tag:econsultancy.com,2008:/topics/delivery-fulfillment Latest Delivery & fulfillment content from Econsultancy 2017-07-14T14:04:40+01:00 tag:econsultancy.com,2008:BlogPost/69252 2017-07-14T14:04:40+01:00 2017-07-14T14:04:40+01:00 10 dazzling digital marketing stats from this week Nikki Gilliland <h3>Three in four shoppers browse elsewhere before making Prime Day purchases</h3> <p>Research from <a href="http://blog.bazaarvoice.com/2017/07/10/brands-retailers-seize-amazon-prime-day/" target="_blank">BazaarVoice</a> suggests that Prime Day shopping extends beyond Amazon, with 76% of people visiting other online retailers before making a purchase. 46% of consumers are said to visit Walmart, while 40% check Target. </p> <p>BazaarVoice also found that consumers tend to browse other retailers depending on product categories. For example, more than half of shoppers researching electronics brands will also visit Best Buy, while 49% turn to Lowe’s for researching outdoor items like hammocks or barbeques.</p> <h3>33% of consumers say they will erase personal data as GDPR comes into effect</h3> <p>A new survey by SAS suggests that nearly half of consumers plan to utilise their new rights over personal data in May 2018.</p> <p>In a poll of over 2,000 UK adults, 33% said they plan to exercise their right to remove personal data from retailers, while 33% will also ask for their data to stop being used for marketing purposes.</p> <p>17% of people said they will challenge automated decisions, and 24% will access the data that retailers hold on them.</p> <p><img src="https://assets.econsultancy.com/images/0008/7477/SAS_GDPR.JPG" alt="" width="780" height="298"></p> <h3>Prime Day is the biggest sales day of the year for Amazon so far</h3> <p>New data from Hitwise has revealed that there were 9.5m transactions processed on Amazon.com during Prime Day 2017 – making it the biggest sales day of the year so far. The day generated even more sales than last year, when Amazon processed 6.7m transactions.</p> <p>Altogether, Amazon.com accounted for 87% of all online transactions processed by the top 50 retailers on Prime Day – a day when one in every 10 visits to the site resulted in a purchase.</p> <h3>Companies experience digital performance problems once every five days</h3> <p>Research by <a href="https://www.dynatrace.com/digital-transformation-audit/" target="_blank">Dynatrace</a> suggests that organisations are encountering digital performance problems on average once every five days, with individuals across business and IT functions losing a quarter of their working lives fighting to address these problems.</p> <p>In a survey of 1,200 global IT and business professionals, 75% of respondents said they have low levels of confidence in their ability to resolve digital performance problems. 48% also stated these issues were directly hindering the success of digital transformation strategies in their organisations.</p> <p>Marketing professionals are said to lose 470 hours per year or nearly two hours every business day to addressing performance problems, while IT operations professionals lose 522 hours per year or over two hours every business day.</p> <p><img src="https://assets.econsultancy.com/images/0008/7475/Dynatrace.JPG" alt="" width="582" height="293"></p> <h3>Debit cards overtake cash payments in the UK</h3> <p>The latest <a href="https://brc.org.uk/news/2017/debit-cards-overtake-cash-to-become-number-one-payment-method-in-the-uk" target="_blank">Payments Survey</a> has revealed that debit card purchases have overtaken cash for the first time in the UK, with nearly £190bn being spent via this channel in 2016.</p> <p>Meanwhile, the share of cash transactions shrank 4.5% to account for 42.3%, leaving credit and charge cards to make up the remaining 11.4%. </p> <p>The use of contactless technology has contributed to the rise in card payments, with consumers increasingly using contactless to pay for smaller purchases. The average transaction value on cards declined from £30.53 in 2013 to £25.40 in 2016.</p> <p><img src="https://assets.econsultancy.com/images/0008/7474/Cash.JPG" alt="" width="740" height="513"></p> <h3>37% of online spend goes through Amazon</h3> <p>The success of this year’s Amazon Prime Day might be indication enough, but new research from <a href="https://info.salmon.com/amazon-king-of-jungle-research" target="_blank">Salmon</a> has also highlighted just how much the retailer dominates the ecommerce industry.</p> <p>In a survey of over 6,000 consumers across Europe and the US, Salmon found that 37% of all consumer spending goes through Amazon. This could rise, too, as 73% of consumers say they will increase their use of digital shopping channels in future.</p> <p>53% of survey respondents also said they would be more likely to buy through Prime than a retailer’s online store, while the majority of consumers feel that Amazon is ‘leading the way in digital retail’.</p> <p><img src="https://assets.econsultancy.com/images/0008/7478/Salmon.JPG" alt="" width="550" height="435"></p> <h3>Fresh grocery searches on the rise</h3> <p>From analysis of over 100m online searches in Q2, Criteo has discovered that searches for online groceries increased by 108% during the period of April to June 2017.</p> <p>With consumers relying on faster and more flexible delivery options, buying fresh produce online is becoming all the more convenient. Consequently, searches for milk, eggs and cheese all increased in the second quarter. Online searches for milk increased by 92% from the first three months of the year.</p> <h3>More than 50% of travellers look for inspiration during the planning process</h3> <p>A <a href="https://info.advertising.expedia.com/multi-national-travel-trends-in-the-tourism-industry" target="_blank">new study</a> by Expedia Media Solutions has uncovered the motivations and behaviours of travel consumers across eight countries including China, Australia and the UK.</p> <p>In all eight countries, at least 50% of travellers say they are often undecided on a destination close to booking, with most looking for help and inspiration during the planning process. More than 65% say they are influenced by informative content from travel or tourism brands.</p> <p>That being said, the research also found differences in the kind of marketing people respond to. While ads featuring deals are most likely to influence Americans, Canadians and Australians, Chinese travellers are prompted by ads with appealing imagery and informative content. Both French and German travellers place equal value on appealing deals and imagery.</p> <p><img src="https://assets.econsultancy.com/images/0008/7476/Expedia_Media_Solutions.JPG" alt="" width="780" height="363"> </p> <h3>Marketers struggling to localise content</h3> <p>According to research from the <a href="https://www.cmocouncil.org/authority-leadership/reports/328" target="_blank">CMO Council</a>, marketers are finding it difficult to localise content and tailor their output for individual media platforms.</p> <p>In a poll of 150 marketers, just 36.2% agreed they were performing well when it comes to translating creative strategies across all the necessary physical and digital touchpoints. Furthermore, just 32% believed they are succeeding in adapting branded content for different markets, audiences, and locations served by their companies around the world.</p> <p>47.7% of respondents stated that ‘localisation demands’ – e.g. language, cultural values and religion – were putting pressure on teams to deliver creative at scale. 43.9% also cited new digital formats and device types as a big challenge.</p> <h3>Emojis lose momentum as a marketing tactic</h3> <p>Research from 2016 showed that 95% of Brits were more likely to open an email if they contained emojis that juxtaposed the subject line. However, a new study by Mailjet suggests that emojis might be losing their effect.</p> <p>In a series of tests, Mailjet found open rates in the UK and the US rise by just 5% and 6% respectively when emojis accompanied the subject line.</p> <p>While the crying-with-laughter emoji was previously the most popular, Brits are now 33% less likely to open a message using the crying emoji than an email without it. The current overall best performer is the simple red heart emoji, being one of the few to generate a positive net result across all test regions with a 6% increase in open rate. </p> <p><img src="https://assets.econsultancy.com/images/0008/7479/emojis.jpg" alt="" width="540" height="540"></p> tag:econsultancy.com,2008:BlogPost/69250 2017-07-14T10:52:35+01:00 2017-07-14T10:52:35+01:00 Four reasons behind Superdrug's 41% increase in profits Nikki Gilliland <p>So, why the big turnaround? Here’s a look at Superdrug’s strategy, and the reasons why it’s currently enjoying a resurgence.