The Perils Of Showrooming – And What Retailers Can Do

Leave a reply

With the continuing spread of smartphones (by May 2013, according to TNS Mobile Life, 60% of Kiwis had smartphones), local retailers need to develop strategies to deal with the practice known as “showrooming”.

What is showrooming? According to Wikipedia, “showrooming is the practice of examining merchandise in a traditional brick and mortar retail store without purchasing it, but then shopping online to find a lower price for the same item.”

Why do consumers showroom?

A September 2013 Canadian/U.S. study, “Showrooming and the Rise of the Mobile-Assisted Shopper“, identified the key reasons cited by consumers:

Conversely, why do Mobile Shoppers still buy instore?

The value of the item under consideration matters, according to the study, with more expensive items (unsurprisingly) more likely to be showroomed:

And the critical pricepoints?

Is showrooming a problem in New Zealand?

Yes, according to Colmar Brunton (CBOmnijet Sept 2013), who report that 58% of online Kiwis have seen something in a shop, checked the price on their phone while in the shop and then bought the item elsewhere.

A BBC news report highlighted the demise of a camera retailer, and staff reaction to the store’s closure:

“The staff at Jessops would like to thank you for shopping with Amazon” read the sign in a shop window shortly after the British camera chain went into administration.

It was a dry reaction to a growing problem for “bricks and mortar”-focused retailers. Showrooming is said to have exacerbated the decline of high-profile brands like Comet.

Gadget stores, bookshops and the cosmetics industry are all losing sales to showroomers, but solutions have proved hard to find.

Kelly Buckle, 23, of Birmingham, sometimes spends more than £200 in a single shopping trip – but never actually gets as far as the checkout.

“I can go in and smell a perfume and then find it online for £30 less,” she says.

Research by design agency Foolproof found that 24% of people showroomed while Christmas shopping – and 40% of them took their business elsewhere.

So what (if anything) can be done about showrooming?

One strategy we wouldn’t advise is to follow the example of this Queensland store and charge prospective customers just for browsing:

A Brisbane specialty grocery store owner is charging customers to browse after becoming fed up with people who enquire but don’t buy.

A poster telling customers they’ll be charged $5 for browsing if they don’t purchase anything has been put up at Celiac Supplies in the suburb of Coorparoo.

Owner of the gluten free produce store, Georgina, says she resorted to putting up the sign after spending hours each week giving advice to people who leave empty-handed.

About 60 people a week would go into the store, ask questions and then buy the same or similar product at a supermarket chain or online.

She has became frustrated as her prices often match that of the supermarkets but people still go elsewhere as they are under the impression it will be cheaper.

She says the sign has turned some people away but others are more sympathetic and pay up.

“I can tell straight away who are the rat bags who are going to come in here and pick my brain and disappear,” she said.

Australian Retailers Association executive director Russell Zimmerman says charging customers to browse will likely turn people away.

He says a few stores in Queensland are charging to try on shoes or clothing but this is the first time he’s heard of a browsing charge.

Better instead, perhaps, to consider this American example. Time Magazine reports that leading U.S. retailer Nordstrom is testing one possible way to benefit from the practice through a partnership with jewellery website Blue Nile:

Blue Nile is paying Nordstrom for display space in the chain’s downtown Seattle store. A Blue Nile representative is on hand, iPad at the ready, to answer questions and help create customized rings.

The practice is unique because Blue Nile is a direct competitor to Amazon, and customers who want one of the rings have to purchase from the jeweler’s website.

Why would Nordstrom want to be used so blatantly as a mere showroom for another retailer? For one thing, though the terms of the arrangement were not made public, Blue Nile most certainly is paying the department store for its prime retail space. The other reason for the partnership is that Nordstrom hopes it will attract new customers to check out its Wedding Suite area, where they’ll browse (and perhaps buy) wedding dresses, bridal gowns, and other items before or after checking out the jewellery from Blue Nile.

If that sort of partnership strategy is unlikely to work for you, here are some other possibilities. First, USA Today suggests these ten strategies:

1. Offer benefits. For those who purchase from you, offer post-purchase support — lessons, personal set-up, service, telephone support.

Make sure you prominently display the fact that such services are included after purchase for those who purchase from you.

2. Stock different merchandise. If a shopper can get exactly the same merchandise online at a lower price, it’s easy to comparison shop.

So look for items that are unique or special in some way.

3. Specialize. Become a desired destination for certain shoppers.

A small grocery store in my neighborhood, nondescript store where people pick up a few last-minute necessities, transformed a section into a specialty store, stocking craft beers with a sign outside touting “999 great beers — and a few lousy ones.”

4. Hold events. Become a place customers want to hang out.

I recently attended a great event at my local bookstore, Kepler’s Books in Menlo Park, Calif. One Saturday night, they had a book swap.

