In Fashion E-Commerce, Service is the Key Differentiator

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Jordy Leiser is CEO and Co-founder of StellaService.

With global online retail sales poised to reach $1.5 trillion this year — a 20 percent increase over last year, according to eMarketer — there’s no disputing that we’re in the midst of a significant paradigm shift that’s impacting every sector of the fashion industry. Retailers and brands of all sizes, from high street to luxury, are confronted with a growing set of challenges owing to the rapid growth of e-commerce.

And, often, a commitment to customer service is the missing piece in the puzzle for retailers who are hoping to carry the premium in-store experience to digital channels and convert browsers into loyal, repeat customers. Time and again, an emphasis on improving the customer experience has proven to be a key differentiator for e-tailers in today’s competitive environment, where a quick Google search returns many online stores offering the same product at the same price.

In today’s digital environment, the …

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Target Expands Fulfillment Network, Offering Same-day Delivery in Three Markets

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After successful tests in the Minneapolis market, Target will expand the same-day shipping pilot to three U.S. cities starting in June.

For a $10 “rush delivery” fee, customers can place orders up to 1:30 p.m. and receive the order between 6 p.m. and 9 p.m. that day. The pilot program will be available to customers in Minneapolis, Boston and Miami.

The news was announced on its May 21 earnings call. Target also announced plans to launch ship-from-store from 136 U.S. locations spanning 38 markets later this year. Turning stores into fulfillment centers will allow the retailer to get products in the hands of online shoppers faster.

“By leveraging the store network as fulfillment centers, we can offer faster standard shipping, typically one to two days, and provide access to store-only items not previously available from Target.com,” said Kathryn Tesija, Chief Merchandise and Supply Chain Officer at Target Corporation. “We will continue to monitor results to determine …

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Nordstrom’s Big Bet on Ecommerce Should Speed Lagging Delivery Times

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Nordstrom plans to invest billions of dollars into ecommerce improvements over the next five years, with a particularly heavy investment slated for technology and fulfillment capabilities.

“We plan to invest $3.9 billion in capital over the next five years as we focus on serving more customers through store and online growth,” Mike Koppel, Nordstrom executive vice president and chief financial officer, said on a May 15 earnings call. “An important element is our technology investments, which represent $1.2 billion or 30% of our capital plan, and approximately 40% of our technology capital relates to infrastructure to support our growth plans and to facilitate enterprise-wide synergies.”

Koppel said 40% of that capital is earmarked for online growth, including expansion of the fulfillment network to increase speed of delivery. Another 20% will support tools for salespeople, such as a new texting platform and point-of-sales technologies.

Nordstrom’s first quarter sales jumped …

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5 Things Elite Customer Service Teams Never Do

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Jordy Leiser is CEO and Co-founder of StellaService.

In any profession, sport, or trade, world-class teams do certain things that separate themselves from others. On the flip side, these elite teams avoid certain activities in order to ensure maximum performance. The world of service is no different.

To provide a truly exceptional experience–one that helps earn that elite reputation with customers–management teams must religiously avoid pitfalls that run-of-the-mill competitors fall into.

Whether your company is scaling rapidly or just starting to build a solid foundation for the future, don’t let your team fall into these common traps:

1. After receiving the same inquiries over and over, reps start acting as human FAQ machines.
People don’t contact customer service to have policies read back to them verbatim. They want help making the right decision. Elite agents not only know the answers (or where to find them), but they drive customers to the right course …

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Room for Improvement: FedEx Pricing Change Puts Spotlight on Poor Package Fit

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FedEx orders will not be judged by weight alone. Bulky boxes, beware.

In January, FedEx will apply “dimensional weight pricing” to all ground shipments, meaning packages that measure three cubic feet or more will now cost more to send. The change is expected to affect a third of FedEx’s U.S. ground shipments.

The Wall Street Journal noted, “The change in pricing could dramatically affect either online shoppers or retailers or both. Someone will have to swallow the estimated hundreds of millions of dollars in extra shipping costs.”

No doubt, retailers will be looking to use smaller packaging to cut costs.

As part of its ongoing evaluations, StellaService grades Package Fit for every order received. Looking at 2,253 packages delivered by FedEx in 2013, 9% had “poor” Package Fit – deemed extremely wasteful and inefficient.

