How to Decrease Customer Turnover Due to the Impersonal Culture of E-Commerce - Research Paper Example

How to Decrease Customer Turnover Due to the Impersonal Culture of E-Commerce? What is e-commerce? E-commerce has evolved in the operations of a business since it first started in the 1990’s, with the ease of online shopping at their disposal; customers can avoid the hassle of visiting marketplaces. However, certain disadvantages come with the package of ecommerce for the companies dealing in this online retail system; the leading problem being the lack of customer loyalty which leads to high customer turnover, as oppose to the traditional business method (Reynolds, Jenice).Companies continually devote their concentration towards developing new buyers rather than retaining the existing customer base, this mistake on the executive’s part leads to customer disloyalty resulting in a high attrition rate. As online purchasers get the luxury of anonymity in e-commerce, loyalty is heading fast towards extinction. This has become a growing dilemma for online businesses, as the lack of personal contact and reliability leads to customers feeling alienated from the whole transaction process. This translates into their quick conversion from one supplier to another due to the incapability of companies to harness the potential of profitable relationships by developing a consistent customer base that makes repeated purchases (Arden, Lynie). Customers hold trust and reliability as the most important factors in doing their business online. Many e-commerce businesses fail to recognize this and as a result end up having high customer turnover. How the online marketing system is different and what problems it faces. It is important to understand the differences between an online marketing system and a traditional one which involved the customers going to look for their good in market places before we plunge on to finding effective solutions for the inefficacies that lie in the online marketing system. Over the internet, it makes it easier for the customers to do business whenever they want and where ever they are. They can be sitting in their living room when they order or making something in the kitchen side by side. The customers do not have to be free and take out time specifically for the shopping. They can do so while they are accomplishing other tasks at home or workplace. This saves the customers a lot of time and a lot of hassle that may have been there in the case of traditional shopping (Brown, Bruce). Also, in the online shopping system, there are lower customer handling costs. The sites need to have a good appeal and an instructive display to attract the customers. They don’t have to worry about their shop size, location, lighting, cleanliness, banners etc which may be the source of a lot of capital consumption in the traditional marketing style. Also, there are improved efficiencies because of the use of posted ordering instructions and frequently asked questions. In the traditional marketing environment, the users have no say and their comments often go unheard, but the online marketing system ensures that all complaints that are on the company’s database are answered as soon as possible. This keeps the company up to date with consumer needs and demands which is the sole aim of a company whose fate depends on the consumers themselves (Torado, Miquel). However, there are certain problems associated with the virtual customer service that makes online shopping a questionable act. The relationship with the customers is less personalized because of online shopping so they may have greater expectations from the company than the company realizes. When they choose an online marketing site over a local mall whose salespersons may know the customers personally, of course they attach greater hopes and expectations from the online marketing system in terms of quick service, better quality, overall efficiency and reasonable rates. Often such sites lack a personal touch or a personal feel, which surely is discouraging for the clientele who want greater from such sites. Solutions to the problems Since most problems associated with the high turnover rate due to impersonal nature of e-commerce links to a weaker bond between the company and the customers and the customers being dissatisfied as a result. It is very important that the online marketing companies realize this before it is too late and they lose their market to someone else. Even though not much can be done to add the personal touch that the customers want there are certain essentials that need to be followed by the customer service department to ensure that the clientele gets the personalized touch from their website and continue to use it for all their transactions. First and foremost is acute attention on web based facets and details. The company should invest sufficient time and money in creating its website. It should ensure that it has simple navigation tools and overall design (Bayles, Deborah). Anything that is very complicated or intricate will hamper users who do not have a very strong backing in computers. It should be realized that online shopping is done mainly by people who like to sit back at home rather than going from shop to shop. These may constitute older population, mothers of toddlers, housewives or business executives on vacations. All of these would prefer a very simple display and easy to understand navigation tools and methods so that they don’t waste time thinking how to look for the products and their prices. They would prefer a very straightforward way instead. A lot of images and other interactive displays add a lot to the website but it needs to be ensured that the images download instantly and there is fast access to information (Scarborough, Mary). For example, if a user is using http://www.beliscity.com/ for purchase, he’d like to see the products, prices and the pictures but if they display instantly, that would save him time. Otherwise, he may log on to other websites instead that provide faster access to information. Also, if the website compares and contrasts other goods of the same kind by different companies perhaps, that could be an excellent resource. Generally, people roam from shop to shop to have an idea of all the available goods, their prices and their relative advantages and features. If they get this all on a website, they would not feel the vacuum caused by impersonal nature of e-commerce. Rather, they would be getting all the advantages of traditional marketing style using lesser resources and eating up lesser time. There are certain human facets too that the companies that deal with e-commerce need to concentrate on. Usually queries and comments are sent via email or phone. It should be ensured that the customer service department responds promptly to any requests on email and any complaints