For a price, the bookseller offered food and wine and guests swapped books they loved with one another. It reminded me how wonderful it is to be surrounded by people who love books and reading and how fabulous it is to go to a vibrant, real bookstore.

5. Create a membership programme. Why not turn customers into members?

This isn’t as crazy as it sounds. After all, outdoor sports retailer R.E.I. has members. Members pay a small price but get a discount on purchases, invitations to special events, extra services, and a greater feeling of attachment to your store.

6. Engage with customers on social media. The closer customers feel to you, the more likely they are to be loyal.

7. Allow customers to run a tab. Everyone loves to be considered a regular.

If you sell something that customers purchase regularly — books, garden supplies, hardware — create a programme where they leave a credit card on file and just add to their tab when they come in.

8. Make sales from your website. Some customers may not be quite ready to buy when they come to your store but want to make an online purchase later.

If you don’t have e-commerce on your website, they’ll go elsewhere.

9. Provide great service. Small businesses have to go the extra mile to stay alive.

I go to my local hardware store instead of the big, ugly home-improvement stores because I get help from people who really know what they’re talking about. They’re friendly, helpful, knowledgeable, and I like going there.

10. Do everything you can to remind people what they lose when they fail to support local stores: the convenience of shopping locally, the health and vibrancy of their town, and, most important, tax dollars that support their schools, streets, and safety.

The US National Retail Federation gives some useful additional advice:

11. Seize the moment. Bricks-and-mortar retailers have a chance to salvage a sale that might not otherwise happen if the customer is merely shopping online.

12. Engage all five senses. Take advantage of the physical presence of the customer to wow them with sight, sound, touch, taste and smell.

13. Upskill your staff. In-store consumers have more information than ever before. If sales associates can’t enhance that knowledge — or worse, know less about a product than the customer — the sale can be lost.

But “if the sales associate is empowered with technology and has a deeper understanding of the product” and access to CRM data, “they’ll have a better opportunity to connect more effectively with the shopper,” says Branden Jenkins, general manager of e-tail/retail products for NetSuite.

Focusing on staff expertise will move the in-store experience from commodity-based to “value added”. People still buy fashion in a store to ask, ‘Does this look good on me?’ … [retailers] need to drive up knowledge as currency.

14. Know your customers. Customers also want to feel valued — and known — by the retailer.

The battle for the retail floor is going to happen in the cloud [via] customer data and an understanding for customer preference. Most companies — retailers and non-retailers alike — “do a poor job of leveraging the valuable customer information they have,” says Brent Cohler, director of mobile product marketing for SAP. “That’s frustrating because the more customers are engaging with the brand, the greater their loyalty and expectations. Retailers should provide customers with personalized content and offers at the point of decision. They can do this using information from a variety of sources … and combining it with the rich contextual signals that mobile devices provide.”

Greg Girard, program director of merchandise strategies for IDC Retail Insights, cites the MyLowe’s plan, in which Lowe’s customers swipe a card when they make a purchase and can keep up with home-oriented details online. Lowe’s “can help manage warranties of products … or remind them that it’s time to do periodic maintenance,” he says. “That’s a great customer support system, but there’s analytics behind it, too.”

15. Millennials are leading the way … but not for long
Mark Logan, senior vice president of digital innovation at advertising agency Barkley and head of Moonshot Innovation Lab, says half of all millennials surveyed in 2011 reported using smartphones while shopping, compared with 21 percent of non-millennials. “A year later, that gap had closed,” he said.

And retailers with older core audiences need to pay particular attention, says Jeff Fromm, Barkley’s executive vice president and author of Marketing to Millennials. “The older generation is adopting more and more the technology habits of the millennials,” he says. “Millennial influence is much greater than just the impact on members of their generation.”

Barkley’s research showed Facebook was the second most-used app among millennials while they shopped. “When we asked them about it, they told us they use it as a way to consult with friends about a potential purchase,” Logan says.

In fact, the research showed that 60 percent of millennials don’t make a decision without seeking advice from others. Retailers “could make it easier to gain ratings/reviews and see that the value equation is in line instead of trying to prevent it,” Fromm says.

Logan cites cosmetic retailer Sephora, which allows customers to scan a barcode for access to reviews and ratings. “It’s a simple tactic that gets people thinking about checking out the review,” he says. “It brings the tacit endorsement from all those voices into the … store.”

And for millennials — and those who follow — that might just be enough to close the sale.

