E-retailers showing off with innovation
When Internet retailing first began, books, film and music ruled the roost. It was these products that the first online consumers mostly bought. Today, the six books/film/music retailers in the Hot 100 are building on this long history with innovations that advance e-commerce.
Borders Group Inc., for example, moved off Amazon.com Inc.’s platform and launched its own site—a robust, feature-rich shopping destination. The goal was to present much of what shoppers loved about browsing in a Borders bookstore, plus add the magic of e-commerce to create a unique shopping experience. For instance, the new Borders.com offers personalized product recommendations and customer reviews, and videos of exclusive interviews with authors.
The centerpiece of its new site is the Magic Shelf search and navigation feature that aims to emulate the in-store shopping experience of browsing book, CD and DVD titles. An online shopper can make the shelves of the Magic Shelf move vertically or horizontally without moving the rest of the web page.
Apple’s iTunes store this year unveiled iTunes 8, with its trademark Genius feature. A user selects one song, then clicks on the Genius button. The software scours the user’s digital music library and, through an anonymous data link, the libraries of other users who have opted in to the Genius feature. It then instantly creates a playlist of songs it believes complement the original selection.
What’s more, Apple merchandisers had a stroke of genius: Not only does Genius pull together a list of songs in that user’s library, it also recommends songs he doesn’t own that are sold through iTunes.
And Indigo Books & Music Inc. is a pioneer, not just in this category but in all of e-retailing, in that it is hosting its own social network. Membership topped 180,000 this year and is growing by 400 members a day, the merchant reports. Some members are contributing a great deal to the community section and turning other members into buyers. In a move that shows the innovation of leading e-retailers in this category, Indigo is considering a plan to reward these members financially by making them affiliates who receive a percentage of sales they help generate.
A clearer picture
In film parlance, Blockbuster Inc. has turned its e-commerce site from a ho-hum B-movie into a top awards contender.
In 2005, Blockbuster updated Blockbuster.com with a fresh look that delivered movie buffs plenty of content and incentives to sign up for Total Access, a multi-channel program that gave subscribers the option of returning DVDs rented online by mail or exchanging them at participating Blockbuster stores. But then Blockbuster.com maintained the status quo while Netflix Inc. updated Netflix.com with more advanced features, such as personalized movie recommendations and digital downloads.
Now Blockbuster is catching up, under the leadership of CEO Jim Keyes, the former chief executive of 7-Eleven Inc. Blockbuster began transforming Blockbuster.com this summer into a state-of-the-art site that offers movie trailers on the home page, clearly labeled categories, better personalization tools and more reviews and ratings.
Blockbuster.com now also features a digital download center that gives visitors access to more than 9,000 movie titles from major studios such as MGM, Sony Pictures and Universal. “The new design is all about featuring movies and giving shoppers and subscribers multiple ways to rent, purchase or download the films they want,” says Blockbuster chief information officer Keith Morrow. “We added more detail to the movie title pages and made clear navigation a top priority.”
The updated web site will also be the key component of a digital kiosk strategy Blockbuster is piloting in two of its stores in Dallas. “The web will be front and center,” says Morrow. “In the store, customers can use the web-enabled kiosk to make a purchase, check inventory, complete a download or update their account.”
Retail web site design analysts like the level of personalization and attention to detail on the retooled Blockbuster.com. “The level of immersion that site users can get to on a movie page is delivered exceptionally well,” says Dan Kurani, CEO of retail web site design firm Kurani Interactive. “The home page makes it easy for shoppers to select a path, and it’s easy for visitors to get to where they want to go.” Back to top
A magical storyline
When it decided to move off the Amazon.com platform and back to an e-commerce environment of its own, Borders Group Inc. refused to settle for just another retail site. It wanted the new Borders.com to present much of what shoppers loved about browsing in a Borders bookstore, plus add the magic of e-commerce to create a unique shopping experience.
