The British retail giant, Marks and Spencer, experienced a dramatic reduction in the growth of its online sales from +20% to -8.1%. Just half of the 6 million users had re-registered on its new website. Additionally, owing to the lost user data, the user’s experience on the new website was not personalised yet, as in the old website.
M&S representatives insist that this state of the website is bound to change as more and adaptation to the new is not far away. As put by M&S’s finance director, “it is a bit like going to the supermarket for milk. They’ve moved it and you can’t find it immediately. However, the result of £150 million and 2 years of investment on their website has made neither the shareholders, nor the customers happy.In this article,we take M&S as an eCommerce case study and analyse where they went wrong causing such extreme dissatisfaction.
M&S was in outsourcing its ecommerce platform and data storage to Amazon’s cloud services, affirmed by a deal signed in 2005. In 2012, M&S wanted to up their mundane online experience and decided to switch to their own servers and in-house website management team. Even though this mighty migration to their own server could be handled much better, there are 3 fundamental mistakes made by M&S that has resulted in their online doom.
1) Choosing cloud services
Public cloud services, such as Microsoft Azure and Amazon cloud services act as service providers, offering and managing data storage and processing for a monthly subscription fee. Such services are very attractive and suitable for retailers, as they offer reliability, scalability and flexibility, moreover, being more cost- effective than having the whole process in-house.
Hence, it is not a surprising that M&S opted for a long-term eCommerce partnership with Amazon cloud services for their website in 2005. This route seems rosy, however, in due time it is easy to get into a fix with having your data rooted to the public cloud service. That is exactly what happened with M&S. M&S faced this problem, when they decided to build and migrate to their in-house system. Their database and website information could not be moved from the Amazon cloud without re-writing or reformatting the applications. Along with this, the database of all registered users on their site was also lost. Getting out of a cloud service is not as easy as it seems as they are designed to be sticky. The reason for staying with a cloud based service should be quality, not transfer costs.
Lesson learnt: Do not rush in signing a deal with your vendor. Reading the fine print is very important before getting into a long term relationship. Make sure your cloud based server is open and portable. Choosing platforms and cloud providers who excel and specialize in providing services to your business kind should be more preferable as they would be able to solve and work on business problems faced by you faster. For example, MartJack specialises in providing retailers multi-channel eCommerce capabilities.
2) Making online changes:
2 years of time was spent by M&S to roll out the current website. However, this new format of the website has gotten a lot of flak from customers about its usability, who have found it ‘awkward to navigate’. Some have taken to social media to express their disappointment. This has also hugely upset the shareholders of the company, with the complaining about the long settling-in period.
Lesson learnt: The “grand opening” of a brand new website will not always be accepted with a rolled out red carpet and excited users. It takes time for customers to get used to a new website and it is not advisable to make all the changes in one go. Users like to use familiar interfaces and new changes will be met with resistance. Customer is king and an organisation should function according to the customer’s wishes. Customer wants change frequently; hence, delivering a product 2 years later is not parallel with being customer oriented.
Facebook is innovating and improving their User interface every day. Just invisibly with a big release every Tuesday and two releases every weekday. The changes are so small that users seldom notice a change. Rome wasn’t built in one day.
3) Agile development:
The internet is all about agile, continuous development now. Changes are made in small increments and designing, failing and fast optimizing is all part of the process. With increasing number of smart phone users today, the focus is now changing from pc to mobile. Demographics have drastically changed since M&S embarked on its online haul. The younger generation has further moved on to mobile apps. Drastic redesign leads the users to abandon the website due to frustration of not being able to use it.
Lesson learnt: Change is introduced in phases, where first is it tested on a small group of users (alpha), and is optimised according to their reaction to it. Then, it is introduced to a bigger group of customers (beta), and finally, after fine-tuning by analysing user behaviour, it is made public. This is followed by internet giants such as Facebook and Amazon, who are changing all the time. However, the changes are small and are hard to spot. However, if the change fails, which can be decided by analysing data, the site can easily be taken back to the original without users noticing much change.