Multi-Channel Commerce & Retailing

In my last posting, I talked about the impact of requirements on performance.  Another reason for the slowness of Web sites is the number of moving parts that could be performing poorly. Let’s look at  the most important components in your customer’s Web experience:

·         Browser – The browser is the first touch point.  All browsers are not created equal, however because they multithread.  In fact, the most modern releases of browsers can open 3 to 4 times as many connections as the old ones.

·         The Internet – Like it or not, we are all at the mercy of the Internet providers that we subscribe to.  In addition, they are at the mercy of the “big pipe” owners who manage the large connections between regions and continents.  Plus, we are all at the mercy of the Internet Standards like HTTP, TCP and IP.   The combination of these creates a phenomenon sometimes call the “Internet Weather”.  This means that the Internet is slower on some days and faster on the others in a random fashion that comes and goes like the weather.

·         The Site Hosting Environment – Requests eventually arrive at the physical location of your site, passed to you by your Internet service provider.  Once within your network, response time is subject to your network traffic, firewall restrictions, security checks and load balancers.  Any of these can cause performance to degrade if not configured properly.

·         Web Server – The humble Web Server’s job is to take HTTP requests in, hand them to your site and send your responses to the user.  If configured poorly, they can be a source of slowness.

·         The Application Server – Most of the big eCommerce sites use either WebSphere Application Server or JBoss to process the request.  These components are very complex and must be tuned properly.

·         eCommerce Framework – Commercial products like WebSphere Commerce Server,  ATG,  and Microsoft Commerce server are essentially libraries of prewritten commands that you either use out-of-the-box or modify them, then use.  Needless to say, the quality of these components is critical to your performance.

·         Interfaces – Your site is interconnected to somewhere between 20 and 150 pieces of software that are outside of your control.  Many of these sites are internal, but others are services that are run by “software as a service” vendors.  Any of these can create a slowness in your response times if they respond to you slowly.

·         Your code – Finally, the code that you write has a huge impact.  Poor design and coding can ruin your chances for a good customer experience.

 

The fact is that any one of these can cause your site to perform poorly.  This can transform your job from software engineer to detective as you try to figure out where the problem lies.

Posted by Stephen Alan Potts at 08:10 PM | Permalink | Comments (0) | TrackBacks (0)

By Simon Harper and Zoe Schagrin with support from Magan Arthur

There is no doubt that new technologies are causing a permanent shift in the way companies and consumers communicate.  But what makes these new channels so attractive – low cost, ease of implementation, global reach – also makes them dangerous for companies who don’t understand their nuances or just how drastically digital marketing has evolved.  Some of the biggest names in business have entered the new digital marketing arena with good intentions only to wonder “how could it have all gone so wrong?” 

Digital marketing blunders aren’t just the domain of small firms making rookie mistakes.  Some of the biggest names in business have had recent misstep or learned lessons the hard way as outlined in these high profile examples:

Starbucks’ Twitter Campaign

Starbucks recently launched a digital campaign which involved hanging a series of posters in major cities and asking contest participants to find and photograph them.  The winners were those who first found each poster and uploaded a photo of it to Twitter using predetermined hash tags.  Unfortunately, an anti-Starbucks activist and filmmaker was launching a YouTube video the same day condemning Starbucks for its labor practices.  He read about the contest in the New York Times and made a post on his anti-Starbucks blog for users to instead post photos of themselves holding politically charged anti-Starbucks posters.[i]

Starbucks ultimately had to abandon this part of their campaign which ironically served as excellent buzz for the filmmaker, Robert Greenwald.  His video had 30,000 YouTube views and made it to the first page of Digg.  Greenwald explained, “I think that the corporations will learn very quickly that if they want to function in a social marketing arena, then they’re going to have to change some of their practices or else they’ll have to get out.”[ii]

‘Wal-Marting across America’:

In late 2006, an American couple named Jim and Laura began an RV journey to ‘Wal-Mart across America’.  They planned to take advantage of Wal-Mart’s policy allowing RVs to park overnight in store parking lots.  The couple setup a travel blog to capture their adventures, but there was no indication that Wal-Mart had any affiliation with Jim, Laura, or their blog.  However, when posts began to read like company propaganda and the couple seemed to be playing the role of corporate puppets, readers became suspicious.  One reader in particular challenged the couple to “reveal” themselves and provide information as to their financial backing.

