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Multiple retailers ‘out-perform’ over Christmas period

A significant number of retailers are posting upbeat sales figures during the Christmas period, including Selfridges, Next, John Lewis, Aldi and Dunelm.

Selfridges revealed what it called a ‘record-breaking’ Christmas trading period, with sales up by eight per cent in the final week before Christmas and up 10 per cent in its Oxford Street flagship store during the 24 days prior to Christmas, driven it aid by exclusive products.

Meanwhile, supermarket Aldi reported its ‘best-ever Christmas period’, with sales topping £1 billion in December as a whole, fuelled in part by 17 million bottles of wine, champagne and prosecco sold.

Homeware specialist Dunelm reported a 5.7 per cent increase is sales for the 13-week period ended December 29th, with total like-for-like revenue in its second quarter up a 9 per cent and online revenue up 37.9 per cent.

High street fashion retailer Next reported a sales growth of 1.5% for the last two months of 2018, with a spike in sales from the last three weeks of December, helping to save the chain and Christmas blushes.

However, there was a stark contrast between the store’s brick and mortar premises and online operation, with sales down 9.2% in the High Street, compared with a jump in website sales of 15.2%.

Lower profit margins have now been forecast as a result of fulfilling web orders, bringing annual profit down by £4m to £723m, with predictions of profits falling again Christmas 2019.

“Full price sales for the Christmas trading period have been in line with the guidance we gave in September,” the Next chief executive, Simon Wolfson, said. “Strong sales in the three weeks prior to Christmas along with a good half-term holiday week at the end of October made up for disappointing sales in November.”

Department store chain John Lewis also reported a strong finish to retail sales through the Christmas period as customers made late buying decisions, with an 11% rise in sales in the last week of 2018 compared to sales this time last year.

Attention will now focus on competitors Debenhams and Marks and Spencers.

“We think John Lewis and Next will have outperformed, however, so we still wouldn’t rule out some bad news from Debenhams or M&S,” retail analyst Nick Bubb said.

INFOGRAPHIC: How to build a ‘customer-centric’ e-commerce website

By SQLI

60% of purchase decisions are based on buyers’ perceptions and their confidence in a brand. Focusing on the UX design of your e-commerce website is key to attracting consumers and gaining their loyalty.

Check out our infographic for advice from an experienced UX designer and find out how to build a real “customer-centric” e-commerce website.

About SQLI:

SQLI is a service group dedicated to the digital world. It assists companies and brands in defining, implementing and managing digital systems for a redesigned customer, partner and collaborator experience. Its unique positioning at the crossroads of marketing and technology enables the group to meet the challenges of developing sales and reputation (digital & social marketing, customer experience, cross-channel commerce, mobile, data intelligence, etc.) and the challenges of productivity and internal efficiency (digitalisation of operations, collaborative company, connected objects, CRM, etc.) in a comprehensive way.

www.sqli.co

SQLI, providing digital solutions for businesses (for ecommerce website development and design). Magento, SAP Hybris and Salesforce Developer Agency UK, Platforms used include Magento, SAP Hybris and Salesforce Commerce. See our blog for latest updates and news on digital solutions.

Global m-commerce ‘to take over desktop shopping by 2023’

UK consumers are on an endless mission for convenience as mobile continues its ascent to dominance as the most popular shopping channel.

Growing at a rate of 16 percent annually in the UK, m-commerce is set to be worth £88.1bn by 2022, according to new data from Worldpay.

In its annual Global Payments Report, Worldpay found the total eCommerce market in the UK is set to grow by 40 percent between now and 2022 to £240bn (9 percent CAGR).

E-wallets in particular are favoured when purchasing via mobile, currently making up 23.2 percent of online payments in the UK.

This is set for rapid growth driven by increased smartphone ownership, faster mobile networks and consumers continually looking for a more seamless payment experience. The predicted rise in mobile commerce is a strong vote of confidence for the security and convenience of the UK’s digital payments.

Worldpay’s report, which examines online shopping in 36 countries across five continents, found that m-commerce currently accounts for 38 percent of the £990 billion in global eCommerce sales, and global m-commerce is set to grow a staggering 19 percent over the next five years.

The largest markets in the world for m-commerce are China (£0.57 trillion), U.S. (£0.16 trillion), UK (£48.8 billion), Japan (£26.4 billion) and South Korea (£22 billion).

