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TOP SECRET: eCommerce Tactics

Posted on 7.31.2008

It figures to be a busy online holiday shopping season this year and for many years to come. With an uncertain economy, rising fuel costs and an ever-increasing comfort level with online shopping, consumers will take to the Internet in droves to find good deals without leaving the living room. Experienced online shoppers are going to expect more from you this year and new online shoppers are going to need a helping hand. There will also be a new crop of competitors in your industry.

If that’s not exciting enough, there is a host of new, innovative technology out there for merchants. By exploring these innovations, trends and techniques from those both leading the way and those following them, online retailers can make a lasting impression on their site visitors and gain loyal customers for years to come.

Understanding Audiences, Motivation and Intent

Perhaps the most significant challenge for online merchants is in understanding the composition of our audiences; their motivations as well as their overall purchasing intent. Though helpful, it’s no longer sufficient to simply understand basic demographic information such as age or gender, as it falls short in helping develop a precise understanding of our users.

The first step in understanding one’s audience is to get a handle on their collective makeup – are they primarily men or women, young or old, college educated or in high school, from Miami or China? Services like provide a broad yet interesting look at attributes and values that characterize a group of individuals. Demographic attributes include gender, age, income, ethnicity and educational attainment. Quantcast displays demographics in two ways: as pie charts representing absolute percentages and bar charts representing audience composition relative to the U.S. Internet average.

E-commerce vendors are now increasingly exploring buyer purchasing patterns, what drives them to purchase online and even their overall intent once they arrive to improve their enterprises’ bottom line.

One such company capitalizing on this trend is 7 Billion People ( Merging aspects of behavioral psychology, information technology and the art and science of communication, the Austin, Texas-based firm is changing the personal Web experience for the user. By gathering key information such as users’ click paths and the content of each click, 7 Billion People can then processes session information to develop a unique view of visitors’ preferences and preferred communication styles. These “Portraits” allow merchants to personalize and optimize the customer experience on their website. For example, one user might react better to a bulleted list of product features, while another might prefer detailed product reviews. By taking advantage of these insights, retailers can customize the website experience to each user.

TOP SECRET:  While it falls far short of gaining real-time, on-site actionable data, there is genuine value in exploring consumer behavior during the marketing and advertising of products and services. Short of running your own focus groups, there are a few ways to detect online commercial intent.

Web page searches essentially display two levels of commercial intent: informational and transactional. Microsoft’s AdLab offers a tool that detects customer intent — either information gathering or purchasing behavior — based on their search queries or recently visited URLs. For example, if a customer searches for “canon digital camera,” it is likely they are nearing a purchase; therefore, the online commercial intent is strong, with a confidence level larger than 0.5. This tool can be used to find keywords that have low bid density (low price), but high commercial value.

Trust, Reputation and Feedback

If you are unable to build a trusting relationship with consumers, you might as well pack it up, call it a day and go home. Most articles on trust building and reputation management focus on the importance of developing and designing an appealing and trustworthy-looking site. But in this case, you can’t fake it until you make it — meaning in no uncertain terms that there is more to building a good reputation online than a well designed website. While it is impossible to argue that consumers are naturally inclined to trust an attractive website, the road to full confidence is not won or lost on the page itself. Building trust with consumers and establishing a reputation that generates sales is a process.

Know Where You Stand

You can’t manage what you can’t measure. As such, reputation management has taken the Web by storm, and is now a top-of-mind concern for merchants of all sizes. For the budget-conscious brand advocate, simply setting up and monitoring a custom RSS feed with your company name or associated key terms and phrases can go a long way towards managing feedback and overall reputation. Many merchants create Google or Yahoo! News Alerts that track news, Web groups, blogs and even press releases to get an idea of what others are saying. Most important, however, is to understand patterns related to the buzz about your company or its products and services. Free resources such as BlogPulse, Feedster, Technorati, CyberAlert and CustomScoop give merchants and Web professionals insight into how influencers control the online conversation. There are also other sites such as Yuku’s, and that will help site owners and marketers identify and follow buzz in the forumsphere.

TOP SECRET: Other options for reputation management include software solutions such as Trackur, allowing users to monitor social media, weblogs and news sites for predefined keywords or phrases (company name, product name, brand name, etc.) The service is designed for those that don’t have the time or skills to set up their own reputation monitoring system, but could prove to be very helpful for serious bloggers and marketers. This can be particularly useful in today’s social Web environment. There are tens of millions of conversations taking place every day on sites like Facebook, MySpace and LinkedIn and trying to follow them on your own can be an impossible task. Offerings like these cater to those that have a greater number of Web mentions but there is most certainly value in the information they provide — either on your own brand and products or those of your competitors.

Prove Your Worth

One method to instill confidence and to gain the trust of prospects is the inclusion of testimonials from satisfied customers or clients at your e-commerce website.

