The e-retailer reports a $126 million net loss, stemming from a $640 million year-over-year increase in spending in the quarter on technology and content ...
In 2004, Abt Electronics had a problem organizing more than 10,000 SKUs on its web site. Since partnering with a provider in early 2005 the retailer has deployed detailed decision tools that help shoppers search by product features and intended use.
In 2004, Abt Electronics Inc. knew it had a problem organizing more than 10,000 SKUs on its e-commerce site. Customers were having a hard time plowing through the mountain of data on consumer electronics and appliances, and customer service agents were hearing about it.
Late that year, Jon Abt, vice president and head of e-commerce at Abt Electronics, learned of decision-making technology from Guidester Inc. The provider was looking for retailers to showcase its technology, beginning with digital cameras.
The match was obvious. “We needed technology to guide customers to products and help make decisions more easily,” Abt says. “They had the database to ask the right questions.”
The provider also had the technology in hand. That was appealing because Abt, No. 156 in the Internet Retailer Top 500 Guide, had explored building a search tool in-house and knew it would take considerable time to do so.
The search technology also went beyond features and functions. “We liked the way it worked,” Abt says. “It didn’t just ask shoppers how many megapixels they wanted in a camera, but how they were going to use it.”
By March 2005 Abt began deploying the tool and since then has implemented 17 more in product categories such as TVs, wine refrigerators and vacuum cleaners.
About three months after the camera search technology was implemented Abt noted increased sales in the category. Conversion rates for products using the “Guidesters” now range from 2% to 8%, Abt says.
The best part? “There is no investment on our end,” he says. “The model is to have manufacturers pay. They can sponsor the tool so their products appear toward the top of the page, like Google AdWords.”