It's Time to Go Online - Here's How
By Sarah Sperry
If you are a retailer and don’t yet have an Internet presence, it’s well worth checking the facts: this is the time to do it.
In today’s volatile marketplace, retailers are playing a game of survival, and those that have an online presence are already ahead of the curve. As more and more shoppers become web savvy and the younger generations increase their buying power, an online storefront is a now a necessity in improving your bottom line.
According to Internet Retailer, jewelry was the fastest growing retail segment in the company’s 2008 Top 500 Guide. The magazine states, “jewelry web retailers are getting very good at giving consumers even more ways to conveniently research and purchase a big-ticket jewelry item online.” Online jewelry retailers ranked in the current Top 500 Guide had combined sales totaling $1.05 billion in 2007, an increase of 36% from combined sales of $772.4 million in 2006. Additionally, the 2007 sales of these online jewelers outpaced the sales growth of brick and mortar-based jewelry stores, which grew 2.7% to $30.7 billion from $29.9 billion in 2006, as calculated by the U.S. Department of Commerce.
Why Invest in a Website?
The benefits of a web storefront are obvious: the convenience of online shopping is undeniable; inventory is immediately available to everyone; it allows you to expand beyond your current customer base; and, website development is vastly more cost effective than opening a physical storefront. The web is also where the Gen X’s and Y’s and the generations that follow do research and shopping. Additionally, today’s shoppers expect you to be online, if not for transaction ability than certainly for information. Think about what it says to your customers if you don’t have a website: shopper’s will question your viability and stability in the marketplace and wonder why you not part of the 21st Century. No web presence or an out-dated site says as much about your store as an impolite sales person or chaotic aesthetics.
What Do Consumers Expect?
Adrift in a sea of shifting technologies, building a great website can be difficult business, especially identifying which technologies consumers expect to see. Dana Goldsmith, a senior sales executive at MyBuys.com, a company that provides personalized product recommendations for e-tailers, says that in today’s marketplace shoppers expect a great site experience, which boils down to great search functionality and a simple and flawless checkout. Forrester Research recently conducted a usability test of over 1,200 websites to understand the quality of online customer experiences. Three percent of the sites passed the test. Bruce D. Temkin, vice president and principal analyst of customer experience at Forrester Research Inc., says, “The No. 1 failure, believe it or not, is text legibility. In this day and age companies are investing hundreds of thousands of dollars, even millions, in their sites, yet display content in a way in which people can’t read it. Another failure near the top of the list is inefficient task flows. Some e-retailers, for example, have checkout processes that put you through too many steps. The processes simply are not efficient.”
Ms. Goldsmith concurs, reiterating that e-tailers must take the frustration out of the purchasing experience. She recommends watching people make transactions and reducing the number of steps in the checkout process. Another detractor from purchase is shipping information. Ms. Goldsmith says that in her experience conversion rates (sales) went up when shipping costs were introduced at the beginning of the purchasing cycle.
In addition to good search and ease-of-use, today’s consumers want the ability to dictate more of the shopping experience, or a participatory web experience (Web 2.0). Technologies that fall under this category, include blogs, video, podcasts, chats, product customization, and product recommendations and reviews.
Along with improving search functionality and re-platforming older technology, Ms. Goldsmith sees her clients focused on personalization and customization functions. She points to a recent statistic from Forrester Research that when product reviews and recommendations were added to websites, businesses saw an 18 times conversion rate. Additionally Bazaarvoice, a technology company that enables consumers to write product reviews and contribute user-generated content on websites, relates that Zales.com experienced (measured over a three-month interval):
- a 38.7% incremental increase in conversion for products with reviews; and,
- a 101% incremental increase in conversion for products with more than five reviews.
Customization has become a key growth driver for e-commerce businesses because people want to buy products that express their individuality. Customization functionalities like building a ring or a necklace are on the rise and very popular. Shoppers also demand great photography with zoom and multiple view options and alternative means of payment (PayPal, eBillme).
A good analytics package is a must-have for e-tailers. From this detailed analysis, you can learn about where your visitors come from and how they interact with your site. It allows you to see where you’re gaining and losing people and has been likened to watching a consumer flip through a catalogue and measuring its success.
Improving Search: Mercado, Endeca Platforms: Demand Ware, ATG, MarketLive E-mail Marketing: Responsive, Silver Pop, Blue Hornet Product Reviews and Ratings: Power Reviews, Bazaarvoice Analytics: Google Analytics, Omniture, Webtrends Imaging and Multiple Views: Scene7