Third Annual JDA/Centiro Customer Pulse Report Reveals that 70 Percent of Australian Customers Intolerant of Poor Online Experiences

Online study reveals that customer experience is crucial for business success else retailers risk alienating customers; however, Australian retailers are beginning to reap the rewards of Click & Collect investment

Sydney, Australia and Scottsdale, Ariz., May 30, 2017

Almost three quarters (70 percent) of Australia online shoppers would likely switch to an alternative retailer when next shopping for products online if they had a poor experience with ordering an item online, according to the JDA/Centiro Customer Pulse 2017 Report conducted by YouGov and co-sponsored by Honeywell (tweet this). This is a rather alarming figure at a time when most retailers are consolidating their ‘bricks and mortar’ stores and continuing to invest in their online presence.

Of those respondents who had experienced a problem when making a purchase online in the last 12 months, 50 percent of respondents had experienced late delivery, 41 percent had missed a delivery despite being at home, 28 percent never received an item, and 23 percent received incorrect items (tweet this). This was the second highest level of intolerance from the various country-specific surveys JDA has conducted, with only the UK (78 percent) having less tolerant shoppers. Consumers are clearly most sensitive to online experiences, which suggests this is an area that retailers need to give specific attention to as they develop new ways to engage with the customer.

Click & Collect on an upward curve

The maturity of the Australian online market has fueled a high level of Click & Collect usage, with 47 percent of shoppers who have made a purchase online in the last 12 months, having used this service (tweet this). This is beaten only by the UK (54 percent) where it is appreciably higher than in other major markets including Germany (28 percent) and France (36 percent). The increased adoption by shoppers reflects their growing appetite for convenience and cost-efficient online buying. The survey shows the key drivers for Click & Collect use are avoiding delivery charges (45 percent), convenience (37 percent), and greater confidence of receiving items compared with home delivery (26 percent) (tweet this).  

However, with such a focus on Click & Collect, it is disappointing that as many as 68 percent of Australian Click & Collect shoppers have encountered an issue over the past year (tweet this). This is significantly higher than the UK (43 percent). For those Australians who have encountered a problem, the major issues were long waiting times (27 percent), staff in-store unable to locate items (27 percent) and no dedicated Click & Collect area in-store (20 percent) (tweet this).

“As the data shows, Australian retailers face a challenge on several fronts when it comes to online. Fulfillment and ‘last-mile’ issues continue to hinder retailers’ efforts at a time when consumers are becoming increasingly intolerant of poor service. With retailers competing ever more aggressively for sales and offering an increasing array of fulfillment options, delivering high service levels efficiently and profitably remains a challenge for many retailers, yet is expected by today’s shoppers - and across all channels. Retailers that fail to keep up with demand put themselves in serious danger of being left behind,” said Patrick Viney, vice president, industry strategy, retail, APAC at JDA. “However, encouragingly for retailers, it does appear their continuing investments in Click & Collect are starting to pay off. Adding to that, 41 percent of shoppers expect the shop to be their most popular channel, so it is clear that stores are not going to be disappearing any time soon. The physical store in Australia remains vitally important to domestic retailers that are fighting the challenge presented by overseas online retailers.”

“Retailers need to be more confident in their last-mile capabilities, otherwise these fulfillment issues will continue to reflect poorly on the overall brand experience customers receive. This is one of the reasons we have seen the likes of Amazon bring more of its delivery function in-house to erode much of the market share,” said Niklas Hedin, CEO of Centiro. “Today, there are greater pressures on retailers’ delivery capabilities than ever before and if customers’ expectations aren’t met, they will simply shop elsewhere in the future. Through improved visibility into delivery networks, retailers can help ensure that customer promises are kept. In the future, predictive analytics will also help retailers and delivery companies pre-empt problems before they happen, taking the customer experience to the next level.”

“The growth in Click & Collect requires retailers to re-think their current fulfilment methods and consider alternative methods to pick online orders more efficiently and accurately. Picking and packing is only part of the solution; capturing and delivering accurate and timely information to customers is important when providing a memorable shopping experience. Retailers need to build flexibility and resilience in their e-commerce model by incorporating worker-focused technologies that allow their staff to easily deal with higher order volumes, accurate order picks, packed, placed, and ready for convenient pick up. There will also be challenges managing product returns due to exchanges and damaged goods. Existing technology developments and exciting new picking technologies will help enhance their customers’ online experience,” commented Tony Repaci, sales director of Honeywell Safety and Productivity Solutions, a leading provider of data capture products and productivity technology.

Acceptance for minimum order thresholds

An overwhelming majority (83 percent) of respondents would be happy to exceed minimum order values in order to ensure they can enjoy free delivery (tweet this). This is higher than the 75 percent in the UK and could be a result of Australians regularly grouping their orders to waiver the more onerous charges and thresholds applied to international deliveries. Nearly a third of Australians online would be happy to exceed minimum order values if it resulted in them qualifying for either free same day delivery (29 percent) or next-day delivery (28 percent) (tweet this).  Worryingly, a sizeable 27 percent of all Australians online would take their business elsewhere to a retailer that did not have a minimum order value for free delivery or Click & Collect, while 23 percent would choose an alternative free delivery / collection option (tweet this).

“Online retail continues to be extremely competitive. The winners will be those retailers that can offer a reliable and convenient fulfillment service to consumers, rather than simply focusing on speed and price. At the same time, escalating costs and ever-increasing competition is putting pressure on retailers’ already squeezed margins. Retailers must think hard about the configuration of their supply chains, and will need to become much smarter about how they use their key assets of staff, stores and inventory to fulfill customer requests intelligently. They need to think smart – finding the perfect balance between cost-effectiveness and a great customer experience,” added Viney.

The survey was commissioned by JDA and conducted by YouGov Plc. The sponsors include Centiro and Honeywell. All figures, unless otherwise stated, are from YouGov Plc. Total sample sizes were 1,044 adults in Australia, 2,070 adults in the UK, 2,124 adults in Germany and 2,014 adults in France. Fieldwork was undertaken between December 2016 and March 2017. The survey was carried out online. The figures have been weighted and are representative of all adults in each market (aged 18+). While this is the first survey for Australia, JDA is in its third year for customer pulse surveys commissioned for UK, France, Germany, Sweden, China, and Japan.

Download the complete report covering returns, delivery habits, issue resolution and more online behaviour here.  

Additional Resources:

  • Access the JDA/Centiro Australian Customer Pulse 2017 Report here
  • Download our infographic: The Online Shopping Experience 2017: are retailers getting it right?
  • Read the JDA Digital Supply Chain for Dummies book here

Tweet This: .@JDASoftware Survey: 70% of Australian Customers Intolerant of Poor Online Experiences #JDASurvey @ HONProductivity http://bit.ly/2rh7l4s

About JDA Software Group, Inc.

JDA Software is the leading provider of seamless supply chain planning and execution solutions for retailers, manufacturers, logistics providers and wholesale distributors.  Our unmatched solution portfolio enables our clients to reduce costs, increase profitability and improve visibility so they can deliver on customer promises every time.   More than 4,000 global customers run JDA, including 73 of the top 100 retailers, 71 of the top 100 consumer goods companies, and 13 of the top 16 3PLs.  With JDA, you can plan to deliver.  www.jda.com

About Centiro

Centiro is the leading innovator in cloud-based transportation and delivery management solutions. Centiro’s products empower companies and finer supply chains in more than 125 countries. The company has won several awards and accolades over the years and is ranked as one of the best places to work in Europe by Great Place to Work®. For further information, please visit: www.centiro.com.

 

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