Australian retailers have spent years making it easier for customers to find products, compare options and complete a purchase. Now, more attention is turning to what happens after the sale.
The post-purchase experience can have a significant influence on how customers perceive a retailer, from knowing whether an item is available, tracking an order, or arranging a return. With consumers finding more ways to shop, retailers must ensure their operations behind the sale keep pace.
Dynamic Business recently spoke with Eric Clark, CEO of Manhattan Associates, about changing customer expectations, the complexity behind modern retail and the role connected technology and AI can play in improving the experience after checkout.
Australian retailers have spent years investing in the path to purchase. So, why is the post-purchase experience becoming just as important to customer retention and long-term growth?
Retail investment has largely focused on the customer-facing side of the business. Retailers have improved their websites, apps, search, payments and personalisation. But the transaction is only one part of the experience.
The retailer still has to locate the inventory, fulfil the order in the shortest and most efficient manner, and get it to the customer when and where they promised. Customers also expect updates about their order and to have options if their circumstances change. They will judge retailers on whether they are true to their word. If the experience after checkout falls short, it can affect customer loyalty. This is where real-time and seamless commerce and supply chain operations come together. The experience presented to the customer has to reflect what the retailer can actually deliver.
Where do the biggest operational problems tend to emerge after checkout, and what impact can they have on costs, margins and customer loyalty?
One of the biggest issues is when the information presented to the customer doesn’t match what’s happening elsewhere in the business.
If a retailer makes a sale without an accurate view of inventory, they may suddenly find they’ve got an order they can’t fulfil. Delivery promises can become difficult to meet if they are made without considering where stock is located and how the order will reach the customer.
Those problems have both a commercial and customer impact. Retailers may need to expedite an order, split a shipment, source stock from a less efficient location or spend more time resolving the issue through customer service. That all adds cost to the transaction while potentially disappointing the customer at the same time.
Accurate inventory and order information across stores, distribution centres and other fulfilment locations helps retailers avoid those situations and make better decisions about how orders should be fulfilled.
Add returns to this and the process can get even more complex. When a customer returns a product, it needs to get back on the shelf as quickly as possible or there is a risk of it going to super discounted stores or on clearance.
As customers move more freely between stores, websites, marketplaces and social channels, why is delivering a consistent experience becoming more difficult behind the scenes?
Retailers have orders coming through multiple channels and inventory spread across more locations. But customers aren’t thinking in terms of channels. To them, it’s all the same retailer. They might research online, buy through an app, collect from a store and return the product somewhere else.
Retail operations have to support that movement, which can become difficult when there is lack of real-time visibility and different channels are being managed through separate systems or processes.
Retailers need to understand what inventory is available across the network and decide how each order should be fulfilled. The closest stock is not always the best stock to use. Cost, delivery commitments, other customer orders and store demand can all influence that decision.
Having a holistic view of inventory and orders allows retailers to make those decisions across the network rather than managing each channel separately.
What do customers now expect from retailers once an order has been placed, and which of those expectations are putting the greatest pressure on retail operations?
Customers increasingly expect visibility and flexibility. They want an accurate delivery promise, they want to know where their order is and, if something changes, they expect the retailer to be able to help them.
That becomes particularly important during peak shopping periods. The traditional holiday peak has become much longer, with consumers starting their shopping earlier, promotional periods stretching over several weeks and returns continuing well into the new year. What was once a relatively concentrated spike in activity can now place pressure on retail operations for several months.
Throughout that period, customers still expect the same level of service. They may want to change an address, cancel an item, redirect a delivery or return a purchase through a different channel. To action those requests, the retailer needs to know exactly where an order is in the fulfilment process and which steps are still possible.
Returns are particularly important because customers see them as part of their experience with the brand, rather than as a separate operational process. Making returns easy for the customer while managing the cost and complexity behind them is an important balance for retailers to get right.
AI is increasingly becoming part of how consumers discover, research and compare products. How is that changing the relationship between customers and retailers?
Consumers have access to more information before they interact directly with a retailer. AI can help them research products, compare alternatives and narrow down their choices, which means the customer may arrive at a retailer’s website or walk into a store with a much clearer idea of what they are looking for.
That changes where the customer journey begins and the role the retailer plays. Retailers aren’t necessarily the first place a customer goes for product information, but they still need to be able to deliver on what the customer has discovered elsewhere.
The opportunity is to make sure the experience remains connected when that customer moves from discovery to the retailer itself. The information they receive about products, availability, price and fulfilment needs to reflect what the retailer can actually provide.
If customers are arriving in-store already armed with more information, how does that change what they expect from retail sales staff?
It changes where store associates can add the most value. A customer might walk into a store already knowing which products they’re considering, as well as what alternatives are available and how those prices differ.
That doesn’t make the store associate less important, it just means they need the ability to build on the information the customer already has. That might mean answering more specific questions, checking product availability beyond their own store, ability to upsell or helping customers access a product that isn’t available on the shelf.
Technology can empower associates with a broader view of products, inventory and fulfilment options. AI can make that information easier to access, helping them find answers and support customers without having to navigate multiple systems.
For Australian retailers looking to improve profitability while still meeting rising customer expectations, where should they be investing and focusing their attention now?
I would start with the promises being made to customers. Are you confident the inventory shown as available really is available? Can you give customers an accurate delivery date? Once the order has been placed, can they see what is happening? If they need to make a change, can your teams act on it?
Retailers should also look at what it costs to deliver those promises. The objective isn’t just offering more fulfilment options but making good decisions about how each order is fulfilled based on inventory, customer expectations and cost.
A lot of this comes back to speed to value, simplification and innovation. Technology should make it easier for retailers to adapt and introduce new capabilities without adding more complexity to the business. The faster they can respond to changing customer expectations and put new capabilities into practice, the sooner they can start seeing value from that investment.
Retailers have done a great deal of work to make purchasing easier. The focus now should be on connecting inventory, order management, fulfilment and service so they can deliver the experience customers expect without adding unnecessary cost and complexity behind the scenes.