StellaService Analysts often see extreme offenders of poor Package Fit — candy bar-size products in boxes appropriate for boots. The data …

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Stella Benchmarks: Net-A-Porter.com Delivers Luxury Experience Across Shipping and Returns

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Net-A-Porter.com, a purveyor of luxury fashion across hundreds of brands, is building an online business that aims to compete with the experience shoppers find at their favorite luxury brick-and-mortar boutique.

Of course, the logistics of shipping and returns are a thorn for online retailers, but Net-A-Porter.com’s focus on those areas is helping the retailer stay competitive in a landscape that is crowded with players pushing the same luxury goods.

And, in the month of April, that focus led Net-A-Porter.com to the top of Stella Benchmarks. In addition to leading all other retailers in overall performance, Net-A-Porter.com was also best overall at Returns and tied with Amazon.com-owned Shopbop.com for Shipping performance.

“Of the hundreds of orders received by StellaService Analysts each month, Net-A-Porter.com consistently delivers packages that stand apart from the rest,” said Kevon Hills, Vice President of Research at StellaService. “The Net-A-Porter.com team seems to …

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5 Questions with GripeO Chief Executive Mike Klanac

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Just two months after receiving a set of quality steak knives as a gift, Mike Klanac was cutting a pizza when one of the knives broke. Frustrated, Klanac says he almost tossed it in the trash but his wife encouraged him to take up the issue with the company.

“Thus began an odyssey of dropped calls, confusion, social media, and eventually, two months later, a new knife,” Klanac says. “I love the way that technology allows us to innovate the existing way we do things, and I quickly realized: we can do this better.”

Klanac had been previously involved with several successful startups, and assembled a team to work on a “minimum viable product” and started to prove out the concept. The feedback was strong, and shortly thereafter they launched GripeO, a platform that helps foster better communication between consumers and the businesses they have issues with.

We spoke with Klanac to get a better understanding of how GripeO works and what’s ahead …

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Google Expands Its Same-Day Delivery Service

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The footprint for Google’s same-day delivery service continues to expand.

The search giant announced last week that it has expanded Google Shopping Express, its same-day delivery service, into Manhattan and West Los Angeles. Google is working to bring the delivery service to Brooklyn and Queens in New York and Bel-Air, Beverly Hills, West Hollywood and other parts of Los Angeles “in the coming months.”

Google has been conducting a trial of the service in San Francisco for about a year.

“We opened the service to shoppers in the San Francisco Bay Area last year and now we’re ready to bring the service to both coasts, starting with West Los Angeles and Manhattan,” Jenna Owens, GM of Operations for Google Shopping Express, wrote in a blog post.

The service enables shoppers to purchase goods from retailers including Whole Foods, Staples, Walgreens and Costco.

The fleet of couriers isn’t actually operated by Google, instead the company partners with delivery …

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Zulily’s Delivery Speeds Show Improvement, But Still Trail Other Flash Sites

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Mom-focused discount retailer Zulily was challenged for slow delivery speeds in an article published this week in the Wall Street Journal.

Zulily told the Wall Street Journal that average fulfillment speed in 2013 (not including days in transit to the customer) was 11.5 days. But, StellaService data shows total days to delivery at 11.7 days and fulfillment time clocking in at 7.2 days – a bit faster than WSJ’s report. Still, Zulily trails its peers for speed in both legs of the process.

The reason for the delay: Zulily doesn’t buy in advance most of the products it offers.

“Instead, it orders the items from vendors after the sales end,” WSJ reported. “Vendors then ship the merchandise in bulk to one of two Zulily warehouses, where the products are sorted and combined with other orders before being shipped back out.”

The consignment model has been troublesome for several flash retailers as consumer expectations around speedy delivery have increased. Most have …

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How To Predict the Future of Physical Retail in the Digital Age

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The dawn of the Amazon Age has shifted momentum in favor of online shopping. E-commerce is continually picking up speed and reaping market share, solidifying its place as the preferred shopping way of the future. But believe it or not, despite the ease and convenience of a one-click-shop for all your necessities and luxuries, the majority of shopping still takes place offline and in the store. By the end of the 2013 holiday season in-store shopping garnered $265.9 billion compared to only $46.5 billion online – proof positive that physical stores aren’t going to suddenly and completely disappear. In fact, retailers still need to know and interact with their customers on a personal level, making a brick-and-mortar retail strategy a key tool for both traditional retailers and ecommerce-only brands alike.

Maintaining a geographic footprint can be a significant financial burden for retailers, seemingly a crippling cost that can’t be sustained as ecommerce gains share. However, …

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