How the UK’s top 30 ecommerce retailers are taking online CX to the next level

Retailers across the UK have shown incredible flexibility and resilience when it came to investing in their online strategies during the lockdown. From extended return policies to investments in tools for enhancing customer experience (CX) such as ASOS’s ‘Virtual Catwalk’ that uses virtual reality (VR) technology, many ecommerce retailers have managed to thrive by matching customers’ expectations during challenging times and thinking out of the box.

“The downturn has taught retailers to prioritise investment in the right areas–seventy nine per cent of leaders agree that great CX is essential to their business goals”, says Eric Jorgensen, VP of Enterprise EMEA at Zendesk.

Customers’ shopping behaviours are changing yet again largely due to the current high inflation rates, which are strongly influencing their spending power and intent. Because of that, many customers are looking to buy their favourite items in-store again, hoping that they will benefit from a better in-store experience as well as more attractive prices. In fact, according to Retail Week, retail online sales fell over four per cent year-on-year in February, and sales between January and February fell by almost eight per cent. As a result, ecommerce retailers must find innovative ways to improve their online CX in order to retain and attract customers.

In collaboration with Retail Week, we take a look at how the Top 30 UK ecommerce retailers are listening to their customers and adapting their strategies accordingly. These ecommerce retailers are prioritising investments in technology, staff, supply chain and all the while placing their customers at the heart of their strategy.

Here’s Retail Week’s top tips to REFRESH your ecommerce strategy in 2023:

Recommendations and personalisation are key

Today’s customers want relevant information communicated to them, with customised product recommendations based on their individual preferences. As a matter of fact, almost half of UK customers (forty nine per cent) feel frustrated with irrelevant content and offers, so matching their preferences online is vital.

Companies such as ASOS are investing in data science and analytics platforms to keep improving their algorithms. In fact, the online retailer has increased its tech investment from £157m in 2021 to £183m in 2022, which allows ASOS to increase the personalisation of their homepages and provide strong customer recommendations. Next is also increasing its tech spend, with capital investments expected to increase to £36m in FY2022, up from £31m in FY2021. These investments are being made to provide further personalisations across their marketing strategies, including fully personalised homepages.

Enhance the app experience

While investing in improving the website experience is key to a great online CX, many customers also use apps to purchase from their favourite brands. For ASOS, eighty eight per cent of their online visitors stemmed from mobile users in FY2022–so investing in mobile apps is an essential step to creating great CX.

The report takes a look at Nike’s case, as they have really elevated their customer experience . In fact, their Connected Partnership with JD Sports allows customers to link their accounts together and have access to incredible benefits. These include customer rewards based on their spending and fitness levels, provides access to sports experts, personalised workouts, and priority event access. The Nike app also integrates augmented reality (AR) technology so that customers can have a more accurate size estimation when purchasing online–an innovative strategy to prevent online returns. The Nike app now accounts for almost half of the brand’s digital demand.

Focus on staff

There are several proactive steps that the UK’s top 30 ecommerce retailers have taken in order to prioritise the wellbeing of their staff, especially in today’s macroeconomic environment. Ikea, for instance, is investing £12m in pay rises, as well as offering staff discounts, free meals, public transport discounts, and access to loans of up to £1,000 or ten per cent of their salaries.

Additionally, investing in your staff, such as customer service teams is vital. “Service teams are integral to meeting the increasing needs of customers” says Eric Jorgensen, as customer engagement has increased by fourteen per cent compared to last year. Therefore, investing in tools to help service teams provide better personalised service is a key differentiating factor, especially as over sixty per cent of customers have higher service expectations than ever before. A great example of investments in service teams is Currys’ Colleague Hub, which helps bridge the gap between online and offline to support hybrid shoppers. This gives staff real-time access to customer history for example, as well as helps the staff get a single view of customers.

Replatforming reaps rewards

For some retailers, reevaluating some of their online strategies can go a long way. For instance, Boots replatformed their website using IBM Cloud and has strongly improved the performance of their website. According to the retailer, in the quarter up to November 2022, digital growth continued to outperform the market, and their website now accounts for eighteen per cent of their total sales.

The report also takes a look at Fenwick’s website launch back in 2019, which experienced a two hundred per cent year-on-year online growth to £7.5m. As a result, the retailer is now focusing on their online presence instead of their physical stores, by selling their Bond Street store and reinvesting part of the proceeds towards their online operations.

Elevating partnerships

Another exciting way ecommerce retailers are keeping up with customers’ expectations is through strategic partnership. In fact, with responsible and sustainable fashion being on many consumers’ minds, online retailers are partnering with third parties. Marks & Spencer (M&S) partnered with Hirestreet to introduce rental offers on their website in 2021, as the retailer found that one third of their consumers’ consider the environment before purchasing clothes.

Another interesting example is AO.com’s partnership with Homebase in 2022, where the retailers entered a five-year agreement to supply, install, and recycle appliances. Like the example above, sustainability is a big differentiating factor, and this partnership allows Homebase’s customers to access AO.com’s recycling scheme.

Savvier supply chain thinking is needed

Retailers have gone through a unique set of challenges over the past few years, the supply chain crisis is one of them; however, many have demonstrated innovative ways to stay on top of the issue. Investment in AI and automation are some of the most popular options, such as Amazon’s Sparrow, a robot designed to store inventory and pack orders, which enables the retailer to reduce costs.

Other strategies include more partnerships to cater to customers’ needs, such as Sainsbury’s partnership with Deliveroo, and more recently Just Eat, to deliver groceries to customers in under thirty minutes. The report also takes a look at the comeback of charging for returns–often for sustainability reasons as well–which seems to be a working method for Inditex’ Zara. Investments in AR and VR (such as Nike’s app) are also an increasingly popular way for retailers to both enhance their customers’ experience and prevent returns. Lastly, Retail Week also reports some retailers using faster delivery services for higher fees, which allows customers to receive items in a matter of hours.

Hone in on what’s already working

While there are many technology advancements available in today’s marketplace, there are many online retailers who benefited from what’s already working. Improving certain processes can go a long way, instead of investing heavier sums in the latest technology. For instance, Amazon launched Prime Lite Service in India in January 2023, which is a less expensive version of Amazing Prime, where customers can receive somewhat similar benefits from Prime members.

In short, there are many ways ecommerce retailers can improve their online experiences. The key is to put your customers at the heart of everything, as this has allowed retailers to understand their customers’ preferences, buying behaviours, and needs and develop strategies adapted to them.

To learn more about different ecommerce retailers’ strategies, as well as to find out Retail Week’s ranking of the UK’s top 30 ecommerce retailers, click here.