Motie Bring, general manager for the UK, Global Enterprise eCommerce, at Worldpay Inc. said: “The UK in particular is a highly-developed market, and with 99 percent of the population connected to the internet[1], e-wallets are clearly the future of mobile commerce for shoppers – but this is only the beginning. The latest innovations in device hardware, from voice recognition to facial scanning, are helping make payments more seamless and secure than ever before, prompting consumers to ditch desktop in favour of their smartphone or tablet.

To stay ahead UK merchants should invest in their own apps, building a seamless shopping and checkout experience across every device, and support the most popular payment methods.”

Worldpay has published guidelines for merchants to help capitalise on the global mCommerce opportunity:

  1. Consider developing a branded app. We know that 71 percent of shoppers prefer apps over mobile browsers when shopping on their smartphone, and many say they won’t buy from a business that doesn’t have an app.[2] It’s no longer enough to just have a mobile-optimised website – if you’re not prioritising a transactional app for your brand, you’re not putting your best foot forward.
  1. Make it easy and use biometrics to speed up the journey. Shoppers are becoming increasingly familiar with the concept of fingerprint scanning and facial recognition, so they do not shy away from using these methods as a form of authentication. Biometrics place payments at the back of the user’s mind, giving them a faster and friction-free experience, making the payment seem ‘invisible’.
  1. Identify the most popular payment methods in each territory in which you operate. There are huge differences in payment preferences across the world, and alternative payment methods are gaining share over traditional credit and debit cards. There’s no one-size-fits-all in any region so you’ll need to understand the best options for your company.

Online retailers ‘not using own data to improve performance’

Online sellers are using eCommerce solutions to gather better data insights, yet many are failing to use it to make better business decisions, according to new research.

Whilst 42% are using data to improve customer service, only 24% are using data for buying behaviour analysis and two thirds are not using it to improve the user experience.

The survey of 559 global B2B organisations by Sana Commerce found that many are still only focused on using e-commerce for sales and improving online shopping for customers – traits associated with e-commerce 1.0 and 2.0.

48% identified driving sales as the top priority for their e-commerce solution and 38% said it was to improve the user experience.

Despite having data available at their fingertips, online sellers are not using their data to achieve desired business performance outcomes. The main response to tackling competition is competing on price (47%) and increasing the online customer experience (38%) rather than enhancing the proposition.

Only a third said they would use data to improve personalisation and 26% said they would use data to improve targeting and account-based marketing.

Sana says many online sellers seem to be overlooking the true value of e-commerce 3.0 and improving integration with key business systems such as the ERP to drive broader business benefits.

Michiel Schipperus, CEO and managing partner at Sana Commerce, said: “It’s encouraging to see online sellers building on their digital transformation strategies and considering the implementation of these advanced technologies, but it’s important to first establish how they can be implemented strategically. E-commerce 3.0 has enabled better integration between internal systems as a growth strategy and way to improve businesses agility. M2M and other forms of automation represent a significant investment, so e-commerce businesses need to ensure they’re being used to their full potential and improving key business drivers.”

The survey of B2B organisations in Europe and the US was undertaken by independent market research company Sapio on behalf on Sana Commerce. You can download the report here.

GUEST BLOG: How retailers can embrace cryptocurrencies to boost business and loyalty

By Raj Agrawal, Founder & Tech Entrepreneur, Dewber

Traditional loyalty schemes are in need of an overhaul – customers are tired of carrying around multiple store cards and retailers are looking for new ways to encourage sales.

This is where cryptocurrency comes in, offering a new platform that retailers can customise and use how they see fit. Any retail business can incorporate cryptocurrency into their business operations, creating new opportunities and advantageous benefits for both the business and the customer.

Loyalty schemes are nothing new. Big retailers have seen loyal customers purchase 90% more regularly than casual customers, and the average spend can be much higher when a customer knows they are collecting points. The problem is, smaller and independent retailers can find it difficult to achieve the same amount of customer retention through their loyalty scheme alone.

Many loyalty points are forgotten about, and too often accounts become inactive. Globally, there is over 100 billion dollars worth of unclaimed loyalty points, leading to the question: How can we innovate our loyalty schemes to keep customers coming back?

Cryptocurrencies may seem complicated, but once on board, it can give retailers the opportunity to attract and keep a new, young customer base. Over 17% of millennials have purchased digital coins, which can be spent and traded freely through a centralised, online system. This cashless system is gaining momentum, and retailers can maximise business by incorporating this into their loyalty schemes. By receiving digital tokens instead of traditional loyalty points, customers are getting something they really want – the ability to earn loyalty from everywhere and choose where to spend thereby creating shared loyalty experience on the high street. The chances are they will keep coming back to you when they know their digital purse is growing.