History often times is the best indication of future performance. By including testimonials from satisfied customers or clients at your e-commerce website, you are taking an important and meaningful step in gaining their confidence. Still, few merchants recognize the importance of this undertaking. Since the prevailing thought or suspicion by many consumers is that testimonials are artificially created, how do you convey to consumers that they are, in fact, genuine? Several companies are emerging that facilitate the validation of testimonials. Companies such as and give merchants verifiable proof that you are not attempting to con the public. By contacting the authors of testimonials and displaying seals of approval, services such as these can help to foster a sense of trust between a prospective customer or client and your business.

Companies like BazaarVoice are attempting to improve the ratings and review trend by helping their merchant customers create custom white-label solutions for their website. The advantage for BazaarVoice clients is that all content can be moderated before publication to ensure tactfulness and relevance. The result is higher engagement, more buying confidence and lower return rates. The greatest hidden benefit is perhaps the natural search traffic thanks to keyword rich, consumer-generated content.

TOP SECRET: Merchants more sensitive about the dialogue taking place about their company are increasingly looking towards solutions such as RatePoint. This proactive system enables clients to collect, manage and promote customer feedback and reviews, and stay connected with customers. Using Ratepoint, companies can ask customers for feedback and reviews and manage that information through the RatePoint Business Center (a Web-based console/dashboard), then publish those reviews on their website. RatePoint even enables businesses to stay in close contact with customers through email marketing and survey tools. Starting at $17.95 per month, it's a strong option for the reputation conscious.

Payments: Give Consumers Options

The ability to accept and process payments is perhaps the most widely discussed issue for Internet retailers and for good reason — if it works then you’re in business. If not, well, you’re out of business. Before anything can be advertised or marketed on the Web, thorough research in relation to the initial costs and transaction fees of each merchant account provider (or their alternatives) is necessary. But why use a traditional merchant account with so many viable alternative payment options? Last year, sales increased an average of 14 percent for retailers offering three or more payment methods.

According to a December 2007 study from Brulant, three out of ten major online retailers offered new payment methods as an additional option to credit cards — an increase of 24 percent of major online retailers who offered alternative payment methods from February 2007. More than 20 percent of online retailers surveyed offered Bill Me Later, while PayPal was a close second with 19 percent. One out of ten online merchants accepted PayPal’s rival Google Checkout for payment.

On average, online retailers accepted 2.6 different payment types this year, up from 2.1 in 2005. PayPal had the largest increase in adoption by retailers, at 217 percent between February and December 2007. Adoption of Google Checkout doubled during the same period. Another alternative payment method, more than three-quarters of online retailers surveyed accepted private label gift cards.

TOP SECRET: In rough economic times, consumers are doing all they can to tighten their belts and merchants should take the alternatives to the extreme. Services like eLayaway enable shoppers, much like traditional layaway programs, to purchase products through monthly payments that merchants set in advance. eLayaway’s calculator lets merchants break down the order purchase price over 3-13 monthly payments that are automatically deducted from consumers’ checking accounts. Customers receive their orders when paid in full. The eLayaway system works with platforms such as Cardinal Commerce, Mercantec, and 5th Avenue Software. Many merchants will look at the solution seriously with low monthly fees ($99.00), a one-time setup fee, lack of chargeback risks, zero merchant transaction fees and 1.9 percent fees for consumers.

Video Boosts the Web Star

Internet video will account for half of all consumer Internet traffic by 2012, according to new research from Cisco. In its Visual Networking Index, the company claims video already accounts for a quarter of all consumer Internet traffic, a number that will rise to 32 percent by the end of the year.

It’s clear that big things are expected for video — even in light of perceived cost and complexity issues. While we are still in the early days of online video, it’s proven to be an immersive experience and can be used to cross-sell and up-sell different services, opening up additional merchandising opportunities for online retailers. But retailers are historically oriented towards text and images. When Web retailers get to video they encounter challenges in the creation and serving of such content.

There have been some vendors like BrightCove who offer white-label video serving solutions, but they come at a high cost (sometimes hundreds of thousands of dollars) and require technical expertise and a major time commitment — not always feasible for small businesses.

TOP SECRET: Fliqz is one of the companies making video marketing a reality for merchants. About 16,000 currently use the platform, from a basic ad-supported version to a “bronze” edition that contains no branding, all the way to the “platinum” version that enables users to design their own video player skin, provides multiple video players, has custom workflows and leverages high-volume streaming and uploading.

Enterprises such as Major League Baseball use Fliqz for user-generated videos. Fliqz is unique in that it enables companies to brand their videos (no Fliqz advertising or attribution on the video), doesn’t require adherence to a particular ad network, can be implemented in less than 30 minutes by just about anyone and is affordable for companies of all sizes. With the same plug-and-play functionality starting at $50 per month, you can see the opportunity. Very few companies realize these solutions are available now, but times are most definitely changing.

Reduce Abandonment Now

One of the most watched metrics for online merchants is their shopping cart abandonment rate. Through consumer education and positive word-of-mouth experiences however, online retailers can reduce the percentage of consumers who placed items in their carts but did not end up buying them.

