May 29, 2009, 12:00 AM

Sponsored Supplement: Technology investment for now and the future

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Increasingly a major aim of performance testing is to track metrics that measure performance in relation to the cost of the conversion. Every malfunctioning page link or slow-loading page raises the possibility the shopper may contact a customer service agent for help or abandon the transaction and the retailer all together. That is expensive since the cost of having a service agent handle a customer inquiry is three to five times the cost of self-service through the web site.

“In today’s economy, it is all about ROI, cutting operating costs, and whether the technology can enhance the shopping experience and drive incremental sales,” Santos says. “It is incumbent upon vendors to show retailers they can meet these criteria.”

Thinking of metrics as a measure of a site’s financial health pushes retailers to consider all the angles of performance, not just the most obvious ones. Using this line of thought, analytics can be applied to determine whether product pages are showing up in site search results.

A page is visible to a site search engine only if it is tagged with the proper HTML code. “If an apparel retailer is not seeing much traffic to related pages from site searches for women’s slacks, that’s an indication those pages may not be properly tagged and aren’t showing up in the site search results,” says PM Digital’s Sandberg.

Test keywords

It is also recommended that retailers regularly test keywords in their dictionaries. This is important because keywords purchased for paid search may unexpectedly rise in price or deliver a less than expected ROI and need to be replaced with more effective alternatives.

With retailers tightening their search marketing budgets in these tough economic times, they must continue to test long-tail keywords and match types in an effort to lower costs.

“It’s important to test more long-tail, exact-match keywords since they are more cost-effective. This testing could yield higher sales even if the search marketing budget has shrunk,” Sandberg says. “Retailers that don’t test continually are at risk of falling behind the competition, especially if budgets suddenly do increase.”

Tighter budgets, however, are the norm for retailers in this volatile economic climate. While some retailers may not necessarily shrink their operating budgets, they are adhering to them more strictly. As a result, the decision to purchase new technology is undergoing greater scrutiny.

“Performing more due diligence before making the decision to buy a new technology ought to be the norm,” says FitForCommerce’s Wu. “In the past there hasn’t been enough due diligence by retailers or focus on the ROI from a technology investment, which sent retailers rushing into new technologies because everyone was adding them, even though they weren’t critical to increasing conversions or generating larger orders.”

When performing due diligence on any new technology, retailers should demo the technology to see how it works firsthand. By doing so, retailers can determine if the technology will actually meet their needs or if they are buying features likely to be underutilized.

“The economic slowdown has woken a lot of retailers up to the need to better evaluate the technology and make sure it’s what they need,” says Americaneagle.com’s Svanascini. “Retailers should also be talking to the vendor’s customers to find out how well implementation went, and whenever possible, staffers that have experience running the application, since they are closest to it.”

Due diligence

The last piece of the puzzle is to perform due diligence on the financial health of the vendor. The shaky economy has weakened many companies financially. Requesting copies of a vendor’s financial statements is an acceptable business practice, especially during a recession.

“Prospective clients ask us all the time now to review our financials before signing off on the deal,” Svanascini says. “It is very understandable in this climate because we are seeing more e-commerce vendors open to the idea of acquisition because of their financial health than we have seen in recent years.”

Ultimately, the question every retailer must answer before purchasing new technology is whether the time is right to do so. “It’s a big debate, but retailers that take the steps to upgrade the core parts of their platform will be the ones positioned to leapfrog competitors when the economy rebounds,” says Svanascini.


Raising the bar on customer service

Technologies that help retailers keep pace with consumers’ rising expectations of customer service provide a key point of differentiation

Just as e-retailers are evaluating new technologies to create a more satisfying site experience they are also upgrading customer service technologies that are less visible to shoppers but which impact the customer experience nonetheless.

Customer service, specifically live chat, and fulfillment are where retailers do the blocking and tackling that complements the site experience and creates post-sale customer satisfaction.

Making any customer service strategy work requires flexible, seamless technology.

“Regardless of how good a retailer’s site experience and architecture may be, if the customer service experience isn’t top-notch, then the shoppers the retailer fought so hard to attract and convert into customers won’t be coming back,” says Bernardine Wu, CEO of consulting firm FitForCommerce. “Customer service is a moment-of-truth factor in the retail business and retailers that lack the technology to deliver in that moment of truth will not be on solid footing.”

A culture of impatience

Indeed, retailers can ill afford to let shoppers down from a customer service standpoint in today’s volatile economic climate.

“E-retailing has helped create a culture of impatience among consumers,” says Steve Castro-Miller, president and CEO of Bold Software, provider of the BoldChat live chat product, as well as click-to-call and e-mail management applications. “To help balance out the lack of patience among online shoppers, retailers must use live chat to proactively reach out to shoppers that appear to be stuck on a page or struggling with a decision through live chat.”

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