JDA & CentiroChristmas Customer Pulse Report 2017Voice of the online customer

Survey conducted by Sponsored by

JDA & Centiro Christmas Customer Pulse Report 20172

Customers take an increasingly proactive approach when faced with Christmas ordering deadlines

ContentsIntroduction 3

Little improvement in reducing problems with online orders 7

Click & Collect remains an important part of the Christmas shopping mix

Summing up

5

12

10

Online Christmas shopping continues to be popular

Product availability remains a pain point

4

11

Poor online shopping experiences will see retailers haemorrhage customers 8

Christmas Click & Collect issues remain stubbornly high

About JDA & Centiro

6

13

IntroductionOnline retail continues to play a significant role over the Christmas period. Over the course of Christmas Day and Boxing Day 2016, IMRG predicted that online sales would hit £1.789 billion.

The chaotic scenes sparked by Black Friday in years gone by appear to be a thing of the past for the UK, with some live television broadcasts showing relatively empty stores. As shoppers have become increasingly experienced at dealing with promotional sales days, they are more comfortable using the full range of fulfilment options available to them. From Amazon to Zara, many retailers also continued the trend of stretching Black Friday offers across a longer period. With promotions being staggered over a number of weeks, retailers hoped managing demand would become increasingly realistic.

The days of omnichannel being a distant buzzword are well and truly gone, as retailers are now expected to offer a range of channels. Some are learning the hard way that problems with online orders, deliveries and Click & Collect services will not be tolerated by UK customers. So how have retailers delivered on customers’ expectations across the online channel this year, and what have been the differences compared with 12 months ago? Surveying 2,070 UK adults, the JDA/Centiro Christmas Customer Pulse 2017 report* provides a thorough overview of customers’ online shopping experiences during the 2016 Christmas period.

*All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2,070 adults and fieldwork was undertaken between 29th to 30th December 2016, The surveys were carried out online. The figures have been weighted and are representative of all UK adults (aged 18+). The research has been commissioned by JDA.

of online Christmas customers shopped at alternative retailers due to stock unavailability and delivery time constraints

19%of online Christmas shoppers said they would likely switch to an alternative retailer as a result of a poor online Christmas shopping experience

of online Christmas shoppers stated they had experienced issues with their online purchases

78%

32%JDA & Centiro Christmas Customer Pulse Report 2017 3

JDA & Centiro Christmas Customer Pulse Report 20174 JDA & Centiro Christmas Customer Pulse Report 2017 5

Click & Collect remains an important part of the Christmas shopping mixThis Christmas, Click & Collect usage has plateaued compared to previous years. The research highlighted that 39% of online Christmas shoppers used Click & Collect services, compared to 41% in 2015 and 39% in 2014. Click & Collect remains an important part of the Christmas shopping mix, and it is apparent that the introduction of minimum order values by some retailers has had a negligible effect on Click & Collect behaviour.

Many UK adults continue to embrace online channels when it comes to Christmas shopping; 49% of UK adults carried out at least half of their Christmas shopping online this year. Those aged between 18 and 24 proved keen to buy more online, with 54% of that age group completing at least half of their Christmas shopping online. That figure rose to 62% of 35-44-year-olds, many of whom will have been grateful for the opportunity to shop at a time that suits them, rather than taking time out to head to physical stores.

49% of adults carried out at least half of their Christmas shopping online

Which of the following comes closest to the amount of Christmas shopping you carried out online this year?

26%

16%

20%

24%

5% 9%

10%

0

20%

30%

40%

50%

None

None

None

Most

Most

Most

Some

Some

SomeAl

lAl

lAl

lHalf Half Half

I did

none

I did

none

I did

none

18-24 35-44

Demographic Results

55+25-34 45-54

Online Christmas shopping continues to be popular

“62% of 35-44-year-olds were grateful for the opportunity to shop at a time that suits them”

None

None

Most

Most

Some

SomeAl

lAl

lHalf Half

I did

none

I did

none

Did you use Click & Collect services this year while completing your Christmas shopping?

Yes39%

No57%

Didn’t Know4%

18% of males

35% of females

More convenient than home

delivery

Avoid delivery charges

More confident of getting my

goods than with home delivery

53%

28%

50%

from

201

5

None

Some

Half

Most

All

I did no Christmas shopping this year

The motivations for using Click & Collect are twofold; of those respondents that used Click & Collect this Christmas, 53% did so to avoid delivery charges and 50% said it was more convenient than home delivery. These drivers for use are just 3% apart, whereas when the same question was asked last year, the gap was 7%. This indicates that convenience is becoming just as important as cost to online shoppers.

Interestingly, avoiding delivery charges was particularly important to female online shoppers (35%) compared to their male counterparts (18%). Click & Collect is also increasingly being seen as a more reliable option, as 26% of respondents who used it stating they had done so because they were more confident of getting their goods than with home delivery.

Which of the following statements about your Click & Collect shopping this year apply to you?

used Click & Collect to avoid delivery charges

Which of the following did you experience with a Click & Collect purchase?