Once a retailer is signed up to a blockchain-based loyalty scheme, they will become part of a wider, global network of retailers who offer the same digital tokens and business specific rewards. Customers can receive digital tokens with every purchase, which can then be redeemed globally at any participating business. It’s up to you how the tokens are awarded and redeemed. Customers will become magnetised to these businesses who offer a common goal, leaving the individual store cards behind. This innovative system allows a much greater use of loyalty points by the customer, which in turn can only lead to more committed customer base for retailers that may have struggled before.

By introducing cryptocurrency into your loyalty scheme, you can begin to capture the attention of the younger generations, and ultimately improve customer engagement and repeat spends. Companies such as Dewber are gearing up to provide a user-friendly platform for retailers to get involved, and aid with navigating this game-changing way of rewarding customers.

Whether you are a café, bar or independent retailer, offering digital tokens could be the business-savvy way forward.

About the Author

Dewber founder and CEO Raj Agrawal has over 20 years experience in business, technology, senior management experience in operations, IT security, marketing and finance within fortune 50 companies like Deutsche Bank, Prudential (Vitality), Visa Europe and Deloitte UK.

Dewber is a tech start-up which uses blockchain to bring innovation to the loyalty economy with the ability to run global rewards and crypto points schemes. Dewber offers a digital mobile experience, customer engagement, cross channel redemption capabilities and strictly does not perform any data mining by collecting or analysing customer purchase history for marketing or cross product promotion.

Half of global wholesalers feel threatened by manufacturers selling direct

More than half of global wholesalers have witnessed manufacturers sell directly to end customers, driving the disintermediation of the traditional supply chain model and increasing competitiveness between traditional partners, according to new research.

47% of global manufacturers operate e-commerce web stores to allow them to sell directly to end customers while 24% intend to implement an e-commerce solution as an additional revenue stream in the future.

The survey of 559 global B2B organisations found that 41% are using e-commerce to change their business model while 43% are creating a new revenue stream in a bid to move away from selling across channels.

The survey of B2B organisations in Europe, US and ANZ was undertaken by independent market research company Sapio on behalf on Sana Commerce. The survey sample covered food and beverage, automotive, construction, healthcare/medical supplies, electronics, fashion and apparel, home goods and furnishing, machinery and supplies or packaging industries.

An increasing number of organisations are putting e-commerce at the front of their businesses to remain competitive, increase the volume of sales and improve the customer experience.

However, following the implementation of an e-commerce solution over a quarter of businesses failed to meet these objectives due to increased competition and more aggressive marketplaces.

The research found that 33% of organisations felt that manufacturers, wholesalers and distributorsselling direct to customers was driving down the price of products, threatening business profitability and longevity. The research also found that 63% of distributors saw wholesalers as their biggest threat within the market, highlighting the possibility of the supply chain seeing a mass consolidation as organisations purchase rivals in a bid to remain competitive.

Implementing an e-commerce solution as part of a digital transformation strategy has allowed more than half of companies to target new markets and three quarters of global manufacturers want to sell more online.

While 79% of organisations are planning to upgrade their e-commerce solution in the next two years, other companies are already using advanced technology within the sales strategy. 39% of businesses are currently using virtual reality to personalise the buying experience and 39% plan to adopt fully automated ordering using the internet of things.

Michiel Schipperus, CEO and Managing Partner at Sana Commerce, said: “E-commerce sits at the heart of organisations’ digital transformation strategies and continues to drive change throughout the supply chain. Businesses are feeling increasing amounts of pressure from online competitors as they enter new markets. To remain competitive businesses will need to utilise their e-commerce systems for more than just to generate sales. With constant changes with the marketplace businesses need to consider integrating their e-commerce solutions with their internal systems, such as the ERP system to allow them to keep up with competitors.”

For more insight into download the report here.

Moonpig unveils eCommerce tech hub in Manchester

Moonpig is to create fifty new technology jobs across Manchester and London as part of a multi-million pound investment that it says will unlock the next phase of its growth plans.

The new office opens at No. 1 Spinningfields on 1st November and will lead the development and rollout of a new ecommerce, data and personalisation platform for Moonpig.

The project will be led by Peter Donlon, Chief Technology Officer at Moonpig, who said: “Moonpig produces over 15 million completely one-off items for customers every year, each one uniquely personal to the sender and receiver, and powered by our ‘emotionally intelligent’ technology.

