Tag: marketing

Trends in internet retailing

This is a nice summary of key trends, from internetretailing.net

  • Multi-channel integration. Online consumers are getting ever more demanding, and ever more intolerant when retailers fail to join up their multi-channel dots. A seamless cross-channel experience, driven by a single view of the customer, will become a core requirement for success in the years ahead.
  • Mobile. The potential of mobile as a new channel for retailers has received much of the industry’s attention over the last few months. The ability for customers to easily price check, find the latest coupons and deals and purchase online from their mobile phone — even in-store — is going to lead to significant changes in shopping habits.
  • Mobile – again. One of the most interesting developments is likely to be the way in which mobile will link into retailers’ multi-channel strategies as a way to connect up the different channels through technologies such as mobile barcodes, coupons and NFC.
  • Delivery. Fulfilment and delivery service providers have responded well over the last few months, introducing ever more sophisticated delivery options. ‘One size fits all’ is no longer enough.
  • Personalisation. Everything from personalised on-site recommendation engines to tightly targeted email campaigns will be key to delivering growth as internet retailing becomes ever more competitive in the years ahead.
  • Choice. Whether it’s offering a wide range of ways to pay, or options for the frequency of marketing emails, consumers are set to expect online retailers to use information gained from previous purchases and site visits to tailor the offering to meet their particular needs.
  • Social media. On the one hand, social media has now become quite entrenched. On the other, however, an understanding of the ways in which social media can be leveraged to aid business decisions is still in its early days and is set to deliver significant commercial advantage to those who gain the greatest expertise.
  • Email. Still very much a key sales driver, and one that internet retailers still need to be investing in and making a key development priority.
No Comments by on March 29, 2010
filed in Ecommerce strategy, SEO, Social media
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Is adwords ever “not cost effective”?

I was talking to the owner of Sunspel, a website selling luxury menswear both online and offline, who came out with the statement “Adwords is not cost effective for us” (not for product-related keywords, only for brand-related keywords).

My main experience with Adwords was for Viners.co.uk where my adwords campaigns generated 50% of sales at a cost per conversion of around 10% of the average order value – so very cost effective, in fact the most cost effective marketing channel in that particular case.

Of course an adwords campaign will not be particularly cost effective if the keywords chosen are not relevant, if ads are poorly written, and landing pages are poor. But the point made by Sunspel was that there were too many competitors bidding on keywords like “T Shirt” or “mens clothes”, and with so much competition it’s difficult to push a luxury message vs. a price-based message.

To some extent I had it easy running campaigns for a site selling mostly cutlery, where the majority of traffic came for a handful of “cutlery”-related keywords. And there are fewer Adwords competitors in the world of cutlery than T shirts. But to a much bigger extent Adwords was cost effective due to constant optimization; stopping keywords and ads which were not cost effective, refining keywords and ads which were more cost effective; constantly looking for trends and opportunities in the long tail of search terms.

No Comments by on March 15, 2010
filed in Ecommerce strategy, SEO
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I Like:

Zappos.com (the biggest online retailer of footwear in the US, now owned by Amazon) has this nice widget to encourage you to “blog about this item”.

I Like:

Ramona by Lassen at Zappos.com
Ramona by LassenZappos.com - Powered by Service

It’s a great example of building engagement with the brand AND helping SEO by building links to their site. Apparently Zappos has been doing social media well for a while, as this chart of inbound links since they embraced Twitter shows:

No Comments by on March 5, 2010
filed in SEO, Social media
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Incremental sales, or cannibalising from other channels?

Reading about the imminent launch of a Gap ecommerce site in the UK got me thinking about to what extent online sales are incremental, or merely cannibalised from existing channels.
Gap in the UK has been a notable latecomer to online retailing (along with Primark, H&M, Zara, Claire’s Accessories, Morrisons…). In the US it has been trading online since 1997; in the UK it been testing the water with an online offering through asos.com.

It’s interesting reading discussions about why brands aren’t trading online. This one assumes that online sales have the potential to bring in 10% of total offline sales. Whilst this seems a reasonable ballpark for any retailer, it can’t be assumed that the 10% will be incremental and not simply customers who would have bought in store switching to buying online instead. It’s difficult for most brands to assess whether or not online sales are incremental, because there are so many competing factors determining retail sales and customer behaviour. Perhaps in Gap’s case the uplift would not be significant – as Gap’s stores are fairly widespread and I suspect the customer base is fairly loyal. Perhaps this has been their experience in the US, hence the slowness to launch online?

In some cases there’s a more compelling case for incremental sales – for a retailer with stores only in one part of the country, online opens up a much wider market. In my own experience working for a retailer with 15 or so stores located in factory outlet centres I don’t believe there was much cannibalisation from the stores, however there was almost certainly cannibalisation from other consumer and trade channels.