Christmas Click & Collect issues remain stubbornly high

Staff were unable to/took a long time to locate or source my item(s) when collecting them in-store

Long waiting times when collecting my item(s) due to lack of in-store staff

No dedicated area in or near store for ‘Click & Collect’ purchases

Item(s) were out of stock at my preferred store, so I had to collect them from an alternative store

The retailer notified me before collection that my item(s) were no longer available, but only after I placed the order

I received the wrong item(s)

I received damaged item(s)

Based on your Click & Collect experience of Christmas shopping this year, which statement best applies to you?

I will use it more next Christmas

I will use it less next Christmas

I will use it the same amount next Christmas

6%

61%

20%

Little improvement in reducing problems with online orders

Did you experience any problems with your online shopping orders this year?

Which of the following issues did you experience?

Yes32%

No65%

Didn’t Know

3%

Late Delivery or Item Never Received

Damaged Goods

Item Never Received (despite retailer/delivery company stating delivery was made)

Incorrect Goods

Missed Delivery

49%

22%

10%

15%

24%

48%

17%

14%

48%

45%

23%

10%

49%

24% of people experienced missed deliveries despite being at home

2016 2015 2014

The amount of online shoppers experiencing an issue with an online order dropped slightly this year; from 33% in 2015 to 32% this Christmas. Of those shoppers that had experienced an issue, Change to 31% experienced late delivery and 23% never received their item, 24% experienced missed deliveries despite being at home, and 22% received damaged items. So while retailers have made a marginal improvement to mitigate online delivery problems this Christmas, these findings must be tempered by the fact that online sales volumes continue to grow year-on-year.

Almost a third (32%) of Christmas Click & Collect shoppers encountered issues with their online orders, and while this is a decrease from 36% the previous year, it is still too high. Long waiting times due to a lack of in-store staff (32%), and staff being unable to / taking a long time to locate items in-store (30%), continue to be cited as the primary reasons that had a negative impact on the Christmas Click & Collect shopping experience.

Interestingly, just 16% of the respondents that experienced issues said it was down to the lack of a dedicated area for Click & Collect, down from 31% in 2015. This indicates that retailers placed a greater emphasis on Click & Collect this Christmas, even if the data shows they continue to be let down by operational issues. The staffing piece of the Click & Collect puzzle is where efforts need to be focussed over the coming year.

Although there are still improvements to be made, Click & Collect will continue to be an extremely attractive option for many online shoppers at Christmas. Looking ahead, 20% of respondents said they would use the service more over Christmas 2017, compared with only 6% who would use it less over this period. At a geographic level, Click & Collect growth looks set to be particularly strong in London, where more than a quarter (26%) of respondents said they would use the service more next Christmas.

Did you experience an issue with a Click & Collect order this Christmas?

Yes32%

No58%

Didn’t Know

10%

16%

6%

32%

14%11%

30%

15%

JDA & Centiro Christmas Customer Pulse Report 20176 JDA & Centiro Christmas Customer Pulse Report 2017 7

JDA & Centiro Christmas Customer Pulse Report 20178 JDA & Centiro Christmas Customer Pulse Report 2017 9

How likely would you be to switch to an alternative retailer as a result of a poor experience with ordering an item online?

...a poor online home delivery experience?

...a poor experience when it came to resolving an issue?

...a poor returns experience?

“71% of 18-24-year-olds stating they were likely to switch”

20%

0

40%

60%

80%

100%

Likely

Likely

Likely

Likely

Likely

Not Li

kely

Not Li

kely

Not Li

kely

Not Li

kely

Not Li

kely

Don’t

Know

Don’t

Know

Don’t

Know

Don’t

Know

Don’t

Know

18-24 35-44

Demographic Results

55+25-34 45-54

Poor online shopping experiences will see retailers haemorrhage customers

How likely, would you be to switch to an alternative retailer when next shopping for products online specifically as a result of...?

As online retail becomes an increasingly normal part of everyday life, consumers are becoming increasingly intolerant of substandard experiences. More than three quarters (78%) of Christmas online shoppers said they would likely switch to an alternative retailer as a result of a poor online Christmas shopping experience, up 1% from the previous year. Older consumers were the least tolerant, with 80% likely to switch retailer due to a poor online experience. This decreased in those at the younger end of the spectrum, with 71% of 18-24-year-olds stating they were likely to switch.

Looking at the specific reasons for switching retailer, 76% would do so due to a poor online home delivery experience, while a poor Click & Collect service would lead 66% to look elsewhere. A poor returns experience would drive 74% to a different retailer, while poor problem resolution (79%) is the biggest driver behind switching retailers.

Don’t Know

10%

Likely

Not Likely

78%

12%

11%

13%

Likely

76%

Don’t Know

Not Likely

10%

11%

Likely

79%

Don’t Know

Not Likely

79% of people said they were likely to switch retailers

74% of people said they were likely to switch retailers

...a poor click & collect experience?

