The Challenges Of Moving Your Retail Business Online

In this video, Managing Director of Kamarin Computers, George Smith, leads a discussion about the challenges that many of our KCPOS customers are facing when moving their business online. Involved in the interview are Matt Smith, Operations Manager at KCPOS and Lee Drew, Managing Director at our sister company Jugo Systems. They cover topics such as dealing with customer expectations for online ordering, customer behaviour, dealing with the ‘Amazon Experience’ expectations, how to get more online sales and what the future looks like as retailers begin to reopen following national lockdown. Watch the full interview below.

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Full Video Transcript

George:
Hello everyone welcome to our new series of video interviews that I’m doing with members of our team, where we’re talking around topics and issues that are relevant to our customers and people who are interested in a new EPOS solution. One of the areas that’s been a massive hot topic over recent months, with all that’s going on in the world, is the shift from traditional on-premise retail to e-commerce and selling online.

This isn’t a new topic, this isn’t a trend that’s just started because of COVID not at all. But what we’re seeing is what COVID has done it’s really accelerated that process and I was talking to one of our customers quite recently and they said what’s happened in the last 12 months is essentially put their e-commerce business three or four years ahead of where they planned it to be. So it’s definitely a topic that’s affected a lot of retailers and people who traditionally sold in an on-premise environment.

So we’re going to cover that as a topic today and talk through some of the challenges, as well as all these opportunities it creates, some of the challenges that our customers and others in the industry might be might be facing. I’m joined here by Matt (Smith) who’s our Operations Manager here at KCPOS and also Lee Drew the Managing Director of Jugo (Systems), our sister company down on the south coast, that implements and supports KCPOS for lots of our customers down in the south.

How are you doing guys?

Lee:
thank you good

Matt:
very good

George:
Right so I’m going to kick things off by talking about customer expectations. We are going to go on some of the operational challenges around selling online but first of all I want to get into the actual customer themselves. Do you guys think there’s any difference between your on-premise customer who comes in and visits you in store and the e-commerce customer that’s buying from you online? I don’t know if you’ve got any thoughts on that first?

Matt:
Yeah I think there’s lots of differences but what we’re also seeing now is with the ongoing pandemic that there’s people that previously wouldn’t have really shopped online but now they’ve got no choice so what they’re expecting is the same experience online as what they got if they go into a store. So that’s why we’re seeing lots more online chats through the e-commerce sites, previously you could pop into a store get some advice on, i don’t know what’s the best hi-fi or whatever it may be, and that kind of service isn’t always available online these days. You’ll have reviews but actually speaking to an expert in store is something that these new online purchasers are looking for.

George:
Okay yeah so they’re looking to recreate that benefit that’s always on site has stuck to for quite a while now has been that advice you get that customer service that guidance you get when buying, but these customers now are sort of expecting that online. as well

Matt:
absolutely yeah that’s what we’re seeing.

George:
Okay how about you Lee? Have you seen any differences in the type of customer or the behaviour, the expectations they may have?

Lee:
Yeah I think with the online I mean we’re all kind of guilty I guess expecting the Amazon experience. I think you know there’s a lot there to be said of what people are expecting online. Also with online shopping you haven’t got that kind of emotional attachment whereas we’re in a shop you know you can look at it, you can see how big it is, you can touch it, feel it you know. Obviously when we’re not on a pandemic, but you can do and I think trying to recreate that online so that people can get the information they need to kind of make a informed purchase. I guess you know kind of giving them more information rather than less, but making it kind of easy for them to get hold of rather than having to kind of delve into many pages and everything else. As matt said I think reviews are certainly a key part of that now, that people can kind of see what others feel that see that product once they’ve received it and use that as a basis for decisions on for online purchases.

George:
Okay so I think you’ve both mentioned reviews then that that’s potentially a really useful tool then for retailers who are moving on online to utilize, to give their customers that assurance and that extra information that you usually would have had when they were visiting.

