Technology Trends in eCommerce 2010 2013
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Below is a presentation I prepared whilst working on the digital roadmap for Coles online, the leading eCommerce grocery business in Australia. It provides a snapshot of some of the key trends facing e-tailers over the coming 12-36 months.
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Technology Trends in eCommerce 2010 2013
- 1. Some interes+ng technology trends 2010 – 2013 30 January 2009 Andrew Braun
- 2. “Internet marke+ng is s+ll in its infancy. Too much aDen+on has been given to digital adver+sing and not enough to the crea+on of loyal customer rela+onships, which are especially valuable in the “one click” purchasing environment…The true power of internet marke1ng is the ability to interact to develop superior customer knowledge and real-‐1me rhythm to significantly build one’s business.” Rick Braddock, Chairman and CEO, FreshDirect 2
- 3. (17) CRM and web analy+cs tools assist us to beDer understand our customers, as we can: Build user profiles, define user segments, market to segments , create micro segments, spend more on micro segments, which assists us to op+mise our marke+ng spend3
- 4. • Customisable dashboard to highlight key metrics relevant to different audiences. • Alerts can be established to no+fy the user that targets have/have not been met. • Sales funnel reports are one of the most Site Analy1cs tools important analy+c reports. • Sales funnel reports uncover leakage or abandonment in the shopping cart process. • These reports also highlight how customers are interac+ng with the shopping cart – how they are entering and exi+ng and where they go to next. • Providing the business with an opportunity to address abandonment issues and increase conversion efficiency. On any given page, where are our customers clicking?. Dark red areas = Most frequently clicked areas 4
- 5. Which test won? (A/B tes+ng) Var A: Right-‐side Add to Cart Var D: Le<-‐side Add to Cart 1.9% Click through rate 2.2% Click through rate Purchases li,ed nearly 16% Website analy+cs tools + a technology environment that allows for tes+ng = user centered design = more revenue 5
- 6. Example real-‐ +me dashboard that could be built for COL TESCO brings business intelligence to more users Tesco has begun building a new analysis system that allows more users across its operations to work with data warehouse information. The new solution, which is based on Microstrategy software (which Coles has), will not only be deployed in the head offices but also in the stores. Dedicated dashboards for the outlets will support the store managers with information about their performance. Tesco has been running a Teradata data warehouse since 1998.
- 7. Searchandising 85% of top 80 e-‐commerce businesses have sor1ng and filtering capabili1es on search results (8) 7
- 8. Customers approach purchasing a product on an e-commerce website in one of 3 modes (19): 1. They know exactly what they want - the search box plays the predominant if not exclusive role 2. They have some idea of what they want - Search gets the customer started but navigation using filters is necessary to narrow down the choices to the ones that meet the customer’s needs 3. They have no idea, and are just find-a-bil-i-ty n browsing to see if anything a. The quality of being locatable or navigable catches their eye - Here a customer b. The degree to which a particular object is easy to is wandering around, department discover or locate by department, as they would do in a physical store. A good c. The degree to which a system or environment supports navigation & retrieval navigational category structure is the best way to provide customers with a clear On the web, and specifically for e-commerce sites, understanding of what you sell findability means how easy is it for a shopper to find the product they are looking for. (19) 8
- 9. Make it personal and empowering Home page needs to accommodate all types of users (7), e.g. • Explorer: has purpose in mind, conversion probability low to medium • Hunter: Brand or product in mind, conversion probability medium • Tracker: knows exactly what they want, conversion probability high 9
- 10. Needs based merchandising: microsites and brand bou+ques www.zappos.com www.ebay.com Hugo Boss brand bouGque 10