Mobile-Assisted Shoppers, Segmented

Finally, let’s hear some good news. That September 2013 study we mentioned earlier, “Showrooming and the Rise of the Mobile-Assisted Shopper“, took a closer look at the category and established that not all shoppers are alike. The study identified five different segments:

These were the key findings of the study:

Only 6% of Mobile-Shoppers are “Exploiters” — already planning to buy online, and always opting for the lowest price
30% are “Traditionalists” — committed to purchasing in-store, and only using their smartphones to find more information
Convenience, urgency, and immediacy — the top three reasons that Mobile-Shoppers buy in-store even after they find the same product cheaper online
48% of Mobile-Shoppers are more likely to purchase products in-store despite equal or cheaper prices online when they are a loyalty program member
60% of Mobile-Shoppers are more likely to buy a product in the store when they find online reviews on their smartphone
55% are willing to sign up for a store loyalty programme in order to gain benefits on their smartphone while in the store

For more details about these Mobile Shopper segments, download the free report here.

Our conclusion: showrooming is a problem for retailers, but not an insoluble one.

Kiwi Shopping At International Stores Up 20 Percent

Leave a reply

The latest BNZ Online Retail Sales Index, covering NZ eCommerce trends up until November 2013, has just been released and it demonstrates just how small the world is — and the heightened risks facing NZ retailers.

The most significant statistic is that online spending by New Zealanders at offshore stores in November 2013 was up approximately 20% on November 2013, while spending in domestic online stores was up just 5.5% (this despite the introduction of several Kiwi online initiatives such as Click Monday and Click Madness).

Whilst we’re not seeing the huge gaps that we saw in 2011 (see the graph below), the trends are clear: Kiwis are spending more online — and are spending more than three times as much online as they were in January 2010.

In which countries are we shopping? Not only in America, as you might have expected. In fact, the US accounts for only 30% of online spending, according to the BNZ’s figures. “Other” (encompassing Asian trading partners such as China, Hong Kong and Singapore) is in second place, followed by the UK, the EU and Australia.

The economic impact on NZ retailers of this trend towards international shopping has been in the news of late, most recently with Hallenstein Glasson chief executive Graeme Popplewell citing “competing with an e-commerce world where profit margins are low or nonexistent” and forecasting a 20 per cent decline in half-year profit.

Steve Waite of accounting firm BDO penned a column carried by the Herald Online arguing that NZ should charge GST at the border on all transactions, not just those over $400. This, he argued, should “give our retailers on Main Street a bit more time to adapt to the brave new world confronting them”.

Unfortunately, those sentiments drew little sympathy with the vast majority of the more than 290 commenters on the article. Typical responses pointed out that there can be vast differences between the cost of products sourced direct from offshore and those sold locally:

The issue is not so much the GST as the massive mark up charged to NZ customers on some goods. If goods were priced competitively compared to overseas people would not bother buying from overseas.

I have just bought a juice pack from the USA for $49. For sale here at $220 dollars. That’s why people buy overseas. In a market economy adapt or get out.

It would take a month at most for a NZ retailer to cut prices to match. They simply need to stop making such high margins. I bought some North Face shoes that cost $250 in NZ and $110 in the USA. No one will convince me that 15% GST and the cost of moving a container of shoes to NZ instead of the USA from Vietnam adds $140 to the price.

Just bought some Levis jeans in Costco in LA. US$19 a pair. Same jeans in NZ? US$135/pair or so. Please explain how adding 15% to $19 will make me stop buying overseas?

The other most commonly-cited reason for buying online: range, quality and variety.

The reason why I buy online is to get better quality of goods as well as specialty items that are not available in NZ shops.

Convenience gets a mention from a few:

It’s not just the pricing that’s attractive to the consumer, it’s the whole package. No driving around in circles trying to find a park, no overworked underpaid disgruntled staff showing you no courtesy or manners (in fact a lot of the stores are understaffed at busy times), no queues, no crowds, no dirty toilets and waiting for a loo.

Compare that to browsing your favourite stores online in the comfort of your own home or office, and having your purchases delivered to your door.

And then there’s customer service (or its perceived absence locally):

I personally don’t care if 95% of NZ retailers go bust because they cannot compete – most of them are next to useless anyway, with very limited stock inventory, slack and uninformed staff and poor warranties/return policies that offer only the legal minimum, combined with ridiculous trading hours that mean they close at 1230 on a Saturday and don’t open Sunday etc.

I’ve been trying to buy an item for a month from a NZ company, have emailed 3 times and no one has bothered to respond, so guess what, I bought it overseas and it arrived within a week.

What about buying locally so that you’re protected if anything goes wrong?

A couple of months ago I purchased a $500 item from a store, instead of for $200 USD overseas, thinking that I would get better after sales service. However, when a part of the item broke last week, I had terrible service from the retailer, who in turn got no service from the importer.

And shipping from local suppliers comes in for criticism as well:

How is it that I can purchase something online from a NZ shop on the same day as something from a US based retailer, and have the US purchase arrive first (by courier)?

