Many Unhappy Returns

Channel-crossing customers could cause chaos during the 2003 holiday shopping season, as research from the e-tailing group, inc. finds that retailers are ill-equipped to handle the online purchase/in-store return combination.

Channel-crossing customers could cause chaos during the 2003 holiday shopping season, as research from the e-tailing group, inc. finds that retailers are ill-equipped to handle the online purchase/in-store return combination.

Nearly half (44 percent) of the 16 evaluated stores offering the “shop online/return in-store” function required a manager to override the system to complete the process. The study found that there were compatibility issues that prevented easy returns, such as Internet invoices that lacked tax, credit card and order number information. The problems led store salespeople to call their e-commerce counterparts for clarification, and resolution occurred on average of 6.6 minutes.

Lauren Freedman, president of the e-tailing group, inc., noted that there was room for improvement and merchants should create channel cohesion before the holiday season. Improperly trained salespeople may be an issue, as stores emphasize “buying” rather than “returning.”

Freedman also noticed the lack of in-store promotion of the store’s Web site, almost as if the online component didn’t exist. Signage referencing the merchant’s Web site was present in only one-half of the 20 stores with an online component: 63 percent had information on the store receipt; 50 percent posted it on the retailer’s main door; 38 percent at the cash wrap; and 25 percent on shopping bags. Only 13 percent of the stores had kiosks which were informational rather than transactional (with Internet access for order placing) and unfortunately, none were operational.

Hitwise ranked the top online department stores for August 2003, and found that 7 of the top 20 were part of the e-tailing group survey. Amazon overwhelmed the category, capturing nearly half of the market share, largely due to the lack of an offline component.

Top Online Department Stores (Ranked by Visits, August 2003, U.S.)

Site Market Share (source: Hitwise)

Amazon.com 42.79%

Walmart.com 9.12%

Target 7.48%

JC Penney 5.43%

Sears.com 4.98%

Costco 2.46%

HSN.com 2.39%

Overstock.com 2.02%

Kmart.com 1.97%

Kohls.com 1.88%

Sam’s Club 1.77%

Macys.com 1.25%

Amazon UK 1.12%

ArcaMax 1.11%

Nordstrom 1.02%

LTD Commodities 0.97%

L.L. Bean 0.83%

Sears Card 0.79%

Spiegel.com 0.65%

May Department Stores 0.61%

Hitwise categorized any site that offers a wide range of goods ? across more than 50 percent of the Hitwise shopping classifications ? as a department store, including both online and offline stores. Hitwise analytics revealed a profile of the average shopper of online department stores during August 2003 ? 35-to-44 year old (26 percent) female (57 percent), connecting from home (69 percent), with a household income above $75,000 per year (38 percent). The average session lasted 8 minutes, 12 seconds.

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