E-Businesses ignore failed transactions

Websites: Most focus on getting customers to a site but not on keeping them there

Network News

By James Middleton - VNUNET

October 31, 2001 - European e-businesses have no idea whether their customers' online transactions have been successful or not, leaving users out in the cold when a problem occurs, research has revealed.
A study of 100 organisations commissioned by fail-over software developed Rainfinity and carried out by Aspect Consulting, found the majority were focusing too much on getting customers onto a site but were not putting enough effort into keeping them there.

Only 53% of European e-businesses attempt to monitor the end-to-end success or failure of online transactions. And 60 per cent of those rely on customers to alert the firm to a failure.

The problem is that disgruntled users will simply move onto the next vendor - 42 per cent never return to a site where a transaction has been unsuccessful.
Rainfinity claims this is because over three quarters of e-businesses do not have a system that allows them to manage a transaction that fails, leaving the customer in the dark and inadvertently prompting them to move to a competitor.

But Colin Rowland, European vice-president of Rainfinity, claims that boosting customer retention by 5 per cent can improve profits by more than 25 per cent.
"While customers are prepared to accept the fact that online transactions may fail, they will keep jumping to competitors sites unless organisations can find a way of communicating with them and solving the problem," he said.

An accompanying study by analyst McKinsey & Co concluded that the real cost to a business is not the value of an isolated transaction, but the future spending potential of the frustrated online customer that moves to a competitor.