A few commenters felt that the real problem is not so much the retailers but rather the various intermediaries that each add their own margins:

Rubbish, people shop online because NZ retailers are forced to pay ridiculous rentals, and have to then gauge extortionate profits, and justify it by saying it is because we are so far away in NZ.

Yet, even single items can be purchased for half the price overseas, online. If they were only 10-15% more expensive, nobody would bother.

The main problem is middlemen, or wholesalers, who have large warehouses, teams of people, and fleets of vehicles that all have to be paid for. In most cases, these wholesalers are making more margin than the retailers.

This middleman structure will disappear in the future, and retailers will all be buying direct, importing their own products. At that stage, we will have retail prices that are consistent with prices charged overseas.

And as for that “a bit more time” comment:

Finally, how long is a “bit more time” for retailers to address their cost structures in relation to on line business – 5 years, 10 years, 20 years, or more? On-line stores like Amazon, iTunes and even New Zealand’s ill fated Flying Pig have been around for many years now – Amazon started in 1994, and will celebrate 20 years next year.

Ultimately, what is being requested is protectionism not an efficient market

All in all, it’s clear that there’s little sympathy for buying locally if the consumer has to settle for higher prices, limited range, poor service and inefficient delivery times. Which explains the continuing appeal for international shopping.

What’s to be done? One commenter made some useful suggestions:

Until retailers (here and offshore) understand that they need to add value to customers, not simply attempt to sell products that will always be available for less somewhere else (whether on Amazon, eBay or even Trade Me), they will continue to lose market share.

There have always been retail establishments that charge more, but we frequent them nevertheless, because they either:

understand our needs better;
introduce us to products we never would have thought of buying otherwise;
have a unique perspective on the world that catches our imagination;
have mastered retail as shoppertainment;
curate products, not just sell them;
provide peace of mind after the sale;
are really nice people with whom we just like to deal; or
otherwise distinguish themselves in a world of parity products and retailers.

Food for thought.

Click Monday and NZ Online Shopping

Leave a reply

Today is Click Monday, the latest attempt to transplant the U.S. notion of CyberMonday to New Zealand soil. As Trade Me’s Mike O’Donnell observed in a recent Stuff column:

This year has seen the [CyberMonday] concept reach New Zealand. Several times over. Three different organisations are having a go at creating a Cyber Monday-like event, and there’s even rumour of a fourth.

The first was held [at the beginning of November] by Nzsale, an Australian-owned member-only online shopping club. Held a good three weeks prior to Thanksgiving weekend, Nzsale staged a “Flash Frenzy“, and billed it optimistically as the biggest online event ever.

The next event to be announced [went] live on 12 November … “Click Madness” is backed by The Warehouse Group and involves special deals from The Warehouse, Noel Leeming, Warehouse Stationery, and ilovebeauty.co.nz.

The event closest to actual Thanksgiving in the United States is “Click Monday“, being run by Auckland ecommerce consultant Cate Bryant and Alain Russel of Blackpepper fame.

Click Monday has successfully involved a swathe of big names in the event including Bendon, Icebreaker, Briscoes and Hallensteins. It goes live for 24 hours, starting at 7pm on November 25.

The reason for this flood of Kiwi CyberMonday lookalikes can be summed up in one word: ClickFrenzy. This Australian online shopping event, launched with a bang in 2012, attracted a whole lot of headlines across the ditch last year, not always for the right reasons (the ClickFrenzy website, was down for several hours because of unprecedented traffic volumes, with reportedly 5% of the Australian population, some 2 million users, landing on the Click Frenzy site in the first few minutes):

Perhaps the most serious consumer complaint was simply that the deals on offer didn’t live up to the hype:

Following the launch of Click Frenzy, consumers immediately began comparing the ‘deals’ to local and international offers, highlighting the lack of value from some of the ClickFrenzy offers via Facebook. One example is Jamie Olivers 15-minute meals book, on sale for $26.95 via the Click Frenzy site. Customers were quick to respond calling out that the same book is available for less elsewhere (~$15 from the UK and under $25 at BigW and K-mart at a non-sale price). [PWC Digital Pulse]

Despite the negativity, Click Frenzy was repeated in Australia this year (last week), with rather more impressive results reported, including:

Online fashion retailer The Iconic smashed previous sales records achieving its first $1m dollar day and doubling sales from last year. It counted more than 200,000 visits during the 24-hour flash sale. (AdNews)
[IBM Digital Analytics Benchmark data] showed retail sales were up 16.3 per cent throughout Click Frenzy, which ran for 24 hours from 7pm, Tuesday 19 November 2013, compared to the same period last year. This is despite the fact preliminary figures of 1,061,000 visitors were slightly short of last year’s 1.6 million. (Retailbiz)
Traffic spikes during the 24 hour shopathon occurred around 9:30pm and 11:30am as people piled in after dinner, and again during mid-morning breaks. And they were looking for bargains: The average basket spend was down 4% from last year at $131.13. (AdNews)

