For Jack Ma, executive chairman of Alibaba Group Holdings, today is an extremely busy and lucrative day because the company he founded 15 years ...
Analytics is providing answers about how customers use web sites, but retailers want more. Includes a comprehensive list of analytics providers.
Seeing is believing for Mike Frazzini, vice president of technology and operations for eBags Inc.
Frazzini regularly uses web analytics to determine which merchandise customers shop for most frequently at eBags.com. So when improved analytics delivered unexpected information in an easy-to-visualize format about the effectiveness of the site’s gift center during the holiday season, Frazzini made an instant change in site design. “With advanced analytics we can now see and analyze instantly how customers are reacting to site content and merchandising categories and make very quick changes,” Frazzini says.
Using a new application that superimposes clickstream and viewing information on top of single web pages and merchandise categories, Frazzini could tell right away that more shoppers were clicking on eBags’ gift center portal, selecting the Gifts for Him link, and purchasing a wider variety of men’s wallets, briefcases and computer bags. With earlier versions of web analytics tools, Frazzini would have needed at least one more analyst to break down reams of reports and help turn the data into usable information-and the process would have taken days. But with analytics that provide access to real-time information and deliver data such as conversion metrics and sales totals in easier-to-read formats, Frazzini can make quicker decisions and take swifter action. “That’s something we couldn’t do before,” he says.
The instant display of information, an enhancement to the Omniture Inc. ClickMap product that eBags uses, is just one example of the strides that web analytics have taken in a relatively short time. Just 18 months ago, retailers were happy to know what paths customers took on their journeys to checkout or, more often, abandonment.
Only the start
Those advances are only the start, though. Retailers today are demanding more sophisticated features and functions, vendors and analysts say. And vendors are responding with next-generation tools just hitting the market now or scheduled for release this year. They feature larger amounts of standardized information, more data reporting categories and embedded graphics. And in the research-and-development pipeline are tools and consulting services that let online retailers summarize statistics and compare their performance against other merchants or users of the same analytics package.
Furthermore, retailers are telling vendors they don’t want applications that just deliver static information. What they really want-and where the market for retailing web analytics is heading-are tools that deliver a wider variety of data in formats that make it easier to summarize and act on constantly changing merchandising trends. “Analytic tools can generate so much information that the danger to the retailer is having too much data that can’t be compiled into actionable results,” says Bob Chatham, analyst with Forrester Research Inc. “Vendors know this and they’re responding with new features and functions that summarize data and graphics into easily understood reporting categories.”
By now most web retailers know the basic reasons for using web analytics, including measuring who’s coming to their site and staying, and using data to track customer traffic and conversion rates. Early web analytic reporting tools weren’t user-friendly for many managers beyond webmasters and information technology staffers. Merchandising and marketing managers may have had access to site traffic information, but they needed help from IT to compile historical data and summarize the reports.
But now that web retailers are demanding easier-to-use analytic applications that deliver a wider range of information to a more diverse group of users, vendors are responding with a variety of new features and functions. Graphical display of data, such as that used by eBags, is just one. Another is consulting and comparison services that allow retailers to benchmark their performance against others.
DoubleClick Inc., for example, now offers users of its Strategic Services access to benchmark data compiled from 30 DoubleClick retail customers. With access to a wider variety of performance information, and help in interpretation from DoubleClick data analysts, web retailers can analyze more than 800 customer performance and relationship metrics, pinpoint where improvements can be made, and develop an implementation strategy.
Flax Art & Design is using a combination of historical analytical reports and outside analysis to find ways to improve poor retention. Traffic reports revealed that the Flax site was getting plenty of traffic. However, 71% of shoppers left after visiting only the splash page that displayed links to Flax’s three brands’ home pages, instead of sticking around to view the merchandise and purchase art supplies. . After studying conversion, traffic and sales reports, Strategic Services analysts helped Flax determine that it was offering too many portals on the home page. Visitors came to the site looking for flaxartandesign.com but were confused by links to three different shopping portals.
Retention rate up 30%
By moving two of the portals to inside pages and redesigning the home page to feature just Flax Art & Design, the retailer improved its retention rate by 30% and increased sales by 5%. Flax Art could have used analytics to identify the problem on its own. But with help from external analysis and performance reports, Flax was able to make design changes and see improvement in days rather than weeks.
“Retailers use web analytics to determine their own site performance, but where customers told us they really want help is in comparing how they benchmark against others,” says Nancy Joyce, DoubleClick vice president and general manager of analytics. “They already may know that their site drop-off or shopping cart abandonment rate is high, but by looking at and interpreting the results with help from others, they may come away with better insight on where the problem begins and what steps they can take to fix it. Flax Art & Design is a good example of this.”
And now vendors are pushing the usefulness of web analytics beyond online retailing-again as the result of retailer demand. Coremetrics Inc. surveyed 50 retail customers recently on how future applications could solve their most pressing business issues. The survey found widespread use of analytic tools among retailers to improve site design and measure the effectiveness of various online advertising campaigns.