that are made, are forwarded to the concerned personals in due time. Not only that, the customer should receive complete and accurate information of any proceedings that take place with regard to their queries or comments. This is important as it will encourage the customers to stay loyal to the website. They would be assured that their problems and complaints are taken seriously and personally (Meyerson, Mitch). It is very important for the customer to realize that despite the internet, they are being taken personally. Also, there should be some toll-free customer service phone numbers. This is highly encouraging. The internet has long been known for frauds and other discrepancies. If the customers are provided with some customer service phone numbers that are accessible all round the clock, it will give them the assurance that the company is actually concerned about the customer needs. It will help them deal with any issues promptly and will somewhat nullify the impersonal nature of e-commerce as such. There can also be offline purchasing assistance from customer service representatives further improving the bond between the customer service department and the clients leading to higher satisfaction rates. For example, http://www.ebay.com/ has been one of the most trusted and visited online shopping sites since the last five years. This is because they promptly and correctly reply to customer queries and they add a personal touch in all their emails. The customer service representatives also communicate through phone and make sure that the customers receive their orders on time and are satisfied. This encourages the clients to stick to the same website for its shopping errands than switching from one site to another every time it needs to purchase something. Also, since e-commerce depends entirely on the information that is provided on the company’s website, it is extremely important to have complete details on the website. There should be complete descriptions of the product, accurate specifications, regularly updated prices, self explanatory frequently asked questions, bundling of similar data to avoid a lot of haphazard and stocking on the homepage, smart and easy to use shopping carts and some cross purchasing suggestions. It is the responsibility of the customer service department to work on details such as FAQs that would help the customer understands the site and products better (Antion, Tom). For example, http://dexpel.com/ deals with laptop skins, i-phone skins, x-box skins and psp-skins. To ensure that the clients know how to apply these skins, take them off or just to take dimensions of their products they give a detailed explanation of each step that needs to be followed. It seems as if the customer is talking to someone who is explaining him every step in sufficient detail with graphics. This is very encouraging for new users since it helps them understand the basic working of the site and other requirements. The vacuum that is created because of impersonalization is somewhat removed when such details are provided. This encourages new users and keeps existing users stick to the site for their transactions. The customer service department can also encourage the customers using some incentives such as promotion schemes, offers and money back and on-time delivery guarantees. To ensure that the users are satisfied, there can be an approximated delivery time emailed to them and then it should be ensured that the good reaches the customer before the assigned time. In other cases, money should be returned. This will ensure efficiency in the working of the company and will lead to customer satisfaction. When the customers refer to the companies for assistance through email or phone, there should be some incentives given to them, there can be some draws leading to attractive prizes or there could be some discount given to them. This will add a personalized touch to the transaction leading to customer satisfaction and contentment. Offers of free shipping and handling can also be provided to allure users from faraway places and there should definitely be concessions on bulk buying encouraging other companies to associate themselves with each other. The customer service department should also ensure a follow through program once the order has been shipped to the customer. This is extremely essential to keep the existing customers intact. There should be some confirmation emails exchanged between the customer service department and the users so that it is ensured that the good reaches its owner on time. There should be an automated shipping and tracking system to satisfy the customers in case they are worried about their order (Chia, Ewen). The customers will then know that their order is important to the company and its tracking it till it reaches the client. Also, there should be some satisfaction surveys and questionnaires so that the feedback of the customers reaches the company and something can be done about the problems that users are facing in due time. Last but not the least, the customer service department can also open up fan pages on social networking sites to increase brand loyalty and encourage new users. These days everybody uses Facebook or Myspace. Fan pages will serve in attracting new customers globally. This will improve the company’s image and reduce the turn over that it was facing previously due to the impersonal culture of e-commerce. Conclusion E-commerce is a very cheap way to take orders and ship them. It reduces costs of rent, excessive lighting, banners etc but leads to an impersonal culture in shopping which may be discouraging to some users. In order to ensure that the users are satisfied by this system of exchange, the customer service department must plunge in and make sure that they add a personal touch from miles away (Collins, Shawn). References: Reynolds, Jenice (2004). The complete E-commerce book. CMP. Arden, Lynie (2009). Start your own e-business. Entrepreneur Press. Brown, Bruce (2006). How to use the internet to advertise, promote and market your business or website with little or no money. Atlantic Publishing Company. Torado, Miquel (2009). Internet marketing methods revealed. Atlantic Publishing Company. Bayles, Deborah (2000). E-commerce logistics and fulfillment. Pearson Education. Scarborough, Mary and Meyerson, Mitch (2007). Mastering online marketing: 12 ways to transform your website into a sales powerhouse. Entrepreneur Press. Meyerson, Mitch(2005). Success secrets of online marketing superstars. Kaplan Business. Antion, Tom (2005). The ultimate guide to electronic marketing for small business. Wiley. Chia, Ewen (2009). How I made my first million on the internet and how can you too! Morgan James Publishing. Collins, Shawn and Ward, Missy (2010). Internet Marketing from the Real Experts. Morgan James Publishing. Read More