16%

18%

Likely

66%

Don’t Know

Not Likely

13%

13%

Likely

74%

Don’t Know

Not Likely

Customers take an increasingly proactive approach when faced with Christmas ordering deadlinesUK consumers took a more proactive approach to Christmas shopping this year to ensure ordering deadlines didn’t prevent them from getting hold of all the goods they needed. This year, 27% of shoppers ordered items earlier than planned due to Christmas ordering deadlines, which was up from 23% in 2015. More than a fifth (21%) of online shoppers even took the step of shopping in a store rather than online to ensure their needs could be fulfilled (this is an increase from 19% last year). This behaviour might have been spurred by people having experienced problems in the past, and learning that they need to shop smart to make sure they get everything they would like.

An area of concern for retailers is the 11% of respondents who shopped with an alternative retailer either online or in-store, along with the 5% that decided not to order/buy the item at all because of delivery deadlines. This equates to 16% of potential lost sales, which is an increase from 14% the previous year.

Ordered items

earlier than planned

Shopped with an

alternative retailer

Shopped in store,

instead of online

Didn’t order or buy the item at all

Bought a different

item instead

27%

21%

5% 6%

from

201

5

Which of the following did you do as a result of Christmas ordering deadlines? 16%

of all potential sales were lost in 2016 compared to 14% in 2015.

Yes, I did because my preferred retailer did not have items I needed available online

Yes, I did because my preferred retailer did not have delivery times that met my requirements

No, I didn’t

Don’t know

Did you have to use an alternative retailer for any of your purchases?

18-24

Yes -

not

avali

able

Yes -

deliv

ery t

imes

No, I d

idn’t

Don’t

Know

Yes -

not

avali

able

Yes -

deliv

ery t

imes

No, I d

idn’t

Don’t

Know

Yes -

not

avali

able

Yes -

deliv

ery t

imes

No, I d

idn’t

Don’t

Know

Yes -

not

avali

able

Yes -

deliv

ery t

imes

No, I d

idn’t

Don’t

Know

Yes -

not

avali

able

Yes -

deliv

ery t

imes

No, I d

idn’t

Don’t

Know

35-44

Demographic Results

55+25-34 45-54

20%

0

40%

60%

80%

Product availability remains a pain pointStocking up ahead of Christmas sounds like an obvious step retailers would take, but it appears not all of them are getting it right. 12% of UK adults online used an alternative retailer this Christmas for the very fundamental reason that their preferred one didn’t have items available online. Stock availability issues and unsuitable delivery times resulted in nearly a fifth (19%) of online shoppers using an alternative retailer. A further 7% of people used an alternative retailer because their preferred one didn’t meet their delivery requirements; illustrating that not enough retailers have built flexible and robust carrier networks which enable them to offer a wide range of reliable options to customers. These figures, together with the ordering deadline figures show that those retailers that get Christmas availability and fulfillment options right, stand to win a significant amount of business from their competitors.

69%

12% 12%7%

JDA & Centiro Christmas Customer Pulse Report 2017

11%

JDA & Centiro Christmas Customer Pulse Report 201710 11

JDA & Centiro Christmas Customer Pulse Report 2017 13

Summing upShoppers are growing increasingly accustomed to shopping online. As a result, their behaviours are becoming increasingly sophisticated as they look to use channels that best suit their budget and lifestyle. This is leading to a growing necessity for retailers to be able to provide a great service over a number of channels, whether online, in-store or a combination of both.

Problems were tolerated to an extent when these channels were new, but that’s no longer the case. Furthermore, whilst retailers have made some progress in stemming the rise in issues experienced – which is no mean feat with the increasing volumes and expectations around Christmas – there is still a lot of room for improvement and opportunity to capture business from the competition.

Retailers must ensure they have the online fulfillment and supply chain capabilities to deliver a great customer experience, not just at Christmas but throughout the whole year. The opportunity is out there for retailers to take a big share of the customers’ online shopping wallet, but be warned – get it wrong, and an increasing number of people won’t give you a second chance.

Is your supply chain ready?

REFERENCES https://www.imrg.org/media-and-comment/press-releases/imrg-christmas-day-online-sales-forecast-2016/

About JDA

JDA Software is the leading provider of seamless supply chain planning and execution solutions for retailers, manufacturers, logistics providers and wholesale distributors. Our unmatched solution portfolio enables our clients to reduce costs, increase profitability and improve visibility so they can deliver on customer promises every time. More than 4,000 global customers run JDA, including 73 of the top 100 retailers, 71 of the top 100 consumer goods companies, and 13 of the top 16 3PLs. With JDA, you can plan to deliver. www.jda.com

About Centiro

Centiro believes in empowering logistics for successful companies. Our cloud-based solution for delivery management is used by finer supply chains in more than 105 countries. With us a retailer can think global, yet offer customers a consistent and personalised experience for first- and last mile delivery and returns to take a brand and shopping experience full circle. It’s a plug-and-play setup offering a world-class portfolio of carrier networks.

From straightforward shipping labelling solutions and carrier management, through harmonised tracking, event management and cost control – we offer functional features that extend your existing IT-landscape.

For further information, please visit www.centiro.com

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Christmas Customer Pulse Reports 2017Country-specific Christmas Customer Pulse reports are also available to download for Germany (in German) and Sweden.A European comparison report (comparing results from France, Germany, Sweden and UK) is available in English and French:

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