Recently we did a market research on ecommerce and other online commerce platforms and solutions. We will provide the full report in some parts. Here is the complete report.
Every company is moving online and the reasons are obvious. Lower set-up and operational costs, wider reach, increased customer information, 24 hour business, no middlemen, competing with big organizations are some of them. At first glance the ecommerce website functionality seems pretty straight forward all almost commoditized. All websites have product catalogs from where customers can search what they want, have detailed products information pages, have shopping carts where the products are added and secured payment portals where the users can pay via multiple options. But it is not as easy as it appears. Below that expected looking website lies a complex set of capabilities that are required to keep the web store performing. Not many have been able to achieve it!
Do you also face the problem of abandoned shopping carts? Do you also get frequent complaints of the ineffective search capability or a tedious checkout process on your website? Do you also face the problem of lack of control over processes? Do you also face the problem of having a lot of customer data, but you don’t know what to make of it?
Whereas some organizations are breaking newer grounds in e-commerce, some traditional organizations are struggling to implement even the most critical e-commerce capabilities that could enrich the customer experience. A lot of businesses are moving online and the number of vendors, the number of ownership options and the number of platforms are all increasing. The result is an increase in investment and competition to take the advantage this market has to offer. According to the Internet Retailer’s magazine, the top 500 retailers of North America sold $150 billion worth of goods and services in 2010, up by 18% of their 2009 sales. (Internet Retailer Magazine’s Top 500 Guide,” 2011 Edition). The demand for custom ecommerce solution continues to grow.
2 New rules and new tools of customer engagement
Today’s customer is highly evolved. He is always right. If there was any doubt regarding the truth of the adage, social networking has eliminated it completely. A study conducted by Jupiter Research revealed that if customers aren’t satisfied with the information provided on your website, there is a 45% chance that he may leave the website and go to a competitor’s website, 45% chance that he will not visit the website again and 40% chance that he will not buy from you online. (Jupiter Research, “NPD Retail Consumer Survey,” June 2008). What more? There is an even a chance of him spreading negative word about your website on social networking websites. Remember the case of Dell where an unhappy customer’s blog post and Dell’s silence tarnished the company’s reputation badly.
Understand your customer and see what type of customer drive the sales for your web store. This data can be used retain the current customers and target new customers.
There are four types of customers that visit a webstore. The seekers, who are looking for a specific product, the researcher, who has a specific goal in mind, but has not thought about a particular product or brand, the bargain hunter, who will only buy when he gets the best bargain and the window shopper, who just searches for entertainment or shopping for a gift. (Volusion’s Ecommerce Blog, 2011)
Using Business Intelligence and Business Analytics tools a company can determine what category its customers fall into and what category it would like to target. After determining this it can use specific ways to engage its customers using specific solutions. For example:
- Including relevant keywords and manufacturer information may help the seeker find the specific product he is looking for. Search engines may land some of the users directly on the product page but other may land on your homepage. So make sure your internal site search has working keywords too.
- The researcher is a confused person. So helping him clearing his confusion with Guided search, clearly defined categories, site navigation and detailed descriptions may help in a conversion. Providing links to similar or related products may mean additional business
- Having a ‘Deal of the Day’, Coupon codes and discounts, additional services like free shipping might entice Bargain Hunter. As per Freeshipping.org almost 90% of shoppers said that they would be enticed to shop more and spend more money if the shipping is free of cost.
- One of the ways to keep a window shopper engaged is updating your product catalogue with the most popular, interesting or unique products regularly. This will surprise the window shopper and he might want to visit your website again. Making the product more real by adding multiple images, detailed descriptions and customer reviews might make the window shopper interested in the product.
3 Expectations from the ecommerce providers
The ecommerce provider should be able to provide these capabilities:
Basic Capabilities that include:
- Creation and management of Web storefronts
- Product visualization
- Shopping cart management
- Transaction management
Middle Level Capabilities
- Interactive Site Presentation
- Order management
- Analytics and reporting
- Search engine optimization (SEO)
- Multiple browser support
- Site merchandising management
- Site/product search
- Customer/account management
- Customer community management or participation
- Integration with social media
- Warranty/returns management
- Mobile stores
- Lead management
- Integration capabilities
- Product management
- Content management
- Multichannel selling
- Interactive selling
- Campaign management
- Locator and matching
- Personalization/preference profiling
- Entry and management of large orders, ordering from sales contracts, and distributed order management
- Management of certified partners and product entitlement
- Internationalization and multisite management
4 Mobile Commerce
Morgan Stanley has predicted that, by 2015, more users will connect to the web via mobile devices than desktops and laptops. So you as a company can no longer afford to ignore mobile commerce as part of your multi-channel strategy.Shop.org and Forrester research have found that more than 70% of online retailers are either having or developing a mobile commerce strategy. And for good reason – the opportunities are immense. Smart phones, tablets and hand held devices are driving this explosive growth. (Demandware, ‘Critical Success Factors for Mobile Commerce’, 2011)
People are not just using smartphones for making purchase transactions. It is also influencing the purchase decisions in other channels as well. People do comparison shopping, search for prospective buyers, locate brick and mortar stores and read reviews from their smart phones. According to a recent research by Dell out of all the people who used mobile phones to help them shop only 25% transacted a purchase and the rest used if for other purposes. These trends are only going to accelerate with the increasing adoption rates of smart phones and as vendors optimize the online experience for their users. So an organization should not treat mobile commerce as a separate channel but it should be a part of its overall strategy.
Success in this field relies on a vendor’s ability to deliver a shopping experience that leverages the characteristics of different devices. Typically mobile phones are used by people to shop when they are on the run and don’t have a lot of time. That means a different set of requirements. At minimum, your mobile commerce strategy should address the following:
- Speed and Security – People expect the website to load as quickly as it does on their desktops. They also expect that payment through their smart phones is safe and is that their personal and personal information is not susceptible to theft.
- A website or an application – If you have a powerful brand or a loyal set of customers a native application might not be a bad idea but in other cases, a website might be a better alternative.
- Enriching the mobile experience – Native apps can leverage the functionality of mobile devices like the camera or the GPS and can provide options of offline purchases. Other features like inbuilt search, streamlined checkout process, presence in comparison shopping engines may further enrich the customer experience. A prime example would be combining the real store inventory information, geo-location services and personalized promotional offers to a consumer’s mobile device while he is in the proximity of the store.
HTML5 and 4G networks are already helping vendors to expand their offerings to its users. Capabilities such as barcode scanning, QR codes and NFC, GPS geo-location services, real time content sharing are already feasible from within a mobile website. And the pace with which more capabilities are being added is neck breaking. So retailers need to plan for the future by adapting to this rapid evolution and formulation an agile strategy to match the speed of this change.
Ecommerce is a very exciting space to watch for as of now. Some will succeed, some consolidate and most perish.