“We’re seeking the best engineering talent out there to turbo-charge the Moonpig business going forward. We selected Manchester for its thriving tech scene and wealth of exceptional talent.”

Mark Evans, previously of Nested.com and Sainsbury’s has been appointed to lead the new office as Head of Engineering.

Since being founded in 2000, Moonpig has helped customers celebrate over 120 million special moments across the UK through its personalised cards, gifts and flowers.

The news comes on the back of the appointment of Nickyl Raithatha as Moonpig’s new MD in July and the move into its new award-winning Farringdon HQ in London.

UK consumers ‘contacting brands nearly half a billion times every month’

Research has highlighted the growing volume of consumer queries that UK brands now need to handle across eCommerce, complaints and the like, and the increasing cost this imposes on companies – estimated at £1.227 billion.

The average UK consumer now contacts organisations nine times per month, according to research undertaken as part of the 2018 Eptica Customer Experience Automation Study.

Across the adult population this means brands need to respond to 463.5 million contacts every month, and the figure is rising.

88% of those surveyed said they now contact companies more or the same number of times as five years ago – with 16% getting in touch more than twice as often.

Increasingly, consumers are happy to embrace self-service channels where they can find their own answers, without needing to contact brands through email, the telephone, chat or social media.

83% already use or are willing to use web self-service systems, which analyse queries and deliver automatic instant answers on a company website, while over half (54%) would use intelligent voice assistants, such as Amazon’s Alexa, Google Home and Siri from Apple to gain information. 64% also want to use automated, artificial intelligence-powered chatbots.

Using industry average figures from analysts Contact Babel[1], answering these queries costs the UK economy £1.227 billion across the telephone, web, email, social media and chat channels. This is made up of £440.44m (email), £236.98m (social media), £211.99m (chat) and £338.31m (telephone).

In contrast automated channels such as self-service, chatbots and voice assistants have a negligible cost per interaction once they are in place.

“Delivering an excellent customer experience is crucial to every organisation today. However, our research shows the scale of the challenge brands face, with consumers getting in contact nearly half a billion times every month in the UK,” said Olivier Njamfa, CEO and Co-Founder, Eptica. “Clearly many of these conversations are complex and require the human touch, but others could be automated, speeding up the process for consumers and increasing efficiency for brands.”

Demonstrating the multichannel nature of today’s customer experience, on average each UK consumer used email for 27% of their interactions by brands, followed by web self-service, telephone and social media (17%) each, with 11% of contacts through chat and chatbots respectively.

“Reducing the number of contacts by 10% would save over £122 million – enabling companies to focus resources where they are needed most. Our research shows that consumers are open to embracing new AI-powered technologies such as voice assistants and chatbots, providing an opportunity to improve the experience and reduce costs at the same time,” added Olivier Njamfa.

For the research 1,000 UK consumers were surveyed online in Q3 2018.

The full report, including the study results, graphics and best practice recommendations for brands is available here.

An infographic on the results is available here.

BRC welcomes Chancellor’s stance on online retail taxation

The British Retail Consortium has given the thumbs up to Chancellor Philip Hammond’s stance on tax for online retailers, in addition to its view on a number of other policy proposals from both the Conservative and Labour parties at their respective conferences.

In his speech to Conservatives in Birmingham, Hammond revealed that he is considering is a so-called digital sales tax to make sure there is parity between High Street retailers and eCommerce giants when it comes to HMRC.

There has been much debate recently as to ways High Street retailers could be helped through tough times by tax reform, especially as the online players many of them compete against often pay much less to the Exchequer, as highlighted by the recent Amazon our cry.

In his speech, Hammond said: “The global internet giants must contribute fairly to funding our public services. The time for talking is coming to an end and the stalling has to stop. If we cannot reach agreement, the UK will go it alone with a digital services tax of its own.”

In response, Helen Dickinson OBE, Chief Executive of the British Retail Consortium, said that the organisation welcomed the sentiment, but that special care must be taken to ensure already struggling bricks and mortar retails with online operations are not unintentionally punished:

“We agree with the Chancellor that the business tax system is in need of reform and we agree that the best way forward is through international agreement via the OECD,” said Dickinson. “We note the Chancellor’s intention to levy some form of services tax on internet companies and we are pleased he hasn’t been tempted to propose an online sales tax which would be an additional burden on retailers many of whom have online as well as physical stores.”

