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Retailers Struggle to Keep Applications Running for Shoppers

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Summary
There's a lot of money on the table for online retailers this holiday season, but are businesses ready to meet the high consumer demands and expectations? A new global survey from AppDynamics casts some doubt.

Retailers are bracing for their biggest holiday season to date with Deloitte predicting that holiday retail sales will top $1.10 trillion this year, a 5 percent growth from 2017.

And it’s eCommerce retailers who have the most to gain – or lose – after the Thanksgiving leftovers are put away. Deloitte is predicting eCommerce sales alone to reach as much as $134 billion this holiday season, compared with about $110 billion a year ago.

That’s a lot of money on the table for today’s digital retailers. And it’s all up for grabs with one simple caveat: In order for consumers to shop and open up their wallets, digital channels must be reliable and allow them to do so, as performance is key to overall digital customer experience.  

Unfortunately, a glitch-free experience is hard to come by, according to a new global AppDynamics survey of 6,000 IT decision makers. In fact, 98 percent of retail respondents reported that in the last 6 months, at least a portion of their major business-critical applications have experienced performance issues. Additionally, 89 percent said they have had to rollback new software application releases or major code enhancements due to problems.

These issues could be anything as painless as pages taking a couple extra seconds to load – or something as detrimental as customers not being able to add items to their cart or go through the checkout process, whether via a browser or mobile app.

But over the last decade, as Black Friday and Cyber Monday have become increasingly online-centric – with record volumes of traffic – the number of performance problems reported has become a common occurrence. Quite simply, increased demand is great for business, but only if it can be met with the necessary capacity and performance from a software and associated technology perspective.

The problem is that it can be difficult for retailers to accurately predict demand during these intense periods. So, unless IT takes the route of a costly over-provisioning strategy, performance problems will likely always arise. To help offset this, IT teams should instead focus on Mean Time To Know (MTTK), the time it takes to discover, analyze, and troubleshoot emerging performance issues before they impact customer experience.  

Our survey found that it takes retailers an average of 5 hours to resolve business-critical application performance issues. That’s 5 hours of poor customer experiences – and customer frustration – which can have a dramatic impact on brand reputation and revenue.

In the world of retail, customer experience is directly proportional to bottom-line performance. For every hour an application is down, our research found that retail companies lose an average of $38,855 per hour.

And on a heightened consumer-spending day like Black Friday or Cyber Monday, the potential loss is much higher. The impact of a poor digital customer experience goes beyond the hours of downtime and revenue lost. It also hurts customer loyalty – tremendously.

According to our survey, when a performance or user experience issue occurs, 63% of retail IT departments are notified of the problem through customers calling or emailing the help desk.

And these calls and emails will likely lead to customer defection. In fact, according to the App Attention Index, 53 percent of consumers have abandoned a website after one disappointing experience. Even scarier, 80 percent of consumers will delete an app entirely due to poor performance.

In today’s digital world, consumers have a low tolerance for poor experiences – because they can. Choice is limitless and switching brands is effortless when it comes to online shopping.

Second chances are exceedingly rare when it comes to online shopping, placing increasing pressure on retailers to deliver a flawless digital experience for their customers. And it’s clear that to maximize eCommerce conversions and revenue this holiday season, retailers must optimize application performance.