Clarity of online business practices and simple privacy policies that potential buyers trust can gain repeat online visitors.
Posted Oct 10, 2005
Retailers are better than other sectors when it comes to email responsiveness, but need to simplify their Web sites and be clearer with their information-sharing policies, according to a new study by the Customer Respect Group (CRG). "Online Customer Respect Study: Retail Companies Q3 2005," assigns a Customer Respect Index (CRI) rating of 1 to 10 to each company by measuring a customer's experience when interacting online. Retailers' overall score increased from 6.8 six months ago to 7.0
Internet retail sales totaled $87.5 billion in 2004, up 25 percent from $70 billion in 2003, and Jupiter Research estimates the online buying population grew by 14 percent in 2004. "Nearly all projections and research indicate a positive future for the retail industry, [but] this should not be an excuse for complacency," the report states. "The companies that continue to develop easy-to-use and well-designed Web sites and demonstrate a respectful approach to users will reap more rewards."
The industry averaged an 8.0 for transparency, which reflects how honest companies are and places particular emphasis on the clarity and comprehensiveness of their privacy policies. "A policy should be concise and easy to read," the report states. "Often, polices are written in a cumbersome style and use too many legal terms that can confuse the reader." Only one company of the 53 evaluated, Tower Records, scored 10 in any index, for transparency. Blockbuster, DVD Empire, and Wal-Mart all scored a 9.6 in that category.
Site simplicity is also an important factor in gaining return visitors. The study found that 28 percent of users abandoned sites because they were too hard to use and another 26 percent left because the site was too slow. Of all the elements the CRI measured simplicity has the greatest impact, comprising 20.1 percent of the overall score. "Simplicity of a Web site significantly impacts online users' behavior. A lack of simplicity and delays in downloading pages can cause users to abandon sites," the report states. "Simplicity is not just about an easy-to-use navigation system, but also about ensuring that Web sites provide visitors with as much self-service capability as possible." The report suggests providing tools like a FAQ section, a site map, and a keyword search facility. It also suggests reducing page size to speed up browsing.
Retail companies averaged 6.0 for email responsiveness. Still, 26 percent of email replies took more than a day to arrive, which CRG says reflects badly on the industry. "Whether online or offline, the speed of response to customer queries is indicative of a how a company values customer interaction and communication," the report states. "If the company is not equipped to deal with...inquiries it will directly affect the customer's brand loyalty. If a company does not respect its customers online by providing the customer with a negative or non-optimal experience, it will have a ripple effect."
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