KEEPING THE ONLINE CUSTOMER SATISFIED
WHETHER IT’S BOOKS OR FRIDGES, INTERNET RETAILERS ARE WORKING HARD TO LIFT THEIR GAME IN THE SERVICE DEPARTMENT.
A REVOLUTION IS TAKING PLACE in online retail. Sales growth continued apace in August, up 22 per cent year-on-year, according to the NAB Online Sales Index. And it’s no secret that in the past 12 months many more retailers have taken online seriously – including veteran Gerry Harvey, who started selling his products on the internet late last year.
But what is not widely known is how the successful online model is bringing customer service people into transactions. We are moving from one- click-to- order towards a far more human experience, one with real customer service.
AppliancesOnline founder and chief executive John Winning has experienced robust growth since launching in 2005 and says his business model is based on targeting time-poor customers who need to replace an appliance.
“Typically, we have customers who already know what they want, whether it’s a fridge or washing machine,” he says. “They don’t need to come into the store to touch the product; they have the measurements; they know and trust the brand. It’s not quite the same as more personal items such as shoes or clothing.
“The biggest fallacy about running an online business is that you don’t need to interact with customers. To the contrary, the AppliancesOnline team applies old-fashioned customer service to every transaction, and the team has worked hard to replicate the best possible customer experience in an online format. We aim to respond to any customer query within 11 seconds.
“It’s not so much the case that we want customers to stay away from the physical store; rather, we have built the model so that the website will give them what they need. Consumers are demanding the convenience [of online shopping]. If they know what book they want to buy, they’re going to buy it online. It will be cheaper and more convenient. Our sustainability is based on discerning customers coming back and spending with us and telling their friends about the experience.”
Another dedicated online player with a very high growth rate is Booktopia. Claiming his Australian base as a key differentiator against the mammoth Amazon, Tony Nash and his co-founders have built a vibrant business with annual revenues in excess of $20 million. “We started eight and a half years ago with a $10-a-day budget; it was a side project. Now we have more than 3000 square metres of space,” Nash says, adding that beginning as an online retailer provided a platform for growth.
“We started off holding no stock; we took orders and shipped books. It was a simple model. But we have listened to customer feedback and evolved. They told us we were slow. We noted that classic, perennial titles sold steadily – To Kill a Mockingbird, How to Win Friends and Influence People, Napoleon Hill’s Think and Grow Rich and others. So we started to stock them and deliver promptly. We committed to holding stock, rather than [being] a fulfilment service. It was quite a breakthrough.”
For Nash, growth has been about sales. “We simply had to sell more books. You get innovative. You get focused. You try all the marketing channels – even letterbox drops. What works? Online works. We don’t have Amazon’s massive power, but we do have a customer-centric approach. And we’re uniquely Australian.”
This customer- centric approach is the next phase of internet marketing’s evolution. It’s about fast shipping, strong packaging and a “track and trace” capability for customers.
Book retailing has other challenges; one of them being print versus ebook. “That’s the biggest trend. How are they [books] going to nestle into our life? Self-publishing is another big one – like Fifty Shades of Grey, which started off as an indie ebook. The book is only a device [for delivering information]. And we are asking: How would you like to consume that information?”
He says that traditional publishing is like a fiefdom, and authors are subservient. “With an IT background, I was used to it being the case that you took care of customers. In publishing now, readers are gaining power through online distribution and reading devices.
“As online becomes more prevalent, people will check review sites and bestseller lists. A book site becomes like a catalogue. To survive, you must know your shelf. Whether it’s travel or wine, people want an informed view. You need to be involved with your customers. If they are satisfied, they tell other people.”
Booktopia’s Tony Nash says the decision to hold stock was a breakthrough for his online bookstore.