Matt:
Yeah I think what’s becoming a challenge these days is reviews are not quite trusted like they used to be. There are now some services that you can essentially pay for reviews to make products look better than perhaps they are, so there is a general feeling these days that there’s not quite as much trust around views as they used to be. So now e-commerce sites are looking how they can give more reassurances in making verified purchases, so only allowing reviews for people who have actually purchased the item and similar kind of features.

George:
Yeah okay and how about when things go wrong? So things go wrong in every business, every customer service business and it’s more about how you put them right but when it comes to customer complaints or issues with purchases do we see a difference in how customers are sort of reacting to that when they’ve gone through an e-commerce experience compared to again that on-site one.

Lee:
Yeah I think so i think with obviously going in-store you can chat to a person, you can escalate to a manager if you kind of need to get it resolved, whereas online you know I would say that most sites are not kind of manned 24 hours a day. Whereas most of us probably do our shopping later in the evenings or the weekends so I think having that additional information such as FAQs, online chat facility, auto responses, ability to log a ticket for the customer service team out of hours and track those responses i think is really important when you’re buying online.

George:
Okay great, so these customers are certainly demanding I think that’s fair to say they expect a lot of us, from our e-commerce sites and they want a lot of information. They want the “Amazon experience” and the “Amazon experience” has a set challenge for all retailers, because obviously they’ve got resources, they’ve got technology that can mean they can hit those expectations, those next day deliveries etc. That’s becoming expected of all retailers, but I guess that that’s a challenge once they’ve landed on our site and once they’ve considered purchasing something from us.

In terms of getting people onto the site themselves, yes e-commerce creates this huge extra opportunity to get your window in front of more people but how easy or difficult is it to be attracting people onto to your ecommerce store in the first place?

Matt:
I think it’s more difficult than ever obviously there’s just so much competition out there search engine optimization (SEO) used to be kind of the way to go, but it’s very difficult to compete with the big players these days so e-commerce companies are now looking at new ways really of being able to get visitors to their site. I still think email marketing is still worthwhile as long as the user feels in control that they don’t feel like you’re spamming them, they’ve got the ability to unsubscribe or just subscribe to the kind of areas that they are interested in. So I still think kind of email marketing is still a big player.

George:
How about you Lee? Have you seen any of our customers that are moving online? What sort of activity are they doing to not get their existing customers, who would have visited them in store, but find new customers as well?

Lee:
Yeah I think it’s a new challenge because I mean a lot of them have not potentially had an online presence at all and obviously they’ve had to shift, with COVID especially, but obviously you know more and more is naturally happening online. So you know the steep learning curve i guess, as Matt mentioned around SEO and email marketing, obviously Google AdWords plays a big part in all of this but it’s very expensive. I think what I’ve sort of seen is from speaking to a few customers is that there’s kind of trying to find you know niche products which no one else is doing. Also trying to find products they can make more marginal rather than perhaps that you know you see some sellers online that have 100 different businesses selling the same item and it’s always a race to the bottom. So it’s just trying to find something a bit different that stands out and I think that’s kind of quite key and then you know perhaps trying to find different marketing activity to push those products whether it be social media or those sorts of channels.

Matt:
As well I think sometimes as well you’re off put by the likes of Amazon on eBay. How do we compete? Sometimes I think you just have to kind of join the big boys and use the Amazon store fronts and the eBay equivalent. Once you’ve got your product out there, use that as an opportunity to kind of promote your brand and promote your product.

George:
Yeah that’s interesting you mentioned that because i know we’ve seen a number of our customers that sell in either b2c or b2b making a shop as well as having their own ecommerce site. They are utilizing the likes of Amazon and eBay as marketplaces. Do we have any thoughts on that or any experience of what it’s been like for our customers when they are utilizing those platforms?

Matt:
Yes yeah and then there’s there are kind of logistical problems the services through the likes of Amazon can be quite difficult to use. I think Amazon are deliberately making it difficult to almost take those new customers away to your own site, so yes it can be difficult but I think that’s kind of better than giving up and ignoring the opportunity at the same time.

George:
Yeah okay I think we could probably spend all day talking about attract visitors to your e-commerce site, how we can convert them and we’ll probably revisit that again in a future session. But where I want to concentrate a little bit of time is actually on some of the operational logistical challenges that happens when you get going with your ecommerce site.