By all accounts, one of the biggest problems with this year’s ClickFrenzy event was Ambush Marketing, with non-participating retailers attempting to climb on the bandwagon without paying for the privilege:

Dick Smith gatecrashes the online sale with Deal Frenzy, JB HiFi has Early Bird Xmas Frenzy, while Kogan is just always in a frenzy. (Channel News)
Kogan.com.au has been issued with a cease-and-desist letter after it hosted a Click Frenzy sale despite not being part of the official event. (Smart Company)

We’re already seeing similar ambushing in New Zealand. For example, even though the Warehouse Group‘s Click Madness event is officially over, there are still deals to be had when one searches for Click Monday:

Similarly, PBTech is serving up CyberMonday Sale advertising to accompany stories about online shopping, with its event starting one hour earlier:

Australian commentator Myles Harris offered up these key learnings from last year’s Click Frenzy:

That many Australian E-Tailers are under resourced and did not comprehend the amount of traffic a good deal online can bring.
That many Australian retailers view online as an avenue of selling surplus stock. There were a lot of complaints last night that selection was limited and that the store treated it as a dumping ground.
Many Australian retailers are not on the ball with online communication streams. Many who were part of Click Frenzy were not active on their Facebook pages or on twitter. Customers certainly loved those who were and directed them to the correct site without having to go through the Click Frenzy site.
That if the price is right the people will come. For far too long retail and some Aussie e-tail have not offered any incentive to buy online price wise. The deals are often not good enough or it’s the same price that is in the bricks and mortar stores. While this is an understandable tactic, it certainly does not attract the majority of online shoppers who shop on a global level.

As Click Monday prepares to launch in New Zealand, we wish the organisers well and trust that they and their participating retailers have learned these key lessons from our trans-Tasman neighbours.

Scary eCommerce Statistics, Trends & Predictions

Leave a reply

Wondering about the latest eCommerce statistics? Planning ahead and need some trends and extrapolations?

Check these out (we call them “scary” if you’re a retailer committed to bricks & mortar):

54% of Kiwis aged over 18 years are now shopping online, an increase from 38 percent of New Zealanders five years ago (Nielsen NZ Online Retail Report June 2013)
In key spending demographics, the numbers are much higher. 71% of Kiwis aged 25-34 and 68% of those aged 35-44 now shop online (Statistics NZ, per NZ Retailers Association Online Retail Report 2013)
New Zealanders spent $3.7 billion in the last 12 months purchasing via the internet (Nielsen NZ Online Retail Report June 2013)
26% of the total NZ online shopping, representing nearly $1 billion, was spent on international websites (Nielsen NZ Online Retail Report June 2013)
These totals are only for physical products purchased online. It’s estimated that a further $1.6-$2 billion is spent on downloadable products or intangible purchases such as airline tickets, rental cars, accommodation, theatre tickets and entertainment (NZ Retailers Association Online Retail Report 2013)
37.8% of Kiwi online shoppers bought Clothing, Shoes or Accessories online in 2012, while 32.1% bought Books or Magazines (Nielsen NZ Online Retail Report June 2013, as reported in NZ Retailers Association Online Retail Report 2013)
Smartphones have changed the way that Kiwi consumers shop. Smartphones are critical shopping tools with 74% of NZ users having researched a product or service on their mobile device. (Google/Ipsos Our Mobile Planet NZ May 2013)
33% of Kiwi smartphone users have made a purchase on their phone; of those, six out of ten have purchased within the last month (Google/Ipsos Our Mobile Planet NZ May 2013)
U.S. wedding ring retailer My Trio Rings reports that the amount spent in a smartphone transaction tends to be as much as 12% more than sales through other media
More than a quarter (27%) of Kiwi online shoppers made 11 or more transactions online in 2012, an increase of 44 percent from 2011 (Nielsen NZ Online Retail Report June 2013)
17% of Google searches on a mobile device result in a purchase (Google/Nielsen Life360 Mobile Search Moments Q4 2012)
Over 40 per cent of all visits to Trade Me are now from smartphones and tablets (Trade Me Annual Report 2013)
A survey of 2000 UK consumers by ITV’s Tonight news programme found that 49% of UK consumers plan to buy the bulk of their 2013 Christmas gifts online
By 2018, the Centre for Retail Research predicts that 61,930 UK shops will close and more than 21% of purchases will be made on the web (Monocle, October 2013)
Internet marketing experts at Emarketer estimate that by the end of 2013, eCommerce sales in the U.S. will generate US$262.3 billion worth of sales, 16.4% higher than in 2012
Sales from U.S. mobile commerce alone is projected to amount to US$41.68 billion in 2013 (eMarketer September 2013)

New Zealand eCommerce Statistics 2013 [Infographic]

1 Reply

Because infographics are so popular, we’ve put together this collection of New Zealand 2013 eCommerce statistics.

