Gimmick or innovation? eCommerce UX in 2018

By: Luke Griffiths


Competition in the retail sector is fiercer than ever. Technology has fundamentally changed the way retailers interact with shoppers, and consumers now rightfully expect to shop how and when is most convenient to them.

But despite the new rules of retail, the overall mission for merchants remains the same: creating a seamless experience built around the needs of today’s consumers. Key to this is embracing innovation, meaning today’s retailers need to be bold when it comes to their tech strategies.

This is easier said than done. But the merchants who fall behind will lose out to their competitors, and it’s those who can be nimble and responsive to new technology who will survive and thrive. This was highlighted in a recent whitepaper by Internet Retailing in association with Klarna.

This article looks at the key attributes retail leaders embody, and investigate how technology helps them stay ahead of the competition.

Fortune favours the brave

Investment in mobile channels graph

Through the many interviews we conducted with retail leaders, there emerged three recurring themes. Great retail leaders are courageous, willing to take a chance on something new, and believe in the power of first mover advantage. They’re constantly on the lookout for ways to reinvent the shopping experience as, or even before, their customers’ expectations evolve.

But with innovation comes risk. And with so many new products in the market, it can be difficult to work out which are the ones worth investing in. So, what scalable technologies should retailers prioritise in 2018 – and what will soon be old news?

Prioritise user experience over gimmicks

Over the past decade, retail has been redefined - going from a straightforward high-street transaction to a multi-channel experience. Research conducted by Klarna and Ovum shows that online retail sales are set to grow exponentially - with merchants expecting almost two-thirds of total sales (65%) to take place online by 2019. This is supported by recent figures from RPC, which shows that sales at the 20 biggest online-only retailers jumped 23 per cent - up to £8.4bn in 2016-17 from £6.8bn in the prior year.

With so much of the battle for consumer spending being fought online, every stage of the online shopping journey must be built with the customer in mind. But getting the basics right is more important than investing in showy technology. Yes, augmented and virtual reality can capture headlines – but there are many more touchpoints that consumers prioritise ahead of this sort of technology.

Retailers shouldn’t underestimate the value of focusing on the basics. Optimising functionality is crucial, and retailers looking to stay relevant must adopt friction-reducing design across channels to help guide their customers through to the checkout in as seamless a manner as possible. This is the key battleground both online and offline, and where the fight against giants such as Amazon will be won or lost.

Embrace alternative online payments

Building the perfect path to purchase means creating smooth and simple customer experiences from the point of browsing through to the returns process. But as the last step in the purchasing journey, the checkout process is one of the most valuable.

2017 saw a huge rise in the number of merchants reviewing and refining the online payments process. Alternative payment methods rose in popularity, with more online providers offering services such as pay after delivery and consumer finance. We expect to see this trend continue throughout 2018 – and those retailers that don’t keep up with the changing demands in this area risk falling behind and losing out to competitors.

Indeed, this lack of innovation can have a huge effect on sales. Research we conducted showed that 52% of retailers reported that friction in the checkout – whether that’s a multi-stage process, or customers not being offered their preferred payment option – was the biggest driver of abandoned baskets – and that’s costing a UK retailer on average £37,000 a year.

Checkout friction graph

Blurring the lines between online and in-store

But it’s not enough to only give customers greater flexibility when shopping online. As the lines between online and offline shopping becomes increasingly blurred, we’re going to see stores focus on their bricks-and-mortar strategy to deliver as frictionless a shopping experience in-store as online. And while many may discount the importance of physical stores, they offer a level of convenience very different to that offered by online outlets – for example, by allowing customers to try on items there and then instead of having to wait for them to be delivered.

Looking forward, rather than competing against one another, retailers’ online and offline channels will need to work in harmony to deliver a consistent brand experience. Showrooming, for example, - whereby shoppers go to physical retail stores to view and interact with items, and then go online to make the purchase (often at lower prices) – looks set to grow in popularity for those brands wanting to offer a more personal, immersive experience for their customers.

Growth of mobile sales graph

We’ll also see a greater focus on how technology can improve the customer’s high street experience. Where payments are concerned, there’s also the possibility to offer the same frictionless alternative payments that are currently available online. In Sweden, for example, some shoppers can simply give their mobile phone number to the cashier at the checkout. They then receive a text message with a link to an online portal, where they confirm the payment with a click, and have the choice to pay on the spot or within a required time frame. 

Ultimately, key to survival in these competitive conditions will be perfecting the consumer experience - whether its payments, customer service or a symbiotic online-offline relationship - because there are no prizes for second place.


By: Luke Griffiths, General Manager, Klarna UK

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