</p> <h3>Targeting younger shoppers </h3> <p>Boots is the largest health and beauty retailer in the UK, with over 2,500 stores compared to Superdrug’s 850 or so. It’s also got the longest history, as well as a large and loyal consumer base that includes people of all ages and budgets.</p> <p>With Boots catering to such a large demographic, Superdrug has changed its strategy to target a more specific set of consumers. While its rival concentrates on its own-brand beauty range of Botanics, as well as more mid to high-end brands such No. 7 and L’Oréal, Superdrug deliberately targets younger consumers interested in more affordable cosmetics. </p> <p>Cheaper brands like MUA, GOSH and Make-Up Revolution, despite being less well-known, are now sold in most stores.</p> <p>So, alongside a general focus on affordability, how exactly does Superdrug entice younger consumers?</p> <p>In the face of low-price beauty launches from the likes of Primark, H&amp;M and New Look, Superdrug’s work with <a href="https://econsultancy.com/blog/66560-what-are-influencers-and-how-do-you-find-them" target="_blank">influencers</a> certainly sets it apart. The retailer struck a deal with Zoella in 2014 to sell her beauty range, with the collection going on to break sales records. </p> <p>Upon launch, the Superdrug website saw twice as many visitors as usual, with 25% of new visitors clicking on the Zoella range. Since then, Zoella has gone on to release two new collections, both resulting in similar success for Superdrug.  </p> <p>Other popular influencers such as Tanya Burr and Fleur de Force have also partnered with Superdrug to sell exclusive make-up and cosmetics collections, meaning the retailer has been able to capitalise on their existing and loyal audience. </p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr"><a href="https://twitter.com/Zoella">@Zoella</a> <a href="https://twitter.com/ZoellaBeauty">@ZoellaBeauty</a> I've just picked this up from Superdrug it's so pretty <a href="https://t.co/IKAg0QyMdR">pic.twitter.com/IKAg0QyMdR</a></p> — Jessica newman (@jnew135) <a href="https://twitter.com/jnew135/status/883622463531253760">July 8, 2017</a> </blockquote> <h3>In-store experience</h3> <p>Influencers are not the only way Superdrug has aligned itself to younger shoppers. In 2014, it rolled out its new ‘Beauty Studio’ concept, offering beauty services such as threading, manicures and eyelash extensions in-stores. In select locations, it also introduced digital displays and an interactive ‘selfie’ area to encourage shoppers to share their makeovers on social media.</p> <p>Elsewhere, and even in stores that do not include a Beauty Studio, the design and layout of most stores is used to differentiate itself from Boots’ pared down approach. The retailer often uses bright colours and illuminated lettering, bringing a fashionable element into stores. Again, cosmetics is a huge focus, with this area often much larger than other areas.</p> <p><img src="https://assets.econsultancy.com/images/0008/7455/superdrug_cosmetics.JPG" alt="" width="650" height="431"></p> <p>Another way Superdrug has enhanced the in-store experience is to introduce Wi-Fi and its own radio station. ‘Superdrug Live’ is used to support brand campaigns and promotions, as well as create a unique store environment through music.</p> <h3>Healthcare focus</h3> <p>Alongside its Beauty Studio, Superdrug has also expanded into the healthcare market, placing much more focus on its status as a pharmacy as well as cosmetics retailer.</p> <p>While its stores used to have a 70/30 split between beauty and health products, some stores now have a 60/40 strategy, with the retailer introducing consultation rooms and services from pharmacists and nurses, such as flu vaccinations. </p> <p>Interestingly, Superdrug has also introduced its own brand of morning-after pill, selling it at half the cost of the average pill sold over the counter. The move has been praised by the British Pregnancy Advisory Service, which applauded the retailer for giving women greater choice and accessibility. </p> <p>There’s no doubt that Superdrug’s focus on healthcare is succeeding – sales of this category grew 12% last year.</p> <p><img src="https://assets.econsultancy.com/images/0008/7456/wellbeing.JPG" alt="" width="650" height="444"></p> <h3>Rewarding loyalty</h3> <p>Superdrug’s <a href="https://econsultancy.com/admin/blog_posts/69250-four-reasons-why-superdrug-is-succeeding/edit/Six%20tips%20for%20loyalty%20program%20success" target="_blank">loyalty program</a> has also grown over the past few years. In fact, membership is said to have doubled over the past two years, with the retailer having 19m registered members by the end of 2016. </p> <p>The Health and Beauty card is a fairly standard retail loyalty system, rewarding shoppers with points that can be exchanged for discounts. However, Superdrug adds value with exclusive offers and perks, also rewarding long-term loyalty members with exclusive gifts. Regular promotions like ‘Treat Thursdays’ – which offers exclusive discounts – provide incentive for members to collect and spend points.</p> <p>The Health and Beauty card also works in conjunction with the Superdrug app, allowing shoppers to collect and monitor points as well as access offers. By aligning the app and loyalty program, Superdrug has also been able to improve targeting, offering deals and promotions to customers based on their location or past purchase history.</p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr">Calling all Health &amp; Beautycard members! Get 10% off Diet &amp; Fitness products until 23:59 tonight <a href="https://t.co/pj1ctMQvf7">https://t.co/pj1ctMQvf7</a> <a href="https://twitter.com/hashtag/treatthursday?src=hash">#treatthursday</a> <a href="https://t.co/qcrKFWzd3g">pic.twitter.com/qcrKFWzd3g</a></p> — Superdrug (@superdrug) <a href="https://twitter.com/superdrug/status/885431137660796928">July 13, 2017</a> </blockquote> <h3>Improved online presence </h3> <p>While most consumers might naturally think of Superdrug in terms of physical stores, the retailer has been making strides to improve its ecommerce capabilities – as well as its general digital presence.</p> <p>With improved delivery and click and collect, it offers customers more flexibility than before – perhaps one of the main reasons its saw a 60% growth in online sales last year.</p> <p>Another reason could be its Online Doctor service, which allows customers to consult with a doctor on various medical issues and arrange prescription for collection or delivery. The popularity of the Online Doctor has spurred on expansion of Superdrug’s healthcare services, with the retailer recently announcing that will open 30 new stores and create 600 new jobs in the UK.</p> <p>Meanwhile, Superdrug uses social media to reach out and interact with consumers. Its Twitter and Facebook strategy involves a lot of user generated content, with the brand also using lifestyle and pop-culture inspired content to engage younger, female consumers.</p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr">Chris says he isn’t bothered… but we have a feeling that he is defo bothered! <a href="https://twitter.com/hashtag/draaaaaama?src=hash">#draaaaaama</a> <a href="https://twitter.com/hashtag/muggymikeisback?src=hash">#muggymikeisback</a> <a href="https://twitter.com/hashtag/loveisland?src=hash">#loveisland</a> <a href="https://t.co/Tzj24KdgFW">pic.twitter.com/Tzj24KdgFW</a></p> — Superdrug (@superdrug) <a href="https://twitter.com/superdrug/status/885590454573641736">July 13, 2017</a> </blockquote> <h3>In conclusion…</h3> <p>Making both beauty and healthcare accessible, Superdrug has managed to carve out a niche in the market, making its high street presence almost indispensable to consumers.</p> <p>While it previously stood in the shadow of Boots, its strong growth and expansion plans means it is a worthy competitor – possibly even winning in the fight for the attention of today’s young consumers. </p> <p><em><strong>Related reading:</strong></em></p> <ul> <li><em><a href="https://econsultancy.com/blog/67138-native-apps-for-retail-10-reasons-it-s-now-or-never/">Native apps for retail: 10 reasons it's now or never</a></em></li> <li><em><a href="https://econsultancy.com/blog/66160-how-boots-can-improve-its-customer-journey-from-search-to-checkout/">How Boots can improve its customer journey from search to checkout</a></em></li> <li><em><a href="https://econsultancy.com/blog/68472-three-reasons-behind-whsmith-s-boost-in-profits/" target="_blank">Three reasons behind WHSmith’s boost in profits</a></em></li> </ul> tag:econsultancy.com,2008:BlogPost/69216 2017-07-07T10:12:39+01:00 2017-07-07T10:12:39+01:00 Four factors fuelling the growth of fast fashion retailers Nikki Gilliland <p>So, what’s fuelling this boom? Here’s a bit of a deep dive into Hitwise’s <a href="http://www.hitwise.com/gb/articles/urgency-catwalk-look-fuels-fast-fashion-industry/?bis_prd=1" target="_blank">research</a> and how brands are capitalising on the consumer desire for instant and affordable fashion.