Overpromise and underdeliver: Is your brand's eCommerce strategy guilty of this?

The popularity of eCommerce has risen amidst the COVID-19 pandemic, as more consumers remain at home to practise social distancing. According to statistics from Nielsen, 37% of consumers in Singapore shopped online more often during this period. Meanwhile, 40% of Malaysians and 30% of Indonesian consumers said the same. While consumers might purchase a mix of essentials and non-essentials online, the ultimate goal is to receive the goods on time.

Recently, consumers have taken to social media to voice their displeasure of their online purchases not being delivered, despite brands claiming that their online stores are open and there will be discounts offered. Spotlight Singapore, Harvey Norman Malaysia and IKEA Malaysia were on the receiving end of the unhappy comments. About two weeks ago, Spotlight Singapore extended a 30% to 40% discount off items on its online store. However, some netizens were unhappy that the deliveries would be delayed due to the circuit breaker, and that no items on the online store were available for purchase. Others also allegedly had their orders cancelled. 

On 16 April, the brand announced on Facebook that it is open online 24/7 for immediate door to door delivery. It added that consumers will receive free delivery on orders over SG$100 until 4 May, which was the initial end date for Singapore's circuit breaker measures. A quick check by Marketing found that some consumers still had their orders cancelled.

Meanwhile, Harvey Norman Malaysia also initially faced backlash on Facebook for allowing online orders during the Movement Control Order (MCO) period when no deliveries would be made. On 14 April, the brand explained that all stores will remain closed until 28 April and while online purchases can still be made, efforts to fulfil orders "have to be ceased" as deliveries can only be made after the MCO period. Several netizens voiced their displeasure in Facebook and also requested for refunds. Three days later, Harvey Norman announced that it was granted approval to operate about 14 of its stores for consumers to purchase essential electrical appliances and computers. The outlets include IPC, Mid Valley, IOI City Mall, Setia City Mall, and Sunway Pyramid.

Similarly, IKEA Malaysia's consumers were also unhappy that their items were not delivered, and requested for delivery status updates as well as refunds. Some added that IKEA should clearly state during check out that deliveries will only be made after the MCO is lifted. So far, IKEA has been transparent with consumers and specified in its Facebook post dated 11 April that consumers can shop from the comfort of their homes to secure the earliest delivery slot after the MCO. 

"Kindly know that we are strictly unable to provide delivery and assembly services at this time due to restrictions placed on the home furnishing industry during the Restriction Movement Order. Rest assured we are working closely with the relevant authorities for a solution that will both support your needs and the government’s efforts in containing the spread of COVID-19. We will be sure to keep everyone updated on any developments," it added on Facebook.

In a statement to Marketing, IKEA's spokesperson said fulfilment is an important aspect when it comes to eCommerce and at IKEA, as it deals with such fluid situations, it believes in always being transparent with its customers, ensuring that despite unexpected circumstances, they are progressively informed when IKEA is unable to deliver.

"While we remain compliant with the regulations and restrictions placed on the home furnishing industry, we are also working hard to ensure the needs of our customers and fulfilment of orders is our utmost priority, as soon as we are able to commence our delivery services," the spokesperson said. 

The spokesperson added that IKEA is adapting and finding improved ways to reach its customers, ensuring they are still able to enjoy the IKEA experience despite the MCO. Some of the ways include providing remote planning services with IKEA's home furnishing experts to help its customers make their home interior dreams a reality. This one-on-one remote planning service is carried out via an online meeting programme and screen sharing tool.

IKEA has also teamed up with its new delivery partner BungkusIt so consumers can still enjoy their favourite IKEA food, inclusive of the ongoing discounts, in the comfort of their homes. "This partnership makes us more accessible, in addition to the takeaway service that is also available at our restaurants," the spokesperson explained. She added that IKEA also has a special Ramadan menu for consumers.

It also released a video titled "Make Home Count" the captures moments at home of its fans and their loved ones. Additionally, the company is also inspiring fans with #MakeWFHCount stories of renowned individuals who achieved great things from the comfort of their homes, ensuring customers are encouraged to discover a new meaning to life at home. "In such unprecedented times, while we continue to evolve and adapt, we will always come back to our vision — to create a better everyday life for the many people," the spokesperson said.

Harvey Norman declined to comment on Marketing's queries. Marketing has reached out to Spotlight for comment.

Managing consumers' expectations

Delivery and prompt shipping is a big part of the customer experience when shopping online. According to Kevin Kan, current CEO of Break Out Consulting Asia and former managing director Asia of CRM and loyalty company AIMIA, the key to managing customer expectations of consumers during the circuit breaker and MCO period in Singapore and Malaysia, is to always be aware of the changing environment and how that impacts government policies.

With staff operations becoming even more challenging due to the tightening restrictions around COVID-19, Kan explained that companies need to clearly and often communicate how their operations are going to change to be compliant with government regulations and consultants. "A good example of this is how McDonald’s in Singapore communicated how it was going to initially only have drive through service or home delivery and then after consultation with government bodies, it suspended all operations," he said. 

