Highlights from Online Retailing Conference

Future of Online Retailing

In 2003, online retailing accounted for 5.5% of all purchases (= $507 million) — it took catalogs 100 years to get to 5%!! The forecast for 2004 is 6.6% (est. $590 million). It’s estimated that 25% of all off-line retail sales are influenced by Web research/preview shopping. Example: >* Sears has found that 22% of all appliances sold in its stores are first researched online

Consumers are demanding more expertise and information from retailers than ever before. Make your site the FIRST place people will go to for information on what you sell – inform first, sell second is the axiom reinforced by online companies like Home Depot, Sears, and eHobbies. Build trust and credibility!

Constantly collect feedback information from your customers via…

• Customer surveys (on-site and/or delivered via email)
• Implement an on-site feedback tool
• Conduct in-store research
• Monitor message boards and discussion groups

More and more, multi-channel retailers are offering “Buy online, Pick up at store.” Sears has implemented this and has found that 40-45% of its sales in 2004 will be buy-online/pick-up at store because…

• 31% say it saves them on shipping costs
• 26% say it’s convenient
• 22% say they need it asap

One typical purchase of this kind is sporting goods (which has surprised Sears). Almost 1/4 of all Sears customers using this kind of purchase option make additional purchases worth $200 while they’re at the store. This feature has led to incremental sales!

One of the hottest methods being utilized by online retailers these days is the email re-delivery of abandoned shopping carts. To facilitate, you must get an email address early on.

• Put the email address as the first field in the check-out process!

Insight into Search Engine Advertising

• 40% of searchers type in 3 or more search terms
• Many of these searchers are now typing in product keywords and/or SKU numbers
• Put the price of the product in the title text of the ad
• Provide as many facts in your ad copy as possible

Maximizing Online Conversions

Constantly test to improve conversions:

• Product information (detailed vs. summarized; located where on the page? On the site??)
• Navigation
• Creative
• Promotions & pricing (location on page; offers; etc.)
• Cross-sells & up-sells (how many?)
• Personalization
• Check out process

Case Study: eHobbies – From eDust to Top 50 in 24 Months

• Differentiate your company and add value
• Be the go-to expert in your market
• Get publicity/get published
• Build trust
• Make money on the accessories, add-ons and after-sells rather than competing on price for the main item because you’ll probably lose to the bigger players
• Develop strategic partnerships, e.g.
• Barter quid pro quo for statement stuffers and/or package inserts
• Align yourself with bigger entities than you (e.g. eHobbies is THE hobby site on Discover.com)
• Negotiate for placements on post-transaction pages to deliver your offer
• Guerilla marketing tactics eHobbies employed:
• Aligning with charity groups
• Sponsoring half-time entertainment at sporting events
• Loyalty program
• Other niche advertising:
• Local cable TV (e.g. advertising during the X Games)
• Niche magazines
• They’ve had success building sub-sites for niche or specialty sectors
• Don’t feel like you have to do everything from scratch and build it all yourself. Find good solutions providers and pay for their tools or services.
• Don’t try writing all the content yourself. Accept newsfeeds.
• Accept and collect feedback

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