existing eCommerce landscape, we caught up with Josh Bolland, J B Cole CEO and Mark Taylor, Managing Director of Retail Solutions.
To begin with, what do you think has been the biggest trend in eCommerce we’ve seen so far this year? And what are the biggest challenges you are facing right now?
Mark Taylor: “Online sales have been increasing year-on-year for some time, but this year has seen significant growth across all retail sectors. The pandemic has accelerated this growth from both a consumer and a retailer perspective.
“The biggest growth areas are from small local companies moving online for the first time and facing the challenge of competing with much larger companies, and manufacturers bypassing the traditional retail distribution channels to go direct to consumers with a D2C strategy.”
Josh Bolland: “Manufacturers moving to a DTC model has undoubtedly been one of the biggest trends in the retail space in 2020. We’ve also seen many traditional businesses reimagine their offerings to cater for the lack of an offline customer experience.
“During the early stages of lockdown, the team at J B Cole assisted with bringing a wedding dress business online. Shopping for wedding dresses is all about the experience – as much as the dresses, so replicating this to an online setting was a key challenge in itself.
“Customer experience is crucial. If consumers don’t get what they need, somewhere they’re more than happy to look elsewhere. In fact, 40% are willing to switch to a competitor in the face of poor customer experience.”
Does that mean that retailers have to be ready with exceptional CS now more than ever before?
MT: “Exactly. Customer service standards have to be better than your competitors and exceed customer expectations. CS is so much more than a smile and a positive response, although these are often overlooked by retailers.
“To win at CS retailers must respond quickly – same day to a customer’s email and within minutes or even seconds to telephone calls. Consumers demand a response to messaging applications they use every day. So for example, retailers using text, WhatsApp, Twitter and Facebook are able to respond immediately to customers and within apps they’re used to using.
“Other ways to ‘win’ at CS is to be in-stock, offer payment options such as Apple Pay and Klarna rather than just credit card, offer delivery options such as alternative delivery address, click & collect as well as next day or even same day.
“Returns are an often overlooked aspect of CS, and as recently reported by the Royal Mail, 53% of online purchases are returned. Partnering with the new Royal Mail returns service will give retailers a CS advantage.
“Systems integration also is imperative. Real-time stock information is vital to both the customer expectations and the profitability of the retail operation.”
JB: “I couldn’t agree more on the integrations point.
“At J B Cole, our mantra is very much that you simply can’t succeed online without precise and intelligent integrations. We’ve seen it during the first half of this year. Yes, a pivot to selling online or implementing a DTC approach is fantastic and necessary for the survival of many businesses, but you can’t do it simply with a shiny website.
“Supply chain and finance must be front and centre to achieve cross-channel fulfilment. Connecting your warehouse, website and operations team with efficient integrations saves time and money. Customers can be catered for and importantly you can scale up to cope with surges in traffic around peaks and of course the big shopping days we’re about to see in Q4.”
Which brings us onto the topic of Black Friday. It’s notoriously hard to predict anyway, but this year feels a little different. What are your thoughts on Q4 2020?
MT: “Forecasting in retail is always difficult and this year will be even harder. On the one hand, the proportion of online sales will undoubtedly increase but this is predominantly due to the reduction in high-street sales. Nevertheless, online sales volumes this year (Oct-Dec) will be at least 20% higher than 2019.
“Black Friday is going to be bigger too with companies like Amazon already stating that their Black Friday promotion will last for at least one month, starting on 26th October 2020 and where Amazon goes, others follow.
“Consumers expect big discounts from retailers on Black Friday but with ever declining retail margins, this becomes hard to achieve year-on-year. However, with shops full of goods but empty of consumers, expect online Black Friday promotions to be big as retailers look to turn stock into cash.”
JB: “I think that’s the key point around Black Friday. It’s what consumers expect, so retailers have to be ready. Understanding consumer expectation is absolutely fundamental in the current climate.
“This includes aligning messaging and comms with ever-changing and unpredictable consumer values. It is increasingly difficult for brands to put their finger on what trends from 2020 will stick. What will consumers expect from retailers in the next three, to six, to 12 months? Brands that can answer that will win. And for me, the truth lies not only in the data, but how you interpret the data.”
MT: “Exactly, data is reportedly more valuable than oil. Having insight to past customer performance, applying analysis to potential future behaviour gives invaluable insight to providing the right products, to the right customer, at the exact time they’re ready to buy. This is excellent CS and even better business practice.”
JB: “And with data comes both knowledge of your user and the wider market. Then comes the potential to make predictions in this extremely unpredictable landscape.”
So, on that note. What are your predictions for the next year or so?
MT: “It will be a tough three to six months with further retail casualties but out of adversity, new retail successes will emerge. This will be good for consumers as business operations will be leaner, prices lower and service standards higher.”
JB: “For me it’s all about innovation. We’ve seen before the emergence of innovative brands and tech companies from recessions and I hope this time around it will be no different. These includes both retailers, but also service providers. If you can understand the customer, identify their challenges and solve them with innovative yet simple technology, that is a recipe for success.
“Could we see some really innovative products and tech start ups in the next year? I really think we will.”
And finally. On a personal note, do you feel under more stress now with the increased focus on digital over the last year or so? And how are you handling it to find a good work-life balance?
MT: “There is significantly more pressure on getting things right as the financial consequences of getting it wrong are huge, but nobody comes into retail for an easy life! Retail is in our blood and we love the operational thrust of the industry and the joy of delivering customer satisfaction.”
JB: “The importance of digital is a drum I’ve been banging for well over 10 years now, so I’d have to say I feel like I’m thriving on the pressure currently. Work-life balance is crucial, however. For me it’s all about family time, exercise and the dog. In that order.”