There's a Radio in my Head

Thursday, February 23, 2006

Day One recap

The days are split into a general session, which is attended by all, and three different tracks, each of which focuses on different elements of eCommerce.

General Session

Focusing on the Integration of your Brand in the Customer Experience
Sharon Turney, President & CEO, Victoria's Secret Direct
Fairly okay presentation, but it seems like it was written by the marketing department as a generic speech. Their web site had 8 million visitors in December, with an average of 20 pages per visit. She recommends that retailers focus on the few that drives the many - in their case, whatever bra happens to be hot at the time. She noted that in order to be successful, multiple ideas need to come from multiple sources - internal, partners, vendors, competitors, and of course customers. Their content philosophy is that bells, whistles, and editorial copy distract users, so they avoid those elements. They have discovered that high-dollar clientele is willing to shop at low-price stores (she gave an example of the woman parking her Lexus at Target). VS tries to focus on innovative and emotional connectivity to their clients. She pointed out that the average web user receives 361 emails per week, which highlights the need to be unique with email marketing.

Are Retailers Meeting Customer's Needs?
Larry Freed, President & CEO, ForeSee Results
Larry focused on the American Customer Satisfaction Index, which is handled by the University of Michigan. He had some interesting information:

* The average customer visits a site 2-3 times before making a decision to buy.
* If your site has high customer satisfaction, you can and should leverage it.
* eCommerce has very high customer satisfaction - higher than mail order and retail.
* and Circuit have low customer satisfaction.
* Amazon and Barnes & Noble have very high customer satisfaction. People on Amazon expect the "Amazon" experience, even from retailers selling through their site.
* In 2004, there was a very strong drop in satisfaction as the shipping deadline passed. In 2005 e-tailers set better expectations and there was no drop in satisfaction when the deadline passed.
* Infrequent visitors make up 24% of the audience, and are significantly less satisfied than frequent visitors. The strong recommendation is to meet the needs of visitors who DON'T purchase.
* Satisfaction drives conversion, loyalty, and retention

True loyalty has enormous value, while "purchased" loyalty is almost worthless - competitors can out-bid you and buy your customers' loyalty. True loyalty is earned, not purchased, and is far more durable and valuable.

Important take-away: Analytics tell you what HAS happened. Satisfaction metrics tell you what WILL happen.

Transitioning from a Multiple Channel Organization to a Multi-Channel Enterprise
Sam Taylor, SVP, Online Stores & Marketing,
Sam spoke about conflicts BB experienced as their site matured. He likened it to kids playing in the same sandbox, arguing until they learned to get along. BB tried several strategies to resolve the conflicts. What it came down to is:

* Share the money
* Share the data
* Share the solution & the experience

Interesting market data:

* 50% of households with HDTV don't receive HD broadcasts
* 34% of households with digital cameras don't print their own photos

Best Buy has placed great emphasis on their Geek Squad, which currently totals 10,500 agents, all of whom are BB employees. They offer in-home, in-store, and phone support. Best Buy also now does their own installations, no longer outsourcing it. Customer satisfaction jumped when they did that. Best Buy is now offering in-home consultation and system planning.

Their in-store pickup has been extremely successful. 40% higher AOV than online-only. 20% make additional purchases. 65% are new to In-store pickup is a major initiative for them this year.

Next Generation of eCommerce: Delivering a Differentiated Customer Experience
Jim Caldwell, Director WebSphere Commerce & Retail Software, IBM
Allison Nichols, Executive Consultant, IBM Atlanta Innovation Center
Great presentation - one of the best I attended. IBM shared the following:

* Sources of differentiation are diminishing
* Consumers are totally in the driver's seat
* Customer experience is the only sustainable differentiator
* The web plays a growing role in the customer's experience
* A next generation eCommerce platform can help deliver a differentiated experience.

IBM then showed a beta demo of a new product selection tool. It is in Beta on LL Bean's site, and inaccessible without the secret url. It was, quite simply and by far, the most impressive product selection "solution" (I'm starting to despise that word, by the way) I have seen. It's Flash-based, and allows the customer to do almost anything - far frendlier than guided navigation, and very high cool factor. I'll describe it next week.

There may have been a perception of IBM sort of lagging behind the industry, but it's pretty obvious they've made up any lost ground and zoomed past the pack. I spent a great deal of time chatting with them at their booth, and of all the vendors I talked with (too many to count), they were the only one who wanted to talk about us, rather than pitch me on their hot new thing. They just exuded an air of interest and intelligence- it was rather refreshing.

How Brands Become Icons: A CEO Panel Discussion
Kent Anderson,
Marie Toulantis,
Michael Crotty,Bergdorf Goodman
Shelly Nandkeolyar, Home Depot Direct Brands
Patrick Bartlett, Canada Post Borderfree

* The web can add sizzle to a brand relatively inexpensively and efficiently
* Segmentation is essential - your best $$$ customers deserve your attention

When asked what each considers the key metrics,

* Canada Post Borderfree: Customer Value Index, which actually drives their corporate bonuses. They have extensive customer surveying to obtain this.
* Order composition, cross-sell, and # of inquiries to orders
* Home Depot: Top skus (Daily) and categories
* Bergdorf Goodman: Conversion and getting the absolute most out of the home page
* Macy's: Cross-shopping (in-store, online, and proprietary credit card applications and use)

Home Depot's goal is to make their site their brand's flagship.

