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23 March 2006
UK retailers warned: Wake up to website woes, or pay £226 million price tag - website underperformance amounts to 'sleeping at the till', reveals Xansa and Akamai research
UK retailers lost an estimated £84 million of online sales in the busiest quarter of 2005 due to unreliable websites, according to research(1) conducted by leading retail analyst, Verdict Consulting. Based on these results and conservative growth estimates of the online sales channel(2), this figure looks set to rise to at least £226 million(3) in lost sales during 2006.
Xansa, a retail outsourcing and technology specialist, and Akamai, the leading global service provider for accelerating content and business processes online, commissioned the research which questioned 52 leading UK retailers to establish the cost of ineffective websites over Christmas 2005. The results showed that downtime and unavailable or slow websites lead to a loss of customer sales amounting to over £84 million.
Commenting on these findings Mark Collyer, market development director at Xansa, said: "This research shows that, despite increasing numbers of shoppers using the online channel, retailers are failing to support and integrate this important part of the retail experience. Whilst some retailers have addressed outdated approaches to infrastructure, website development, service management and back-office integration, others continue to plaster over the cracks and hope that the problem will go away. As an increasing number of shoppers turn to the online channel, this situation will only get worse for retailers who fail to act now."
Perhaps most likely to contribute to shopper frustration is the fact that 17 per cent of retailers faced some form of website downtime, with nearly 10 per cent of those experiencing several hours of outage. What's more, 15 per cent of those surveyed admitted to slow site performance over the festive season. Seven per cent of these faced issues for up to a week.
Malcolm Rowe, retail sales director at Akamai Northern Europe, said: "The provisioning of bandwidth and support infrastructure is critical to ensuring that retail websites provide optimum performance at all times. The fact that so many of the retailers still face website performance and downtime issues is a real wake-up call that these issues must be addressed."
"If the thought of losing £226 million in sales isn't shocking enough, retailers must realise that lost sales can be just the tip of the iceberg," added Collyer. "There are many factors that affect your perception of a brand and can influence buying decisions across channels. A retailer is judged on all aspects of interaction - so a shoddy, slow or unavailable website is going to cut much deeper than just the lost sale."
To address some of the online and in-store IT performance issues facing UK retailers, Xansa and Akamai will offer customised solutions where expertise in both in-store and online retail business can be combined with website performance, reliability and security.
Download: Full Verdict research report
About Akamai
Akamai is the leading global service provider for accelerating content and business processes online. More than 1,900 organizations have formed trusted relationships with Akamai, improving their revenue and reducing costs by maximizing the performance of their online businesses. Leveraging the Akamai EdgePlatform, these organizations gain business advantage today, and have the foundation for the emerging Web solutions of tomorrow. Akamai is 'The Trusted Choice for Online Business.' For more information, visit www.akamai.com