We’ve got orders coming in and obviously it’s a totally different process through your business selling something online compared to when someone’s walked into your store picked up the goods and walked out again. So I want to explore a little bit more around order fulfilment really and some of the challenges that it may bring. Can you guys share with me any of the common challenges or pitfalls that happen when a business sees more of its revenue going through e-commerce and having to fulfil orders that have come from online rather than that traditional over-the-counter sale.

Lee:
Yeah I think a lot of it is really trying to sort of tie systems together, I guess making sure that kind of everything’s in sync and you’re not relying on manual entry. You know a lot of the e-commerce platforms now are really good at managing sales notifying the customers, handling refunds that sort of thing. I certainly think using technology to kind of help with the online processes because you don’t have staff there as you mentioned to help with the buying process. Then obviously you know once orders are in the system it’s then using that data to help you dispatch those always nice and quickly and if issues do happen you know again you’ve got that information to hand to deal with them as quick as you can.

Matt:
I think one of the biggest challenges really is stock information, so making sure you’ve got real-time stock available on the website especially if you’ve got multi-channels. So if you’ve just sold a product in in-store and it’s from the same pool of stock that your website uses, that website needs to be updated relatively quickly because the last thing you want is to tell a customer when they’ve purchased an item that actually it’s not in stock. You’re likely going to lose the customer straight away, they’re just going to go to a competitor.

George:
Yeah it’s a good point that one on stock and I guess it can work both ways because when you receive new stock you want that available on the website as soon as possible, because if you’re out of stock they’re just going to move on and find someone else. How frustrating would it be that you know you did have some new supplies in that were sat in the stock room and because you haven’t got around to updating your e-commerce stock values you miss out on a sale. But the flip side of that like you said is saying that you do have some and then get the order and then having to disappoint the customer that probably going back to that expectation of customers now they’re probably never going to use you again. That customer’s loyalty is a pretty fickle thing now when it comes to e-commerce.

Matt:
Yeah because e-commerce websites are local to everybody these days previously there may just be one store in town that you could go to purchase this particular item and if it’s not in stock until the following week you didn’t really have another option. Now there’s probably a hundred different sites that sell the same item and can deliver it the next day.

George:
Yeah. In terms of shipping you mentioned shipping there and some of the expectations that we have around notifying customers etc. What does a good shipping process look like to you? What should our customers be expecting to deliver to their customers?

Lee:
I think really it’s kind of keeping them informed along the way. So you know whether it’s just confirming the order initially so there’s some confidence there that it’s actually being worked on and then from there it’s going over to the picking process. Maybe sort of guiding the staff kind of where those products are and again you know then notifying the customer again that that order has then shipped. We obviously could look to integrate possibly into couriers etc. But I think key again is getting the information back to the customer, so once you’ve got that tracking information, get that over to the customer as quickly as possible. A lot of these big platforms now will handle the tracking process and things like saying “Do you want to leave it with the neighbour?” to make sure it gets delivered. But again, as we mentioned earlier, that the big retailers are doing this and have been doing it for some time. So I think those basic steps of allowing the customer to see where their parcel is all the way through. If they want to log on and track it every 10 minutes and see what number they are on the queue, then I think that’s a good thing. It just gives them that confidence and it’s just a professional look and feel as well I think important.

Matt:
Yeah I think people these days they kind of they plan their lives around deliveries arriving at the door, I know kind of some days we do. You will make decisions based on when that delivery is coming in but I think there’s also not just a logistics kind of point of view but I think it’s quite exciting to see these things! Knowing that it’s just left the warehouse and it’s just gone onto a truck somewhere 100 miles away and you’re drop number 46 of 52. I think places like Dominoes, where you can see the pizza going into the oven. I think it’s quite an exciting kind of concept as well that people do enjoy.