To a large degree, it has accomplished that with a site that offers an appealing visual experience backed by reams of information about its books, DVDs and CDs, says Paula Rosenblum, managing director of research and advisory firm Retail Systems Research LLC. “This is a great site,” she says. “The visual impact of the site is most profound. It has great colors, it captures your attention, yet it’s not cluttered while being chock-a-block full with information. I really like it.”
Borders brought together a team of about a dozen technology vendors to create a site that offers personalized product recommendations and customer reviews, offers videos of exclusive interviews with authors, and provides access to hundreds of thousands of book, music and movie titles.
The centerpiece of its new site is the Magic Shelf search and navigation feature, built with Flash technology by Allurent Inc. and search technology from Endeca Technologies Inc.
The Magic Shelf brings online the in-store shopping experience of browsing book, CD and DVD titles on a shelf—a shopper can make the shelves on the Magic Shelf move vertically or horizontally without moving the rest of the web page. Shoppers who use the Magic Shelf place 62% more orders per shopping session than shoppers who don’t use it, says senior vice president of e-business Kevin Ertell.
In addition, Magic Shelf users are 13% more likely to buy online, 9% more likely to return to shop, and 11% more likely to recommend Borders.com to other shoppers, he adds.
“We realized we had an opportunity to bring a real bookstore experience online in a way no one else had,” Ertell says.
That’s a story Borders is now in a position to tell. Back to top
Bookshelves tell the story
A peek at the books on someone’s bookshelves reveals a lot about that person. This is the foundation of Indigo Books & Music Inc.’s social network. Rather than write extensive personal profiles, community members express themselves through what they opt to place on their shelves.
While more retailers are turning to Facebook, MySpace and other social networks to market their brand, it’s rare today for a retailer to operate its own social network. Indigo Books & Music does, and does so in a way that benefits customers and itself.
“There are customer reviews and lists, but there still is a lot of anonymity in those. We did a lot of research and discovered customers wanted to go deeper, to have their own voice,” says Carolyn Beatty, senior vice president, online. “They also wanted to go deeper to see if they relate to other customers. Now they can filter reviews based on that reviewer’s bookshelf, which shows how much they have in common with that reviewer. It lets community members know if that’s someone whose perspective they would value.”
Indigo receives numerous benefits from its social network, an integrated part of its e-commerce site. Customers who are community members visit the site more frequently, buy more often and spend more per order, Beatty reports. And community has helped in natural search, increasing Indigo’s ranking with Google because members generate so much new content on a daily basis, she adds.
“Community is heavily promoted; it’s clear they’re trying hard to encourage user-generated content and interactions,” says Craig Smith, founder and managing director of consulting firm Trinity Insight LLC.
Indigo launched its social network late in 2007. Membership topped 180,000 in 2008 and is growing by 400 members a day, Beatty reports. Some members are contributing a great deal to the community section and turning other members into buyers. Indigo is considering a plan to reward these members financially.
“We’re using analytics to track the revenue members are generating,” Beatty explains, “and we’re looking into a program that can turn members into affiliates.” Back to top
A stroke of Genius
Apple knew it had to create a digital music and video store for iPod users that matched, if not exceeded, the hip and sleek iPod’s rep. And that is exactly what it did with iTunes, which this year sold its 5 billionth song.
Album, film, TV show and promotional images are crisp and powerful. Images are presented in new and different ways, such as in the iTunes film library where customers can browse through titles as if the titles were on a rotating rack. The store offers a formidable search tool, PowerSearch, that gives customers myriad ways to find what they’re seeking. And the store integrates seamlessly into the downloadable software that customers use to manage their digital collections.
That software received a big boost this year when Apple unveiled iTunes 8. The highlight of the latest update is its Genius feature. A user selects one song, then clicks on the Genius button. The software scours the user’s digital music library and, through an anonymous data link, the libraries of other users who have opted in to the Genius feature. It then instantly creates a playlist of songs it believes complement the original selection.
