Online Retailers Deliver the Goods

Whether they’re looking for 14-karat gold rings or 14-bit drill sets, consumers are flocking in record numbers to the Internet to buy products. The question is, can Web retailers handle the increasingly heavy traffic effectively?

Last year, cyber-shopping went from marginal to mainstream, as 73 percent of consumers bought products online, according to a survey by AT&T. And by next year, global Web sales are expected to reach $51.6 billion, according to a survey by Jupiter Media Metrix, a research firm.

As technology improves and consumers become more comfortable buying online, the number of Internet shoppers likely will increase, too. In fact, 54 percent of those who didn’t shop online last year said they would this year, according to the AT&T survey. Indeed, today’s challenge for Internet retailers is not so much getting customers to their sites, it’s getting them to come back.

Online Shoppers Are Making Demands

As noted, a growing number of consumers embrace the idea of shopping on the Web, but other studies show that buyers are not accepting shoddy online service.

For example, the AT&T survey found that 47 percent of respondents said Web sites loaded too slowly; 35 percent didn’t know where to go to buy what; and 33 percent said they couldn’t reach a customer service rep when they had questions about something they saw online.

Many consumers also had complaints about back-end operations, which includes tasks such as order-taking, payment processing, packing, shipping and inventory control. In fact, 38 percent were upset because the items they wanted were out of stock and 20 percent were turned off because items didn’t arrive on time.

In addition, about half said they wanted to see more user-friendly Web sites; 45 percent said they wanted to see items guaranteed to be in stock; and 38 percent wished for assurances of on-time delivery.

Also high on consumers’ wish lists is Web site security: Of those surveyed, 58 percent said they want guaranteed security of their financial information.

The online retailers who can fulfill these customer demands now undoubtedly will be the companies that benefit in terms of customer loyalty in the future.

Front-end vs. Back-end

In the past, industry analysts say, too much money was spent on Internet advertising and not enough on back-end fulfillment. To be sure, things have improved much during the Internet’s evolution. But where is the convenience of shopping from the comfort of your own computer if your merchandise doesn’t arrive on time?

As always, technology is only as good as the people behind it. Yet according to a recent survey by Forrester Research, 85 percent of companies with e-commerce operations have no automated, real-time connection with any of their existing business applications. A survey by IDC, a research company, found that just 61 percent of online retailers had integrated their Web-based retail activities with customer service.

Many e-tailers are suffering from lack of adequate customer service, no live person for customers to speak with if needed and late deliveries. In many cases, Internet shopping is missing a back-end infrastructure system specifically designed to effectively resolve some of these issues.

One Solution: Outsourcing

Outsourcing these tasks to a fulfillment company may be a cost-effective way to meet customers’ fulfillment needs. Plus, it also may free up your catalog’s resources so you can focus more on your core competencies.

If your catalog company decides this is the way to go and is shopping for such a provider, look for one that offers an integrated suite of customer services, fulfillment and logistics. To ensure that your online shoppers have a satisfying experience, the service should offer tasks such as inventory management, delivery, post-sale customer service, status updates and personalization.

In addition, you may elect to have outsourced employees answer your phone- and Web-customer inquiries. To assure consumer satisfaction with personalized customer service throughout the sales process, fulfillment houses must staff their companies with knowledgeable, multi-lingual customer service reps, people who add the human touch to online transactions. In this way, your customers’ online shopping experiences are enhanced, further promoting brand loyalty.

Also look for a fulfillment house that can manage the physical logistics of delivering merchandise to cyber-shoppers with a real-time, order-fulfillment software system. Such a solution can process a high volume of daily orders. Additionally, look for a system that offers inventory management, shipment tracking and merchandise returns management.

Successful online retailers know the secret to getting and keeping customers is not flashy Web sites hiding weak back-end operations, but rather sites that can match—and even exceed—online consumers’ desires.

Elise Chow is president and founder of Waltham, MA-based Fulfillment Plus (www.fulfillmentplus.com), a back-end infrastructure service company offering an integrated suite of customer services, fulfillment and logistical offerings. You can reach her via e-mail at echow@fulfillmentplus.com, or by phone, (877) 337-7587.