‘Loyalty is a three-second affair’

The year 2015 has seen many e-commerce me-too’s come and go, and 2016 is expected to be no different. Except that the number of those aspiring to join the esteemed ‘Unicorn’ club will only multiply. Both e-commerce entities and investors are closely watching the space to track where the next big catch is expected to come from.

In the meantime, most traditional retailers across industries are ceding control to newer disruptive online models, in some cases very hesitantly as is evident from the recent strike among local chemists in certain parts of the country to protest the growing influence of online pharma retailers making a dent in their market.

What is the strategy? However, the question now isn’t about whether to or not to have an online channel. Instead, the conversation now is about the most effective strategy to deploy online to get ahead in this race that has clearly disrupted the way we buy and sell.

And what e-tailers need to keep in mind is that competition isn’t coming only from other e-tailers or brick-and-mortar or direct sales channels but also from Home Shopping Networks that claim dominance in the interiors which are a burgeoning market opportunity.

As smartphone penetration grows in these markets and the Government’s Digital India mission takes shape, it’s only a matter of time before this set of consumers become ‘bankable’ for e-tailers constantly looking to grow their market.

So how does one compete? Is the right product mix and pricing enough? Or is there more to what the typical online shopper really wants? For the online shopper, loyalty is only a three-second affair!

A global survey by US-based Dyn in early 2015 revealed that in India, 42 per cent of online shoppers would wait only three seconds before switching to a competitor’s website!

Sounds fickle? But the truth is that in this era of online retail, the customer has finally and truly emerged as King! Never before has a consumer had so many suitors wanting to impress. How then does an e-tailer make the three-second affair work?

The answer lies closer home than what most e-tailers believe.

Take, for instance, the infamous Big Billion Day crash of last year or even the cases of e-tailer sites going down during peak hours which have been reported in recent days.

The common failing in all these incidents was the inability of the e-tailers to accurately estimate the load that was expected to be generated by the onslaught of online shoppers that had been eagerly waiting to click on the ‘buy’ button.

Who do you really pin the blame on in such cases — the IT department? The website hosting company? The internet service provider? Or quite simply the marketing team for not being able to make an accurate estimation?

Truth be told, absolutely no one can really nail it!

Like the weather or the Government, the internet is a complex, interconnected and difficult space to fully understand and control. Hence, online businesses need tools and planning to deal with the inherent challenges of the web and help to improve their performance and return on investment (ROI).

What if on sale day, your website is hit by one of the 3,000 internet outages taking place everyday?

One of the greatest threats to an IT executive in charge of internet assets is the possibility of an outage that could partially or severely disable normal business operations. With more than 3,000 internet outages happening every day, redirects and hijacks on the rise and cloud providers, data centres and Internet Service Providers all susceptible to slowdowns and latencies, the question is not if your Internet infrastructure will experience outages and delays, but when.

And if your objective is to really plug this issue before it hits, you need to make a serious assessment of how prepared your website really is to deal with the online onslaught.

First of all, e-tailers need to dynamically adapt to spikes in online traffic.

Over-provisioning infrastructure wastes valuable dollars, which is making retail companies leverage cloud solutions to use only the resources they need when they need it.

Peak times can be slow web load times if not planned for. What e-tailers need to do is to cost-efficiently plan for spikes by moving to cloud-based infrastructure.

Second, personalisation for customer interaction is an important element. Being able to create an ‘identity graph’ of customer profiles, behaviours and preferences associated with those profiles can help with better targeting and provide the customer with what they want.

While much of this capability comes from the applications themselves, these assets need to be in the best locations for the best customer experience.

Third, security continues to be a concern area for online shoppers. A website’s performance significantly affects a consumer's trust in the company, negatively affecting a consumer’s lifetime value. Hence it’s essential for e-tailers to work with a partner that specialises in web performance and has security offerings that can ensure that web traffic doesn’t get hijacked, and routed through some other location before completing the requests.

 Then comes the matter of multiple vendor management — large retailers turn to big systems integrators to be the intermediary of multiple vendors. For smaller companies that do not have this luxury, the best practice to adopt would be to diversify its vendors for business continuity, however the management of so many vendors can be a burden making it essential to use performance tools that can help keep track of the vendor’s performance.

And finally, with e-tailers moving across platforms and some recently moving to the app-only channel, it’s important to have a seamless omni-channel strategy. While teams in charge of infrastructure may not have any control over the experience customers have at the brick-and-mortar stores, they do have control over the online customer experience. As per the Dyn survey quoted above, 85 per cent of consumers surveyed globally still cite clear differences in the kind of experiences they have when shopping in stores, online, and on their mobile devices.

In the end, like most fairy tales, e-tailers hope this one too will have a happy ending! But the journey for e-tailers in India has just started to get exciting. And as the story evolves, so will each one’s learnings and internet performance requirements as therein lies the answer to a long and happy customer relationship.

Martin Ryan is VP & MD - APAC, Dyn

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