Ultimately it was revealed that while the couple had approached Wal-Mart to seek approval to park in store parking lots, Wal-Mart had supplied the RV and was covering travel costs.  Wal-Mart even paid Laura, a writer by trade, a fee for her blog postings.  In its desperation for good press and desire to create a new connotation for the term ‘Wal-Marting’ (commonly used to describe how large retailers drive out small businesses) the company violated one of the tenets of digital marketing – be genuine and transparent. [iii]

Sony’s PSP Blog
A blog supposedly managed by Sony PSP fans was setup to help their friend get a PSP for Christmas.  However, savvy consumers recognized that the blog’s URL was registered to a marketing company and began to question the authenticity of blog posts like the following:

“...we created this site to spread the luv [sic] to those like j who want a psp! …consider us your own personal psp hype machine, here to help you wage a holiday assault on ur [sic] parents, girl, granny, boss—whoever—so they know what you really want.”[iv]

Rather than owning up to the disingenuous campaign when pressed, Sony instead tried to contain the negative buzz, employing the same hip-hop oriented language explaining, ““yo where all u hatas com from... juz cuz you aint feelin the flow of PSP dun mean its sum mad faek website or summ... youall be trippin.”[v]

However, after continued pressure the company finally owned up and posted the following on their site:  “Busted.  Nailed.  Snagged.  As many of you have figured out (maybe our speech was a little too funky fresh???), Peter isn’t a real hip-hop maven and this site was actually developed by Sony. Guess we were trying to be just a

little too clever. From this point forward, we will just stick to making cool products, and use this site to give you nothing but the facts on the PSP.”[vi]

The campaign was a huge embarrassment for both Sony and its marketing firm Zipatoni.  Ultimately, the effort was successful in creating a viral buzz, but not quite what either company had hoped for as angered consumers voiced their grievances on blogs and videos:

While traditional marketing campaigns such as TV advertising have typically required an extensive upfront investment of time and capital and have given the advertiser full control of the message, today’s digital marketing campaigns are a totally different breed.  Advertisers today don’t dictate the dialogue, they merely initiate a conversation.  Publishing a blog post, a YouTube video, a Twitter Tweet or a message across any other digital channel is simply a launching point. 

The same audience that stands to make your message the next big thing can also use the same channels to launch a viral campaign condemning your business or brand for its customer service, poor labor practices, or product quality.  Just ask Dell, where a single active blogger preaching about what he described as “Dell Hell” ultimately caused the company to revamp their entire customer service methodology.[vii]

In the examples highlighted and in our additional research, we have identified that digital marketing missteps are often due to one of the following:

·         A lack of transparency or authenticity

·         A hastily assembled campaign due to the easy ability to create and distribute digital content

·         The digital campaign is a ‘one off’ and not integrated with the larger brand message

·         Failure to monitor the message after launch  and/or the lack of a mitigation strategy

·         An inability to balance controlling and protecting the brand while providing consumers a voice

We believe that implementing a governance structure and program can be critical to playing ball in the new digital marketing arena and can help mitigate many of these common missteps.   An appropriate governance structure won’t guarantee that your firm will launch the next viral YouTube hit , but it will help you to ask the right questions going into a campaign and to get it back on track when it begins to take on a life of its own.  

Governance is certainly a vogue concept, applied to everything from data management to corporate portals.  Yet governance is curiously only modestly applied to the area of digital marketing.  So what is governance and why does it need to be applied to yet another domain?  Governance implies general oversight and broad program management – it involves clear and consistent policies as well as defined processes for decision making.  It goes beyond simply developing a one-off campaign to actually formalizing a structure and approach to the channel.  In the context of digital marketing, we have identified four primary components for a successful governance program:

1)       Develop and promote a clear and consistent strategy

2)       Define and track metrics for ongoing value tracking

3)       Develop a mitigation / response strategy for undesired feedback or unsuccessful campaigns

4)       Develop a strong, cross-departmental governance team 

Focusing on these areas can ensure a well-planned, long-term DM strategy and can help to prevent many of these common mistakes from being made.  Furthermore, a well-planned governance team and program can ensure if a mistake or issue occurs in a DM campaign it is quickly dealt with and resolved.