The "Cover" home page can make a huge difference from one week to the next, and it's not possible to highlight everything there. Suggestion was to create "boutique" home pages for special events/seasons/product/categories.

Bergdorf treats their emails and catalogs as unique issues of a magazine. Each one needs to be interesting to their customers.

Play to the customer's passions - and more importantly UNDERSTAND WHAT THOSE SPECIFIC PASSIONS ARE.

One thing all of these CEOs have in common is they listen to the customer, and rarely try anything new without testing it first.

What can suppliers (our manufacturers) do to help? Provide streaming video, even commercials. Provide demos. It's cheap for us, and helps brand us and them as being topical. Retailers need to be prepared to handle this content sooner rather than later. It also keeps the customer from going to the vendor's site for more information. All agreed that it is crucial to have the manufacturer's "brand story" on our site.

All agree that there's too much friction in friction-free commerce, and that the Barnes & Noble concept of "Fast Cashiering" needs to be a key metric. There was general agreement at many sessions that online checkouts are too long and way too invasive. This is one thing consumers are universal in not liking.

Search & Metrics Track

Maintaining a Balance of Improved Search Functionality and Projecting Your Brand in an Already Effective Search Campaign
Don Steele, Director of eCommerce, The Food Netwetwork
The Food Network is an Omniture shop. For their SEO, they find what terms have the highest conversion and invest heavily in them. For them, their top terms are their celebrity chefs, or their talent.

Moving theNeedle When You're Already At The Top
Noah Maffitt, Director of eCommerce, Office Depot
Rich Stendardo, Industry Manager - Retail, ENDECA
This was pretty much a sales pitch (Home Depot uses ENDECA). The session title is a little misleading, since Home Depot's search engine really didn't work before they got ENDECA. Nevertheless, there was some good info shared.

* Rule #1: Don't mess up what works
* Rule #2: Try, test, iterate. Repeat as needed.
* Rule #3: Don't forget Rule #1.

The biggest opportunity to gain through site search is with new customers. If your search doesn't work, they're outta there. Makes sense.

Customizing & Personalizing Your Product Mix Based on Proven Shopping Behavior
Sally Babcock, SVP, American Greetings
This session actually was about A/B testing, which I learned most do NOT do. We're definitely in the minority. Some good pointers:

* Don't be afraid to retest what you've tested previously. What worked last year may not work now.
* AmericanGreetings uses Omniture, and they love the instant monitoring capabilities. Omniture also is very good with A/B testing.

She recommends testing

* Home page
* order paths
* merchandising
* cosmetics
* editorial
* payment
* marketing messages
* benefit statements
* mini-sites

American Greetings has an entire marketing team focused on analytics and A/B testing. They will often do 90-10 tests first, then 50-50 tests. They've culled some bad ideas that way. They use 30-day cookies, and ensure the same version of the test is served.

Beware that any promotional changes (i.e. new home page content) during a test can drastically affect the results.

AG has found that users are usually very comfortable using Beta areas/sites.

Measuring and Analyzing All Data Captured from Search to Maximize Future Sales: A Panel Discussion
Don Steele, The Food Network
Greg Foglesong, The Home Depot
Ed Bussey,
Dave Williams, 360i Search
This dealt with SEO, and wasn't that illuminating for me. I did learn that The Food Network bids on 15k keywords, Home Depot bids on 160k, and Figleaves bids on 100k.

They agreed that onsite search needs to serve relevant institutional content as well as relevant product results.

Mastering Site Search by Understanding what your Metrics are telling you
Greg Foglesong, The Home Depot
Home Depot receives 400k visits/day. They use their search results page to push content - featured products, top sellers, and promotions.

Best practices:

* spell correction
* "Did you mean?"
* Category matches
* Thesaurus
* Redirects

Focus on these levers:

* Thesaurus
* Redirects
* Search promotions
* Navigable attributes
* Product data modifications
* Relevance ranking/search tuning

Involve the web team, marketing, and merchandising in search.

* Weekly review of top terms
* Quarterly review of categories and trends
* Category reviews when new products are added

Strongly suggest customized landing pages for top category searches. They have seen a major lift.

Conversion: identify outliers and missed opportunities

Goal: serve the products BUYERS are looking for.

Online Analytics: Turning Data Into Dollars
Steve August, VP of Customer Marketing, Brookstone
This was definitely an executive-level presentation, and dealt with Brookstone's concept of a product's "contribution." It dealt primarily with SEO. In fact, nearly all of the "search" discussed in all sessions was SEO, with site search definitely secondary.

Re-engineering Your Enterprise through the use of an Optimal Dashboard of Web Analytics: A Panel Discussion
Justin Miller, eBay
Steve August, Brookstone
Sally Babcock, American Greetings
Larry Freed, ForeSee Results
Kent Zimmerman, The Finish Line
eBay has 25-30 people who do nothing but continually examining the qualitative customer experience, and the same number examining the quantitative customer experience.

* The QUANTITATIVE data tells you what happened
* The QUALITATIVE data tells you why it happened

Not every customer wants a "relationship." Many just want to buy something. LET THEM.

If your site offers any sort of freebies, make it very easy for people to find them. If that's all they came for, finding them easily will translate to a good site experience, even without a purchase. Having to work to find them will inevitably translate to a bad experience.


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