Friday, 9 April 2010

From Paris With Love...

As we all know, the rise of ecommerce continues unabated, as online becomes an increasingly important sales channel for retailers.

There is huge competition on the internet as more and more businesses continue to come online, and existing online retailers strive to constantly improve their product offering and customer shopping experience. And of course in a crowded market points of difference make the difference between driving sales, and driving customers away. Whilst there are plenty of ways in which retailers can do this online, there is one simple way that they can increase brand loyalty and trust and poach customers from competitors in the process.

The bone of contention that is the humble Delivery Charge; or as I would rather call it, The Convenience Surcharge.

Smart retailers are beginning to recognise that subjecting customers to a prohibitive delivery cost (it can vary from anything from a couple of quid to hundred of pounds), is becoming less and less palatable to us consumers. Such delivery charges are barely justifable when we know that as the online portion of a retailers' business grows (as inevitably is the case with most) economies of scale dictate the the cost of delivery reduces. A large number of retailers operating in Europe  are able to ship goods to your home in the UK cheaper than many UK retailers can, which leads the cynical amongst us to suspect that this convenience surcharge is simply being used as an easy way to increase profitability at our expense.

As such in order to retain and grow our business, sensible UK retailers are already starting to offer more reasonable options, such as free delivery, free delivery over a threshold amount, or collection in store, but this is certainly not the case for all. Whilst I can still get a chaise longue shipped from Paris to North London cheaper than getting a sidetable delivered from Laura Ashley's local depot , we still have a problem.

And we won't have it. Retailers who don't pass their delivery cost savings onto customers, or those who won't take a hit on the bottom line to keep our purchase costs reasonable are being terribly short sighted- as we will vote with our feet (or rather our mouse) and simply shop elsewhere.

Mon Dieu!

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