DM campaigns are commonly flawed by their design in isolation of other organizational initiatives.  Developing a clear and consistent digital marketing strategy to be applied to all digital marketing channels can ensure that the programs are consistent, in-line with brand images, and convey the desired message.  This will allow campaigns to build upon one another, strengthening the company image and voice rather than delivering inconsistent or competing messages to the consumer. 

While defining the DM strategy, it is critical to remain true to company values and behaviors.  One must keep in mind that the digital age swings both ways.  Consumers are smart and messages spread quickly.  The same viral power that can help a new commercial take off can also empower a campaign detractor.  Consumers can see through transparent or dishonest campaigns, as demonstrated by the Walmart and Sony examples, and they will surely make their protests heard.  As such, it is important for all campaigns to remain true to the company values and to represent the organization honestly.

Strong governance necessitates the definition of clear and consistent metrics tracking.  Digital channels allow for rapid changes in campaigns and the continued tweaking of message.  Therefore, it is imperative to continuously monitor campaigns and react rapidly if they are proving ineffective.  The benefit of DM channels is that rapid changes are possible, as opposed to traditional channels which require months of planning and cannot be altered after launch.  This advantage should be leveraged in campaigns.  Feedback from consumers should be monitored and responded to as necessary.  A number of software programs from Webtrends to Salesforce.com exist to allow for DM monitoring of Twitter, Facebook, and other online applications, and this information should be taken advantage of in understanding the effects of a campaign.  Additionally, monitoring the success of each channel and campaign can help to determine proper resource and funding allocations. 

Integrating social networking tracking techniques can help identify a failed campaign or potential issue early on.  A mitigation and response strategy must, in turn, be defined well in-advance to address these problems once they are identified.  Having an action plan in place can help to 1) react quickly and definitively 2) adapt the campaign as necessary and 3) ensure that the same mistakes are not made going forward.  In the PSP example above, Sony responded poorly to the accusations of insincerity and in-genuineness by continuing to hide behind their character front, and the language used in their response “yo where all u hatas com from…” seemed to simply aggravate the situation even further.[viii]

Another component of strong governance is developing a governance team.  This team should oversee DM campaigns and provide strategic guidance for new projects.  As such, the governance team should monitor program metrics and consumer feedback.  It is important for this team to include a mix of cross-department resources.  Proper staffing of this group can bring knowledge and representation to DM from a number of different background and areas.  A diverse team can both offer new perspectives as well as prevent a single department from laying claim to Digital Marketing channels within an organization. 

Governance can also help provide the structure and funding for centralizing DM programs and applications, initiatives leading to greater efficiencies and reduced costs.  One such approach is the new ‘digital workbench solution’ Infosys Technologies is currently developing.  The solution offers an integrated platform for developing, sharing, and reusing content across multiple advertising agencies and portals, thereby providing reduced time to publication and lower creative development costs.  Infosys Technologies has developed a number of solutions to centralize digital resources and make digital campaigns more effective.  Organizations investing in large DM initiatives should consider similar solutions in order to make their programs more efficient and retain DM materials for future use.

As companies allocate additional funding for digital channels, it becomes increasingly important to go in with the ‘right’ approach.  Mistakes can result in major and unforeseen consequences, as seen here.  Applying a governance framework and developing a strong governance team can help to ensure that digital marketing and social media programs are undertaken and maintained successfully.  While digital channels continue to evolve, they no longer represent new territory.  Companies must be smart about how they play the game, as savvy consumers often leave little room for mistakes.

