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One quarter of attempted holiday purchases over the Internet typically end without a sale, a new study by Andersen Consulting reveals.
The firm's attempts to buy 480 gifts at 100 different Web sites resulted in only 350 completed orders. More than one quarter of these sites crashed, were blocked, were under construction, or were otherwise inaccessible during the attempted transactions.
Web sites of pure-play Internet retailers generally provided better customer service than traditional stores with Web sites, the study found. Shopping at the sites of traditional retailers took almost 30% longer (14 minutes) than ordering from a pure-play Web merchant (11 minutes. In addition, pure-plays are the most effective at tracking inventory: 44% of their sites can inform consumers whether items selected are in stock, versus 40% of retailers with bricks-and-mortar operations, and 37% of catalog companies which take orders online.
"The fundamental question being posed this holiday season is if it's cheaper, faster, and more convenient to shop online," says Robert Mann of Andersen Consulting's supply chain practice. "The answer is that it may not be better to go to the Web...yet. At the same time, retailers which consistently satisfy online customers enjoy a distinct competitive advantage, since selling products online isn't just another way to take orders. Right now, reliability and service are the only things that matter."
To study online fulfillment, Andersen Consulting asked 25 employees in its supply chain practice to purchase gifts online from a mix of traditional retailers, Internet pure plays and catalog companies. All orders were placed over a seven-day period, morning, afternoon and evenings, and delivered across the country to Atlanta, Chicago, and San Francisco. Follow up analysis on actual delivery trends is planned.