Easy e-commerce creates a new Moment of Truth
If you’re not familiar with the term ‘Moment of Truth’ then you’ll probably not be aware that this is retail industry speak for specific moments in a shopper’s journey. There were originally just a couple of these special points in the retailing process: the ‘First Moment of Truth’ (the purchase) and then the ‘Second Moment of Truth’ (the experience back home - or in an e-commerce situation, once it gets delivered and a person unwraps what they’ve ordered). Since then, Google has also introduced the ‘Zero Moment of Truth’ (also given the catchy acronym ZMOT, typically pronounced “zed-mott” in the UK, but referred to as “zee-mott” across the pond) which now covers the whole customer consideration cycle beforehand.
Therefore from initial awareness of the product through to the eventual experience of it, there’s a ‘Moment of Truth’ that can be used to define each stage.
However, let’s consider the online shopper for fast moving consumer goods (e.g. fashion clothing, where I have a fair amount of multi-channel retail experience) and how they might differ from their offline (traditional store-based) shopping cousin. Whereas in the real world a person might grab a few items and try at least some of these on for fit and style, the online shopper doesn't have this ability. Instead they have to wait until the item is delivered or collected to put it on and then properly experience it. In this situation it is therefore not uncommon for the online shopper to purchase not just one item, but two or even three of them in different sizes or even colours.
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This is made all the more easier by online retailers offering free delivery and even free returns across their product range. Also, with one department (the e-commerce one) usually getting the credit for the sale, and another (the warehouse or fulfilment partner) typically absorbing the cost of the returns… there is usually no system put in place to stop this multiple purchase activity. And in fact, why would an online retailer do this? Especially when there could a perfectly justifiable reason for a customer to buy lots of the same items in similar sizes (e.g. presents, poor sizing information, long-term wardrobe planning, work uniform, etc.).
However, I believe that there is now the opportunity to consider an additional stage, primarily for the online / multi-channel shopper… the Third Moment of Truth. A point beyond the moment of unwrapping and experience (or even usage in some naughty cases), but a subsequent one when the customer actually decides to return at least some of their purchases.
However, this Third Moment of Truth identifies a real issue for online retailers and raises major questions.
1. How are retailers supposed to get an accurate picture of ‘real’ digital sales, when a proportion of product is likely to come back?
(And depending upon the product, price and other factors, this could vary by a significant amount)
2. What about those users who buy multiple sizes / styles and despite easy or free returns, never actually get around to doing it?
3. What alternative models of fulfilment are there that might be more cost effective to retailers (e.g. would a ‘click and try on’ system work for some?)
4. Surely providing free delivery and free returns encourages this sort of behaviour? If so how can you minimise this without affecting either the user experience or overall revenue?
Sure, it would be relatively easy for most e-commerce applications to stop multiple purchases of the same product... but wouldn't this also affect those who wanted to buy lots without the intention of returning most of their products?