Qn: When did Flipkart start sending emails (latest being valentine’s day offer) to its customers?
Ans: A few weeks back.
Qn:What about other ecommerce companies?
Ans:They took the extreme route and have sent mailers to those who never bought from or, never ever subscribed to their newsletter.
No focus has been given to understand the customer’s behavior or its affinity towards the marketer’s communication.
Current Metrics followed by Indian ecommerce companies
Transactions. And not repeat purchase, or returning customers.
An investor (of an ecommerce company) made an apt statement during an informal conversation that most of ecommerce players are focusing on ‘acquiring transaction’ and not on acquiring customer. In fact, very few actually are spending efforts in understanding the difference between the two.
Theoretically speaking, these companies are targeting repeat purchase (they are trying to), but practically speaking – the focus is more on getting ‘that one’ transaction from users – and this is obvious from the sleazy or misleading banner ad you will spot of ecommerce companies trying to sell anything in the name of ‘category expansion’. The trend has been the negative margin campaigns where the marketer literally shows the desperation to get that one time transaction happen.
For instance, Yebhi did a campaign to sell slippers at Re 1, yes Re 1. The result was great – they sold a lot of slippers for that cost, but how many of them later came back to buy shoes or,even socks? So who are these guys that Yebhi acquired with this revolutionary campaign?
One example is “Paras” – a college kid(from Delhi University) who recharges his prepaid cell phone from a particular shop near his home cause he gives him a free chewing gum each time. Paras has visited the website so many time after that just to find out if any thing else he can get at Re 1, as on today that was his first and last transaction with the retailer. Plus as he has been finding the emails irrelevant- he has been marking them spam. There are many other examples where the retailer is getting people like Paras on board in the name of acquisition and inflating the customer base to go back to the VC to show him growth and secure that next round of funding in the bank account.
Loyalty : The Ecommerce Way
Today the customer has so many options,so is it that make jump from one website to another? Is it only pricing?
Most of ecommerce companies have been busy playing the ‘hey! we are cheapest’ game but is that all that matters to the customer? You deliver the product in a bad shape the customer is annoyed, your customer care is rude the customer is annoyed, your delivery is late the customer is annoyed and there are many more things that affects the customer and it could result in change of mind to switch to your competition.
One of biggest thing that all these guys missed out is the fundamentals of why would a customer would buy from you and only from you. For this to happen the first step is that the consumer needs to like (oh! Please stop buying Facebook likes?) you and fall in love with you. What have you done to make this happen? Have you done anything special that the buyer is bound with “stickiness” to you? Have you shown him that you really care for him, or, have have you expressed that you really understand him and his needs? Unless you have done any of the above you have no right to complain that the customer only looks at pricing. And neither is pricing the only metric to pay with – unlike what most of the ecommerce companies like to think.
Real life example
(1)Boy reaches late on his date with his lady love and hands over a Rs 100 to buy herself an ice cream – By the way that is how your customer feels when you delay or, deliver the product that is not matching the customer’s satisfactory level and you have given them coupons/store credits.
(2)Boy reaches late on his date and takes out a red rose (Rs10/) from his inside pocket with a small note saying “I am sorry”- Have you tried sending them- be it a small gift saying sorry and appreciating their patience?
Now, take a look at how companies like Amazon have built customer loyalty.
The first thing that they took care was actually becoming a shopping destination rather than becoming a discounted shop. They actually reward loyalty! Case in point: FREE Super Saver Shipping, that gets you free shipping of products if you place at least $25 of eligible Amazon.com products in your Shopping Cart.
Now, how many Indian ecommerce companies are even thinking of rewarding loyal users? Do they have the understanding of the individuality of the customer to reward them appropriately?
“Flipkart is now charging me Rs. 30 to ship any order in case the total order is lesser than 200.! Well, amongst the 230 odd books that i have purchased on flipkart, less than 5% of the books were of cost above 180..!! So, what i dont understand now is why is there a shipping cost?” [@Madani/Pluggd.in Forum]
The key to understand here is that customers are not always looking for cheapest price, but a lot more in terms of what efforts you take to make them feel cared and understood. In a brick and mortar world example,you don’t want to be the factory outlet that sells stuff at a discount throughout the year, you want to be the shop in downtown that the customers thinks of first when he wants to buy clothes.
Long story short, most of the ecommerce companies aren’t yet with the customer. They are more focused on the customer wallet than a customer’s preference and expect the bravehearts of the ecommerce space to come out and do a better job of building a solid CRM around the service.
Having said that, companies like Flipkart are doing a few things right. Like ensure timely delivery by their OWN logistics providers. Empowering call center executives to give refunds amongst a few customer focused actions. However its still the tip of the iceberg – and a long way to go for the community as a whole.
For now, customer relationship is invoked only when a customer tweets or puts up a blog post. Till then, it is assumed that everybody is happy.
What’s your take?
[Article jointly authored by Ashish Sinha, Sameer Shisodia and Saurav Patnaik (cofounder of kenscio).]