No retailer can afford to be without a website these days, but what are the must-haves and what are the costly fripperies that won’t improve your bottom line? Joanna Perry explains today’s essentials
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By 2013 online sales will account for 10 per cent of total retail spend, according to a report from Datamonitor looking at how retailers can achieve cross-channel consistency.
- Download a free copy of the Datamonitor report, courtesy of BT Expedite.
When a retailer says that 90 per cent of its store customers have been on its website before coming to a shop to make a purchase, it’s clear the online channel must be providing a competitive advantage.
That retailer, Evans Cycles, makes regular improvements to its site – which raises the question, what does a modern website need to do to maximise sales conversion across all channels?
Google retail industry leader Peter Fitzgerald accepts that some developments are a step too far. He says that one UK footwear retailer has looked at 3D layouts on its site, but tests showed it wasn’t enough of a sales multiplier to make the major investment required worthwhile.
What he thinks is worth investing in is the ability to make site merchandising changes almost continually to maximise sales. “You want the ability to make changes in real-time on 90 to 95 per cent of the site,” he says.
However, he suggests that even if retailers adopt best-of-breed applications for their web platform, that does not mean that their work is done.
M and M Direct IT director Graham Benson agrees: “There are some big-name sites that I still believe get the basics wrong. It goes back to what your brand stands for and what the consumer expects of your business model. It is giving consumers what they want in order for them to be able to transact with you. We spend a lot of time really understanding our customers’ motivations for shopping with us, build the site to match them and regularly review it.”
On Evans Cycles’ site, the latest investment has been in on-site search. The Avail Intelligence system learns from customer behaviour, analysing where shoppers go on the site after using the search facility, so the results should improve over time.
Evans Cycles marketing and e-commerce manager Ben Hart says that as the system has only been up and running for about a month it is too early to show conversion uplift, but the number of customers who have to make multiple searches to find what they are looking for has halved to 9 per cent.
The retailer is also personalising its site. Once customers log in, their behaviour is tracked and analysed to present relevant products within category pages. Evans Cycles is also incorporating an element of merchandising this way. In its basket page it also serves up product suggestions based on what other customers making similar purchases also bought.
Another basic area where sites can fall down is how they deal with customers who need help.
Digital marketing expert Leon Bailey-Green says the more customer service options retailers offer the better. And fast replies are important too, with an emphasis on a phone number that is visible at all times. Bailey-Green says email is acceptable for customer service, but companies must reply quickly if it is to meet customers’ needs. He explains how a phone service can affect conversion. “Quite often people are calling for confirmation of a purchase choice that’s already been made,” he says.
Similarly, he believes that the functionality to allow customers to email product details to a friend is important for potential buyers who want to validate their choices before they complete purchases.
A social animal
The area that is more contentious is social commerce – mixing e-commerce with social media to try to influence customers and increase loyalty. EMC Conchango senior business consultant Derek Dunlop says that retailers need to make better use of all the information that’s on the internet and pull in what people are saying about products.
For instance, Dunlop says pictures pulled from photo-sharing website Flickr of consumers using products are much more interesting than simple box shots. “You need some sort of filter, of course. These sites do have their own controls as well – so you have to trust in the sites that you work with,” he says. There is no way retailers can actively manage all the content, Dunlop says, suggesting that businesses should urge customers to get in touch if they see something they don’t like.
“If you jump straight in then it can be too overpowering, but if you don’t engage then you are seen to sit on the fence,” Dunlop explains, maintaining that retailers must at least keep their eye on social commerce even if they are not ready to introduce it to their site.
Benson points out that internet years are different to real years, so retailers need to be agile when it comes to their websites. He says that retailers need to test their sites not just with loyal customers, but also with those that shop occasionally and those that don’t shop on the site at all.
Barney Brown, founder of fashion site Motelrocks.com, who has branched out into e-commerce consultancy for other brands, agrees that the testing culture is critical. He says that what works on one website won’t work on another. And this means testing factors as seemingly insignificant as the size and colour of a “Buy it now” button.
To properly test changes to sites retailers need a good analytics package. Brown says Google Analytics alone is great for a site that is turning over a couple of million pounds a year, but once a business gets bigger it is not enough.
