In its second-largest acquisition, Amazon buys the company for $970 million.
It’s time to grow, and there are new technologies that can help online retailers take advantage of the improving economy. Technology partners can ease the burden of adding new features, letting retailers focus on what they do best.
A new period of advancement in e-retail technology is likely on the horizon now that consumers are starting to open their wallets again. Retailers will want to add new features to their web sites and create new marketing and merchandising strategies that boost sales and keep customers coming back. That means finding technology partners that can free retailers from day-to-day management of their platforms so they can focus on selling.
“E-commerce is a mature market now, which means it has become a market share game, and e-retailers need to think more strategically about technologies that help them service the customer better and convey what their brand stands for,” says Jamus Driscoll, vice president of marketing for Demandware Inc., provider of on-demand e-commerce platforms. “Allocating 80% of resources to platform maintenance and the remainder to marketing and merchandising won’t cut it anymore. Retailers need to put more of their technology resources behind merchandising and creating a great customer experience.”
The right stuff
Content management is a prime example of a technology that takes on added importance as retailers acquire more inventory to meet consumer demand. Retailers want to organize inventory on category pages so that the items they are promoting-seasonal items, new arrivals and items on sale, for example-appear prominently.
“E-commerce is about selling, and with retailers expanding inventories as the recession eases, they need to think more about how to arrange the order of products displayed so they can get the products they may have bought in anticipation of strong demand or products they want to clear out of inventory in front of the consumer right away,” says Jeff Zisk, CEO of SpeedFC Inc., provider of e-commerce and transaction management services. “It sounds logical, but retailers don’t necessarily think about closely tying content management to marketing and merchandising.”
Effective retail sites also need to put the right information in front of shoppers quickly, as consumers now routinely go to e-commerce sites to gather product information before making a purchasing decision, whether they buy on the web or in a store.
Delivering content that helps consumers answer the questions they have with as few clicks as possible can build brand loyalty. That includes making it easy to find customer reviews or information that a product was made from eco-friendly materials.
“Consumers need to be engaged at all levels, no matter what their reason for coming to the retailer’s site,” says Zisk. “Delivering richer content through video or microsites within the site engage the consumer on a deeper level and enhance the value of the retailer’s brand.”
SpeedFC is currently building a microsite for Shopko.com, which sells items for the home, casual apparel and seasonal products. The microsite will provide detailed information about Sony electronics. SpeedFC previously has built microsites for other clients that feature videos on how to use a product and promotional videos that consumers find entertaining and informative.
Plugging in profit
Developing such state-of-the-art marketing and merchandising strategies in-house would require a lot of internal resources. Outsourcing day-to-day management and maintenance of the platform can free up those resources so retailers can apply them to their core business needs.
“Retailers can’t afford to be saddled with infrastructure management if they are to grow their business, because infrastructure is not what their customers care about and reward,” says Demandware’s Driscoll. “What retailers need is a technology partner that not only can manage their technology infrastructure day to day, but also provide them with the tools to excel with their marketing and merchandising strategies and ready-built integrations to best-of-breed commerce applications.”
Through the Demandware Link community, Demandware and partners offer a variety of free plug-and-play integrations between the Demandware eCommerce Platform and third-party applications, for such things as payments, rich imaging and social commerce.
Snowboard manufacturer Burton, which uses Demandware’s e-commerce platform, built a custom user experience using Flash called the Board Finder to help consumers find snowboards that fit their skill level and budget. The Board Finder is deployed within the Demandware storefront and interacts directly with the API layer Demandware provides retailers to access the data and business processes needed to suggestively guide a customer through the shopping experience.
Visitors launch the application by providing basic information, such as height, weight, skill level and price range. By clicking on snowboards suggested on the results page, shoppers can find more information about the item, such as a product detail page that includes tabs at the top of the page for reviews, FAQs and related gear. Shoppers can also link to a page explaining why that particular board was suggested.
“These are the kinds of marketing and merchandising strategies consumers reward,” says Driscoll. “Freeing retailers from day-to-day infrastructure management and providing access to cutting-edge applications and empowering them with the capability to build their own applications allows them to create marketing and merchandising strategies that keep them out in front of the competition.”
Following its practice of seasonal releases, Demandware upgraded its platform in summer 2009 to include 46 new features and enhancements across merchandising, search promotions, cross-channel integration and site performance functionality.
Another way retailers can merchandise effectively, without burdening their I.T. departments, is to take advantage of inventory-management tools built into sophisticated e-commerce platforms.
Knowing the level of available inventory for each product in the catalog, what’s been sold on the web and through other channels, what items sold in each channel, and how many have been returned provide retailers with a clearer picture of how available inventory matches up with marketing plans. SpeedFC’s order management system generates reports on up to 75 variables about orders and inventory so retailer clients have the data they need to make the right decisions, and make them quickly.
“Information about orders and inventory is a valuable tool for making marketing and merchandising decisions,” says Zisk. “When each department within a retailer’s business has detailed inventory and order information the organization as a whole can make better decisions about how to sell their inventory.”
The mobile experience
Even as retailers have much to do to keep their conventional web sites up to snuff, they face a whole new world of challenges in the mobile commerce arena.