</p> <h3>What is fast fashion?</h3> <p>Before we go any further – what exactly determines a fast fashion retailer? </p> <p>Essentially, it is when the production process is accelerated in order to get new catwalk trends into stores or online as quickly as possible. It also reflects the growing consumer desire for speed and value within retail. </p> <p>It means that, instead of waiting for new seasonal collections (i.e. spring/summer), consumers can get their hands on a continuous cycle of trend-led clothing, all year round.</p> <p>Brands such as H&amp;M and Zara were said to be among the very first fast fashion retailers. When the latter opened its first US store in 1990 (having first launched in Spain in the 1970s) it announced that it would only take 15 days for a garment to go from concept to completion.</p> <p>So, what’s fuelling fast fashion brands?</p> <h3>Speed and agility</h3> <p>Hitwise data suggests that ASOS, New Look and Very are the most popular brands in the category, accounting for 47% of the UK’s fast fashion market share. </p> <p>For brands like ASOS, the ability to capture millennial consumers is key, with this demographic now reportedly having an estimated spending power of $2.45trn. One way it does this is by delivering on the demand for new fashion, as younger consumers typically spend around seasonal events (such as festivals) as well as after payday.</p> <p>ASOS stocks over 60,000 items at any given time, allowing the ecommerce retailer to constantly update its inventory with ‘new in’ products.</p> <p><img src="https://assets.econsultancy.com/images/0008/7155/ASOS_social.JPG" alt="" width="750" height="475"></p> <p>Research by Goldman Sachs suggests that ASOS is able to do this by mastering its supply chain. The below screenshot shows the correlation between supply-chain lead times and like-for-like sales growth, with the results showing just how important speed is for both <a href="https://www.econsultancy.com/blog/69044-five-reasons-behind-boohoo-s-97-increase-in-profits" target="_blank">Boohoo</a> and ASOS.</p> <p><img src="https://assets.econsultancy.com/images/0008/7154/goldman.JPG" alt="" width="650" height="483"></p> <p>ASOS constantly tracks how well (or poorly) trends are selling online, before adjusting its inventory accordingly. This means that it reduces the risk of unsold stock, and in turn, delivers a steady stream of new trends for fashion-hungry consumers.</p> <h3>Celebrity endorsement</h3> <p>Hitwise data also shows that PrettyLittleThing.com is the fastest growing brand in the fast fashion category, with the site seeing a whopping 663% increase in online visits year-on-year since 2014.</p> <p><img src="https://assets.econsultancy.com/images/0008/7150/Hitwise.png" alt="" width="297" height="233"></p> <p>For PrettyLittleThing, working with celebrities and influencers has allowed the brand to drive awareness of its products. A popular search term relating to the site is ‘celebrities wearing Pretty Little Thing’ – mainly thanks to endorsements from the likes of Kylie Jenner and Sofia Ritchie.</p> <p>However, Pretty Little Thing does not only use celebrities to merely promote its clothing. Well-known names, like former TOWIE star Lucy Meck, have also created their own clothing lines with the brand. </p> <p><img src="https://assets.econsultancy.com/images/0008/7151/PLT.JPG" alt="" width="550" height="546"></p> <p>In doing so, it has allowed the ecommerce retailer to strengthen its connection with customers, offering them something more authentic and original than a shallow celebrity endorsement.</p> <h3>Sales through social</h3> <p>Alongside influencers, fast fashion brands have mastered the use of social media to drive sales. </p> <p>Today, consumers are constantly craving fashion and lifestyle-related digital content, not just to inspire their choices, but also for the purpose of entertainment. So, in order to deliver this, many retailers have started to act more like media brands – fusing the worlds of shopping, entertainment, and social media. </p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr">SHINE BRIGHT Shop the leggings - <a href="https://t.co/BAozK9oxRq">https://t.co/BAozK9oxRq</a> the shoes - <a href="https://t.co/ybfQaGIWuX">https://t.co/ybfQaGIWuX</a> <a href="https://t.co/7Nnp9xFv7m">pic.twitter.com/7Nnp9xFv7m</a></p> — boohoo.com (@boohoo) <a href="https://twitter.com/boohoo/status/879474400445292544">June 26, 2017</a> </blockquote> <p>Unsurprisingly, Instagram reigns supreme as the most effective platform for fashion brands, with many posting videos, Instagram Stories, and including links to shoppable content to allow users to smoothly transition from the act of browsing to buying. </p> <p>One brand that has effectively used social to increase sales volume is Missguided. It has even incorporated the recognisable user interface <a href="https://econsultancy.com/blog/67600-missguided-launches-tinder-inspired-app-experience-review">of another social app – Tinder – into its own</a>.</p> <p>With its ‘swipe to hype’ feature, consumers can dislike or like products to create their own wishlists.</p> <p><img src="https://assets.econsultancy.com/images/0008/7152/Missguided_app.JPG" alt="" width="550" height="483"> </p> <p>This ‘tinderisation’ of ecommerce shows how fast paced the industry has become, with consumers making impulsive decisions – often based on the knowledge that there will be continuous stream of new products in the pipeline.</p> <h3>Sustainability and ethics</h3> <p>The fast fashion industry has come under fire in recent years for its impact on the environment, as well as suggestions that the demand for cheap clothing is driving poor working and labour conditions. </p> <p>Interestingly, research shows that 19% of the top fast fashion related searches are linked to the environment, ethics and sustainability. In order to counteract this, many brands are now displaying increased levels of transparency, with some also introducing initiatives relating to ethical and environmental issues.</p> <p>H&amp;M, for example, launched a conscious beauty collection in 2016 which included ‘planet-friendly’ products. Similarly, it has set itself the goal of using 100% sustainably sourced cotton by 2020.</p> <p><img src="https://assets.econsultancy.com/images/0008/7153/H_M.JPG" alt="" width="760" height="321"></p> <p>Meanwhile, Zara has pledged to boycott Uzbek cotton, which is an industry linked to forced labour. The brand has also joined the Better Cotton Initiative to promote sustainability and best practices for workers in the cotton industry.</p> <p>Of course, there is still a long way to go before fast fashion retailers prove themselves, however these examples are helping to satisfy increasingly conscientious consumers – as well as enhance their brand reputation.</p> <h3>Other brands playing catch-up</h3> <p>So, what impact has the fast fashion had on the wider industry in general? Interestingly, mid-tier and luxury brands are recognising that the consumer desire for fast fashion is not only based on low prices. </p> <p>Often, it can simply be because consumers do not want to wait for seasonal collections. </p> <p>As a result, some brands are introducing ‘runway to retail’ concepts to allow consumers to get their hands on clothes as soon as they’re seen on the catwalk. Elsewhere, JC Penney has accelerated the delivery of merchandise in order to update stock mid-season, while GAP has announced that it will be trialling a fast-fashion model to see whether it increases sales.</p> <p>As the continued growth of retailers like Missguided and ASOS demonstrates, fast fashion could be a trend that’s here to stay.