What’s more, Apple merchandisers had a stroke of genius: Not only does Genius pull together a list of songs in that user’s library, it also recommends songs he doesn’t own that are sold through iTunes.
Once a user decides to purchase any music or video in iTunes, he has one of e-retailing’s greatest tools at his disposal, a tool not often seen on e-commerce sites—one-click buying. When a user first implements iTunes on his computer, he fills out a private profile with default billing information. From that point on, to purchase content all he need do is click on the Buy button and the file automatically is downloaded into his iTunes library.
By offering one-click buying, says Craig Smith, founder and managing director of consulting firm Trinity Insight LLC, iTunes creates a smooth and convenient shopping experience. Back to top
Popping a musical hit
Popcuts.com is what you get when three brainy grad students at the University of California/Berkeley figure out what’s wrong with the music industry—and decide to fix it on the Internet.
“This was our master’s thesis project,” says co-founder Kevin Lim. “We started out brainstorming about why the sky was falling in the music business, and we identified the basic problem as a lack of incentive between the people who use music and those who make it.”
Lim and co-founders Hannes Hess and Yiming Liu realized that much of the passion in choosing and sharing music comes in getting recognized by peers as a music trendsetter. “It’s often about who heard of great new music first, or which friends showed off great new bands,” Lim says.
The secret sauce behind Popcuts is software that crunches the numbers on sales of downloaded 99-cent songs and ranks the buyers as trendsetters. The more a song sells, the higher a buyer is ranked as a trend setter and the more she can earn in credits toward additional song purchases. Trendsetting rank and credits are highest for initial buyers, so it pays to be the first to discover and buy good music. “We give music fans a reason to care about how their songs sell,” Lim says.
Popcuts provides a fixed cut for music artists, who are free to share more of their revenue with buyers to stimulate more sales.
“I really like the concept—it’s definitely modern in that it tries to build community both around the music makers and the music consumers,” says Nikki Baird, managing director of research and consulting firm Retail Systems Research LLC.
Baird notes that Popcuts also has room for improvement, such as by leveraging music content already in other social sites like MySpace and by providing better ways to sample music online.
But Popcuts is just beginning, Lim says, and will continue improving the site’s usability and developing social networking opportunities. “We’re not shy about our ambition to fix the gaping hole in how music is sold,” he says. Back to top
Head of the class
Scholastic.com recently tied with party retailer CelebrateExpress.com as the favorite e-commerce site for moms in a survey by Nielsen Online. And dads like David Schofman, who has three young kids, like it, too.
“I’ve been a big fan for years,” says Schofman, a consultant who was formerly head of e-commerce at Callaway Golf Interactive. “I love the balance of education and commerce. The site has very useful, relevant information for parents, and combines that with the ability to purchase most of the products.”
Schofman loves the Word Wizard, an online dictionary that provides definitions and lets the user hear how a word is pronounced. Another feature, especially useful for teachers, lets the user put in the title of a book and move a slider to indicate whether she wants a book that’s easier or harder. The site then provides suggestions. A new feature this fall called First Class supplies materials for first-time teachers.
Nearly 4 million unique visitors per month visit Scholastic.com—children, parents and teachers—who come to learn about books, education and teaching methods. The retailer is adding new resources while it tries to tie sales more closely to information.
Scholastic.com recently relaunched the video portion of its site and is expanding it to include interviews with authors of books available for sale on the site. “Author chats are very popular with teachers trying to understand products,” says Brian Manning, vice president of e-commerce.
The site launched this year a social networking section for pre-adolescent children called The Stacks and is developing more community features for teachers that will allow them to interact and share materials they use in class, Manning says.
Schofman’s only complaint about Scholastic.com is that the site presents too many ads from outside companies on pages aimed at teachers and parents. Manning says Scholastic introduced on-site ads in response to companies advertising in its catalogs that sought web exposure. “We’ve heard from teachers they don’t mind advertising as long as it’s not in places they’re going to use in the classroom,” he says. Back to top