Posted by Simon Harper at 11:23 PM | Permalink | Comments (3) | TrackBacks (0)

Below are just two examples of the “random” messages you will find on Twitter:

“The hulk has prefect teeth”

“Don’t you just “love” the inevitable heavy breathing you hear on conference calls, with mics too close to noses?”

Twitter, which can be defined as a micro-blogging service, is often dismissed by mainstream media; however a study by the Altimeter Group finds that brands using social media have seen recent increases in revenue by 20% on average.

Twitter and other social media tools such as Facebook give merchants a more human like feel. To customers, we become something besides just nameless faceless online stores. We have husbands, wives, children and we go on vacations. Social media also allows you to show customers why you are passionate about what you sell, and that has been a missing element in commerce for a while.

Because you are a human and not a website without a name and face, you are also held more accountable to your mistakes, and are thus more inclined to hear feedback about your products. Customers on Twitter will tell you the positives and negatives about your products and your website. As you can imagine, some merchants aren’t particularly fond of this, but those who embrace it tend to have a very loyal fan base.

The big question people ask is, “Now that I’m all setup on Twitter. What comes next?”

Here are a few tips on getting targeted followers who can then help spread your brand like its the next best thing since sliced bread:

1.     Inform your current customers that you are on Twitter. You would be surprised to see how many people you find who are on Twitter if you just say something about it. Try something like sending out a newsletter about it and putting up a link on your website. Simple no?

2.     Visit  wefollow.com, and search for Twitter users who have strategically tagged themselves with topics related to your products. You can also tweet that you follow those topics too for extra exposure.

3.     Try using a Twitter client such as TweetDeck or Seesmic Desktop to pull searches on keywords related to your products. Follow people who tend to like the merchandise you sell, as well as people who offer useful information that you can re-tweet to share to your followers.

4.      Go to hashtags.org and search for tags that pertain to what you sell on your store.

5.     Send tweets that are fascinating, and try to engage your followers as much as possible by using @replies. You aren’t just tweeting to someone. You can actually use @replies to “introduce” your followers to each other. They will use @replies to introduce their followers to you. In this respect, you aren’t just sending tweets, you are building a community around your brand.

Twitter, like a mobile phone or PDA, is a communication tool. Its uses are only limited by your imagination. Using it judiciously can connect you to a gamut of people who just might be looking for what you sell for a fraction of the cost of other advertising methods.

 

 

Posted by Gaurav Dhir at 04:24 PM | Permalink | Comments (3) | TrackBacks (0)

Government, people, and companies have been discussing and hearing a lot about going green. Everyone from President Obama to your local coffee store is talking about it. Broadly, there is an agreement on the need to do something but a lot of disagreements on what should be done, how it should be done, who should do it, and most importantly who pays for it. For instance, countries are asking others to do more in climate meets. In this entire debate, companies are caught in the middle with the question “Should we go green at all? If yes, what is the business case? Should we be proactive or reactive?”

 

To be able to answer these questions, I believe executives need to understand the four underlying key drivers for change. Depending on the applicability of the driver to their industry and business situation, the go/ no go would become clear. I also believe that each driver leads to different challenges, different groups driving change, different groups of internal resistance and hence a need for  different strategies to overcome resistance.

 

In order of priority, the key change drivers are as follows. These are ranked in the decreasing order of compulsion to change.

 

Driver 1: Government / regulations – “do we have a choice really?” E.g., carbon tax, EPA regulations, car manufacturers having to conform to California emission requirements, etc. If regulations are likely to change, companies have to adapt to it. It is in their best interest to plan for it while they can still do it as this often requires fundamental changes in manufacturing, product development and supply chain processes. Within organizations, this kind of driver for change is best identified by the legal/ risk / compliance departments, and face the most resistance from Operations/ Manufacturing which are impacted the most. The question then is how to best manage this forced change.

 

Driver 2: Shareholders- This driver indicates that there is a good business case to go green, likely due to associated cost savings. E.g., lean manufacturing initiatives that might cut waste (Toyota), or use of more efficient trucks (e.g.  hybrids truck pilot for courier companies). Companies benefit, so does the environment. The problem is that even though the initiative pays for itself eventually and gets potentially good press, practically this kind of change is constrained by limited management focus, limited investment dollars to implement the change and limited organizational change management capability. Only a small percentage - early adopters - would end up doing anything in the next 3-5 years. This kind of change is best identified by internal groups, consultants, and face the most resistance in investment committees. The best approach perhaps is to start by picking the “easy to implement” quick wins- save electricity, water, paper, gas, etc.