</p> <p><em><strong>Related articles:</strong></em></p> <ul> <li><em><a href="https://econsultancy.com/blog/68728-how-fashion-retailers-can-use-search-trend-data-to-inform-marketing-product-strategy/" target="_blank">How fashion retailers can use search trend data to inform marketing &amp; product strategy</a></em></li> <li><em><a href="https://econsultancy.com/blog/66501-how-fashion-brands-are-setting-trends-in-digital/" target="_blank">How fashion brands are setting trends in digital</a></em></li> <li><em><a href="https://www.econsultancy.com/blog/68404-10-examples-of-great-fashion-marketing-campaigns" target="_blank">10 examples of great fashion marketing campaigns</a></em></li> </ul> tag:econsultancy.com,2008:BlogPost/69135 2017-06-02T09:32:24+01:00 2017-06-02T09:32:24+01:00 Dropit review: Is there a demand for a ‘shop and drop’ delivery service? Nikki Gilliland <p>It sounds kind of cool – but is there <em>really</em> a demand for this kind of service? I was intrigued, so decided to download the app and give it a whirl. Here’s my two penneth.</p> <h3>How does Dropit work?</h3> <p>Dropit works via an app which customers can download or access via the POS device in a store. Buying a day pass for £10 allows you to ‘drop’ as many bags as you like in one day, which will then be collected and sent to you in a single delivery at a chosen time.</p> <p>For my trial, I chose to use Dropit in Lululemon’s Regent Street store – one of over 30 that now offer the service in London’s Regent and Oxford Street area. </p> <p>It was all very simple to do. When I went to buy an item in-store, I told the employee I wanted to use Dropit, which meant I just had to enter my details into the POS device, select a delivery time, and wait for them to scan the receipt and a QR code. It didn’t take long, though it obviously meant a bit of extra waiting time than merely buying and walking out of the store.</p> <p><img src="https://assets.econsultancy.com/images/0008/6467/Dropit.JPG" alt="" width="589" height="524"></p> <p>I chose my item to be delivered to my flat the following evening, and sure enough, it was - packaged inside Dropit's signature bag along with a matching purse that held the day pass and receipt.</p> <p><img src="https://assets.econsultancy.com/images/0008/6469/IMG_0401.JPG" alt="" width="600" height="799"></p> <p>I was also able to track my item on the app to see its progress. The app also includes a list and map of all participating stores, though there’s not much else to it than that.</p> <p>In terms of who actually delivers the goods, Dropit partners with a third-party service (similar to most retail stores), so it’s not a company like Deliveroo that actually employs people to deliver.</p> <h3>Who is it aimed at?</h3> <p>The value proposition of Dropit is quite straightforward – it means you don’t have to carry around bags while you continue shopping or go straight out for the evening. However, the question really is whether this is a big enough problem for people to pay £10 on top of their goods to have their bags dropped off elsewhere. </p> <p>Personally, I can’t see myself ever using it in my every day life, unless it was a (first world) emergency and I really couldn’t take shopping bags along with me, say if I was going to a gig after work. </p> <p>Consequently, I do wonder if the service is more aligned to luxury shoppers – people that are willing to pay slightly extra for the comfort and convenience. Or, perhaps even tourists who are really serious about shopping but also want to enjoy their day doing other things. </p> <p>The fact that Dropit often cites hotels in its promotional copy suggests that people from out of town are a target customer. </p> <p><img src="https://assets.econsultancy.com/images/0008/6471/Dropit_insta.JPG" alt="" width="740" height="353"></p> <h3>What’s the benefit for participating stores?</h3> <p>Meanwhile, there seems to be more in it for retail stores. One benefit is the possibility of extra dwell time in-store. If people aren’t weighed down by heavy bags, I guess they might be less worried about carrying things and therefore more inclined to spend.</p> <p>There is also the benefit of accessing data about offline consumers that would usually only be gathered from online purchases. Details such as where people shop and how much they spend could prove massively beneficial for understanding, targeting and retargeting customers. </p> <p>Finally, Dropit’s partnership network means that it also opens up possible marketing opportunities for retailers, including promotion within the app itself or social media. </p> <p><img src="https://assets.econsultancy.com/images/0008/6470/Dropit_M_S.JPG" alt="" width="750" height="483"></p> <h3>Is it worth it?</h3> <p>Personally, I can’t see much of a demand for Dropit from your average shopper. Most people don’t tend to buy that much in one go – or at least prefer buying online if they do. Similarly, I can’t imagine many people would even think of carrying bags as an issue.</p> <p>Having said that, there’s no doubt that the service does provide real convenience. The app and delivery service itself is also seamless and slick, which definitely adds to its appeal. Ultimately, I think Dropit solves a problem that most people probably don’t even realise they have. Which I suppose is the hallmark of some of the most successful companies out there. </p> <p>For rich people or tourists who are serious about shopping in London, it could be something to consider. Retailers keen to get their hands on untapped data will certainly be keeping their fingers crossed.</p> <p><em><strong>For more on retail, subscribers can download the <a href="https://econsultancy.com/reports/digital-intelligence-briefing-2017-digital-trends-in-retail/" target="_blank">2017 Digital Trends in Retail</a> report.</strong></em></p> tag:econsultancy.com,2008:BlogPost/69071 2017-05-09T11:00:00+01:00 2017-05-09T11:00:00+01:00 M&S to trial grocery delivery service: Will it take off? Nikki Gilliland <h3>Growing UK delivery sector</h3> <p>According to <a href="https://igd.com/About-us/Media/IGD-news-and-press-releases/Online-grocery-delivers-huge-potential/" target="_blank">IGD</a>, Britain’s online food market is expected to nearly double to £17.2bn by 2020. It’s not just the big supermarkets that are involved, of course. The likes of <a href="https://econsultancy.com/blog/68508-the-four-goals-underpinning-deliveroo-s-growth-strategy/" target="_blank">Deliveroo</a> and HelloFresh – companies that offer takeaway options and <a href="https://econsultancy.com/blog/67861-four-reasons-recipe-box-brands-are-delivering-success/" target="_blank">at-home recipes kits</a> – are also taking a slice of the pie. </p> <p>Meanwhile, M&amp;S has been missing out. </p> <p>Despite the retailer’s previous insistence that its product-range and basket-size is too small to offer a legitimate and price-worthy service, the emergence and popularity of the delivery market is bound to have been a factor in its decision to get involved.</p> <p>The question is – how will M&amp;S convince customers that it’s worth paying for a proper delivery? </p> <p><img src="https://assets.econsultancy.com/images/0008/5947/grocery_delivery.jpg" alt="" width="700" height="466"></p> <h3>Changing consumer perceptions</h3> <p>With its ‘dine in for 2’ range, M&amp;S Food is typically seen as a top-up shopping option or a special occasion store. That being said, it is a very profitable one, with M&amp;S’ clothing business dwindling in light of the success of its food arm.</p> <p>Last month, the retailer confirmed it was opening an additional 34 food shops following a review of its UK store portfolio. Meanwhile, it already operates an ecommerce service for its wines by the case, as well as party food, homeware, flowers and other non-food items.</p> <p>As well as a focus on physical stores, M&amp;S has also been concentrating on food in marketing terms. Interestingly, news about its delivery trial aligns with a new campaign that aims to get consumers to think of Marks and Spencer in a different light.</p> <p>The ‘Spend it Well’ campaign is more about promoting brand values than its product-range, telling consumers that life is too short not to spend time and money on the things that matter the most. </p> <p>This, alongside clear investment in physical food stores, is perhaps a sign that M&amp;S is serious about getting consumers to view it as more than just a place to pick up a sandwich.</p> <p><iframe src="https://www.youtube.com/embed/hYbh7PbYq5g?wmode=transparent" width="940" height="529"></iframe></p> <h3>Potential partnerships</h3> <p>So, back to the biggest obstacle of a viable business model.</p> <p>According to reports, M&amp;S is currently in talks with Ocado about a potential partnership to handle order fulfilment. The most likely scenario would also involve M&amp;S products being available on Ocado’s website, rather than a new standalone website being set up for M&amp;S. </p> <p>This would solve the problem of small-basket values, giving consumers the option to pick and choose from Marks and Spencer alongside other food brands. </p> <p>However, with Ocado currently having a deal in place with both Waitrose and Morrisons, it’s not yet clear whether it’s actually possible to bring M&amp;S into the mix. Ocado’s current contract with Waitrose specifies that 70% of all non-own brand products sold have to come from Waitrose. If M&amp;S is classed as a brand – the deal will be unable to go ahead.