Just getting back into the swing of things from getting back from Vegas last week and have lots of interesting news to get out on the blog over the next few days. However in the mean time, here are some key insights that were shared at the Shop.org Annual Summit 2009 conference:
- By far the best online retailing show, both in the quality of sessions, # of retailers attending and supporting partner/vendor ecosystem.
First from the Chariman and CEO of Macy*s
- In regards to Macys.com + Bloomingdales.com, these two sites generate $1 billion in online sales, but an additional $5 billion+ in store sales influenced. (Macy*s total revenue is $24B for reference)
- A multi-channel Macy’s customer is worth…
- 2X more than just a store only customer
- 50% more (1.5 times more) to the stores than just a store only customer
- Macy’s has found that $1 spent online influenced $5.77 in additional store purchases within first 10 days (Dunhumby analysis)
- Sees over 3X conversion for those consumers that go into a product finder experience online
- Macy*s nationalized all operations back to NYC, but created 65 “zones” of local decisioning at the market level so as to still receive intel on the local level
- Has over 300,000 product reviews live on Macys.com
- The online and store sides of the business each have dedicated staff that both report to the same person (the CMO)
Forrester shared some stats such as:
- 22% average open rate for emails
- 0.4% click thru rate on social media ads
eBay has some of the best insights around eCommerce such as:
- eCommerce growing from its current 5% of offline sales all the way up to 15% to 20% of offline sales over the next 5+ years
- Forecasting that up to 40% of all online access will come from mobile devices within the next 2-3 years
- From the eBay iPhone app alone, this app has driven over $400 million in volume for eBay
- eBay has over 170 million items live at any point in time, with only 10% – 12% of these items being structured data
- Over 75% of eBay’s traffic comes from organic sources, but they do buy over 20 million keywords from Google for example
- The largest seller on eBay sells over $40 million worth of stuff
- Auctions at this point only account for 25% of all volume on eBay
Resources Interactive offered up:
- The US household on average is making less money: $50,303 in 2009 from $51,295 in 1998 (US Census)
- Folks are getting thrifty: Sales at Goodwill stores open at least a year ago rose 7.1% in the first three months of 2009 over the same period a year earlier
- ROBO shopping is a behavior that youngsters are learning: 69% of young people now research all purchases before they buy anything
- Deals are red hot: Coupon sites have been the 2nd most visited category on the Internet, behind job sites, for about a year (eMarketer May 2009)
- The concept of buying branded products for many digital moms is dead: According to TNS Retail Forward , about 42% of moms are buying store brands all the time
- ROBO shopping overall is the only way consumers are shopping now. Its not a trend its status quot: Some retailers are reporting up to 98% of in store shoppers report that they have already pre-shopped online before hand according to BIGResearch and Resources Interactive survey from August 2009
LIVE Report @ Forrester Consumer Forum 2008
Speaker: Paco Underhill, Author, Why We Buy: The Science Of Shopping, and Founder and CEO, Envirosell
Five (5) Key Issues Facing Today’s Shoppers That Retailer Must Recognize:
1. The visual language is evolving faster than spoken language
Example: With an ever increasing aging population (that is the most affluent customer segment), retailers need to be more cognizant of eyesight issues that come with maturity that result in color, changing light and contrast not being seen the same way as the young 25 year designer that is coming up with visuals. One of the largest physiological drivers of this is the yellowing of the cornea and lens that occurs with age.
2. The retail world is owned, managed and designed by men, BUT women are expected to participate and shop within this non-female friendly environment
Example: The “butt-brush factor“. Ladies are apt to stop browsing if anything rubs against their rear ends. Envirosell caught this on film in a big department store, as shoppers perused men’s ties in a narrow aisle. When the tie rack was moved to a wider aisle, the extra tie sales paid for Envirosell’s services in a paltry six weeks.
3. Shoppers are increasing more “time poor” than “money poor”
Example: Retailers need to embracing pre-shopping on the internet for larger durable purchases as these type of goods require additional information. Having shoppers come in prepared is in the stores best interest
4. The definitions of ‘Local’ and ‘Global’ are becoming really blurred as well as the ‘Store’ and ‘Online’
Example: Blockbuster, Borders Books and Best Buy have all been pushing in-store connectivity to aid the in-store shopping experience
5. Maslow’s hierarchy of needs is being re-ordered all the time
Example: In a recent global behavioral study, a majority of participants first paid their mobile phone bills BEFORE their grocery bills
LIVE Report @ Forrester Consumer Forum 2008
Speaker: Sarah Rotman Epps, Analyst, Forrester Research
There is a whole host of new devices that have already shipped or are on their way in the next 7-8 years that are centered on increasing the number of digital transactions that consumers create. It is important that the retail industry keep up with this brisk pace of innovation so that your business can be aware and leverage these new technologies. However before entering the rabbit hole of future-gazing, there are a few guiding principles to recognize in this new space to help guide your frame of reference:
- Transactions will become increasing dispersed by these devices / technologies
- Different access points will become the norm
- Content and transaction will become highly modularized
Here Today (albeit small in most cases):
- E-Ink – Paper quality display that is flexible. Imagine a magazine or newspaper that looks and feels much like the original paper versions, except the pages are all E-Ink pages that can change. Pick up your E-Ink newspaper off the coffee table in the morning, and it will be updated with that day’s edition via wireless networks. Pick it up an hour later, and breaking news will be refreshed
- The Flip – 1 million units sold already & a ton of press around it. Transactional capability built into it. It can access YouTube videos directly for example as well as it’s own website, Flipper
- Fitness / Well Being – All of the below have transactional abilities
- QR Codes – 2D bar codes that mobile phones with special image reading software can “read” and decipher
- Ikan Scanner – Grocery shop from your kitchen by just scanning items as you use them up and the Ikan will re-order them.