- 11. A picture (or video) tells a thousand words 60% of the top 80 e-‐ commerce retailers have advanced picture capabili+es (e.g. Zoom) and “of those using alterna+ve images, 49% rated them very effec1ve, while 80% of retailers planned to make them an investment priority for the next 12 months.” (18) 11
- 12. Amazon: "The product detail page is where all buying traffic is driven. Amazon has amazing systems that focus on moving traffic to the product detail page so buyers can make a purchase decision. Having the same item sitting in two or three different places (Auctions and zShops) wasn't good for our customers“ 12
- 13. Cross-‐sell, up-‐sell “you are $X away from free shipping” “More from this (category, brand, “Recommended products” author, arGst)” “You may also like” 8% increase in sales when used on products pages 3% increase when used on order pages 6% increase when used on card pages 15% increase when used in call centre 8% increase when used in EDMs “Frequently bought together” “Customers who viewed X also viewed” “Customers who bought X also bought” Shopping cart recommenda+ons is used by 55% of top 80 online retailers (8) 13
- 14. Naviga6on only when you need it Let the content BE the interface, and all interac+ons should fall naturally around it, enabling direct manipula+on or in-‐line naviga+on. A focused UI, especially when an item requires a make complex decision making process or offers many customizable op+ons, can help increase revenues by up to 40%, while shortening the sales cycle by 75%. (20) 14
- 15. (25) Watching online videos on sites like YouTube is more prevalent than the use of social networking sites 15
- 16. Video in ecommerce Shop Direct, the UK’s leading online and home shopping retailer selling a huge range of fashion, footwear, home and leisure products, recently produced and added over 1500 videos onto their nine eCommerce sites driving double digit conversion increases. Their implementa+on was well integrated and complementary to product imagery. click-‐to-‐buy 16
- 17. Convergence of internet and TV 17
- 18. GENERAL ONLINE CONSUMER TRENDS 18
- 19. Every second counts: consumers will not wait • Users expect pages to load in under 4 seconds (5) • Google is likely to place page-‐load performance higher in the list of criteria for its ever-‐changing algorithms. (11) 19
- 20. The largest retailers con+nue to focus on enriching and refining the checkout process (8) with an es+mated 79% of retailers priori+sing a Checkout process redesign in 2010 (4) Google Checkout is Forrester Research a fast, secure reports that 23% of checkout process that helps increase customers sales by bringing abandon at you more customers and checkout if they allowing them to are asked to buy from you quickly and easily register. with a single login. 20
- 21. Ebay core value proposi+on is TRUST (7) • Trus+ng sellers and buyers • Trus+ng product informa+on is accurate and clear • Trus+ng they have a resource if something goes wrong User Generated Content (ra+ngs/reviews, ask & answer, stories, blogs, tweets) aids TRUST (7) 80% of reviews are +ive, with avg. ra+ng is 4.3 out 5 Drives more sales 176% increase in conversions for top rated categories 36% increase in AOV for those that sorted by ra+ngs 42% increase conversion for EDMs Percent who share experiences directly with company went down, while percent who sha re via social network doubled (9) Product ra+ng & reviews is offered by 59% of the top 80 e-‐commerce businesses (8) 21
- 22. Recipe websites and blogs take off.. Source: hDp://www.slashfood.com/2009/03/20/do-‐you-‐use-‐a-‐recipe-‐when-‐making-‐dinner/ More comments at: hDp://www.epicurious.com/ar+clesguides/blogs/editor/2009/03/dinner-‐without.html#more 22
- 23. Only four out of 10 people who regularly prepare their households' meals use a recipe at least once a week, according to the NPD Group, which surveyed 3,000 adults as part of its Kitchen Audit. However, research shows that when making dinner we usually just wing it (21) In a year's time, 90 percent of people will make a dish using a recipe…and a cookbook that's been in the home at least two years will be our main source. 23
- 24. General merchandise…where should we focus? In the past 3 months, what items have you purchased on the internet? (24) 2008 2005 (24) 24
