Study shows the widening gap between the best retail websites in the UK and the rest

Study shows the widening gap between the best retail websites in the UK and the rest

ForeSee Results, customer satisfaction measurement and management system provider, has announced the findings of its annual Christmas customer satisfaction Index across the UK’s top 40 online retail websites during December.

After a huge year-on-year increase in online customer satisfaction from 2008 to 2009 (from 67 to 71 on a 100-point scale), customer satisfaction increased only slightly in 2010 (from 71 to 72). The company said this was significant because highly satisfied visitors to retail websites in the UK said they were 57% more committed to the brand overall, 59% more likely to purchase online, 33% more likely to purchase offline, and 69% more likely to recommend the retailer.

By comparing scores to the overall aggregate for UK online retailers (72), any retailer falling 72 or lower is risking loyalty, recommendations, sales, and market share, according to the company. By this measure, the research found 24 online retailers (nearly two-thirds) were underperforming their UK peers. Despite these findings, the research also indicated that the gap between the best retail websites in the UK and the rest is huge and possibly widening. While the year-on-year increase in satisfaction is small in the aggregate, individual retailers saw big gains. The best and biggest online retailers were typically providing a much better online experience, and smaller retailers were falling further behind.

This was the fourth year that ForeSee Results measured customer satisfaction with the top 40 online retailers in the UK, enabling valuable year-on-year comparison to see which retailers improved and which had slipped over time. The index measured four high-level factors that affect overall customer satisfaction: functionality, price, merchandise and content. Over 10,000 survey responses were collected from shoppers who had visited the top 40 online retail websites in the UK in November and December.

Key trends: retailer satisfaction ratings

The Leaders: Amazon.com (84) was measured for the first time this year as a separate site, and it slightly edged out the long-standing top performer among UK online retailers, Amazon.co.uk (83). Perennially high-scoring Play.com increased two points to round out the top three companies scoring over 80 (last year, only one website scored over 80, which was generally considered the threshold for excellence when using this methodology). John Lewis increased one point to 78, and Marks and Spencer entered the top five for the first time in the study’s four year history with a five point year-on-year increase.

The Fallers: Only seven of the 40 websites (18%) saw scores decline, but all decreased only by one point except for Dell Europe, Middle East and Africa (EMEA), which declined three points since last year to a score of 68, below the online retail aggregate of 72.

The Widening Gap: When comparing the largest online retailers (in terms of revenue, as ranked by IMRG) to the rest of the group, it was clear the largest retailers had the highest satisfaction. In fact, the average satisfaction of the top 10 online retailers (in terms of revenue) was 77, while the average satisfaction for the rest was 71 – a gap of six points. In addition, the 10 online retailers with the best satisfaction had an average increase of two points each, while the other thirty retailers averaged no change since last year.

The Most Improved: Of the 40 measured UK online retailers, 14 (roughly one-third) saw year-on-year increases of at least a point or more. Foresee said the most notable increases were all companies that had built on substantial gains last year and had continued to improve the customer experience on an ongoing basis.

To improve satisfaction, it added that online retailers need to improve certain, specific website elements. On aggregate, retailers needed to focus on improving price (either actual prices or just customers’ perceptions of prices), as well as the availability, variety, and appeal of merchandise.

Social media and mobile influence

Fewer than 4% of online Christmas shoppers report being primarily influenced by social media channels to visit a website. One in ten (10%) visit websites as a result of a promotional email and 13% as a result of search engine trawls. A huge 46% are primarily influenced by their familiarity with a brand.

One in ten (10%) percent of shoppers also accessed a website for a company they rated via their mobile phone. Those that did were primarily using their mobile or smartphone to look up prices, compare product specifications, or do product research. Only 1.3% of all online shoppers actually made a purchase on their mobile phone.

Nearly half of site visitors (49 percent) came to a website just to research, not to buy. Roughly one-fifth of shoppers plan to research online and then buy in the store; a multichannel impact and value that is probably not captured or quantified by the retailer in question.

“The findings around how shoppers are interacting with retailers threw up a few surprises – that just 4% reported they were primarily influenced by social media to visit the site and only 1.3% are making purchases using their mobile phones – both marketing channels that retailers appear to be heavily investing in, with apparently little return or interest from their customers,” said Kevin Ertell, vice president of retail strategy at ForeSee Results.

“While social and mobile may play a significant role in the future of online commerce, it's important to recognise they play a relatively small role today and getting basic web experience right is still hugely important. Retailers need to tune into and fully understand what their customers want from them and focus their attention on converting browsers into customers. Satisfied customers will return, recommend and stay loyal – worth their weight in gold.”