 

Driver 3: Customers- This driver presents itself as an opportunity, likely due to a new market / revenue opportunity.  E.g., Toyota and Honda’s success with Prius and Civic hybrids, organic foods, green cleaning products, home water purifier systems, and many more such examples where customers are now demanding green products. Sales and Marketing departments are supposed to recognize the changing preferences of the customers and drive change. Practically, my belief is that this kind of change is constrained by low organizational ability to even sense demand changes, or agility to react to these changes, or the Product development or manufacturing changes required to effect this change quickly enough.

 

Driver 4: Competitors- Finally the driver that is recognized last by organizations is when competitors have already reaped the benefits and thus taken a lead that is difficult to bridge. To continue with the auto industry references, auto companies who concentrated on selling gas guzzlers while others designed and launched hybrid fuel cars is the strongest example that comes to mind.

 

My point of view is that companies, including retailers and manufacturers alike, need to assess if they are in an industry or segments that have some or all of the above drivers. If yes, they should have a clearly defined framework to holistically address these drivers and plan proactively for change detection, change capability and change management. Retailers, for instance, need to understand that many of the products they sell would have different characteristics, and there are possibly multiple drivers for multiple categories they would need to think through simultaneously.

 

Finally, my view is that for companies where there are no such drivers, going green can still become a part of the greater corporate social responsibility initiative, but only if those companies have a demonstrated track record of putting real dollars behind their CSR initiatives. Those companies that don’t fit any of these criteria- my hypothesis is that going green will not be a sustainable initiative, and should not occupy management bandwidth till such time it becomes sustainable. A half-hearted attempt with no real driver would only kill future real initiatives.

 

Are you facing the question of whether to go green within your organization? If yes, what has been the thought process, including for scoping and timing this right?

 

Posted by Aditya Mittal at 06:50 AM | Permalink | Comments (1) | TrackBacks (0)

This is a question that I hear frequently.  Everyone seems to recognize that a quick response time is the ultimate feature, but very few people understand all of the factors that can harm performance.  In this series of blogs, I will try and shed some light on the different factory that combine to determine your site’s ability to perform.  In this blog, we will discuss the impact of requirements on the overall performance of the site. 

 

I saw a cartoon some years ago that showed a businessman frantically searching for a lost item in a room labeled “Testing”.  Another character walks up and asks, “What are you looking for?”  “Site performance”, the searcher answered.  “Where did you lose it?”, asked the visitor.  “In Requirements”, he answered.  “Then why are you looking for it in “Testing?”  He answered back, “The light is better here”.

This would be funny if it weren’t so sad.  We proceed with a multi-million dollar site construction projects while deferring consideration of the system’s performance until the site is completed and tested for correctness.  We allocate 2-4 weeks to validate that the performance is good; but it almost never is.  Then we spend the next 6 months tuning the system until it barely passes, all the while operating under the suspicion that we don’t know what we are doing. Finally, the business gives up and released a site that is 3 seconds slower than originally specified.   But it doesn’t have to be this way.  There is a process to follow that will greatly improve the chances that you will be fast enough to go live on schedule.  The first part of that process involves the requirements.

 

Like the searcher in the proverb above, we often lose all chance of performing well before the first line of code is written.  The eCommerce business is filled with creative people because that is what is required.  Web commerce is a moving target and people who lack vision rarely last long.  Creative agencies are also filled with creative people.  Their mission is to create a compelling Web presence.  This means that they need to “push the envelope” and bring features to their designs that are above and beyond.   So putting these two groups in the same room will produce a “violent agreement” that this site redesign will be the most feature-rich, coolest, most advanced whiz-bang site on the Web.  They create screens are a marvel, filled with every possible up-sell, cross-sell, top-ten, also-bought, new-product pages know to man.  Then they toss it over the wall to some programmers and shout, “Make it respond in less than one second”.  If the poor programmer dares to protest that they pages are too fat, he gets that “a real programmer wouldn’t complain, he would figure out how to make it work” treatment.