In one handy place, you’ll find:

How many NZ web users made at least one purchase online in 2012
How many New Zealanders now shop online, by age group
How much money will be spent online by Kiwis in 2013 and how much they’re expected to spend by 2016
How many Kiwis shop online by mobile and by tablet
What NZ Internet shoppers buy online, by category
How much NZ Internet shoppers spend in a typical month

The data comes from:

Statistics New Zealand Household Use of Information and Communication Technology 2012
Julian Prior, PwC interview: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10880279
The Nielsen Company, New Zealand 2012 The Year That Was
Roy Morgan Research, State Of The Nation, March 2013 [the graphic from this research comes from the NZ Herald story reporting the results]

If you’d like a copy of this infographic in full size (A4 width), email us at info (at) eCommerce (dot) org (dot) nz.

Latest New Zealand eCommerce Statistics

Leave a reply

Statistics New Zealand has just released the latest Online Shopping figures from the Household Use of Information and Communication Technology report for 2012 — and they make fascinating reading.

Key points:

Yes, 54% of New Zealand’s 2.8 million Internet users (those aged 15 plus who went online in the last twelve months) shopped online and made at least one purchase in 2012.

If we look at individual age groups, those numbers go way up:

Typical online shopping expenditure ranges from twenty to five hundred dollars in a typical month (with a small percentage who spend a lot more):

As Statistics New Zealand notes:

It also seems that what we’re buying is changing. We’re not necessarily buying tangible items; over half of those who shopped online had at least one item delivered electronically. This may include items such as e-books, music, or e-tickets.

Looking at those who had made a purchase in the four weeks before the survey, women outnumbered men in spending a total value of up to $500, while the more expensive purchases predominantly belonged to men.

The number of people spending a total of over $2,000 online has doubled since [the previous survey, i] 2009, to reach 44,000 people in a four-week period.

If you are one of those who aren’t yet offering ecommerce on your website, NOW would be a good time to start. Check out our Mastering eCommerce course.

NZ Post Launches Global Logistics

Leave a reply

NZ Post has just launched its Global Logistics offering with a cute story set in the middle of Nowhere:

So what exactly is on offer?

Here’s a rundown of NZ Post’s Global Logistics services:

NZ Post has a worldwide network of locally-based agents to support the logistics process.

Whether you’re importing or exporting, NZ Post says it can ship, airfreight, consolidate and warehouse your goods in all key global markets.

They say that they can arrange:

Export/import air freight
Wharf and national transport
Customs, clearance, customs tariff, and consultancy
General warehousing
Container unpacking and packing
Warehousing 3PL and 4PL customer solutions
Full pick and pack operation
Full end mile national delivery and returns options
Inventory management
Sub-assembly kitting and co-packing
Full EDI options.

Global Logistics: Think Local

USA and Canada

If you’re trading in the United States and/or Canada, NZ Post’s agent has 36 offices in those markets, extensive transport options and six North American warehousing locations.

China and Asia

Whether you’re manufacturing in Asia and shipping from there or exporting to the region, NZ Post can help:

Labelling – Stock from your suppliers can be consolidated and warehoused in China. Labels can be replaced with local language labels to meet local regulations and then shipped to your stockists in each of your markets.
Kitting – Stock can be delivered to NZ Post’s warehouse in China from multiple suppliers around the world and then items combined ready for sale. Your stores can place orders directly with the warehouse for what they need, saving time and cost.
Effective freight solutions – By consolidating goods from multiple suppliers in China and combining them into one shipment, you can realise significant efficiencies. You can also ship goods directly to destination markets without bringing them into New Zealand first. To safeguard commercially sensitive information, pricing details can be withheld from documentation and costs billed direct in New Zealand dollars.

Europe and UK

By bulk shipping to Europe and the UK, and then using air and sea freight, trucking and state of the art warehousing to distribute within those markets, NZ Post says they could save you significant costs and meet your customers’ expectations for next day delivery within the Eurozone.

Worth Considering?

For more details, call the NZ Post Global Logistics Team today on 0800 501 501 or email a Global Logistics specialist.

How To Market Your Retail Business Online

Leave a reply

It’s one of the biggest challenges facing New Zealand retailers today:

94% of Kiwi web users are researching products online, long before they consider stepping inside a retail store.

More than half of those then go on to buy online – even though, if they only knew, the products they wanted just might be available to them locally, easy to pick up or have delivered, often at competitive prices.

But many Kiwi retailers simply aren’t actively marketing online. Some don’t even have a website. Others aren’t sure where they should be spending their time or money.

