Babar Khan Javed
Aug 20, 2018

Weak supply chain integration hurts online sales: SAP

Identifying friction points in the consumer journey and making improvements to the overall purchasing experience reduces cart abandonment, according to a SAP study.

Alex Atzberger, SAP
Alex Atzberger, SAP

Australian consumers have a high tendency to abandon virtual shopping carts, with 57% discarding their carts sometimes or all the time, particularly in the product categories of fashion (67%) and furniture (65%),

According to findings from the SAP Consumer Propensity Study, consumers based in Australia demand value-added services such as being able to exchange and return services, followed by the ability to compare prices and specifications, and the option of being able to visit a physical store for product trial and purchase.

When those things are provided, the tendency to abandon virtual shoppping carts is reduced, based on the global survey, which included 1000 participants from Australia. This must be coupled with transparency in shipping costs, delivery timelines and inventory, according to SAP. The study found that impulse purchases could be triggered with discounts and promotions, with just under a third [32%] of respondents claiming to be encouraged to buy when multiple purchase deals are offered and retailers respond to queries quickly.

The findings prove that the supply chain and logistics of a retailer can impact sales when integrations with online sales channels are not put in place. “Reviewing cart-abandonment data provides a starting point for retailers to identify friction points in the consumer journey and make improvements to the overall purchasing experience”, said Jennifer Arnold, VP of marketing for APAC, Japan and Greater China at SAP.

By measuring consumer behaviour at the checkout stage, the time spent completing specific actions, and the precise point of cart abandonment, Arnold believers retailers can identify and address the weaknesses in their online sales experiences amongst other factors, which can boost customer engagement and increase conversions.

The SAP Consumer Propensity Study surveyed 1,000 Australian consumers about what their favourite brands do to close the deal and make them click ‘purchase’.

Speaking exclusively with Campaign Asia-Pacific, Alex Atzberger, president of SAP Customer Experience, said that retailers are now competing with companies that were born on the internet, which means integrations between systems and data collection on the customer has become a matter of survival.  

"You as a company then need to connect the journey from marketing, to 'how to do I sell', said Atzberger. "And then how do I actually service and deliver the outcome and how do I actually view the service and delivery outcome as another opportunity to engage my customer further."

The disconnect means that there is a lot of intelligence missing around customer intent and behaviour, resulting in retailers being unable to connect the dots between systems. The final change refers to internal operations, with retailers needing to fit this new business model of integration based focused on customer experience.

"With this context, SAP set out to create a suite solution called C/4HANA to actually connect the entire customer experience for marketing, sales, service, and commerce to one customer data cloud," said Atzberger, adding that the solution is the end result of a series of acquisitions and organic investments.

According to Arnold, the disconnect between online sales channels and supply chains can be solved with an omnichannel approach which integrates customer touchpoints. "With this in place, brands will be able to provide a personalised and responsive consumer experience before and after the checkout process,” concluded Arnold.

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