</p> <p><img src="https://assets.econsultancy.com/images/0008/5948/M_S.JPG" alt="" width="760" height="528"></p> <h3>In conclusion...</h3> <p>With a proper logistics model, success with online grocery delivery is not totally implausible for M&amp;S.</p> <p>Even if consumers do not buy into the idea of a weekly shop, perhaps the introduction of speciality delivery services could prove enticing. If the popularity of its seasonal food is anything to go by - with Christmas and Easter ranges typically seeing shoppers flock to buy a large amount of ingredients in one go – consumers are likely to lap up the added convenience if it is on offer.</p> <p><em><strong>Related articles:</strong></em></p> <ul> <li><em><a href="https://econsultancy.com/blog/67883-marks-spencer-what-does-putting-the-customer-at-the-heart-of-everything-mean/" target="_blank">Marks &amp; Spencer: what does 'putting the customer at the heart of everything' mean?</a></em></li> <li><em><a href="https://econsultancy.com/blog/68355-how-online-grocery-retailers-are-capitalising-on-the-need-for-convenience/" target="_blank">How online grocery retailers are capitalising on the need for convenience</a></em></li> </ul> tag:econsultancy.com,2008:BlogPost/69044 2017-04-28T10:00:00+01:00 2017-04-28T10:00:00+01:00 Five reasons behind Boohoo’s 97% increase in profits Nikki Gilliland <p>So, is Boohoo’s success merely a reflection of the dwindling fortunes of the British high street? Perhaps somewhat, but with other online retailers struggling to capture interest, there’s a reason why Boohoo is head and shoulders above the rest.</p> <p>Here’s what it’s been doing in order to drive online sales.</p> <h3>1. Influencer marketing</h3> <p><a href="https://econsultancy.com/reports/the-rise-of-influencers/" target="_blank">According to research</a>, budgets for influencer marketing were predicted to increase by a whopping 59% last year.</p> <p>Boohoo has evidently ramped up activity in this area, with influencer marketing now a huge part of its strategy to target its core demographic of girls aged 16-24. </p> <p>The retailer has partnered with multiple influencers and bloggers to promote Boohoo across popular platforms like Instagram and Snapchat. One particularly successful example has been its collaboration with model Jordyn Woods on a new range of plus-size clothing. </p> <p><img src="https://assets.econsultancy.com/images/0008/5790/Jordyn_Woods.JPG" alt="" width="650" height="490"></p> <p>The reason it worked so well was not only due to Woods’ personal social media following, but also her connection to other high-profile media influencers like Kylie Jenner and Justine Skye – names that Boohoo’s Generation Z-consumers are likely to be aware of.</p> <p>More recently, Boohoo has also generated buzz from <a href="https://econsultancy.com/blog/69011-jumping-on-the-bandwagon-how-brands-capitalised-on-coachella/" target="_blank">influencers attending Coachella</a> – a festival that typically fills social media news feeds during April.</p> <p>For more on influencers, download these Econsultancy reports:</p> <ul> <li><a href="https://econsultancy.com/reports/the-rise-of-influencers/">The Rise of Influencers</a></li> <li><a href="https://econsultancy.com/reports/the-voice-of-the-influencer/">The Voice of the Influencer</a></li> </ul> <h3>2. Mobile mind-set</h3> <p>Google suggests that <a href="https://www.thinkwithgoogle.com/interactive-report/gen-z-a-look-inside-its-mobile-first-mindset/" target="_blank">68% of teenagers now shop via their smartphone</a>, while 63% of millennials are said to shop on their mobiles every single day.</p> <p>Unsurprisingly, two-thirds of online visits to Boohoo come from mobile, with the retailer subsequently taking steps to ensure that the user experience is as slick and seamless as possible. </p> <p>Last year, it launched apps in international markets as well as a new and improved version for the UK.</p> <p>Personally, I’ve always been a big fan of Boohoo’s app. In fact it’s one of the only examples from a fashion retailer that I turn to over its mobile site. Features like the ‘wishlist’ – which allows you to save items to revisit later – are perfectly aligned with the mobile experience, meaning browsing on the app is even easier than online.</p> <p><img src="https://assets.econsultancy.com/images/0008/5791/bohoo.PNG" alt="" width="250"></p> <h3>3. International expansion</h3> <p>As well as strong UK growth, Boohoo has also seen a rise in profits in international markets, with revenue rising 140% in the US and 40% in the rest of the world.</p> <p>What’s more, the brand looks set to increase expansion plans even further, acquiring Nasty Gal in February – a retailer with a large and existing customer base in the US. Combined with the fact that Boohoo also took over smaller rival, PrettyLittleThing, earlier this year, it looks set to capitalise on these takeovers with further international growth.</p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr">Fries before guys. <a href="https://twitter.com/hashtag/NastyGalsDoItBetter?src=hash">#NastyGalsDoItBetter</a> <a href="https://t.co/wYGU0PmtrR">pic.twitter.com/wYGU0PmtrR</a></p> — NASTY GAL (@NastyGal) <a href="https://twitter.com/NastyGal/status/856032866492334080">April 23, 2017</a> </blockquote> <h3>4. Fast and affordable fashion</h3> <p>Another draw for online consumers is undoubtedly Boohoo’s dedication to fast fashion – meaning the prices are low and the turnover is high. </p> <p>Unlike <a href="https://econsultancy.com/blog/67870-why-asos-is-still-leading-the-online-retailing-pack/" target="_blank">ASOS</a>, which is well-known for carrying a broad and expansive range of designers at a higher price point, Boohoo focuses on stocking key seasonal trends at low prices. While 11% of ASOS products are in the £5 to £9.99 category, this rises to 23% for Boohoo. </p> <p>With consumer expectations rising, and millennial shoppers developing an ‘I want it now’ mindset, Boohoo's business model enables it to deliver a rapid and continuous cycle of affordable fashion trends.</p> <p>Its ‘test and repeat’ strategy allows it to quickly find out what items are selling online before ordering and stocking more.</p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr">This <a href="https://twitter.com/boohoo">@boohoo</a> dress FINALLY came back in stock long enough for me to grab one...Happy Friday!!<a href="https://t.co/xKexqUAbkQ">https://t.co/xKexqUAbkQ</a> <a href="https://t.co/UapfEFbDHr">pic.twitter.com/UapfEFbDHr</a></p> — Halinalinalina (@viechoufleur) <a href="https://twitter.com/viechoufleur/status/850231762961571840">April 7, 2017</a> </blockquote> <h3>5. Harnessing social media and commerce</h3> <p>Its product offering is not the only reason Boohoo has such a large online customer-base. Its dedication to delivering high quality service – both pre- and post-purchase – has helped it to retain strong levels of customer loyalty.</p> <p>One way it does this is through social media, using platforms like Twitter and Facebook to communicate and resolve customer service issues. </p> <p>Of course, it also uses social to drive engagement, continually asking for feedback and opinions, as well as offering incentives such as promotions and competitions. </p> <p>Meanwhile, its also appears to be veering into the world of <a href="https://econsultancy.com/blog/69041-social-commerce-why-basic-bots-and-buy-buttons-are-not-enough/">social commerce</a>, notably including new shoppable elements in a number of recent Facebook posts. While other examples of social commerce have failed to live up to expectations, Boohoo’s ability to resonate and relate to a young and fashion-hungry demographic could mean that its one of the first to truly take off.