Three More Crucial KPIs for Digital Retailers
Recently, we posted a blog about some crucial KPIs that traditional retailers need to understand in order to survive the transition to the digital era. In order to keep their customers and stay profitable, digital retailers need to monitor the ROI on advertising, keep track of the customer journey, and ensure they’re stocking the things that their customers want to buy. Additionally, retailers should focus on some important internal metrics—using customer experience data to fine-tune their internal resources and make smart investments.
Should You Change the Channel?
One-click ordering. Consumer rewards. Free shipping. Customers demand conveniences that come as an expense to retailers. Just as an example, 20% of users will abandon their shopping cart if shipping costs are too high. By using analytics, digital retailers can understand which ecommerce features their customers demand right now, and which can wait.
This approach can help amortize the cost of building and maintaining an ecommerce presence over a longer period, taking less away from the bottom line. As an example, Wal-Mart recently warned its investors to expect two years of decreased profits as they reinforce their online presence.
Are You Changing Fast Enough?
Thirty percent of online shoppers expect to make grocery purchases over the internet. That’s right—even grocery stores are seeing the necessity of an omnichannel strategy. If your brand or industry doesn’t have that strategy in place yet, it’s probably time to invest. Retailers need to future-proof themselves. We’ve already seen the rise of customer experience analytics, social media marketing, and mobile ecommerce. What might be coming around the corner?
Macy’s has just introduced RFID-tagging that allows unsold items in-store to be listed on their ecommerce platform instead of sitting on a shelf. Amazon has introduced dynamic pricing to maximize profits on the fly. Waitrose, a UK supermarket, has introduced digital personalization to boost orders by 24%. One or another of these innovations will allow you to recapture revenue, stay competitive, and remain relevant in the digital era.
Is Your Digital Operation Short-Changing Your Retail Stores?
Online coupons and other price promotions can be gold for ecommerce—45% of millennial shoppers have redeemed a coupon online as of Q3 2015. Because your physical stores will also have to honor the reduced price, however, your digital investments might be draining some of the profits out of your retail locations.
Digital business can definitely siphon money from physical retail, if customer experience is not optimal. More to the point, a lot of retailers can’t even tell it’s happening, because decision makers and analysts often don’t’ have access to integrated digital and brick-and-mortar sales data. Separate data silos now represent one of the largest barriers to accurate revenue analysis in ecommerce.
Recapture Revenue to Reinvest in Your Business
Digital commerce requires serious financial resources. Whether it’s more features on the frontend, or analytics on the backend, digital retailers can expect to invest a great deal of time, energy and money into creating an attractive, well-supported online store. Done poorly, this won’t just represent a waste of resources—it can also drain revenue from your physical locations.
Based on this assessment, it is absolutely necessary to capture as much revenue as possible from an online presence—and there’s where Customer Experience Analytics (CXA) can help. Essentially, CXA helps digital retailers to find ecommerce revenue that they’ve earned, but haven’t been able to realize.
For example, many customers will visit an ecommerce website, find a product they like, click to buy it—but then discover that due to an unforeseen technical issue, their purchase will not complete. Many ecommerce operators have these kinds of issues, and UserReplay can help you sniff them out and uncover what you’ve lost. One retailer was able to get back £4.7 million pounds per year!
For more information on how UserReplay can help retailers uncover hidden income that they can reinvest into their businesses, check out a demo today.
John Thompson, CEO, UserReplay