The BRC was also vocal on the issue of Brexit while cautiously backing the Chancellor’s general ‘back to business’ messaging, with Dickinson adding: “The retail industry firmly agrees with the Chancellor that we need friction free access to Europe to continue. A no-deal Brexit is not an option regardless what fiscal options the Chancellor can conjure up. Our food supply chain in particular relies on just-in-time practises which require frictionless trade with no delays at our borders. We must avoid the cliff edge in March at all costs. It is essential that the UK Government finds a workable solution to the Irish backstop fast, so that the Withdrawal Agreement gets over the line and tariff-free trade is protected during the transition period. Time is running out.”

“The Chancellor’s pledge to “Back Business” is welcome but the retail industry needs to see action. We require a commitment that the Treasury will reduce the overall business rates burden immediately. If the Government is to actively get “Back Business” they must support the retail industry, the country’s largest private sector employer, and reduce this disproportionate and outdated form of taxation.”

The BRC has also commented on proceedings up in Liverpool at the Labour Party conference, in particular honing in on retail-sensitive issues and policy points in Jeremy Corbyn’s keynote, most notably beats that pointed to potential cost increases for retailers.

“Retailers want to be part of building a fair, innovative and productive UK economy where society benefits,” said Dickinson. “But many may feel concerned that parts of this speech will really mean increases in business costs or taxes for an industry already under pressure.

“[On Brexit] is right to say that the business community wants to see a deal with the EU to support the free flow of goods and the role of EU workers to the British economy. Very rapid progress is needed on the Irish backstop to secure a withdrawal agreement that will provide certainty and avoid a damaging cliff-edge for retailers and consumers in March.

And on on Inclusive Ownership Funds, Dickinson added: “There are a number of great examples of employee ownership in the retail industry and retailers work hard to ensure that colleagues across the workforce have a voice. However, there is a fear amongst our members that the proposed model, which would channel excess funds into the Exchequer, would act as an indirect tax on an industry that is already under immense cost pressure.”

UK’s online retailers ‘need to work harder on shipping’ to appease Gen Z

A new report has underlined the influence that shipping has on e-commerce conversion and retention, especially among the so-called Gen Z demographic.

The research from Neopost highlights need for shipping to contribute to customer experience (CX), with 98% of young consumers abandoning their carts online due to shipping-related friction

Key findings of the report include:

  • Cart abandonment strongly influenced by the lack of shipping options 
    98% of Gen Z consumers have stated that they will abandon cart if a preferred shipping option is unavailable to them at checkout, with 44% opting to then buy from a competing online brand, 33% attempting to visit the brick and mortar store of the same brand, and 21% planning to visit a mall to buy the items.  
  • Retailers are not keeping up with Gen Z shipping demands 
    Compared to the previous year, Gen Z’s willingness to pay for new types of shipping services such as hyperlocal (1-3 hours), same-day and weekend or after-hours delivery has increased. Additionally, Gen Z’s demand for these consumer-centric shipping services is significantly higher compared to the average consumer, yet only up to a fifth of retailers offer them.  
  • Strong appetite by Gen Z for speed-based delivery services 
    Gen Z is more committed compared to the average consumer to shop online if retailers can have their orders shipped faster. 71% of Gen Z will increase their basket size to meet the spend threshold for free hyperlocal delivery (1-3 hours) compared with just 56% of the general population. Furthermore, while 44% of Gen Z will shop more online if next-day delivery was available. That’s compared with only 25% of the general population.    

Matthew Mullen, Senior Vice President Americas at Neopost Shipping, said: “Gen Z is changing the e-commerce playbook by challenging retailers to elevate the customer experience. Shipping is a key element of online shopping, so retailers who are adept at working through its complexity to leverage it as a revenue-driving CX tool will reap great returns.

“Gen Z is instant gratification personified. In a market where the likes of Amazon are pushing the boundaries on what a great shipping experience looks like, retailers rarely get a second chance with young and savvy consumers who won’t think twice about abandoning brands that cannot provide the shipping choice and convenience they desire.

“It’s a known fact that shipping and fulfilment can be operationally challenging for many retailers. Instead of taking on the burden of building everything from the ground up, leverage the supply chain innovations that are in the market – such as updating your technology stack with a shipping software platform, trialling smart parcel lockers, and accelerating the process of getting online orders out the door with automated packing machines.”

The ‘Great Expectations’ report also includes insights on how shipping can motivate or detract Gen Z from online shopping, why shipping can drive Gen Z to abandon cart and buy from a competing retailer, what retailers can do to convert and retain Gen Z through shipping, and how marketplaces like Amazon are winning Gen Z over with their approach to shipping.

It is available to download using the following link: bit.ly/GenZGreatExpectations