</p> <p><img src="https://assets.econsultancy.com/images/0008/5792/facebook_boohoo.JPG" alt="" width="760" height="392"></p> <p><em><strong>Related articles:</strong></em></p> <ul> <li><em><a href="https://econsultancy.com/blog/68659-three-reasons-behind-the-white-company-s-boost-in-profits/">Three reasons behind The White Company’s boost in profits</a></em></li> <li><em><a href="https://econsultancy.com/blog/68472-three-reasons-behind-whsmith-s-boost-in-profits/">Three reasons behind WHSmith’s boost in profits</a></em></li> </ul> tag:econsultancy.com,2008:BlogPost/69000 2017-04-24T11:00:00+01:00 2017-04-24T11:00:00+01:00 What Farfetch's 'Store of the Future' tech says about the state of luxury retail Nikki Gilliland <p>This is just one example of Farfetch’s tech-driven approach, which it recently announced alongside a set of ‘Store of the Future’ technologies - designed to enhance the future retail experience for both brands and consumers. </p> <p>So, what exactly does this future look like? Here’s a run-down of Farfetch’s strategy and what it says about the wider luxury retail market as a whole. </p> <h4>Fusion of the online and offline experience</h4> <p>According to Bain &amp; Company, 70% of luxury purchases today are influenced by online interactions, with shoppers partaking in at least one digital interaction with a brand before buying. </p> <p>That being said, it also predicts that stores will play a critical role in the luxury retail market, with 75% of purchases still occurring in a physical location by 2025. </p> <p>So, which one will win out? </p> <p>According to Farfetch - neither. Instead, it predicts a future of ‘connected retail’ – a <a href="https://econsultancy.com/blog/68023-think-retail-how-brands-are-targeting-the-phygital-generation/" target="_blank">blend of the digital and physical</a> realms that will allow consumers to seamlessly shift between the two. </p> <p>The brand’s CEO, José Neves, recently suggested that this will include a combination of innovative tech in-store such as <a href="https://econsultancy.com/blog/68401-virtual-reality-content-marketing-s-next-big-trend/" target="_blank">virtual reality</a>, emotion-scanning software, and innovative payment options.</p> <p>As well as enhancing the physical shopping experience for consumers, this use of technology will also allow retailers to collect vital data about browsing behaviour in-store. In turn, this will inform online targeting, and so the cycle goes on.</p> <p>Browns, the New York-based store owned by Farfetch, will be the first to experiment with these ‘Store of the Future’ technologies. </p> <h4>Innovative online services</h4> <p>Meanwhile, Farfetch aims to enhance its ecommerce service with a selection of new digital services. </p> <p>With younger customers reportedly taking one-third less time than older customers to make decisions, 90-minute delivery specifically targets the ‘I want it now’ mind-set of millennials. A demographic that clearly wants their Gucci loafers delivered stat. </p> <p><iframe src="https://www.youtube.com/embed/3unBWk3yp5Y?wmode=transparent" width="640" height="315"></iframe></p> <p>Consumer expectations are also changing when it comes to personal aspects such as customisation and an alignment of personal beliefs and values. </p> <p>With this in mind, Farfetch has also launched a <a href="https://www.farfetch.com/uk/sets/women/customizable-NK-women.aspx">design-your-own tool</a> for shoe designer Nicholas Kirkwood. Allowing online shoppers to customise its Beya Bespoke line, it’s another example of the retailer putting greater control into the hands of consumers.</p> <h4>Will others take note? </h4> <p>While the physical shopping experience is still in demand across all sectors, it appears to present a greater opportunity for luxury retailers. This is because consumers naturally expect to leave with an ‘experience’ to go along with the actual product they’re buying.</p> <p>By offering a much more intimate and immersive experience, it is a chance for brands and retailers to forge an emotional connection – far more so than online. </p> <p>Luxury retailers have clearly recognised this, with many introducing in-store technologies to dazzle shoppers. <a href="https://virtualrealityreporter.com/dior-eyes-virtual-reality-headst-vr-fashin/">Dior launched a virtual reality headset</a> to give shoppers a behind-the-scenes look of its runway show, for instance. And Harvey Nichols introduced <a href="http://www.harveynichols.com/project-109/">Project 109</a> – an in-store concept space that hosts immersive installations and pop-ups.</p> <p>With the announcement of Store of the Future, Farfetch might just have upped the ante. </p> <p><em><strong>Related reading:</strong></em></p> <ul> <li><em><a href="https://econsultancy.com/blog/68329-farfetch-s-cmo-why-we-re-more-than-just-a-shopping-platform/" target="_blank">Farfetch’s CMO: Why we’re more than just a shopping platform</a></em></li> <li><em><a href="https://econsultancy.com/blog/67705-what-s-now-next-for-digital-technology-in-retail-stores/" target="_blank">What's now &amp; next for digital technology in retail stores?</a></em></li> </ul> tag:econsultancy.com,2008:BlogPost/68909 2017-03-17T13:00:16+00:00 2017-03-17T13:00:16+00:00 10 spellbinding digital marketing stats from this week Nikki Gilliland <h3>Advertisers predicted to be defrauded by $16.4bn in 2017</h3> <p>A new <a href="http://www.campaignbrief.com/2017/03/16/Ad%20Fraud_Report_The%26Partnership_mSIX_Adloox.pdf" target="_blank">report by The&amp;Partnership</a> suggests that the global cost of <a href="https://econsultancy.com/blog/68067-is-ad-fraud-the-21st-century-drug-trade/">advertising fraud</a> could have been significantly under-reported up until this point.</p> <p>While fraud is believed to cost advertisers $7.2bn globally each year, the real cost of ad fraud may have been as high as $12.48bn in 2016 (accounting for almost 20% of the $66bn spent on digital advertising).</p> <p>If advertising fraud continues to evolve at its current rate, this figure could potentially rise to $16.4bn in 2017.</p> <p><img src="https://assets.econsultancy.com/images/0008/4775/Ad_Fraud.jpeg" alt="" width="760" height="427"></p> <h3>A third of Brits would rather read a blog than a book</h3> <p style="font-weight: normal;">New research from Affilinet has found that one in three people in the UK say they read more online than they do in print.</p> <p style="font-weight: normal;">In a survey of over 2,600 Brits, 32% confessed tospending more time reading online, with cookery, diet and nutrition recipes being the most likely category to search for.</p> <p style="font-weight: normal;">When asked about the reasons why, 61% said they prefer blogs because they are ‘cheaper’ than buying books, 58% stated that they are ‘more convenient’ and 49% said they ‘prefer short-form content rather than full books’.</p> <h3>42% of marketers agree that email relevance is hit and miss</h3> <p>A <a href="https://dma.org.uk/infographic/customers-want-relevance-marketers-need-content" target="_blank">DMA infographic</a> has highlighted how marketers are failing to create relevant emails, with 42% saying ‘some’ are relevant to the recipient at best. This is despite the fact that <a href="https://econsultancy.com/blog/67734-three-key-charts-from-our-2016-email-marketing-census/">the medium remains an effective channel</a>, with email ROI increasing from £29.64 to £30.01 in the past year.</p> <p>DMA also suggests that one of the biggest stumbling blocks is a lack of content, with one in four marketers citing this as a major problem.</p> <p>As shown below, other issues preventing effective email is said to be a lack of strategy, a lack of data and data siloes.</p> <p><img src="https://assets.econsultancy.com/images/0008/4776/DMA_email.JPG" alt="" width="630" height="539"></p> <h3>Poor communication results in nearly a quarter of missed deliveries</h3> <p>Research from Engage Hub has revealed that a lack of communication from delivery companies is the main reason UK consumers miss scheduled deliveries, with 23% of consumers saying poor communication has caused them to miss a delivery in the past 12 months.</p> <p>Other reasons include a parcel not arriving at the specified time and having no ability to reschedule the delivery time.</p> <p>When asked about the most important elements of the delivery process, 49% of UK consumers cited clear confirmation regarding delivery time, while 30% said updates from the delivery company in the event of any changes.</p> <h3>Top three searched-for luxury brands see 63.5% of online visits</h3> <p>In terms of the online market share, Hitwise has revealed that Michael Kors, Ralph Lauren and Coach are the most searched-for luxury brands.</p> <p>In fact, these three brands take 63.5% of the share of online visits to the luxury apparel industry as a whole. </p> <p>Meanwhile, data shows that Versace, Tom Ford and Yves Saint Laurent are a hit with millennials, as a large portion of their traffic is currently driven by consumers aged 18 to 34.  </p> <p><img src="https://assets.econsultancy.com/images/0008/4777/Hitwise.jpg" alt="" width="703" height="390"></p> <h3>UK shoppers rate retail experiences as average</h3> <p>According to a <a href="http://www.zetaglobal-uk.com/linking-brand-digital-sophistication-with-customer-demands-whitepaper/?utm_source=media&amp;utm_campaign=cct_whitepaper_lpr&amp;utm_medium=pr" target="_blank">new report by Zeta Global</a>, only 40% of UK shoppers think their favourite retailers provide a good or great customer experience.</p> <p>This comes from a study of 3,000 UK adults, which also found that 48% of respondents considered their <a href="https://econsultancy.com/blog/68839-the-10-principles-for-creating-amazing-online-retail-experiences/">retail experience</a> to be merely ‘average’. Meanwhile, a further 11% believe that their favourite shops provide poor service.</p> <p>From this, it is clear that personalisation presents a huge opportunity for retailers to capture consumer loyalty, with almost two-fifths of shoppers saying they would be inclined to shop around if they received a personalised service.</p> <h3>Emotional context could make digital ads 40% more effective</h3> <p><a href="https://yahoo.tumblr.com/post/158393152734/emotional-context-could-make-digital-ads-40-more" target="_blank">According to Yahoo</a>, the emotional state of consumers can dramatically impact how receptive they are to advertising.</p> <p>With US and UK consumers reportedly feeling ‘upbeat’ 46% of the time, this is a key window for advertisers, with people said to be 40% more receptive to digital ads when they are in this mood.</p> <p>The study also found that when consumers are upbeat, they are 30% more likely to engage with native video content than when they are in any other emotional state. </p> <p>Lastly, consumers are 28% more likely to engage with content marketing and 21% more likely to engage with direct marketing when feeling happy.</p> <h3>Majority of marketers haven’t got to grips with mobile</h3> <p><a href="https://drive.google.com/file/d/0B6yVMKaNCUz6Qm9xMWxIcGpsZW8/view" target="_blank">A new report</a> by Mobile Marketing Association and RadiumOne has revealed that the majority of marketers are failing to tap into the way consumers use their mobiles.</p> <p>From interviews with over 300 senior marketers, two-thirds admitted that they’re not confident they've identified the most critical signals in their customers’ journey.</p> <p>What’s more, 61% aren’t fully confident in their ability to find new profitable customers, and 58% are not fully confident in their re-engagement efforts to prevent customer churn. </p> <p>In terms of the most valuable data, 29% of marketers cite content sharing from apps, 28% cite mobile site visits and 27% cite app installs as the best signals for improving mobile branding. </p> <p><img src="https://assets.econsultancy.com/images/0008/4779/MMA_report.JPG" alt="" width="780" height="236"></p> <h3>25 to 34 year olds 65% more likely to search for bank accounts</h3> <p>New data from Hitwise has revealed that people aged between 25 to 32 are 65% more likely to search for a savings account than any other demographic. What’s more, men in this age group are 60% more likely to be saving compared to women.</p> <p>From an audience of 8.3m 25 to 34 years old consumers in the UK searching to switch banks, Hitwise suggests that the most popular banks to visit are Santander and Halifax, followed by Lloyds and Natwest.</p> <p><img src="https://assets.econsultancy.com/images/0008/4780/Hitwise_2.jpg" alt="" width="599" height="376"></p> <h3>BMW drivers are the biggest retail spenders of any car owner</h3> <p>A new <a href="http://www2.viantinc.com/anatomy-of-an-auto-shopper-uk" target="_blank">study by Viant</a> has delved into the purchase habits and behaviour of major car brand owners in the UK. </p> <p>The report states that Fiat is the most popular car brand for millennials, with this age group 18% more likely to drive hatchbacks than non-millennials. BMW drivers are said to be the biggest retail spenders, being 54% more likely to shop at John Lewis and 2.3 times more likely to shop in Selfridges than Ford drivers.</p> <p>Lastly, Ford drivers reportedly spent £2,157 on flights over a period of six months, with their preferred airline being Emirates.</p> tag:econsultancy.com,2008:BlogPost/68787 2017-02-13T10:06:07+00:00 2017-02-13T10:06:07+00:00 Why did Poundland’s ecommerce trial fail? Nikki Gilliland <p>So, why exactly did it fail? Here’s a bit of insight into the story.</p> <h3>Failure to convert existing shoppers</h3> <p>Having opened its first ever store over 25 years ago, Poundland is built on a tried and tested formula. The reason behind its success is that it knows exactly what its customers want and it unashamedly delivers it. </p> <p>Its stores – a mainstay on most UK high streets – boast bargain multipacks of everything from batteries to fizzy sweets. Though it famously uses tricks of the trade in order to keep its prices so low, such as ‘re-engineering’ products to shrink the size or quantity of items, faithful customers appear well aware of this fact, maintaining that it offers better value than other stores or budget supermarkets.</p> <p>With the arrival of its online shop, Poundland failed to recognise that most existing customers do not typically use it like a standard or large supermarket. </p> <p>The buying process seems much more fractured – people are likely to pop in simply to check out what bargains are in that week or to pick up a specific item. Meanwhile, Poundland's appeal also surely lies in the joy of coming across a surprise find.</p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr">Yes <a href="https://twitter.com/Poundland">@Poundland</a> mate, you've knocked it out of the park with this lifesaver. ONE ENGLISH POUND, GUYS. <a href="https://t.co/VNfdqkmHn8">pic.twitter.com/VNfdqkmHn8</a></p> — Ebony L Nash (@Ebzo) <a href="https://twitter.com/Ebzo/status/825332268893868032">January 28, 2017</a> </blockquote> <p>Further to this, new research from Shoppercentric has found an increase in the ‘little and often’ trend, with 16% of grocery shoppers rarely doing a main shop – a figure 6% higher than it was in 2016.</p> <p>All in all, it seems unlikely that consumers would be able to replicate this reliable experience online. </p> <p><img src="https://assets.econsultancy.com/images/0008/3738/Shoppercentric.JPG" alt="" width="240" height="532"></p> <h3>Delivery costs</h3> <p>As the likes of Sainsbury’s and Tesco launch new initiatives to offer one-hour delivery in London, shipping remains an important sales tactic for most of the big supermarkets.</p> <p>Most consumers are prepared to pay for this convenience, as prices typically fall in line with the supermarket’s wider positioning. In contrast, Poundland’s online delivery costs are somewhat at odds with its overall approach to value, coming in at £4 unless a customer spends over £50.</p> <p>With the average spend in Poundland said to be around £4.72, it seems unlikely that consumers would be willing to pay double for the privilege of getting their goods delivered. What's more, it seems even unlikelier that shoppers would ever be able to reach a £50 shop.</p> <p>Without enough of an incentive in this area, it's unsurprising that existing customers remain satisfied with shopping in-store.</p> <h3>Lack of focus</h3> <p>Lidl was named as the fastest-growing retailer in 2016, with Aldi and Lidl accounting for 10% of the total supermarket spend in the UK. Both have famously avoided venturing into the online sphere, instead choosing to focus on physical expansion with investment in stores and warehouses.</p> <p>It’s certainly been a successful strategy, with some suggesting Poundland could have similarly benefitted from this laser-focus on its physical presence instead of forcing a multi-channel approach.</p> <p>That being said, with the recent launch of <a href="http://www.birminghammail.co.uk/whats-on/shopping/poundland-now-opening-clothing-stores-12545933" target="_blank">dedicated clothing stores</a> for its Pep &amp; Co range, it does appear to be investing somewhat in this area. Again, perhaps herein lies the problem, resulting in a fractured or shallow focus across the board.</p> <h3>Mixed user experience</h3> <p>Finally, while the online user experience is somewhat irrelevant now - with a lack of interest in the overall concept overriding design – it is still interesting to note a few errors. </p> <p>On the positive side, the site appears to be very simple to use, with intuitive navigation and guest checkout facilitating an easy experience.</p> <p>Conversely, certain features like the ‘Shuffle’ tool are a bit baffling.</p> <p><img src="https://assets.econsultancy.com/images/0008/3737/Shuffle.JPG" alt="" width="690" height="465"></p> <p>Attempting to replicate the experience of finding surprise bargains in-store, this ‘new, fun way to shop’ on-site offers up a random selection of items.