Of course there are many more benefits to trading online; lower cost of sale, brand building, more marketing channels, more flexible pricing & merchandising and the multichannel benefits (customers researching online, purchasing in store and vice versa). It is always better to be selling online yourself rather than through a third party, to be able to control pricing and how the brand is portrayed (on other sites and in their online advertising).

I did find a survey from 1999 predicting only 6% of online sales would be incremental. I would guess the experience of most brands is even lower than this. My conclusion? Not selling online is a missed opportunity, but the opportunity is complex and about much more than just sales.

No Comments by on March 1, 2010
filed in Ecommerce strategy
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Lessons to learn from invite-only online shopping

I became a member of Gilt.com, via an invitation from Gwyneth Paltrow no less!

Gilt.com is a members only shopping site set up to recreate the buzz of a New York sample sale but online – you have to be a member to join (by invitation only), each “sale” of a particular brand lasts 36 hours, starting at a fixed time of day with limited availability – first come, first served. Each sale is previewed a few days before and there are 5-10 different sales live at any one time. Typically a lot of products will show as sold out, but you can join a waiting list.

Prices are typically half the RRP, and I suspect the same bargains are probably available elsewhere online. In addition you may have to wait 2-6 weeks for delivery. But that’s not the point – the site is using exclusivity and limited availability to create a real buzz, and avoiding the need for traditional online marketing. Very clever!

No Comments by on February 10, 2010
filed in Ecommerce strategy, Social media
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When social shopping can really work

There are various ways that social media is slowly being adopted by online retailers. It’s becoming increasingly common to find facebook, twitter & blogs on ecommerce sites, and “share this’ bookmarking & product reviews seem fairly standard now on product pages.

Apart from product reviews where there’s a proven link to increasing conversion rate (79% of online UK retailers surveyed reported that the main benefit of consumer-generated rating and reviews was that they improved site conversion rates), it’s hard to demonstrate a direct sales benefit, although of course it all helps in terms of brand building, customer loyalty and rich content for SEO.

In my experience the most effective social shopping sites (and the most effective form of online marketing!) are www.hotukdeals.com and www.moneysavingexpert.com. A post such as this

http://www.hotukdeals.com/item/452300/viners-alaska-32-piece-stainless-st

would typically boost daily sales by 500% – 1000% i.e a spike in sales normally over a couple of days driven by sales of one particular product, with customers discussing and rushing to get the bargain. A product that would normally sell less than 5 a day would sell 500 in one day, with zero cost per conversion, and adding 100s of new potential repeat customers!

Of course success stories like this are unlikely to happen all day everyday, and despite my efforts at influencing the system will be quite random events (be careful – it’s easy to get blacklisted for self promotion)!

The key thing is to be aware of the potential, and keep an eye out for the start of a spike in traffic from one particular source, sales of one particular product, or use of a voucher code.

Then make sure stock levels are available, check the margin on the product, use a popular landing page to up-sell/ cross-sell, monitor what people are saying about your brand and website. And watch the sales roll in!

No Comments by on January 29, 2010
filed in Ecommerce strategy, Social media
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ECommerce: a threat not an opportunity?

I’ve encountered various companies where having an ecommerce website was seen as a threat to other channels in the business – either conflicting with other retail channels (“you’re stealing my customers!”) or conflicting with wholesale channels (“why should I buy from you when you’re selling direct?”).

Perhaps people who are used to meetings and sales rep visits are suspicious of a world where you don’t need to have ever met your developers and agencies, where you can supply a product data feed to a customer rather than send a sales rep with a suitcase full of samples, where customers can receive an instant quote using bulk prices and customer-specific pricing…

Here are some tips, learnt the hard way.

Make retail channels work together, not against each other:

  • Tempt in-store shoppers to visit the website with voucher codes and web-exclusive offers
  • Tempt online shoppers into stores to view the product, buy there and then, or order online with free delivery, and consider allowing online purchases to be returned to stores.

Maximise incremental online sales by having a ecommerce strategy that encompasses your own website(s) and online marketing, and other websites selling your products:

  • If retailers can offer incremental sales (e.g. if they have large email databases, a wide offering of brands, or invest in offline marketing) assist with product images, suggested online retail prices and product information
  • If an online retailer is merely competing with you in SEO and PPC, limit the range of products available to them and consider an affiliates scheme instead
  • Have a AdWords trademark use strategy (you can no longer stop other ads appearing in searches for a trademarked term, but you can stop other ads using your brand name in the ad copy).

Involve other departments in online development & merchandising:

  • Try and build shared ownership of online sales
  • Educate colleagues in the basics of online (where traffic & sales are coming from, key trends).
No Comments by on January 18, 2010
filed in Ecommerce strategy
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© 2011 Helen Coupland