 

So our hapless programmer concludes that “mine is not to reason why”.  He gets busy and creates pages that he doesn’t believe will ever perform.  Six months later, he delivers the code.  The performance test shows that the new system will be “dog-slow” and the business expresses disappointment that the programmer let them down.

 

But it doesn’t have to be this way.  Instead of starting with all the creative people operating in a party mode, invite one party-pooper, the program architect.  Architects are famously lacking in creativity and diplomacy. (They admire the Google home page for its quick response) They will ask you questions like, “What response time are you expecting for this page?”  They will then, rudely, tell you that you can only have one .JSP file, one style sheet, one javascript file and 45 graphics object like screen-trim and pictures.  In addition, they will tell you that the total size of the page and all of its objects must be under 400k.  They will veto all third party-calls, Flash, and dynamic content generation. (No wonder they don’t often get invited).  The creative types will then decide to have the meeting over with out these “kill-joys”.  If you do that, you will live to regret it.

 

The right response is to find the balance.  Challenge the creative people to use restraint.  Challenge the architect to accept a few creative elements and to create a proof-of –concept that will prove whether or not these elements will cause the performance problems, and if so, how much.  The business can then make the tradeoffs between features and performance.

Posted by Stephen Alan Potts at 05:45 PM | Permalink | Comments (5) | TrackBacks (0)

I am sure that most of you would have a large number of online user ids and passwords – each uniquely identifying you, as a user. While some of those identities have just your name and an email address associated with it (for example, a Gmail® or yahoo® id), some others contain large amounts of information (name, date of birth, addresses, payment information, etc) about you contained within them. Examples are your google checkout® account, PayPal® account or an account that you have created with your favorite online merchant. In effect, you are left with a ton of user ids and passwords, each one of them meant to uniquely identify you – the single and unique you. So aren’t we creating too many identities?

 

One obvious problem with having so many identities is that you have to remember their passwords and other credentials (unless you have the habit of using the same user ids and passwords everywhere – which is another problem altogether). The next ‘not so obvious’ problem is that of keeping your information current. When you move, or when you start using a new email address, would you like to log on to each of these accounts and update information? The third aspect is the time that you have to spend to register on every new website with which you have some business to do with – may be to buy something, may be to join on a discussion about a product that you have or may be to network with people. Not sure if you would share the same experience – I have decided not to interact with some sites only because of the pain of creating a new user profile. Having thought about the problems of having so many profiles for a person, I begin to wonder – doesn’t this problem exist in the real, physical world? Certainly it does. You fill out a different form to join each of the loyalty programs, to open each bank account and so on. But then everything online should be slightly better (at least) than the physical world –that is what I believe in. From the way things are evolving, looks like we are getting better at this.

 

Today, there exists a movement called openID (http://www.openid.net) which aims to clean up online identity management. Before explaining the concept, let me tell you who all has signed up. Google®, Yahoo!®, Facebook®, AOL®, Microsoft®, Verisign® and Sun® are some of the prominent members –this list should tell you a bit about the acceptability of this idea. This movement started as early as 2005, but it is only now that the big players are taking notice. Let me explain the idea - openID is an online identity which will have an associated password. There will be a set of websites called as openID providers who will be issuing these identities. Google® and Yahoo® are good examples. There will be a set of websites which allows users to use their existing openIDs without having to register and create profiles separately. Such websites are known as openID accepting sites. An important aspect is that the accepting websites never get to see the openID credentials that are used. They would want to know the user id (so that they can use the same to identify the customer in the future as well). They can also request for other information – like name, address, etc to be shared by the openID provider. There is no standard set of information (yet) that you can expect from an open id provider that is still evolving. For example, Google would only share name and email while AOL shares date of birth in addition. So the single openID ends up being your unique online identifier.