If that situation sounds familiar, help is at hand. We’ve just developed a new online training course to help you develop an effective online marketing programme.

How To Market Your Retail Business Online

This is a ten-week online training course providing a comprehensive introduction to Online Marketing for Retailers, from the basics to detailed instructions on how to build and run a programme.

This eCourse is conducted on a web-based e-learning software platform, enabling course participants to proceed at their own pace, accessing materials online. This particular eCourse provides content in a variety of multimedia forms, including videos, slideshows, flash-based presentations and PDF files. No special software is required to participate.

Course lessons will be provided over ten weeks, for participants to access in accordance with their own timetables.

Course Content

The course covers the following topics:

Lesson One: Establishing Your Web Presence

In this first lesson, we examine the key elements that you need to consider as you set up (or review) your website. We discuss the principles of online marketing (and what we can learn from 100-year old direct marketing principles). And we help you to begin your online planning process, even if you intend to outsource most of the elements. We also tell you where and how to claim your digital identity online, on sites such as Facebook, Twitter, YouTube, Pinterest, Instagram, Google+, Skype, LinkedIn, Trade Me, eBay, gmail and more. We’ll also talk about how you can track the effectiveness of your online marketing efforts through free services such as Google Analytics – and how you can keep watch on both your competitors and your customers in just ten minutes a day.

Lesson Two: Google Places

If you run a local retail business, the next most important territory to stake out (once you’ve claimed your digital identity) is Google Places. It’s free, and for many online visitors it’s the first place they’ll encounter you online. We talk you through the information you simply must provide and the wonderful additional opportunities that Google makes available for smart retailers like you.

Lesson Three: Getting Found In The Search Engines

It’s very easy to be overwhelmed by Search Engine Optimisation and all the scientific mumbo jumbo surrounding search engines. We cut through the orchestrated litany of linkjuice jargon and explain the core principles you need to know to get your business found on Google, Bing, Yahoo! and other search engines.

Lesson Four: Email and the power of the Mailing List

Email is still one of the most powerful weapons in the online marketers’ toolkit. In this lesson we examine what you need to know about email, how to avoid running afoul of the Anti-Spam legislation and how to create emails that your recipients will welcome into their inboxes.

Lesson Five: Mobile Marketing Opportunities

More than half of us now use our smartphones to go online – and that has huge implications for retailers. The statistics are already frightening: 36% of Kiwis have shopped online via a mobile device during the past 12 months (NZ Online Shopping Survey, PwC and Frost & Sullivan, July 2012); 70% of smartphone owners have used their mobiles to check store locations and hours; 43% have used their phones to read customer reviews and 30% have compared prices while in store. If you’re not ready for mobile, you’re putting the future of your business at risk.

Lesson Six: Advertising Online

Once you have your web presence established, how do you attract traffic? We look at Pay Per Click advertising on Google and Facebook and their associated networks, take a look at the Video On Demand possibilities and consider Directories, Classifieds and Display Advertising. It’s possible to waste a lot of money online; in Lesson Six, our aim is to save you from all that.

Lesson Seven: Going Social

In this lesson we examine Facebook, Twitter and the other social networks, share some numbers with you (did you know that there are 1,256 NZ Facebook pages categorised as Shopping/retail, with an average of 790 Likes per page?) and discuss how you can use Social Media effectively to engage with your customers and prospects.

Lesson Eight: Selling Online

In this lesson, we discuss how you can make ecommerce work for you (should you wish to add that option to your web offerings). We talk about the 71 secrets of effective product pages and the 20 classic ecommerce mistakes you should avoid; and how to remarket to visitors who have left your site without buying.

Lesson Nine: The Deal Sites & Services

In Lesson Nine, we take a long hard look at what’s on offer with Daily Deal Sites – and identify the key decisions you absolutely must make before you sign up to offer any daily deal (and how you can lose your shirt if you don’t prepare properly). We also examine some of the newest special offerings on the market, including Google Shopping, Facebook Offers and Facebook Gifts – and what you need to do to make the most of these services.

Lesson Ten: Improving Conversion Rates

Finally, we look at what you need to do to sharpen your sales results (which is what online marketing is all about, at the end of the day). We don’t wish to lapse into jargon at this late stage, but we will have to talk you through Landing Pages, A/B Testing, Conversion Rate Optimisation and other services which have unfriendly labels (but which we’ll make as user-friendly as possible for you).

Course Creation & Tutoring

This course has been created and is tutored by Michael Carney. Michael is a highly-experienced marketer with an insatiable passion for whatever’s new, different, exciting or interesting in the world of communications. Michael has been in the marketing game since 1971, online since 1987 — in a diverse range of roles, including digital marketing trainer, adman, media director, strategist, researcher, copywriter and consultant.