</p> <p>However, instead of providing users with a novel or entertaining experience, it negates the way people naturally want to shop online, making the whole process much more time-consuming and muddled than it should be.</p> <h3>In conclusion...</h3> <p>The aforementioned shuffle feature is perhaps a good reflection of why Poundland's ecommerce venture failed to work. Ultimately, it’s just a bit misjudged. </p> <p>Poundland’s expansion into ecommerce was done in spite of the needs of its core customer. And while a multichannel approach is undoubtedly the goal of many big retailers – it’s no use if the demand isn’t there in the first place.</p> <p><em><strong>Related reading:</strong></em></p> <ul> <li><em><a href="https://econsultancy.com/blog/66602-do-supermarkets-know-what-online-customers-want/" target="_blank">Do supermarkets know what online customers want?</a></em></li> <li><em><a href="https://econsultancy.com/blog/64799-are-supermarkets-missing-seo-opportunities/" target="_blank">Are supermarkets missing SEO opportunities?</a></em></li> <li><em><a href="https://econsultancy.com/blog/68355-how-online-grocery-retailers-are-capitalising-on-the-need-for-convenience/" target="_blank">How online grocery retailers are capitalising on the need for convenience</a></em></li> </ul> tag:econsultancy.com,2008:BlogPost/68739 2017-01-26T11:05:13+00:00 2017-01-26T11:05:13+00:00 How has Click & Collect evolved, and is it still in high demand? Nikki Gilliland <p>Here’s a few facts and figures on the current state of click and collect, as well as a bit of insight into how the service might evolve in future.</p> <h3>Consumer demand for convenience</h3> <p>Before we get on to any changes in the click and collect model, it's worth noting that consumer expectations for a seamless and multichannel experience have heightened in the past few years. Consequently, <a href="https://econsultancy.com/blog/67534-from-checkout-to-conversion-how-to-prevent-basket-abandonment/" target="_blank">basket abandonment</a> remains a huge problem for online retailers.</p> <p>Of course - from complicated sign-in forms to an absence of guest checkout - there are many reasons why consumers fail to follow through on purchases.</p> <p>However, two of the biggest remain surprise delivery charges and a lack of convenient delivery options.</p> <p>A <a href="http://www.retailtimes.co.uk/retailers-cant-rely-brand-integrity-guarantee-seasonal-sales-says-shutl/" target="_blank">recent Shutl survey</a> of over 1,070 shoppers found that 95% of consumers would consider going to another retailer if their first choice didn’t offer a suitable delivery time.</p> <p>What’s more, it also concluded that 45% of consumers now have higher expectations of online delivery than in 2015.</p> <p><img src="https://assets.econsultancy.com/images/0008/3353/Shutl.JPG" alt="" width="480" height="501"></p> <h3>Increase in services</h3> <p>The question is - are online retailers meeting this demand?</p> <p>As of early 2016, it was reported that just over half of online retailers were offering a click and collect service, with <a href="http://edelivery.net/2016/03/72-of-uk-shoppers-now-using-click-and-collect-but-in-store-experience-lets-things-down/" target="_blank">72% of consumers</a> also making use of it. </p> <p>So, it appears we’re not far from reaching the 76% prediction, and this is likely due to many more retailers introducing click and collect since 2014, as well as an increase in the types of services offered.</p> <p>Instead of just multichannel retailers such as Next or John Lewis offering in-store pick up, both ecommerce brands and supermarkets are now partnering with third-party companies to offer greater convenience.</p> <p>Just one recent example is Missguided, which added a Collect Plus option last year to give loyal online shoppers the chance to pick up goods from local convenience stores and newsagents. It also partners with delivery startup Doddle.</p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr"><a href="https://twitter.com/hashtag/Shoesday?src=hash">#Shoesday</a>! <a href="https://twitter.com/Missguided">@Missguided</a> have you covered with up to 75% off. Order pre-8pm for FREE delivery to Doddle. No brainer. <a href="https://t.co/9hojruFoBc">https://t.co/9hojruFoBc</a> <a href="https://t.co/2v4g52bAw4">pic.twitter.com/2v4g52bAw4</a></p> — Doddle (@Doddle) <a href="https://twitter.com/Doddle/status/823802521655316480">January 24, 2017</a> </blockquote> <p>Many retailers are also cottoning on to the fact that click and collect is not only a way of reducing online abandonment, but increasing footfall and in-store sales.</p> <p>Take Morrisons, for instance, which also partnered with Doddle to add click and collect concessions to its larger outlets. By introducing this feature, it has been able to give greater incentive for consumers to shop in its physical supermarkets, in turn capitalising on spontaneous in-store purchases. </p> <h3>Challenges and consumer dissatisfaction</h3> <p>Despite the increase in click and collect usage, shoppers have been left increasingly frustrated with the experience of late.</p> <p>According to JDA, <a href="http://www.retailtechnology.co.uk/news/5903/more-than-a-third-experience-christmas-click--collect-problems/">36% of shoppers encountered a problem</a> with collection last Christmas, with long waiting times and a lack of in-store employees being cited as the biggest areas of dissatisfaction. </p> <p><img src="https://assets.econsultancy.com/images/0008/3354/JDA.JPG" alt="" width="760" height="372"></p> <p>Implementing the service can be a risk for retailers.</p> <p>While the added convenience and increase in sales might prove irresistible, there is the danger that consumer perception will be damaged, and margins will become even tighter.</p> <p>With click and collect costing retailers four times more than in-store purchases, a lack of profit is indeed a significant problem.</p> <p>And as a result, even big retailers like John Lewis and Tesco have begun charging for click-and-collect orders under £30, potentially putting off consumers from using it in the process. Indeed, after angry responses from Tesco consumers, the supermarket subsequently dropped the charge.</p> <p>Other retailers have introduced measures to try and prevent this type of backlash. Sports Direct, for example, charges £4.99 for collection, but also offers a £5 voucher if consumers pick up from a store instead of a Collect Plus outlet.</p> <p>Of course, another factor that could impact click and collect usage is the option for same day delivery. </p> <p>72% of consumers <a href="http://edelivery.net/2016/09/retailers-missing-4-9bn-day-delivery-goldmine-says-stuart/" target="_blank">say that they would be willing to pay more</a> to ensure their items are delivered on the same day, which means that standard collection services could be sidelined if even more retailers introduce it. </p> <p>Whether or not this will happen in the near future is unclear, with reluctance from retailers again stemming from high cost and logistical complexities.</p> <h3>Rise of 'click and commute'</h3> <p>With the aforementioned challenges, it is clear that the click and collect model might not have the same attraction as it did three years ago.</p> <p>That being said, it’s still been suggested that click and collect usage will <a href="http://postandparcel.info/71804/news/uk-online-delivery-and-click-and-collect-to-double-by-2025-claims-new-report/" target="_blank">double by 2025</a>, with the expectation that it will generate 10% (or £23bn) of UK retail sales.</p> <p>So, where will this growth stem from?</p> <p>Many predict it will be from the so-called ‘click and commute’ model, which counts on retailers partnering with third-party companies to offer dedicated collection points in train stations.</p> <p>With Doddle reportedly opening a new location every two weeks in the UK, as well as expanding its service to the US market, we’ve already seen evidence of this. </p> <p>As consumer expectations continue to increase, we could see many more retailers opting for this cost-effective solution to the tricky 'last mile'.</p> <p><em>Click and collect this additional knowledge:</em></p> <ul> <li><a href="https://econsultancy.com/blog/66389-what-does-the-ideal-click-and-collect-service-look-like/"><em>What does the ideal click and collect service look like?</em></a></li> <li><a href="https://econsultancy.com/blog/68043-will-click-collect-be-killed-off-by-same-day-delivery/"><em>Will click &amp; collect be killed off by same-day delivery?</em></a></li> </ul>