Want to see this working? That is easy to do. I will show what happens when an openID holder (most of you would be one) visits an openID accepting website. I will be using my Gmail id as the openID and the accepting site is the MySears community website. I start by visiting the login page - https://www.mysears.com/login

 

In the login page, you have the usual login form. In addition you can see some options on the right side. Shown there are some of the most popular id providers. If you have a user id at any of these sites, you do not have to register! You can just click on any of them. In our example, I choose to click on the Google® icon.

I am taken to the Google website and the familiar Google login form is displayed. However, there is a message on the page which tells that MySears is asking to share some information. Since I did this on purpose, I provide gmail credentials. Please note that MySears does not get to see my password.

Once I sign in, Google tells me that MySears is asking for my email and Name. I chose to allow and also checks the ‘remember this approval’ box (so that I do not have to approve the next time). Once I do that, I am transferred back to the MySears website and I am logged in! Please note that during the first time that you use an openID to sign in, MySears asks for some additional information like zip code (which is specific to MySears since that site requires some additional information to work than what Google has).

This was a very trivial and simple example and the only attribute shared is my email. Still I would never have to remember a user id and password for this site. Isn’t that a good starting point? I am excited to say that we already have created working openID integrations with some of the leading ecommerce products. This would mean that an online business which is using one of these products will be able to become an openID accepting site. Other than solving some of the problems described earlier, there is much more to gain for an online business which can act as an openID acceptor. Let us discuss that a later point in time or maybe you can start listing the obvious ones by commenting…

 

 

 

Posted by Mohan Kumar Krishnan at 06:36 AM | Permalink | Comments (0) | TrackBacks (0)

Over the past few months I’ve had many clients outside of retail (banks, airlines, and manufacturers) approach us about learning how to merchandise and target online.

It seems that having your burger “my way” has permeated to all types of goods and services. Companies selling services online are beginning to deconstruct their services into products. Something as simple as an airline ticket is now broken down into a boarding pass, an upgrade, a bag of peanuts, and rumor has it Ryanair has even considered selling access to the restroom.
As a result, the online shopping experience starts with a base purchase, such as an airline ticket. Through to checkout is a challenge to see how much merchandise or service can be tacked on to that base purchase without losing the customer. So how do I maximize the size of what is now my shopping basket?

The answer is to target effectively. Everyone knows that targeted mail is more effective than spam or junk mail. Online presents a unique challenge. There are at least 3 types of data that can drive the offer:
1)      Segmentation – the tradition method for marketing, coming from loyalty programs or straight transaction history
2)      Browse History – customers browse activity in a particular session tracked via Web Analytics
3)      Product Relationships – products related by being similar, complimentary, mandatory, or premium  

So how do we use it?

First and foremost, use all of it. Use it wisely though. Segmentation is the traditional method. Be careful how you use it. Segmentation data coming from data warehouses is by nature relatively old. It has been updated via several data sources, most likely via batch updates. It is good for banner ad space and other lifestyle offers. It is not always great to integrate into the shopping process.

Recent is relevant. Browsing and search history is as recent as it gets. Even using other shoppers history is still used, the old Amazon phrase “people who purchased X also purchased Y.” Real estate on the right side of the web page typically holds browsing related offers. These can be truly effective if your recommendation engine is smart enough to detect a pattern in the browsing. This can be extremely affective for a bank. As users research funds or loans, a bank can offer the hottest product related to the category the user was browsing. If this is tied to the customer segment as a secondary filter, this is like the nirvana of offers.

The foundation for these offers is the product data. It’s hard for non-retail or consumer goods companies envisage their services and products in a catalog. Retailers deal with tens of thousands of products and variants and they get it done. Spend the time with your data to set up the product relationships needed to effectively merchandise. Don’t be restricted by how you have sold in the past. These relationships are important, as are their integration to browsing patterns or segmentation data.

So what offers do you click on? How often do you buy complimentary or upgraded products? How often do you click on an offer because it fits your lifestyle? I’d love to hear your opinion.

Posted by Seth Lively at 11:47 PM | Permalink | Comments (1) | TrackBacks (0)