Michael has been an early devotee of ecommerce, providing advice and assistance in that space since the early 1990s. He also conducted an extensive analysis of New Zealand’s leading ecommerce operator, Trade Me, culminating in the top-selling book TRADE ME SUCCESS SECRETS (now in its second edition).

Who Should Take The Course

Any retailer aiming to improve their online marketing skills.

Timing

This course is not currently available. If you would like to be advised when it is available, please email us at info (AT) ecommerce.org.nz.

Click Wraps, Browse Wraps & Bad Raps

Leave a reply

Have just read Mike O’Donnell’s latest column, and wanted to share it with you because it makes essential reading for Kiwi eCommerce operators.

Here are the most relevant points:

Broadly speaking there are two kinds of user agreements or “wraps” on eCommerce websites. One is a “click wrap” where you are presented with the terms and conditions and have to click “I agree” before proceeding.

This other is a “browse wrap” where terms and conditions are viewable on the site but your ongoing use of the site supposedly means you have agreed to them. Browse wraps do not require users to click on an “I agree” button, but assume that simply using the site signifies acceptance.

…

Late last year the US District Court found that eCommerce giant Zappos’ user agreement did not protect the company (or owner Amazon) from a class action brought by its customers. In fact the US Court went further than that.

First, it found the “browse wrap” style of agreement under which customers buy stuff on Zappos had no ability to bind those customers to its terms and conditions.

Second, it found a provision in Zappos’ user agreement saying it had the right to change the terms and conditions at any time (without bringing those changes to the attention of customers) was likely to be useless. The District Court called such a clause “illusory” and suggested it was unfair and likely voided an underlying arbitration clause.

Mike’s article goes on to point out that New Zealand’s own Consumer Law Reform Bill is trudging its way into the statute books, and amongst the many implications of that impending legislation are that

… the Bill prohibits businesses from having ‘unfair contract terms’ in their standard term contracts with customers … [such as] terms that allow only one party to limit performance of a contract, vary the terms, or change the price without notice.

If your ecommerce business is typical, it may well have boilerplate ‘Terms & Conditions’ that seem to reserve your right to do anything you want (without bothering to notify customers). The cruelly-exposed reality is that such T&Cs already probably mean nothing (and will mean even less in the future).

Your recommended solution? Go read the full column.

The Perils of eCommerce

Leave a reply

Even when you think you’ve got a solid handle on eCommerce, the basics can still catch you out.

Here’s a classic example. Alas, it’s not a quaint historical tale — the item was received today, from a New Zealand operator who we’ll allow to remain anonymous.

The item carried this pricetag:

You’ll note the markdown, from $39.98 to $9.99. Nice — except that the discounted price on the website (and the price we were actually charged) was $19.99.

We bought two of this particular item, in different colours. The second item just bore the original pricetag, $39.98, with no Clearance sticker.

Sloppy Logistics

We absolutely champion the right of this online retailer to manage its pricing; it may well be that the price on this item was reduced to $9.99 on the 3rd of January and has since returned to $19.99, still a good price against an RRP of $39.98.

However the product packers should be, ahem, ticketed themselves for sending out a product bearing a clearance sticker. The packing slip bore no pricing; it’s entirely possible that the product could have been ordered at full price, which would have resulted in even more annoyance when the item was received by the purchaser.

The result of this sticky oversight: we thought we were getting a good deal at $19.99 — now we don’t. Now we consider we’ve overpaid by ten dollars an item. (Fortunately, a phone call to the seller has resulted in an equitable solution; unfortunately, it involves a trip to one of their retail stores, an outcome we’d aimed to avoid by ordering online in the first place).

Strike #2

This is the second strike against this particular merchant for this particular order; when we ordered these items (and a couple of others), the total came to around $92, with shipping calculated at a flat $10 more. Regrettably, it was only AFTER we’d confirmed the order and paid that we were reminded that shipping is free for items totalling $100 or more. We’d spent a total of $102, but had paid for shipping — if we’d realised, we’d have happily gone back and purchased something else, probably going above $102 in the process. Likely result: increased basket size, happy customer.

The website shopping cart should have been equipped with appropriate triggering code, to alert us to the fact that, just by spending a few more dollars, we would qualify for free shipping. If that was a technical difficulty, then a Free Shipping link would have been a very useful alternative.

Yes, the front page of the site does talk about free shipping, but visitors need to click through if they want more details:

Since the free shipping offer is really straightforward …

*If you spend $100 or more in a single transaction, we will deliver this to you for FREE. It’s that simple.

… why not just spell it out, with a small box on the front page and on every page of the website (including the shopping cart pages)?

Telling us after the sale is a surefire recipe for Buyer Remorse.

Free Shipping is the single most important offer you can make, to close the sale. If you’re going to make the offer, shout it from the rooftops (or at least from within your shopping cart).