Customer Satisfaction: Online Shopping vs. Brick and Mortar Retailers
Forbes ran an interesting article a couple weeks ago about some surprising customer satisfaction results from last Christmas's shopping season. It seems that holiday shoppers are increasingly coming to prefer shopping online to shopping at brick-and-mortar retailers.
Quoting a Motorola study, they found, in most areas, online shoppers expressed dissatisfaction with online retailers roughly half as often, or even less, than with a physical store. Shoppers especially don't like standing in line: 42% of in-store shoppers complained about the checkout process, versus only 15% of online shoppers.
One thing the physical stores definitely need to work on is their item availability. 41% of shoppers were unhappy with item availability in a physical store, versus 20% online. Unfortunately, the survey doesn't say how many online shops they tried. After all, there's a much larger opportunity cost in driving across town to Target because Wal-Mart was sold out, versus clicking around from one website to another.
So that got me to thinking, what else could be behind these numbers? After all, there are pretty clear and obvious drawbacks to online shopping as well. It takes days to get your purchase, it might get waylaid in the mail, and even the Motorola study showed that people were still much more dissatisfied with the online return process.
But let's remember, we're talking about holiday shoppers. Outside of black Friday (or Boxing Day if you're outside the US) there are few periods of time more stressful for shoppers. The noise, the crowds, the insane parking lots, the long checkout lines, the occasional knock-down, drag-out fight over this year's hot toy... no wonder these customers were grumpy!Compare that to the experience of kicking back with a hot cup of cocoa and browsing Overstock.com or Amazon.com, and it seems to me we're talking about people who are already going to be predisposed to enjoy their shopping experience.
No wonder then that Amazon came up with a particularly clever\nasty way of poaching customers from physical stores. They offered a 5% discount to anyone who scanned the barcode of an item in-store using Amazon's app and then bought it from them online. Add in Amazon's free shipping and two-day shipping promotions, as well as Amazon's lack of sales tax, that makes it hard for retailers to compete. Retailers are already accusing Amazon of using physical shops as their own sales floor.
That, in a nutshell, is the problem for physical shops. People are going into stores, not buying anything from them, and increasingly buying using their mobile devices instead. If they are stressed out and dissatisfied with the shopping experience, they have no loyalty that would keep them from buying from Amazon.
If stores think they can compete on customer satisfaction, they need to really compete on customer satisfaction. It may be that in this brave new digital world, the way forward for the brick-and-mortar store is actually the way back, to the relaxed and enjoyable shopping experiences of old. At any rate, doing things the way they have always done them, retailers are bound to lose.
What have your experiences been shopping online vs. retail stores? Which do you prefer?