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South Africans abandon R34bn at digital till points

Admire Moyo
By Admire Moyo, ITWeb's news editor.
Johannesburg, 25 Sept 2019

South African online shoppers are abandoning about R34 billion at digital till points.

This is one of the biggest findings from the 2019 South African Digital Customer Experience Report compiled by marketing agency Rogerwilco. The company surveyed 1 700 South African consumers.

It says with an estimated 24 million South African consumers expected to shop online by 2021, local brands must fix their digital shortcomings fast to remain competitive.

These weaknesses range from slow site speed, a lack of online customer support, too many out of stocks and a lack of product information – all relatively easy solves but which are losing brands billions in sales.

Among key findings, the study found 71% of South African online shoppers abandon a purchase at the digital till point.

The commercial cost of this for local e-marketers is staggering, accounting for a loss of around R34 billion worth of goods per annum, says Rogerwilco.

Payment failure

Online South Africans say payment failure is a big issue (57%), while site speed (38%), being unable to find what they are looking for (37%) and difficulty in navigating the site (27%) all impact the likelihood of an end sale.

“Brands are hell-bent on brand-building and client acquisition – at the detriment of conversion. I see brands throwing heaps of money to get people to their sites and then they spend less on creating an ideal environment when they get there,” says Charlie Stewart, CEO of Rogerwilco.

“If they curb their acquisition budget and put it into the very fundamental elements to give it a better experience, they will convert more customers.”

Rogerwilco notes customer service and support is also a big pain point, with over half of those surveyed saying there is no one to help them when they get stuck.

“There needs to be an improved on-demand support for customers and also brands need to look at why customers need help to make online purchases in the first place – you shouldn’t need a support service if the experience works,” says Julia Ahlfeldt, a certified customer experience professional.

“What is failing in the customer journey that is causing customers to feel they need support? This is a big red flag. Digital shouldn’t be a channel where you need customer service, it should be seamless self-service.

The report adds that chatbots might be the answer, although there are some misperceptions about what a chatbot is.

“Businesses can address this by creating a persona that has some human traits which make it more relatable. Anything that can ease the journey is a good thing,” says Stewart. “Doing so can lead to a 30% saving in customer service costs. Furthermore, chatbots are bringing in the bacon; it is estimated that by 2023, retail sales via chatbots will account for $112 billion.”

When brands do get it right, 44.5% of consumers report they will spend more online, says the report. This also increases in relation to higher incomes; almost 60% of those who earn over R30 000 a month said they will buy more from a brand if the online experience is a good one.

“We consistently see that customers who have a seamless experience on our platform spend more money with us, so it makes clear commercial sense to continue to identify and remove points of friction,” comments Gumtree’s digital marketing manager Michael Walker.

“This can be as simple as enabling buyers to set up alerts so they are notified as soon as a product they're looking for becomes available and having automated prompts that guide advertisers on how to categorise their products with tools that rate the quality of the images that accompany their ads.”

International giants

Notwithstanding site speed, good navigation and customer support, local brands are also being compared to international giants like Uber and Amazon, whose apps often sit side-by-side local brands, says Rogerwilco.

“Look at anyone’s mobile phone screen and it’s likely you’ll see local and international brands’ apps sitting side by side,” says ovatoyou’s Amanda Reekie. “Consumers dip in and out of these brands all day long, switching from Uber to News24 or Netflix to Takealot in milliseconds. And they expect a seamless experience across all of their apps; there is no differentiation in their minds between South African and global brands – they all need to work as well as each other.”

To overcome this, Rogerwilco says brands must invest more in their apps’ usability to make sure the experience is intuitive and make them not only as good as their nearest competitor but as good as Uber.

While banking online or via an app is the most common reason consumers are online in the first place, with 85% of the sample reporting they use the platform for this reason, not everything can be fulfilled online; consumers still want a degree of physical contact, especially with financial services, the firm says.

It points out that while there are no quick fixes, brands that have online platforms can and should address common consumer challenges.

“Given the rate at which South Africans are coming online and using the digital platform to engage with and buy from brands, businesses should be investing far more than the average 10% to 24% of their marketing budget on their sites, to prevent them throwing billions of rands down the drain thanks to high incidences of shopping cart abandonment,” says Stewart.

“Site speed, good user experience, offering customer support and making sure products are available online are all relatively easy things that brands can do to improve their customers’ experience and which when implemented will significantly increase consumer loyalty, return visits and ultimately sales,” he concludes.