Retail, in the eyes of the everyday customer

Many people buy offline and then do in-store alterations. If this data were captured at the store level it could be presented when customers purchase/browse online. Additionally, integrating offline purchase history will allow browsers to see a list of products they have already bought; both online and offline. This is especially useful when someone is trying to buy a shirt and is not sure if they already have a similar color at home. This feature could also be used to make online accessory recommendations for clothes that were bought offline.

Now that you have your web 2.0, curve jumping, paradigm shifting, Google AdWord optimized eCommerce site what strategies could you apply to ensure sustained competitive lead?

Build unique experiences: Don’t let your website be just another way to shop.

Recently while at RedEnvelope.com I came across a stainless steel flash memory stick. This seemed like a perfect Christmas gift, elegant and usable. The website had highlighted an interesting product but was there an opportunity here to build a unique experience? RedEnvelope could have built a feature that allowed one to ‘virtually’ etch a message on the stick to see how the end product looked. This would have taken a potential customer 10 steps closer to actually buying it. Building features that don’t exist in the offline world allows retailers to differentiate and legitimize premium surcharges. So instead of eating into your wafer thin profit margins by waiving shipping costs think of adding features that would justify shipping costs.

While the previous example talked about creating new experiences online this next idea is about bringing good old offline experiences online. 5 years ago eCommerce sites had limited options for building experiences. Today, we can build almost any experience online. A knowledgeable salesperson at a jewelry store has a fantastic opportunity to talk about the uniqueness of the cut, magnificence of the sparkle and value of the piece. This ability to communicate individually is an important part of the shopping experience. Imagine going to a jewelry store and reading a text description of the diamond. It just doesn’t happen. Why not bring that consultative experience online? When a browser is reading about a diamond a prompt asks if they would like to know more about the product at which point a friendly digital salesperson describes the piece. Effective and scalable.

Wine library is the largest independently owned wine and liquor retailer in the country and has revenues of $40 million. However, for years they failed to make a dent in the traditional wine business because people were buying wine from the older, more specialized retailers. So wine library went ahead and changed the game. They started winelibrary.com and added a video Blog on wine tasting with recommendations and opinions; revenues went up 10 times. Today wine clubs pay close attention to this vlog and what they say here actually correlates to national variations in wine sales.  To learn more read this Fast Company magazine article.

Give customers a reason to revisit: Preferably every 24 hours.

Lands’ end has a holiday gimmick on their site that encourages customers to visit daily to see gift ideas. These strategies also have a big viral element.

How about virtual scratch cards with related discounts?

Woot.com is an obscure 1 year old startup that has amassed 500,000 registered users. Woot’s online catalog contains only a single item each day, and they do not tell users how much stock is on hand. This strange sales concept is a powerful concept which enables Woot’s domination as a web marketer, allowing Woot to achieve the “holy grail” of Internet marketing: daily visits by users eager to buy.

Obsessively wonder why: Big insights don’t always come from million-dollar number crunching machines. Often, they are the result of simple, specific observations:

- Instead of only looking at web revenue numbers why not observe instances where people leave without any purchases? While sale analysis shows what’s working observing incomplete sales reveal ways to improve customer experience (and thus increase sales).

- Observe search strings that returned ‘0 results found page’. These reveal your most frustrated customers. Or better still try to convert this into a selling opportunity. Impossible you say?

Backcountry gives a $10 discount when customers can’t find what they are looking for. Not only are they making customers happy they also use this feedback to update their search engine.

- Most websites have an error page (pages that say things like ‘this page does not exist’). Track pages that lead to these and use that information to fix incoming pages.

- Website navigation architecture is the outcome of how ‘you’ believe customers like to shop, but what value does that have? Observing flow patters (clickstreams) will tell you what they actually do on your site. The best and highest revenue generating online strategy is one that facilitates and mimics the behavior of your most valuable customers.

- Question the value of existing features?

Registration page: 90% of all websites have a 10 question registration page. While it’s good to get a detailed history of a casual browser it’s of little use if you aren’t going to use it. Just ask for email id during registration. Once you have that you can always send an email asking for the remaining details. People who do not respond would not have filled your registration page anyway. But at least this way you would have captured their email ids. Typical registration page:

What motivates me to spend 4 minutes of my time to get a whole lot of spam from T.J.Maxx?

Thank you for registering email: welcome emails have the highest open rates. And yet, a recent study found that of the 66% of top retailers that sent out welcome emails, many missed out on the opportunity to use the communication as a selling vehicle. Instead of impressing customers with special deals most simply said ‘hello’. Is this the best way to start a new relationship?

Contact us: pay close attention to things customers complain about, what starts as a trickle often advances into a flood.

Use your online assets to locate, recognize and nurture your evangelists: Deserve it or not you have fans out there. These people will do anything within reason to spread the word about you. I am a fan of OXO and recently noticed a small typo on their website, not wanting anyone else to notice this I shot an email and immediately heard back. Not only did the response ooze of sincerity they also shipped me a gift. There is a simple point to this story; by caring about me OXO made me feel good. One simple act has guaranteed a significant portion of my lifetime consumer products spending. What are you doing to take care of your biggest fans?

Experiment relentlessly: conduct A/B testing across different measures:
SEM Vs. all other traffic
Acquisition costs vs. lifetime value
Browsers Vs. logged in users
Across product categories
Sales Vs. real COGS, etc

These tests are an indispensable tool in identifying hidden issues. For example, if acquisition costs have a 1:1 relationship with lifetime value (translated: if you spend $40 to acquire a customer and the total revenue through this customer is around $40) that could mean there is a product or operation level issue. If SEM is bringing in customers in droves but only repeat customers are driving revenue this could mean the thing to think about is developing an adoption strategy. If SEM is very effective in driving traffic but correlates with abnormally low session times this might be because advertising is making an inappropriate claim. Framing the question is key.

An example:

A generic keyword like picture frame costs quite a bit on Google (Actually, its around $1.81 per click through, and with 1,309 daily clicks on that keyword alone it will put you back 2,380 big ones). Arguably T.J.Maxx is spending quite a lot to draw people who enter this query. Unfortunately, clicking on the boxed add takes you to a non eCommerce page. There is no part of their website that has picture frames. So while they are spending money driving traffic, that is also the only result they are getting.