Online retailers have learned the painful lesson that it is not enough to have a flashy Web site and draw customers in with expensive Super Bowl ads. E-tailers must be able to support the online customer and fulfill the promise of e-commerce through an ongoing, effective fulfillment strategy.
A successful fulfillment strategy will integrate people, processes and technology to generate customer satisfaction and build brand loyalty. The Internet will be littered with the carcasses of companies that ignore this mandate.
When customers have a bad online buying experience — a lost order, late delivery or a billing error — they don’t blame the individual sales clerk, they blame the company. They may not even complain. Instead, they simply don’t come back and tell friends about their bad experience. Another Web site offering a similar product is only a click away.
The creation of an excellent online buying experience includes many components, such as easy access to product and service information, pages that load quickly, readily available inventory and personalized services such as gift-wrapping. To fulfill the promise of e-commerce, a company must also ensure that customers receive what they ordered, the product is delivered on time and that customers are delighted with the entire buying experience.
Buying online is no longer a fad. Business-to-consumer spending is estimated to increase from $20.3 billion in 1999 to $38.8 billion this year, according to Forrester Research, Cambridge, MA. E-commerce continues to transform the retail industry at an astonishing pace. Businesses that didn’t exist two or three years ago have achieved market capitalizations that exceed established industry leaders with revenues 50 to 100 times that of these start-ups.
Whether these companies survive in the long term depends upon customers’ perceptions of the online buying experience. According to media reports after the 1999 holiday season, many online shoppers were dissatisfied with the shopping experience. Many e-tailers succeeded in selling products online, but found it was much more difficult to deliver the products. High distribution costs and low customer satisfaction levels have severely limited otherwise solid Web strategies. E-tailers have found that the lure of easy, low-cost entry to the Internet marketplace has turned out to be a mirage.
Survival also depends on the e-tailer building its brand online and establishing customer loyalty. Repeat purchases and increasing average order size are strategic to the e-tailer’s success.
How does a company overcome these hurdles? There are many facets to self-service fulfillment from the customer’s viewpoint – all of which are key to building customer loyalty:
• Ease of customer inquiries. Let customers contact you the way they want at any time via e-mail, phone, chat, fax or snail mail. Respond promptly with all the information they need to make a decision.
• Personalization options. E-commerce allows a customer to have services personalized, including gift-wrapping and gift cards.
• Prompt handling of returns, rebates and refunds. Today’s savvy Web shopper wants to be able to return a product and receive a rebate or refund with ease. The online shopper expects the process for these three Rs to be just as easy as purchasing the product. If the e-tailer also has bricks-and-mortar stores, the customer should have the choice of where to process their return or exchange.
Systems integration is the key to a successful e-tailing strategy. The Web site must be linked seamlessly to the back-end processing (including distribution centers and customer response centers) to promote efficiency, keep costs down and deliver data quickly to customers. Customers who shop online are impatient. They want real-time product information, real-time payment processing, and real-time data collection on each transaction.
E-tailers as well as customers benefit from this integration. Not only does the e-tailer earn the respect and loyalty of its customers, but it can use sales and demographic information to better understand and anticipate customer demand and build its business around the customer’s needs.
A successful fulfillment company will partner with clients to deliver an excellent online buying experience for the customer. The fulfillment company that delivers on the promise of e-commerce will have:
• Superior IT technology to link the Web site with all back-end processes.
• A scalable infrastructure designed to grow as large and as quickly as the client demands, and able to handle the peak online shopping traffic.
• An integrated customer response center designed to handle online customer inquiries.
• An understanding of the importance of a company’s brand and how to build that brand online
• An experienced management team that will work with clients to offer the best counsel on successful e-fulfillment strategies.
Ultimately, the best e-commerce concept cannot succeed without a well-designed and implemented e-fulfillment strategy. The ability of e-tailers to expediently craft and implement successful e-fulfillment strategies will determine the next round of winners and losers in the e-commerce revolution.