- Game Counsels – Increasing wired and connected
- Chumby – Open source alarm clock that is an ambient device. Linux based, WiFi enabled that a user can plug in any RSS feed (eBay bids updated, Facebook friend updates)
- American Airlines Travel Bag Facebook Application – Immediate feedback was the users want more transactional capability. Basically to be able to do everything that one can typically do on AA.com, just within Facebook.
- REI’s iPhone app – improves in-store experience. PowerReview content is made accessible.
- Virgin America – Seatback monitor that creates a competitive advantage that also a point of service for passengers
- Harrah’s Casino’s – Microsoft Surface table driving increases in show/event ticket sales
- Sling Catcher – The next generation of the Sling Box. It pumps internet video to your TV. Basically it should be seen as a cable killer.
What’s Coming:
- Location Based Interactions – Geo-targeting via SMS & mobile application
- Near Field Communication (NFC) – information and payment use via mobile devices
- Biometrics helping improve mobile security
- iTV where all TVs will have a home page and interactivity will be channel and show-specific
- Ambient Devices will operate at the periphery of our attention and will react to changes in color, movement, weather, etc
- Holograms will bring 3-D to business
LIVE Report @ Forrester Consumer Forum 2008
Speaker: Adele Sage, Analyst, Forrester Research
So what do you think the answer would be if you asked 100 US shoppers the following question…
Thinking about the most recent time that you researched in one channel and then bought in another channel, how satisfied were you with the overall experience?
Here is the shocker. Only 61% of US users were satisfied with their recent research on the web – BUT -in-store purchase experience. What about the other 39% of users that were dissatisfied with their cross channel experience? To make matters worse, only 56% were satisfied with their store to web purchase as well. (Source: Forrester North American Technographics Q3 2008 survey)
So here are three (3) best practices on multi-channel design for creating a better cross-channel experience:
1. Choice
- Can the user complete their goal in all required channels?
- Can the user control how they interact with the company?
- Example: Best Buy – Includes a ‘call me’ feature on their item detail pages that allows the user to choose both the manner of communication (phone in this case) and the timeframe (as the user can schedule when the Best Buy agent will call them back)
2. Consistency
- Is the information consistency across all channels?
- Is language consistent across all channels?
- Example: Kohl’s – For some items, the actual photograph of the product is the exact same both online as well as in-store (eg the item’s actual package)
3. Continuity
- Is the user presented with a clear transition path?
- Is the user’s context preserved across channels?
- Example: Circuit City – The customer call center1-800 phone number is included in practically every touch point of a web purchase experience starting with being permanently displayed in the header, to the help page, to the order confirmation page to the email order placed confirmation that is sent to the user
LIVE Report @ Forrester Consumer Forum 2008
Speaker: James McQuivey, Ph.D., Vice President, Principal Analyst, Forrester Research
Maslow’s Hierarchy of Needs Is Wrong. Needs are…
- Not exclusive
- Not hierarchical
- Not fixed
4 Universal Needs That People Share (Chilean economist Manfred Max-Neef created this universal needs theory about 20 years ago)
1. Connection
2. Uniqueness
3. Comfort
4. Variety
What we know about these universal needs…
- Everyone has all four
- But they vary for each individual
- Each person’s need profile can also shift
- As a result, people will tradeoff needs against each other
Convenience Is A Way To Delivery A Solution (your product/service with a benefit) To A Need In A Way That Overcomes Any Adoption Friction (barriers).
- When reduced to an equation, it looks like: Convenience = Benefits – Barriers
- From this, a Convenience Quotient (CQ) can be generated which…
- Is a single score between -1 and 1 with 1 being the best score and -1 being the worst score
- Tells you how you compare to your immediate competitor(s)
- Tells you how you compare with all alternatives ways to meet the same need
What To Do?
1. Know your target consumer’s target need profile & recognize that they will shift, but NOT change fundamentally
2. Know & increase your convenience quotient (CQ)
Conclusion: People share a set of universal needs. Satisfy those needs with convenience and you will win.
(4.00 out of 5)
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