September 30, 2004, 12:00 AM

Ready or not, Christmas is coming

Retail’s all-important Q4 has arrived, and online merchants have been scurrying to get ready. While they’re loaded up with inventory and features for the season, they’re not locked up—in fact, more in-season adjustment of merchandising is one trend that will likely differentiate this holiday season online from last year, industry players say.

Retail`s all-important Q4 has arrived, and online merchants have been scurrying to get ready for their biggest-money months of the year. While they`re loaded up with inventory and features for the season, however, they`re not locked up—in fact, more in-season adjustment of merchandising strategies is one trend that will likely differentiate this holiday season online from last year, industry players say.

"Last year a lot of online merchants set up their campaigns and merchandising strategies with the onset of the holiday season and didn`t change them much throughout the holiday period," says John Squire, vice president of product management at web analytics vendor Coremetrics Inc. However, when a number of Coremetrics` retail clients reviewed their data after the season, they realized they didn`t get the conversion lift they were looking for compared to auxiliary campaigns they ran during the season, in which they changed different recommended products. "We`ll see those retailers moving their merchandising around more in the season," says Squire. "They will do a lot more testing of products on the home page and in different gift categories."

Searchandising

Squire also predicts more e-retailers will also experiment with "searchandising" strategies this season. Essentially, that`s working with site search technology to weight listings so the products merchants most want customers to see in relevant search results appear at the top of the listings. "Most search tools are offering pretty sophisticated information and tools merchandisers can use to tweak site search to merchandise the site," Squire says. "We have seen some powerful examples of how merchants have been able to use these to drive customers to buy a product that wouldn`t normally be the top product returned in that search query."

Chicago-based web design and usability firm 37Signals says that while new holiday-focused site features are already in place at some larger sites, editing, fixing and adding new features that don`t require big lead times will go down to the wire at others. "The truth is there is still a lot of scrambling," says Matt Linderman, usability expert.

37Signals visited hundreds of e-commerce sites during the last two holiday seasons and posted what it considers the best ideas on holiday feature execution on its web site. Based on 37Signals` observation of the past two years, Linderman says one of the most important things for retailers to consider this holiday season is how they present shipping information. "Come the holidays, the number one thing online shoppers want to know is when they will have to order by to get it there in time," he says. Some of the best ideas the design firm has collected on shipping information include presenting it in a timeline or calendar format—like Amazon.com has—vs. putting those dates in a block of text. "The calendar`s an interface people are used to working with. It presents the information visually in a way people clearly understand so they can know when their deadlines are," says Linderman.

One holiday feature that still needs work on many sites is one of the most popular at holiday time. Linderman calls gift-finders "a great first step, but some aren`t as thorough as they could be." One of the best approaches to gift-finders is to configure them so as to allow shoppers to narrow the search according to multiple parameters, he says. Nordstrom`s gift-finder last holiday, for example, let shoppers start their gift search by choosing "gifts for him" or "gifts for her," then narrowing their choices further by specifying lifestyle factors and a price range. "Most sites will only let you choose from one of those three things. A lot of sites make the mistake of thinking the more things they offer, the better. But when you are shopping for that gift in a rush, you don`t want hundreds of choices," Linderman says. "Narrowing results in that way is a lot more likely to get people the results they are looking for."

While e-retailers may continue to tweak merchandising and site features into the holiday season, most are also preparing to support higher traffic while maintaining response times, if last year`s web performance is any indication.

According to web performance monitoring service Gomez Inc., the majority of sites it monitored for five weeks last holiday season across both the Internet backbone and last mile connection speeds maintained a consistent average. Despite performance variances during the day, web site task response time averages changed very little day to day, Gomez found. The web site of apparel retailer J. Crew had the quickest average response time among apparel retailers as measured from the Internet backbone—10.8 seconds—while Kmart.com`s average response time—7.1 seconds—was the fastest among the mass merchants.

On average, web sites remained highly available through quarter. Transaction success rates averaged 98% for apparel retailers and 96% for mass merchants. The holiday metrics, according to Gomez, "demonstrate the stability of retailers` web offerings and serve as a testament to the viability of the Internet as a highly reliable and growing sales channel."

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