Surging to please the online customer
What retailers are doing to compete with the online surge during these unusual times.
In early 2020, UAE retailers were in a festive spirit anticipating the boom of EXPO 2020. Unfortunately for us all COVID-19 was the unexpected disruptor. With global trade impeded for over six months, a unique challenge emerged. Especially for those retailers who freshly revamped their stores in late 2019 to enhance shopping experience for their ‘walk-in’ customers. They now had to activate their online sales. Thankfully, larger retailers who already had their e-commerce portals adapted faster to this tectonic shift. However, this move was uncomfortably forced ahead of time for many.
The Experience Zone
Sometimes habits are formed without us intending to acquire them. This lockdown imposed online shopping and consumers adopted quickly. Visa’s studies show that 49% of the UAE consumers are now shopping online due to the pandemic.
Studies have predicted B2C E-Commerce sales in the Middle East and North Africa (MENA) would grow two-fold by 2022 compared to 2019. Saudi Arabia and the UAE are the two largest matured markets followed by Egypt promising good growth rate in the coming future. Currently, mobile shopping constitutes well over 50% of the omni-channel.
Identifying this trend in early 2017, retail giant Landmark group bolstered their logistics with a billion-dirham Mega Distribution Centre, operational since December 2019 in Dubai is the largest of its kind in the GCC – an industry benchmark.
Backed by efficient logistics makes the group’s value fashion brand MAX apparel’s online shopping seamless and convenient. Thanks to their impressive returns policy. The customer can return their order to the nearest store and exchange it or return it via the usual online process. Pre-emptive shopping using AI and ML to indicate ‘Frequently bought together’ – a core feature of pioneering E-commerce brands will be adopted soon.
Another fascinating feature is the ‘Click & Collect’. This allows the online customer to e-buy the item and have it collected from the nearest MAX store. In addition to the above, visitors are guided on ‘how to shop online?’ at their in-store digital kiosk. All these have endeared customers and enabled MAX to surpass their budgeted expectations via E-commerce sales in 2020. Moreover, extending the complete benefits of their SHUKRAN loyalty program to online buyers has been the cherry on top.
Retailers have realized that an impressive engagement online potentially can bring the customer to the ‘experience zone’ – the store. Thus, giving them a chance to ‘delight’ the buyer. Based on this interaction the new age customer decides to bond or not to bond with the brand. In case of MAX they also created a remarkable in-store experience charming customers to go online. More brand owners are likely to adopt such unique mix of interactive retail experience going forward. This in our view, the path ahead for brick and mortar retailers.
Order Online for Fresh and everything else
Up until 2020, supermarket giants Carrefour and Lulu International had minimal focus on online sales, but COVID-19 compelled them to activate e-commerce sales for their entire range apart from grocery.
Entering the E-commerce space in mid-2020, supermarket chain Spinneys are positive about the future. Their value offering of ‘No Added Hormones’ fresh meat and ‘Bakery’ are popular amongst their consumers, apart from their usual offerings. Currently, they have commenced delivery for their online operations in Dubai and are preparing for the same in Abu Dhabi. They are expected to roll out their Loyalty program and mobile app sometime in 2021.
Supermarket chains know that customers expect product quality, timely delivery, customer service and a greater B2C relationship via loyalty programs in addition to value-based pricing even for fresh food and grocery. The retailers know they must be precise in competing with offers and prices on Amazon for inedible items too. Failure to adhere to this formula, could negatively impact their e-commerce business causing the consumers to drift away.
Retailers are conscious of these challenges and are aggressively competing by strengthening their buying model, thus passing on the price benefits benefitting the final customer. However, retailers need to be cautious and iron out technical glitches in their applications sooner or risk upsetting their customers. In the current age of social media a few bad customer experiences can harm the brand. We ask our readers, can you really afford one bad customer experience? Please share in your views in the Community Forums!
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