November 8, 2001, 12:00 AM

Guided selling application boosts online conversions by 76% at goodguys.com

Automated sales rep feature helps shoppers choose among complex product specs to close sales of consumer electronics.

Kurt Peters

Executive Editor

Multi-channel consumer electronics retailer The Good Guys increased its web site conversion rate by 76% within four weeks after it implemented a guided selling application, Active Decisions’ Active Sales Assistant. The technology is essentially a search engine that helps online shoppers narrow their choices by questioning consumers online about the relative importance of variables such as brand, price, and other product features, and then issuing product recommendations based on those consumer preferences. It also allows online shoppers to list different models on-screen in a side by side comparison of product features.

The lack of live sales help in the online environment is a particular challenge for shoppers trying to choose among different models of big-ticket items that are differentiated by a wide and complex set of attributes, says Dan Greenberg, VP of Marketing of Active Decisions. “Even at best-of-practices sites, you still find if you navigate down the TV or DVD aisle that you’re presented with 50 to 100 different models, with no guidance to help you figure out which one is right for you,” he says.

The technology appears on goodguys.com as a “decision guide” feature consumers can click on. Once they do, they transfer to the application hosted on Active Decisions’ server, which guides them through the decision process, issues purchase recommendations, and delivers them back to goodguys.com’s transactional system at the time of purchase. The transition is invisible to consumers.

Active Decisions collects and maintains all product specification data for the selected categories on the retailer’s site. It gets ongoing direct feeds on new models as they roll out from most of the major consumer electronics manufacturers. It also maintains a large staff of category experts to reconcile the presentation of data from different manufacturers before it’s put on the retailer’s site, for example, lining up the “image stabilization” feature offered by most camcorder manufacturers with the so-called “Sure Shot” feature – the same thing – offered by Sony. That lets shoppers using the tool do a strict apples-to-apples comparison of product feature data.

Implementation as a hosted application costs retailers from $100,000 to $300,000, depending on the web site’s requirements, says Greenberg, which includes all integration costs. Active Decision’s Active Sales Assistant also supports several sites including Sony’s transactional site and the appliance area of Yahoo.

Retailers have found that payback on investment takes about three weeks, says Greenberg. “Retailers have spent millions building sites and brand and acquiring customers,” he says, “and the biggest ROI is anything they can do to increase the sales rate among people already visiting their site.” In addition to driving up online conversions, the technology has produced an offline effect as well, he adds. For every consumer in the test who used the online tool and then purchased online, another two used the information they’d gathered with the tool to make an in-store purchase.

 

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