In the race to dominate last mile, South African Grocery Retailers have launched many versions of online shopping to their customers. We see the emergence of Immediacy Grocery Shopping in an offering of delivery within 60 minutes through to next day delivery via picking slots, and online shopping with click n collect capabilities or a mixture of all three.
In a world of E Commerce, the laws of compromise are real and pose a serious challenge to Retailers entering this market. I would like to share my thoughts across a few topics and highlight the challenges we have encounted in our very own online journey over the last 3 years at Hillcrest Kwikspar. (www.hillcrestkwikspar.co.za)
- Website addresses mean something. Think of them as your own personal address that you would invite a friend to visit or the directions you would give a person coming to tea. If you are trading under a larger organization and are stuck with an address that is a “dot” extension of a large “umbrella” the limitations are inherited for the following reasons.
Consider that google , social media marketing as well as word of mouth are great drivers of traffic. Without the ability to do search engine optimization and the use of social media marketing website conversions via a FACEBOOK PIXEL to your website, traffic to your store will be limited by your ability to be seen. Essentially the equivalent of building a brick and mortar store in an unheard-of location. Don’t underestimate the use of google “My Business” in sending traffic to your online store.
- Website and App Usability. The compromise is always pretty pictures and website appeal over functionality usability. We found in our online journey that the average age of our users is not Gen X or Millennials that have grown up Tech Savvy but rather an older Generation forced to adopt online during Covid 19 Lockdowns and now find it an easier way to interface with us at Retail. Sometimes less is more when it comes to Website design.
To tackle this subject, we need to understand in order to sell online the product needs a barcode and a price. It’s this barcode and price that are reflected in your online store. What happens when all of a sudden you are forced to deal with a weighted item? In our Fresh Areas in Retail we find by far the largest portion of products are weighted. Weighted items have variable weights resulting in variable prices and thus item codes. I have yet to find a Retail solution that can deal effectively with weighted items integrating them into an online store. In order for any Retailer to succeed in immediancy and online shopping , the retailers with the ability to get fresh departments like Butchery and Produce to its customers will win. The substance of a Retail Stores Online Shopping platform will always be the “FRESH” Departments. It is also its biggest Achilles tendon.
In a World where at Hillcrest Kwikspar , our only option was to use our Brick and Mortar Store as our Picking Warehouse, we have the advantage of having all our stock available to us in the area it needs to be delivered to. The delays of having a Central Replenishment Warehouse would make it difficult to own immediacy shopping due to the delay of getting the stock from the Warehouse to where it is needed by the customer. It is also one of our greatest challenges. Brick and Mortar systems need to be integrated into our online platforms in real time. This means if we have 3 items on shelf in our physical store , there should be 3 items reflected on the online store. The Challenge is when 3 items are purchased by a customer in a brick and Mortar store but the customer has not proceeded to the till yet and at the same time a purchase is made on the online platform. Theoretically the online still has the stock yet it will not be available to the online picker.
- Speed of Service
It goes without saying that when an order is received from an online customer it needs to be picked from the brick n Mortar shelf speedily and the order processed as quickly as possible thus reducing stock availability across all platforms. Whether chasing immediacy shopping or next day delivery only one rule applies… “When is the customer available to receive their order”
- Order Tracking and Delivery Pricing
For a Retailer going into Online Retail for the first time this is the holy Grail and the most overlooked but yet most important aspect of a Retailers online journey. The efficiency at which an order can be processed and delivery made will ultimately decide if it is a cost center or generating revenue for the online Retailer. Far too often I read articles regarding the turnover that online Retailers are doing yet in their financial reports they are loss making entities. Almost always it boils down to not being able to process the acquired number of orders through the “online team” efficiently in order to make them a zero cost to your business and thus the upside being increased Grocery Sales profits. We eventually found that out-sourcing deliveries to an owner driver made deliveries a zero-cost center but by moving away from our own vehicles hampered the marketing ability through lack of signage on delivery vehicles Criss crossing our neighborhoods. Lastly… choosing and communicating your delivery area well from the beginning will help with delivery efficiency.
- Handling Returns
Another overlooked area is how to handle customer returns. Naturally it is best practice to think through all the possibilities that might cause returns like the training of online pickers, double checking of picking slips, correct packing of orders, shelf life on product, correct handling of cold chain. However, mistakes do happen both from the customer and Retailer. Clearly defining a returns policy and process is best practice.
A store that now has an online presence often overlooks opportunities they never had before. Vouchers, gift cards, meal solutions, gifting are often great online opportunities yet are hard to find if available at all in a Food Retailers online platform.
Our Online journey to date has had its fair number of challenges, but the biggest upside is that it has forced us to work on instore practices and systems in our Physical Store. If goods received are not captured timeously, stock takes are not done regularly and an online team developed to keep this entity running efficiently and up to date with the latest products and services your Online store will be met with constant challenges. We look forward to our next chapter and to embrace our future in this impending forth Industrial Revolution.
Blog Post : Mike Egling 6 October 2020