Communications were clear and concise that showed empathy for employees and customers and solidarity for the nation to combat COVID-19.

The rise in eCommerce also prompts the need for companies to boost their supply chain and Kan said the key here is for marketers to work closely with operations and logistics. If they are selling ahead and have limited stock, the operations team will be required to work with suppliers to secure inventory. Once that is done, the scheduling of deliveries to consumers who have placed orders in advance is "truly the practical part of operations management", he added. Once brands have supplier confirmation, then they can weave the timelines into their marketing offers.

Do not overpromise delivery times as your customer experience quotient will plummet.

"Given the prolonged movement restrictions, consumers have short tolerance of poor customer experiences," he explained.

Agreeing with Kan on clear communications is founder of ecommerce and SEO consultancy Stridec, Alva Chew, who said most consumers can understand and accept delayed delivery if the situation is communicated clearly upfront during the checkout process. To better manage expectations, Chew said eCommerce operations that are highly integrated with backend order processing and logistics can provide waiting time estimates upfront to consumers before the orders are confirmed.

"Another method would be to provide some sort of incentive - usually a small discount or rebate - for consumers who are willing to accept a longer delivery schedule, something that RedMart previously has executed to great positive effect," he added. Even a simple text message displayed on the website or ordering platform to highlight the longer-than-usual delivery schedule can also help defuse tempers and allow consumers to regulate their own buying decisions. 

To cope with the stress on supply chain, brands should consider diversifying their delivery channels, Chew said, adding that last mile delivery is typically where the bottleneck occurs the heaviest. 

Utilising freelance or private-hire drivers during this extraordinary period is a viable option, especially for products or goods that do not require special handling. 

Brands also have the option of partnering up with local provision shops to make available more collection points for consumers to pick up less bulky merchandise can also help ease the delivery schedule tightness, Chew added.  
 
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Have a proper standard operating procedure
 
One of the best ways to sustain a business during the lockdown is to keep selling. As such, it becomes difficult for brands to put a stop in receiving new orders, Geometry Malaysia's head of planning Filipe Lampreia said. 

"It is important for brands to now alter and put in place a proper standard operating procedure, which today very much digitally-linked and needs to be optimised to its fullest. And essentially, supply chain will focus on delivering consistent the high output in goods, reduce wastage and time to meet the daily high demands of the consumers," he explained. However, should orders be halted due to the lack of supply, delivery delays should not last more than a week.
 
"Delays or failure to deliver within the promised time frame will put a dent into the brand’s imagery and credibility. Once dented, recovery will then be an uphill battle even after the lockdown period," Lampreia explained, adding: 

 

It is ideal to not overpromise at these tough times, but anything overdelivered will be seen as a bonus.

Agreeing with him is CEO of eCommerce market research firm Digital Commerce Intelligence, Kyriakos Zannikos, who said while it is counter intuitive for companies to stop taking orders, clear and honest transaction communications are paramount. As this is an unprecedented situation, expecting brands to effectively balance the dynamics between sales and marketing is "an over expectation", he said. "What we should expect is good intentions and clarity in each step of the consumer journey path," Zannikos added.

Logistics infrastructure plays a crucial role in determining whether an eCommerce business a winner in its respective market. As this takes time, Zannikos said whichever company had that in place will enjoy a bonus during this period, while the rest "can only struggle to catch up", he added.

Meanwhile, Break Out Consulting Asia's Kan said this is a creative opportunity to keep marketing and selling. Marketers should work with their operations team to gauge inventory levels. "You can hold limited stock item sales with delivery within 48 hours of the circuit breaker or MCO restrictions being lifted," Kan said.However, he stressed that the key thing here is "48 hours", to allow time for brands to get their operations up and running, thereby also managing customer expectations. When deliveries are unavailable, brands can consider selling gift cards to be used after the circuit breaker and MCO are lifted. This helps keep cash flowing into the business.
 
Consider short and long-term perspectives
 
Another reason why brands cannot afford to stop taking orders during the lockdown period is because customers will find alternative brands to satisfy their needs, which could eventually lead to customer loss in the long run. In light of this, Ritika Verma, Geometry Singapore's planning director said brands need to view their go-to-market strategies from a short term and long term perspective.


From a short term perspective, when people are in self isolation or lockdown, the main objective is to ensure product availability and fulfilment. Fulfilment can be done through eCommerce, direct to consumer channels or even subscription models, she said. If a brand does not have its own delivery fleet, it can use other last mile logistic providers. There are more parties joining the last mile providers as their businesses have been impacted, Verma added.

"We have seen a huge shift in courier and taxi providers do delivery of food or products during this phase. By adding these last mile providers in their supply chain the brand can still remain relevant even during this time. From a long term perspective, this ensures the brand has a share of voice in the market and is still on top of the customers consideration set," she explained.

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