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Talk To Your E Shoppers


BusinessWeek e.biz -- Neuborne on E-Tailing

Talk to Your E-shoppers

Retailers need to explain their policies to avoid hard feelings. Ads can help

Macy's, a store I've shopped at for years, is having sales without me. I have finely tuned radar that detects markdowns at Macy's flagship on 34th Street in New York. But online at Macy's.com, there's a different schedule for sales and specials. For the first time since I was 16 and started paying attention to such things, I feel as if I'm out of the loop. What gives?

I'm suffering from a disconnect between online and offline stores. The burgeoning Web operations of traditional retailers are creating new layers of complexity for consumers. Interacting with these stores--buying goods, returning purchases, bargain-hunting--is more complicated than it used to be. A lack of communication between cyber and brick-and-mortar stores didn't mean much when few consumers shopped online. But Christmas, 2000, was a breakout season for traditional retailers with Web stores. Venerable giants such as Sears (S), Wal-Mart (WMT), and Kmart (KM) kicked some serious e-tail tail. These were the sites that got the best marks for service, selection, and ease of use. While Net-born merchants struggled to right their finances, companies that were once dismissed as dinosaurs cleaned up. But if they want to continue their success, they've got some explaining to do to their customers.

I'm not talking about banner ads that say: "Shop YourFavoriteStore.com. We're Online." That era of basic information is over. We already know they're on the Web. Now they need to tell us what that means. Is the merchandise different? When do markdowns happen? What are the refund policies? Part of their job this coming year is to make all this newness make sense. After all, ads--from TV spots to online banners--are not simply a way to get consumers to open their wallets. They're also vehicles to tell consumers what they need to know to get the best experience from a retailer.

Silence leads to confusion and hard feelings. My friend Amanda returned a Christmas present to Barnes & Noble (BNBN) and was refunded the amount B&N charges on its Web site, not the [higher] price she saw on the bookshelf in the store. "Was that a mistake, or is this the new policy?" she asks. B&N says its policy is to refund the price that was paid--although that's tough for someone like Amanda, who couldn't say whether the book had been bought online or in a store. But that's not the point. The problem was that Amanda didn't know what the policy was, and she felt ripped off because of it. Better communication--not to mention coordination--could have left her less annoyed.

Some companies have stepped up to the challenge. Staples Inc. (SPLS), for example, is marshaling its marketing forces to keep the customer up to date on the multi-channel operation the retailer has become. Its latest TV commercial is a humorous little sketch about a hapless Staples deliveryman, hemmed in by slow-driving would-be Staples shoppers. But within the gag is a serious message: the many ways a customer can now shop from Staples. "We place a lot of value in educating the consumer," says Kelly Mahoney, chief marketing officer of Staples.com. That's smart, according to Nora Aufreiter, a principal at McKinsey & Co. Instead of focusing on what the retailers need to sell, she says, marketing should emphasize what consumers need to know to make purchases.

Traditional retailers have a huge opportunity in the coming months to solidify their hold on the Web buyer. Communication will play a big role in this. Merchants who can help us understand what to expect and demand from these new hybrid retailers will win customer loyalty. Those who don't can expect to be a click away from just plain bricks again.By Ellen Neuborne, Ellen_neuborne@ebiz.Businessweek.com


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