5 Most Important Areas For e-Commerce in 2017 in CEE

5 Most Important Areas For e-Commerce in 2017 in CEE

When I am traveling along Central-Eastern European countries and meet people involved in e-commerce I am noticing similar challenges which they must fight. It’s even more evident when I see reports we do in Gemius for given countries.

1. Trust 

75% people in Serbia says that they prefer to pay to the delivery man

Trust is one of the most important factors not only in e-commerce but here is especially visible. From one side you buy some goods, and you expect that they will be as good as described on the website. From the other hand you sell, and when your client chooses to pay to the delivery man, you expect that customer pays. And this something that e-commerce people need to work on in CEE. When we did e-commerce report in Poland, I learned that 39% of customers pointed this method as preferred one.

When we did report in Lithuania, I noticed even bigger number – 47% of people said that, but when I saw the number from Serbia… 75% of clients prefers to pay to the delivery man. What does it mean? Simple – for some reasons customers don’t trust bank transfers or credit cards payments. In some cases the reason is that there are not good enough (and trustworthy) payments systems, in some cases there are, but people have limited trust that the package will be delivered if they pay in advance.

For e-shop, this kind of payment is not good, and there are the reasons:

a/ you get your money after some time, and it depends on some factors, external that you can’t easily control
b/ or you don’t get your money at all because consumer decided not to pay and pick up the package
c/ you pay for delivery, and you have no guarantee that you won;t lose this money but when the point (b) happens you won’t
d/ the goods are outside of your warehouse, so can’t sell them to anyone else, but the only thing you can wait and pray that point (b) won’t happen

From the other side when we asked people who don’t buy online „What are the reasons you have not bought anything online?” many of them answered „I don’t trust the payment methods” – 20% in Lithuania, 29% in Poland and 14,6% in Serbia.

Remember: People prefers to do shopping in e-shops they considered trustworthy

2. Logistic

It’s something that many e-commerces left for the end when creating e-shop. Teams are very focused on layout, UX,

People expect fast and cheap (or free) delivery

products pictures and descriptions, promotions, and marketing, even reporting. And logistic is left alone which is the big mistake. The way of ordering, choosing the method of items transportation and possible returns are crucial, especially now when multichanneling is more and more important. But not only. Customers are more and more impatient and costs-sensible. Which means that many of them expect not only next-day delivery but same-day delivery. And in same cases, if they don’t get this option from e-shop they will search for another. The same with the prices of delivery. You can’t win only with product price as people are aware that final price also includes delivery price. And this is what people are saying.

When we asked people „Which of the following obstacles have you encountered while shopping online?” they were giving very often two answers:
 
Delivery cost too much – 34% in Lithuania, 33% in Poland and 26,9% in Serbia
Delivery takes too long – 32% in Lithuania, 35% in Poland and 16,8% in Serbia
From my experience, I know that you can get good conditions from delivery companies for both cases, but in many cases, you need to spend plenty of time to get this. In one instance I participated, it took us over half a year to get it in other even longer. However, it was worth every single second. If you still don’t believe let’s look at data again. When we asked people „What could motive you to make more online purchases?” they were answering very often:
Lower delivery costs – 52% in Lithuania, 62% in Poland and 55,7% in Serbia.
Just look again at these numbers and think how much money you were possibly losing because you didn’t spend enough time on negotiating delivery conditions. What’s more important, many people are not doing shopping online because of delivery as well. Lok at the answers we received on such a question:  What could motivate you to shop online:
Faster delivery – 29% in Lithuania, 22% in Poland and 11,5% in Serbia
Lower delivery costs – 28% in Lithuania, 33% in Poland and 14,8% in Serbia
Logistics is one of the most important parts of e-commerce, there is no doubt.

Remember: People expect fast and cheap (or free) delivery

3. Multichanneling 

In Poland, 61% of users declared to start shopping on the smartphone and finish on tablet or laptop. And this information should shake every e-commerce owner. During one year number of people who act that way grew about 9%.When we asked people what type of devices they used to do shopping online they said:

Mobile – 41% in Poland (+4% year to year) and 53,6% in Serbia (+6,6% year to year)

Laptop – 81% in Poland (+3% year to year) and 90,1% in Serbia (-2,9% year to year)

The question is one and very simple – if your e-shop is mobile ready. I mean really ready, not just RWD-ready?

Your customers use different devices to do shopping. If it’s not comfortable in your e-shop, they will go away

Everyone who at least once participated in building e-shop knows how complicated it can be to fit all needed features in different resolutions that devices have. In most cases, it means that when designer prepares mobile versions (s)he needs to get rid of some features. It means that product cart will look differently on mobile than on the laptop, that sing-in and account creation will vary, it’s also possible that payment process will be different. All that means that it’s very easy to make some mistake that makes your potential customer feel uncomfortable and (s)he resigns from doing e-shopping in your e-shop.

What’s also important when we talk about mobile it’s operating system. There is one king only, and it’s Android. The difference between number one and two is so big that it’s hard to talk even about competition. Android wins, and there are no signs that that trend can change in close future.

Remember: Your customers use different devices to do shopping. If it’s not comfortable in your e-shop, they will go away. 

4. Product experience 

 

The client wants to experience product as much as possible in shortest possible time. (S)he can’t touch it and smell it. Deal with it.

Unfortunately, I can’t count how many hours I spent together with designers when we were preparing layouts for one 

e-shop I was responsible in the past; I just can say that many. It took months to create final product cart that everyone was happy. But this is not the end of the process it’s just rather beginning. The fact that designers and responsible for e-shop like the final version can mean nothing if customers won’t like it. Sure, basing on the knowledge and experience you know what mistakes you can avoid but tests after launching should be the permanent task. Sometimes really small details decide if the customer buys or not. Today you have many different tools that help you to measure everything that happens on the website, so it’s much easier to eliminate obstacles that prevent people from buying in your e-store. And people are saying so.