He adds that too many retailers turn their noses up at the cost of a good reporting package, but using one could lead to a single change being made that influences 5 per cent of online sales.
Once a retailer’s online sales make up a double-digit proportion of its total revenue, then there’s no longer room for complacency over the continuing development of a site.
Retailers that have benefited from the general rise in online sales need to wise up to what their site will need if this growth trend is to continue.
Brown concludes: “Even if you are rubbish online you will take money – but this won’t last forever. Too many retailers have no strategy to take more money through their site, but they would never contemplate having no strategy around a store opening programme.” Now is the time for retailers to check that robust conversion strategies are in place.
Amazon has led the way with delivering a personalised view to customers based on the information it collects on their site visits and purchase habits. Google says that in some categories personalisation can drive 30 per cent of transactions.
Becoming necessary for sites with many thousands of SKUs
argos“>Argos now estimates that products on its site with customer reviews have a 10 per cent higher conversion rate than those without. In less than a year it has collected several hundred thousand reviews.
There is a clear business case for allowing customers to see each other’s views on products and it can influence product development.
Whether it is applicable to take this further using blogs and social networking sites depends much more on your brand and customer base.
Useful, but handle with care
High-quality product images that can be zoomed in on – perhaps with a 360-degree view – or multiple product images are expected.
Consumers will increasingly be surfing the internet on a mobile handset to research products and prices and to find out where stores are.
Retailers that do not want to create a full mobile-optimised version of their site could consider an iPhone application such as that launched by Oasis.
Nice to have
Sale section or outlet site
Asos, Net-a-Porter and Figleaves have all hived off their clearance stock separately on the internet. Bailey-Green says that if retailers only have a small amount of stock left of a particular SKU, it is better to either take it off the site and put it back on when the site goes into a Sale, or clear it through a separate discount site. Otherwise retailers can end up with lots of end of lines cluttering the site and making it more difficult for customers to find full-priced stock.
Few sites yet offer product videos for all SKUs and it is not yet clear that there is a return on investment for doing so.
Customer service and support
Getting back to customers quickly is vital. A phone number and an email address are essential. Dynamic FAQs that evolve over time depending on what customers ask, call back buttons and live chat are becoming more common.
From the simple “buy online return to store”, to the more complex “reserve and collect” or “buy and collect”, customers are beginning to take such options for granted from retailers that also have a large number of stores.
“The customer expects the product to be wrapped nicely and delivered tomorrow. No excuses,” says Brown.
The trend is certainly towards offering more delivery options and providing more delivery information, and more retailers are using targeted free delivery offers as a hook.
Keeping up with this trend is a must
Online sales trends will decide what is promoted most heavily on the site during the day, with some decisions being automated. Meanwhile, online merchandisers can focus on identifying stock that needs to be cleared, or can work to improve average transaction value or profitability.
In addition, some retailers have reported impressive results from using “searchandising”, where particular products are promoted through a high placement in on-site search results.
Guided navigation applications such as Endeca are acknowledged as being best of breed, making it as easy as possible for customers to quickly drill down into a site to find the products
of their choice.
The trend for running navigation down the left-hand side of the site is being replaced with running a navigation bar across the top of the page.
“Search is important – 40 per cent of transactions go through search,” says Fitzgerald. He adds that a high number of consumers leave sites when searches don’t give compelling results.
The latest search tools continually learn from each search a consumer does on a site to improve the results that are served up over time.
They will also put context to results, for instance asking if a consumer also wants to view blouses if they have searched for shirts, and recognising spelling or other common mistakes consumers may make when inputting keywords into the search box.
Multichannel goes mainstream
By 2013 online sales will account for 10 per cent of total retail spend. That is according to a report from Datamonitor looking at how retailers can achieve cross-channel consistency.
And multichannel services are at the point of becoming mainstream. The report quoted figures of 31 per cent of consumers reserving online and completing the purchase in-store, and 24 per cent of consumers buying online for in-store collection.
The relationship between channels also grows more complex. 40 per cent of men research online before purchasing in stores, but more than 15 per cent research products in-store before completing purchases online. For women, it’s more than 20 per cent for both.
- Download a free copy of the report, courtesy of BT Expedite.