George:
Yes it sort of adds to that purchasing experience & that purchasing journey. You used to get the buzz of going into store and picking up your item and seeing it first time etc it’s a different way of getting it to you but it’s all part of the experience and the emotions of buying something. Yeah okay, just want to touch one of the last things I want to talk about, that’s the importance of accuracy and when we ship things incorrectly or are we sending the wrong quantity or the wrong stock item, how important do you think that accuracy is for a business? Or what can they do to ensure that you know that they’re minimizing those sort of mistakes when it comes to all the fulfilment?

Lee:
I think they’re pretty big really, i think that’s probably where you’re going to spend a lot of your customer service time trying to resolve issues and you know the cost of reshipping goods is substantial. I think having up-to-date information not just kind of here and now but keeping on top of it with things like stock takes, rolling line checks, that sort of thing. Make sure that you know you’re digitally recording damaged goods etc all these channels then updated automatically, quite quickly, rather than being a period where you could potentially sell an item that’s out of stock for a week. Then again with those orders making sure that you’re telling the staff where they are, you could probably spend half an hour trying to find a mug at the back of a cupboard, when it could quite clearly just tell you where it is in the shop or in the warehouse or store. Introducing scanning and barcoding that quickly allows the user to scan that barcode validate if it’s the right product and notify them if it isn’t you know that one quick scan then is going to save potentially hours of customer service time and cost.

George:
Yeah okay, so the things you mentioned there Lee then, obviously in the SME space for retailers in smaller businesses, medium businesses they may have seen documentaries about Amazon and see robots flying around warehouses and something that looks very clever but also very expensive and very technical to set up. What are we finding in the marketplace for SMEs in terms of like technology to help with this? Are things available that are you know of or affordable that can get return their investment or is a lot of this unfortunately left for the big boys and only when you’ve got sort of serious cash to invest in?

Lee:
No it’s obviously not now I mean you know see we have a product called Smart Stock which kind of helps with that so you know integrating into the finance system or the stock management system to pull that data electronically. You certainly don’t need robots flying around to help streamline that process. Giving the information that’s automated from the online into a user’s hand that tells them where they should be going to pick these items, they can quite quickly scoot around a shop efficiently scan to pick items and then we can progress into picking, packing and dispatch. Booking couriers and labels they’re certainly more obtainable now I think than they were a few years ago.

George:
Certainly yeah and then just to finish off then looking forward, obviously hopefully we’ve seen road maps now around easing the lockdown and non-essential retail is going to open hopefully and not close again, but do we think like i said at the start we talked about its acceleration of move to online? Do we think that we’re going to step back a year or do we think it’s going to be somewhere in the middle in terms of that split of e-commerce and on-site? What are people’s thoughts of what the landscape is going to look like in in 12 months time for example?

Matt:
I think that there’s been a big shift and I think a lot of that’s going to stay around now. Some of the customers I’ve been speaking to think this has accelerated e-commerce kind of platforms now for probably four years, some of them are quoting that that were kind of advanced within the last year. So I do think this this is around to stay now, I’m sure there will be lots of people wanting to get back into shops just for the old experience what they’re used to but I think what we will see now is a lot of consumers have now been converted to online shopping. They’ve seen how easy it is, how quick it is, how cheap it is and I can see those wanting to stay online.

George:
Lee your final thoughts?

Lee:
Yeah I think the flip side of that is also for those businesses is that ultimately they can sort of generate some revenue that they didn’t have access to before, you know they were reliant on big expensive premises it’s obviously quite common in retail. They can almost reduce their total overheads and grow commercially, I spoke to a business recently that their online (sales) within 12 months did more revenue than their business has been doing year-on-year for the past 20 years and all that happened in 12 months. They certainly don’t want it to go back but I think as you mentioned that there’ll be a bit of a blend that it’d be nice to go back to shops but I still think a fair percentage here is going to stay as it is for quite some time.

George:
Yeah great okay well thanks ever so much guys that was that was really useful and thanks for joining us for that hopefully as i said this is the first of many of these video interviews and we’re going to cover different topics that we feel are affecting our customers right now and what they want to hear on. So yeah stick around for any more future videos but thanks Matt, thanks Lee it was really, really appreciate time.

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