When we asked people who buy online „Which of the following obstacles have you encountered while shopping online?” there were two relevant answers among the others:

Misleading information – 23% in Lithuania, 10% in Poland and in 21,5% (Serbia

Lack of information – 22% in Lithuania, 12% in Poland and 15,4% in Serbia

When asked „What could motivate you to make more online purchases?” they often answered:

More information on e-commerce sites – 34% in Lithuania, 20% in Poland and 26,2% in Serbia.

When you were preparing your e-shop, you have to remember that your client can’t experience the product physically. All you can do is to deliver as many details as possible starting from detailed description ending with high-quality pictures showing all product. Pay attention to details or count your losses

Remember: Client wants to experience product as much as possible in shortest possible time. (S)he can’t touch it and smell it. Deal with it.

5. Omnichannel

Did ever heard about ROPO effect and reversed ROPO effect? If you have anything to do with e-commerce you should. ROPO is the acronym of research online, purchase offline. Reversed ROPO is research offline, purchase online. ROPO effect is very often in industries like electronics, clothing, and home&garden. Next products that ROPO affects are pharmaceuticals. If we talk about reversed ROPO (research online, purchase offline) – cosmetics and perfumes, electronics, shoes, sportswear and items for children are most popular according to e-commerce report Gemius published in 2016. But it’s not secret that similar conclusion we can come to in all CEE countries.

When we asked people who never bought online „What are the reasons you have not bought anything online?” they answered:

I want to see the products before buying it online – 49% in Lithuania, 52% in Poland and 46,8% in Serbia.

In many cases, for example, if you are selling online only you have to take about online product experience. I wrote about in point 4, so you can come back there if you didn’t read it yet for any reason. But if you have the stationary shop and you are online – omnichannel is something you can consider as „MUST HAVE.

48% of retail sellers who went into „omnichannel commerce” noticed grow of sales

Let’s imagine that you want to buy the brand new laptop. First, what you do it’s research. You are reading articles written by professional journalists, bloggers, then you hit social media and ask your colleagues and relatives. You also use price comparison engines and product comparison options. Equipped with proper knowledge you hit the stationary shop to buy a product you chose (reversed ROPO) or at least to physically experience it. You found it and touched. At one moment seller is coming to you and starts to talk. He recommends you, different model, that in his opinion is better equipped and what’s also important the price is not so much but still lower. Unfortunately, this laptop is not available in the store, but you can buy it in the e-store. You check it for example at your smartphone, and after the quick research, you decide to buy it. It’s Omnichannel. Ok, one face of Omnichannel.

It’s something that is normal, and everyone used to it in Western Europe and the USA. In CEE, Omnichannel is still more often buzzword repeated during industry conferences than something that we can experience. And what clients want? Customers expect quick, comfortable shopping. Customers (look above) want to experience a product and buy it offline or online, and it’s possible that they do it on laptop or mobile or both. Your task is to open all possible doors, to integrate all sales channels – it’s Omnichannel.

What are the biggest problems in CEE in terms of Omnichannel:

  • not all stock available online or even small part only
  • lack of possibility to complain online about the items bought offline
  • lack of opportunity to return items purchased online in the stationary shop
  • lack of possibility to pick up in stationary store items bought online

In 2011 Forrester Research reported that 48% of retail sellers who went into „omnichannel commerce” noticed grow of sales and 25 % of them said they increase profitability.

Five years later in November 2016 Forrester Research predicted that in 2 that „The Line Between Digital And Physical Retailing Will Vanish” and „Retail eBusiness pros in 2017 will face numerous challenges, from wooing cautious consumers and creating rich, personalized customer experiences to offering free and fast delivery (without breaking the bank) in the battle for customer loyalty. They must also pivot (even if painfully) to true mobile-first thinking and manage through the still-acute shortage of „digitally fluent” talent from operations to the C-suite. This brief outlines how retailers will tackle these issues, and it uncovers some areas that they will not have to deal with in the next year.

Few days ago, on 1st of February Forrester Research published report „State Of Digital Store Investments 2017: Firms Must Prioritize Digital Operations” and they informed: „The retail store is in the midst of major change, upending business models, formats, and locations that have been in place since the dawn of the suburban mall. Today, customers are empowered by information and increasingly expect streamlined and personalized experiences both online and in stores. Digital in-store technologies are transforming the in-store experience for both customers and associates. To document this trend, Forrester surveyed eBusiness leaders to understand how they think about and plan to invest in digital store technologies.

Remember: Unifying of various sales channels is a must in 2017

Summary

This article could be longer and I could point many more aspects that every e-commerce should consider as necessary. The truth is that there are many more important areas that you have to cover when you do e-commerce. But I believe that 5 above are the most important for business in CEE. Why in CEE? Becuase Western get rid of many of these troubles or client’s doubts. I am not talking even about Amazon, this is the different story. I am speaking about small e-commerce websites that implemented all should be implemented and run successful business. Like the small German pharmacy I was doing online shopping some time ago. My experience was so great that I promote this to few people. But there are more examples. Sure, there are successful e-commerce businesses in CEE which are on the Western level, but the general picture is as is. And the numbers from reports Gemius did in few CEE countries show how it is. People from e-Commerce industry in CEE must understand that there are two options: or they implement world standards in their e-shops or foreign e-shops will take their places.  Not only nature abhors a vacuum, business even more.