In what may be a sign of the times, shopping cart abandonment has inched up. Consumers were more likely to abandon shopping carts in Q1 2008 than they were a year ago, according to recently released data from MarketLive. The company said the percentage of shoppers who clicked off an e-commerce site after viewing just one page rose 18.9% during that same period.

But is abandonment simply a reflection of the current state of the economy? According to MarketLive, approximately two-thirds of consumers now start their research at search engines. And as many visitors are new to specific e-commerce sites, they are more likely to click away and return to search engines if they do not quickly find what they want, at the price they desire. It is quite possible that abandonment follows that pattern. As more people research products online and become price-sensitive, they are opening up more shopping carts to check out final prices.

According to respondents to a May 2008 survey from PayPal and comScore, high shipping fees were the main reason for shopping cart abandonment. The companies estimated that two-thirds of consumers who put items into shopping carts did not end up buying the items. This hows that consumers are quick to walk away from online purchases when merchants don’t fully disclose critical information, particularly related to cost.

The best way to reduce shopping cart abandonment is to never let it happen. Merchants are increasingly using coupons, behavioral analytics and other means to prevent abandonment. But the exact nature of the offers and when they are presented matters a great deal.

TOP SECRET: As users demand more from the e-commerce experience, companies are offering solutions to fill the void. Velaro, a provider of live chat solutions recently launched a suite of products dubbed Livefluence. Livefluence offers progression analytics — a multi-step conversion tracking tool showing merchants what happens in between arrival and exit, so that appropriate offerings can be targeted according to users’ navigation patterns. Coupled with real-time monitoring, merchants can see what keyword generated the visit and where the user is currently located on the site. This way, a coupon could be offered at the same time a user is viewing a particular product or service. Livefluence also distinguishes by letting businesses engage customers through live chat, click-to-call, co-browsing and survey management — all helpful with engagement and preventing abandonment.

Bring Affiliates Closer Into the Fold

There are no shortages of available e-commerce programs that affiliates can choose to use. But recruiting affiliates who can actually help increase sales is challenging. It’s no longer enough to create an affiliate program, give Web publishers basic information on your products and send them on their way. Much like traditional employees, affiliates need constant oversight, motivation and in some cases incentives to help them maximize their value to your enterprise. To attract the best affiliates, you need to differentiate your offerings.

TOP SECRET: One of the primary complaints of affiliates is the length of time it takes merchants to pay up. RevUpCard is aiming to solve that problem. The RevUpCard is essentially a pre-paid debit card that can be used for payroll administration. It considerably reduces — and in some cases eliminates — payment costs associated with printed checks and wire transfers. Merchants have the option of incurring the fees or passing it on to the affiliate. With the hard cost for the plastic card at only $9.95 with a $1.50 load fee when money is transferred to an affiliate account, merchants have an easy way to offer fast payment, thereby differentiating their offering. The card can link up to a bank account or be used anywhere MasterCard is accepted — funds can even be transferred to a third party.

Merchandising, Searchandising and Beyond

In the brick and mortar world, retailers vie for a coveted spot — the end of the aisle or “end cap.” On the Web, the end cap is a top position on search engine results pages (SERPs) and, as every website owner knows, that’s not easy to attain. But at sites of a vertical nature a new area is opening up for merchants to get their products seen away from traditional search engines or comparison shopping sites.

Companies such as Guidester help consumers narrow down a store’s product selections by specifying granular characteristics and features. In short, they make product searching easier for the consumer. For manufacturers, Guidester’s AdMatch offers a way to take an XML product feed and distribute it among a variety of appropriate retailers. Guidester partners with individual retailers who integrate these product feeds into their site search. When a consumer searches for a product category — say digital cameras — the Guidester results can be ordered based on the highest pay-per-click bid from competing manufacturers. The solution lets vertical sites charge manufacturers for higher placement within search results while offering consumers the best information — photos and specifications — on the products available, straight from the manufacturer.

While logic dictates that other ad-placement services from the likes of Google and Yahoo! are sure to roll out competing offerings, it’s possible that the larger search companies don’t want to risk blurring the distinction in Internet users’ minds between keyword-based ads, sponsored search results, and the ostensibly unbiased results at the core of each search page.

TOP SECRET: What if you’re not selling thousands of products with thousands of SKUs and don’t have relationships with vertical sites? Then it’s time to look closely at comparison shopping engines (CSEs). But instead of spending countless hours developing custom feeds of products and their respective descriptions and images, why not automate the process? Solutions such as from Red Sun Systems automate data feed submissions and provide a valuable resource for marketing on sites such as Shopzilla, PriceGrabber, NexTag,, Google Product Search and Yahoo! Shopping. Include the ability to monitor performance and analyze your return on investment and you have a genuine opportunity to start competing with the Internet’s largest retailers.

Keep Moving Forward

There is no shortage of innovation in the ecommerce industry. From recommendation solutions provided by companies like RichRelevance and Strands, to the vast array of design techniques to keep consumers moving forward towards completing transactions. For more on innovative e-commerce, look no further than Website Magazine’s digital edition, where you’ll find page after page of quality content to ensure your online retail success.


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