- 25. MOBILE INTERNET 25
- 26. Don’t just think iphone, think PHONE (26) 65% have access to a 3G network 26
- 27. Mobile commerce More than 70 million people in the US will access the Internet from their mobile phones in 2009. So it’s no surprise that retailers such as 1-‐800-‐FLOWERS, Amazon, Ralph Lauren, Sears and toys-‐R-‐Us have launched mobile commerce programs so they can be where their customers are. 27
- 28. “The always-‐on, always-‐with-‐you nature of mobile phones will allow them to become the connecGve Gssue that unlocks the fundamental power of personalizaGon in retail, linking together online, in-‐store, Federated IdenGty, purchase history and social media interacGon all within one plaWorm.”(22) 28
- 29. 29
- 30. “Our head of Social Media is the customer” – McDonald’s Click to play: hDp://www.youtube.com/watch?v=ypmfs3z8esI 30
- 31. Specials, events, vo+ng, links to their website, 331,000 fans! coupons + Fastest growing more brand Facebook site ever 31
- 32. Psst…email is the s+ll largest social media plaworm Gen Y respondents: hDp://blog.socialtwist.com/tellafriend/social-‐media-‐sharing-‐trends-‐2009 32
- 33. “It is especially important for leading brands to become proficient in social media – they o<en have the most to gain and the most to lose based on what is being said online…leading brands must think hard about scaling their ability to monitor feedback and to let consumers know the are ‘being heard’” (15) Social Media 33
- 34. Social media is not just a marke1ng tool hDp://offthewall.resource.com/ 34
- 35. API = Access to Partners/Programmers Instantly Currently more than 100,000 apps officially available from the App Store "We know of at least 70 different ways of shopping online, but we've reached the point where we can't afford the +me, resources or support to create 70 different apps," says Nick Lansley, head of R&D at tesco.com. "So we've turned the issue on its head: rather than support them all, we have created a founda+on layer -‐ an API -‐ that lets third-‐party developers create great apps that do a par+cular job very well.“ Facebook, TwiDer, Amazon, eBay, Bewair, Google and 7Digital are just a few to have embraced openness, and all have seen hDp://www.revolu+onmagazine.com/news/947967/open-‐source-‐answer/ their businesses expand in unexpected and profitable direc+ons. 35
- 36. Search con+nues to dominate search 36
- 37. Google keeps adding more op+ons Google can serve highly targeted ads that include richer product informa+on directly in the ad itself -‐ including product image, price, and merchant name. Users are becoming more specific in searching search terms with more than 1 keywords are increasing in all categories. The cost of sale drops by up to 50% when moving SEM campaigns to ‘exact’ match, rather than generic terms. (7) 37
- 38. References 1. Ecommerce book 2. hDp://www.ausfoodnews.com.au/2009/11/09/changes-‐in-‐grocery-‐shopping-‐trends-‐see-‐more-‐purchase-‐decisions-‐made-‐at-‐ home-‐2.html 3. Survey on users of ecommerce websites – iPercep+ons, re+al/E-‐commerce industry report Q2 2008 (Oct 2009) 4. July 09, shop.org, a leading digital retail industry body 5. Forrester Research June 2009; for the full ar+cle refer: hDp://www.getelas+c.com/site-‐performance/ and the webinar at: hDp://www.elas+cpath.com/webinars/performance/ 6. Coles online Debrief (from focus groups), 11 August 2009, Blaze 7. Keynote speakers, E-‐Retailer conference, Sydney August 2009 8. DeloiDe’s 2009 Online Retail Business Capability Assessment (n=80 leading online retailers) 9. 2009 Survey of Online Consumer Behaviour, Harris Interac+ve, Aug 2009 (n = 2188) 10. Forrester, Growth of Social Technology Adop+on, Oct 2008 11. hDp://www.marke+ngvox.com/comscore-‐puts-‐page-‐load-‐+me-‐under-‐microscope-‐045533/? utm_campaign=newsleDer&utm_source=mv&utm_medium=textlink 12. A look at the leading trends for next year -‐ hDp://www.ausfoodnews.com.au/2009/11/18/a-‐look-‐at-‐the-‐leading-‐trends-‐for-‐next-‐year.html? utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+AustralianFoodNews+%28Australian+Food+News%29 13. Usability One – User needs focus groups 15/7/08 14. Usability One – Online survey 18/8/08 15. Building Great Brands in the Digital Age, Nielsen 2009 16. COL Research: Online grocery Shopping – Key research findings from online survey, May 2009 17. Online Commerce in 2009: The Game has changes – have retailers? Retail Systems Research (n=71 leading online retailers) 18. The State Of Retailing Online 2008: Merchandising And Web Op+miza+on Report, a Shop.org study conducted by Forrester Research, August 2008 19. Evalua+ng Findability (source: hDp://findwaD.com/findability/evalua+ng-‐findability) 20. Product Selec+on and Discovery: What You Can Learn From the Telco Industry, hDp://www.getelas+c.com/telco-‐product-‐discovery/ 21. NPD Research, Sept 2009 22. Razorfish Digital Outlook 2009 23. hDp://www.emarketer.com/Reports/All/Emarketer_2000606.aspx 24. Neilsen Global Online Shopping Report, Feb 2008 25. Pew Internet & Americal life project survery Mar 2009 n = 1667 26. Australian Interac+ve Media Industry Associa+on, Mobile Industry Group, 5th Edi+on – Special Topic: Mobile Commerce September 2009, Australian Mobile Phone Lifestyle Index, n = 3710 27. hDp://marketshare.hitslink.com/mobile-‐phones.aspx?qprid=55&sample=31 38
Editor's Notes
- [webtrendmap.com] consists of a collection of graph-like, isometric maps featuring the most &quot;trustworthy&quot; online sources of trends, and their recent tweets.
- Analytics tools help us understand Missed Opportunities to Buy (products viewed or added to basket) Purchase history (Online or Offline) as a result of online browsing Retention or engagement - Frequency/Recency of visit even if non-purchasing visit Browsing habits Propensity to Purchase – by individual, product, segment etc Ad-hoc customer segmentation based on browsing as well as purchasing
- 62% of adult 'net users have watched video online, a figure that's risen from 33% two and a half years ago. Meanwhile a massive 89% of youngsters also watch video online. 36% of youngsters watch online video on a typical day, and 19% of all 'net users do so
- Evolving the checkout process should provide the quickest payback as it is at the end of the funnel
- Web-enabled mobile phone users are much more likely to employ their devices to get weather forecasts, read news, find movie times and bank online than to buy products. Consumers are willing to use their mobile phones to buy items such as pizza, movie tickets and travel reservations. And some have even used their devices to purchase consumer electronics, computers and apparel. But mobile phone users say they would make more purchases if the process were not so cumbersome, products were easier to find and their devices supported secure credit card transactions.
- Below are just some of the exciting mobile media technology opportunities available to retailers seeking to leverage it: • Mobile couponing provides ease of access for consumers, higher redemption rates and cost savings by eliminating weekly FSI printing. • QR code and bar code readers use sophisticated, high-capacity bar codes (QR codes) and bar code readers on mobile devices, allowing consumers to connect directly with merchandise. • Store plan-o-grams take the customer relationship to a new level by providing dynamic, interactive floor plans and merchandise directories to customers while they are in the store. • Mobile commerce allows consumers to complete commerce transactions from the phone. Campaign data from several programs executed by Razorfish™ • RFID and mobile wallet enable consumers, via the next generation of handsets, to speed through checkout with digital payment, while remaining linked to their FID and loyalty information. • Social shopping lets consumers “shop” socially using text and MMS messaging. Retailers that provide tools to facilitate this emerging behavior will foster new connections with its engaged users. • Mobile media and location-based services bring personalization through the front door of the store by using the location-based targeting ability of mobile media to drive consumers to stores near them, and to know where and when they are in the store.
- The API allows non-Tesco developers to access the following services via the API: Login List product categories List products in a given category Search for products by text search / barcode List Basket Change Basket (a single command for adding / deleting / changing quantity) List Delivery Slots Select a delivery slot List pending orders Amend Order