Why people drop out of online shopping

Harish Bhat | Updated on September 06, 2018 Published on September 06, 2018

There is lack of trust about getting the right products online istock   -  Getty Images/iStockphoto

How can online stores bring back lapsed customers to their portals?


In the past, my wife and I have bought a few products from online shopping sites. However, over the past year, when we have wanted to buy apparel, electronic headphones or even luggage, we have always headed out to our favourite brick-and-mortar stores in Mumbai. I now consider myself a lapsed online shopper.

I am not alone. An excellent and insightful report, titled “Unlocking Digital for Bharat”, recently published jointly by Bain & Company, Google and Omidyar Network, highlights that 54 million other Indians have also stopped online transactions after their first purchase. This is a very large number, if you consider that a total of around 80 million Indians shop online for products.

Overall, as this report highlights, there are now 300 million Indians who belong to socio-economically affluent segments (NCCS A/B/C), who are currently using the internet. Most of these people have the disposable income to buy online. However, of this number, as many as 160 million people consume only content online. They prefer to shop offline. The top reason for this is lack of trust in getting the right products online.

Why do consumers distrust online stores? How can the e-commerce industry improve its trust quotient, and attract many more new shoppers? Here are a few pointers, drawn from the Bain-Google-Omidyar report, and my own retailing experience.

Emphasise product quality

One key reason that shoppers have dropped out of online shopping is poor product quality in their first online transaction. This poor first purchase also reinforces a perception that we can check out (i.e. “touch and feel”) product quality while buying in brick-and-mortar stores, hence, why shop online and risk poor goods, once again?

E-commerce sites therefore need to ensure consistent product quality of all goods sold on their platforms. In addition, once they are sure of this, they need to emphasise superior quality through all their communication. Only then can they win customers’ trust.

Deliver superior customer experience

Two pain points that create barriers to online shopping, and also lead to dropouts, are the inability to return products easily, and delayed product deliveries. My wife tells me that her discomfort with the returns process is a major reason why she hesitates to shop online.

E-commerce companies have to relentlessly focus on these basic elements of customer experience. Their messaging and grievance redress systems have to provide the required reassurance. Building omnichannel presence — where brick-and-mortar stores can complement the online site, and provide touch-points for easy returns or quick deliveries — is another possibility.

Be relevant to your customers’ needs

One key driver of trust and assurance is the belief that your store speaks your language. Online players have a long way to go, on this front. A major barrier for many small-town customers is that most online sites speak only in alien English, whereas offline store staff speak in familiar vernacular.

Also, consider the “shopping cart” icon that virtually all e-commerce sites in India use. So many consumers from the heartlands of India are not even familiar with the size or shape of a shopping cart, because their towns do not have modern retail stores that use such carts. Is there a more familiar shopping icon that Indian online stores can consider using, rather than borrowing mindlessly from the developed world?

Respect privacy and empower customers

Some of my colleagues have dropped out of online shopping because of the endless intrusive digital communication they receive, once they shop at these sites. Online players, having obtained lots of consumer data through their digital interfaces, and having applied the power of analytics to such data, need to be mindful of how they use this information.

If you hound your customers, they will walk away. Transparency and respect for customers’ privacy is critical. It is also time that e-commerce players ask themselves, how do we empower customers with their own data, rather than merely leveraging this data to target their next purchase? That will truly make customers trust you.

Bring back the lapsed customer

Once bitten, twice shy. That is the unfortunate story of lapsed customers. Good retailers know that getting the lapsed customer back into their stores is important for growth and for positive referrals. To do so, one has to re-engage with these customers, meaningfully reassure them that their future experiences will be excellent, and even offer them some tangible proof of this reassurance. Not an easy task, but if this is not done, those 54 million lapsed customers may never come back to online shopping.

There are many triggers for the continued rapid growth of online shopping in India — including convenience, lower prices, and availability of a wide range of options. However, for e-commerce to achieve its true potential, winning customers’ trust will be the key.

Harish Bhat is Brand Custodian, Tata Sons, and author of “The Curious Marketer”. These are his personal views. [email protected]

Published on September 06, 2018
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