For Online Retailers, Customer Experience Beats Price Point Every Time
Gemma Espiñeira | October 28, 2016
Gemma Espiñeira | October 28, 2016
Back in 2014, budget airline Ryanair had a problem. Their flights were among the lowest-priced in the market, but the experience of booking and flying with them left a lot to be desired. The “cheap and cheerful” image that they’d built over the years had mutated into a much-less-favourable “cheap and nasty” reputation, and it was hurting business.
Ryanair undertook a programme of changes to their service to try to shake off the bad image they’d developed. They relaxed their previously strict adherence to rules about cabin baggage dimensions, introduced allocated seating to reduce the anxious scrum of passengers fighting for seats at boarding, and ditched the wide array of extra charges for which they had become notorious.
Perhaps more significantly, the change in tone came alongside the launch of Ryanair Labs, a technology department tasked with overhauling their website. Their focus has been on significantly improving the customer experience. At relaunch, customers were able to book a flight using less than half the number of clicks previously required (source - The Drum).
The results have spoken for themselves. In the aftermath of the first round of changes – to the service, and to the website – the airline reported a turnaround in fortunes to the tune of a 37% increase in pre-tax profits.
Focusing on improving website customer experience is a smart strategy for improving the fortunes of a business generally. Our own research has shown a close correlation between experience indicators and website conversion. In other words – and to state the obvious – bad websites make less money
Ryanair’s story holds valuable lessons for many verticals. I want to focus on the parallels with the online grocery sector.
Online grocers face starker digital challenges, arguably, than even airlines. Grocery shopping online involves lengthy visitor sessions (more time for things to go wrong) and large numbers of pages (more places for things to go wrong). Shoppers will often fill a shopping basket over the course of multiple visits – a complicated interaction between visitor and retailer with lots of opportunities for things to go awry.
Differentiating on price alone – as Ryanair has showed us – is a risky approach. So how can online grocers improve their online customer experience to maintain a competitive advantage? I’ve identified 3 quick wins.
1. Reduce friction before the basket
With such a wide array of product pages, and a complicated shopping journey even before the checkout becomes a factor, it’s essential that grocers provide a smooth experience in the initial stages of the shop – browsing and product selection.
By building audience segments based around page taxonomies, online retailers can start to identify sources of friction in the user journey for different sections of the site. Session replay replicates visitor journeys through the website and reveals the positives, and the problems, with the experience offered during the shop.
2. Reduce calls through to the support centre
If you’re looking for a signal that something has gone wrong in the customer experience, they don’t come much clearer than calls to the customer support centre.
When a customer takes this step, at a detriment to their own time, the business faces an uphill battle to put things right. Ideally, then, contacting support would not be necessary in the first place.
By building a segment of visitors who contacted the customer support centre, it’s possible to observe the trends in visitor behaviour that led up to that point. For the online grocer, dealing with hundreds of contacts to the customer support centre every day, there’s a huge opportunity to improve customer satisfaction by viewing user behaviour through session replay and heatmaps that explains the friction that led to the contact initially.
3. Plug the leaks in the checkout flow
A visitor’s intention-to-convert will probably never be higher than when they reach the checkout. And yet, all too often, the experience delivered in the checkout process will reverse that intention and drive prospective spenders to abandon their full shopping baskets.
Understanding where the leaks are in the checkout flow, and then knowing what to do in order to plug them, can help to reduce this unnecessary wastage.
Mapping the leaks using funnel analytics is a great place to start. Accurate funnel reporting tells you the points in the process where visitors give up and take off. Going deeper still, examining the analytics for audience segments that abandoned at certain points will reveal insights into the reasons why.
Whether you’re selling airplane tickets or apples online, the fundamental principle of delivering delightful online customer experiences is paramount. Ryanair has shown the value of differentiating your service on more than price alone.
The modern digital retailer’s mission is to understand and enhance the customer experience online in a virtuous cycle of measurement, insight and improvement. Big names like Asda are already assembling sophisticated technology stacks to facilitate this strategy, and others are sure to follow.
Get the full lowdown on how to measure and improve experiences with our ultimate guide to ecommerce and online retail.
Written on October 28, 2016 by:
Gemma is VP of Client Services at Decibel Insight.