Friday, November
10, 2000
European Online Purchasing Options Grow But Faces
Deliver Problems
A European consumer shopping online today will find much to be satisfied
with, but he may still wait weeks for delivery and, in some cases, may
risk never seeing his purchase at all. These are the key findings of a
new Andersen Consulting research study of online shopping across Europe,
released last week. The study suggests that while online purchasing experiences
are improving, eTailers still have a way to go in providing consumers reliable
and efficient delivery and customer service. The study also reveals that
Europe lags one year behind the United States in the evolution of online
consumer shopping based on the same study conducted in the U.S. in 1999
which revealed the same or similar results.
"Clearly, the issues that plagued online shopping in
the U.S. last year plague Europe this year," said Robert
Mann, an associate partner in Andersen Consulting's supply
chain practice. "It appears that European retailers did
not learn from the challenges faced by their American
counterparts -- namely that the long-term success of
a B2C model depends on reliability and efficiency of
product fulfillment."
The research – conducted by Andersen Consulting in France,
Germany, Italy, Spain, Sweden and the United Kingdom
in the Spring of 2000 – analyzed the efficiencies and
effectiveness of online purchasing in Europe. The study
participants placed a total of 445 orders with 162 dot-com
companies and monitored each company's ability to capture
and fulfill orders, process payments and refunds and
handle returns. The study targeted a mix of leading eTailers,
upstart eTailers, retailers with an online presence and
catalogue companies with online purchasing capabilities.
Order Management and Information Improving
The results show that European retailers are doing reasonably well in helping
potential shoppers' complete online purchases. Most sites provided some
form of confirmation that the order was on its way. Almost two- thirds
of the websites provided a confirmation that the order had been placed,
and twenty-seven percent confirmed when the order was shipped. Approximately
one- quarter provided both services. However, sites are still not providing
consumers enough information about their order and product availability.
Less than one-quarter offered information about whether the product was
in stock at the time of purchase. Only half of the sites had a clear
or visible process for handling returned products. In general and across
all countries, eTailers were best at providing those forms of confirmation.
The study shows that uncompleted orders are costing
eTailers valuable business as well. Thirty-nine percent
of the orders placed failed to be completed transactions.
One-third of the failed orders were not completed due
to technical or procedural problems. The remaining two-thirds
of failed orders were successfully completed online but
the purchased goods were not delivered. In more than
half of these cases, the retailer's delivery execution
was at fault.
Eighty-six percent of the successfully completed orders
were paid by credit card. However, payment options and
preferences varied from country to country. In Germany
and Spain, money orders were a popular payment option,
while Swedish and British companies preferred debit or
credit cards. Other payment methods offered by companies
and used in some countries included cash on delivery
and purchase orders.
eFulfillment Still Short of Customer Satisfaction
The study shows that one area where eTailers need to focus is in providing
customers better information about the purchase delivery. A mere twenty-eight
percent offered an expected delivery date. Of those, less than half delivered
the goods early or on time. One in every five orders arrived within five
days of the expected delivery date. Where a delivery date had not been
provided, 59 percent of goods were never delivered.
Overall, 57 percent of successful orders were delivered
within seven days of placing the order. However, when
an order was being delivered between European countries,
less than four in ten arrived within a week.
"If an eTailer wants to succeed both in its home market
and across borders, it must have a service proposition
that meets the need of the market – and meets those needs
in a consistent fashion." said Mann.
Delivery times seemed to vary significantly among product
types. Three-quarters of the gift products purchased
were received within a week, while only slightly more
than one-quarter of electronics were delivered within
the same time period. In most cases, the electronics
product ordered turned out to be out of stock.
Other Findings
The survey highlighted important differences in performance between countries:
