SPONSORED SUPPLEMENT: Site Search: Creating the Online Precision Shopper

Guide to E-Commerce Technology

One thing is sure about site search: It never sits still. What started as a search function to help shoppers find what they were looking for evolved into a search and navigation function that allowed shoppers to narrow their choices or even go off in different directions. That in its turn evolved into a merchandising function that allowed retailers to present search results in ways that highlighted products they wanted to promote. And today, even that is almost passé as technology developers explore new ways that site search can assist retailers in making sales.

In fact the name “site search” itself, may no longer be apt. “The shift to search, browse and merchandise has already moved through much of the industry,” says Israel Aloni, senior product manager for search technology developer Mercado Software Inc. “Today, people want to enhance that approach so it’s not just merchandising and marketing but also analytics to know how people use the site and what people want from a site.”

Variety of features

In addition, retailers want to use site search results for a wide range of applications. “There’s a whole variety of features available today,” says Stephen Baker, head of emerging opportunities and vice president of e-business for search technology developer FAST Search & Transfer. “The trend in search today is to use the data for personalization, to understand user behavior, for one-to-one marketing. It’s all about how you use search to tailor the shopping experience.”

On top of all the functionality that developers are building into site search and that retailers expect is the fact that not all vendors see the market the same way. “There are a lot of differences among vendors, we’re not all just following each other,” says Geoff Brash, vice president of marketing for search technology developer SLI Systems Inc. “In addition, we’re seeing a great variety of differences in what our customers are looking for in search.”

The evolution of site search has occurred in a relatively short period. Only four years ago, retailers were happy to install a search product that would correct misspellings, include synonyms, such as shirts when a customer searched for a blouse, and eliminate the vagaries of automated responses, such as returning a list of no-iron slacks when a shopper searched for an iron or toys that required a certain type of battery when shoppers were searching for a battery.

A must-do

While a fair number of retailers have been slow to adopt improved site search technology—a survey in the fourth quarter 2004 by Chicago-based consultants The E-tailing Group Inc. reported that only 54% of 100 sites tested returned correct results on misspelled words—vendors forged ahead to develop a search-and-navigation function that not only returned correct results but also sorted the results in a way that allowed shoppers to browse the merchandise.

After that, search vendors developed merchandising capabilities that allowed retailers to display search results in ways that helped them meet their business objectives; for instance, by margin, by current promotions, by inventory status and so on. Then the technology got into providing data for upsells and cross-sells on the product page and in the shopping cart. That higher level of sophistication has become required today. “It’s a must-do thing for retailers today,” says Eric T. Peterson, site technology and operations analyst for Jupiter Research and author of Jupiter’s just released “Site and Commerce Search” report.

That constant evolutionary spiral has raised expectations and today retailers are looking for a lot more. “Once retailers and b2b organizations realized that search was mission-critical and navigation-critical, they realized they could do a whole lot more,” says Kevin Lindsay, Mercado’s director of marketing. “They realized it can allow them to engage in more active selling, including cross-sells and upsells.”

Mercado today includes such functionality as A/B testing, personalization and customer segmentation, all built on its site search platform. One of its goals is to allow online retailers to offer an even better experience than customers would get in a local store. “If you go to a nice local apparel store, the sales personnel might know you and what you like to buy, so they can make suggestions,” Aloni says. “Online sellers want to do things that are similar. But these are enhancements that are not available in the real world. We can help them create business rules that affect the entire shopping experience.”

The feedback loop

Part of that offering includes a feedback loop that tracks everything that happens after a customers enters a term into a search box, such as which items shoppers click on, which they place in a shopping cart, which they abandon and which they buy. Mercado’s system then uses that information to inform the results of future searches. It also reports which were the most popular search terms.

Mercado introduced its business rules solution a year ago and just earlier this year began offering tools so that the end user could create business rules and run the analysis without having to get technological assistance. “Retailers expect tools so they can make their own decisions,” Aloni says.

SLI Systems also offers analysis of how shoppers use search, looking at the terms they search on, which they click on, which they ignore and how long customers take to peruse lists before clicking, among other factors. Then, like Mercado, it uses that data to improve future searches.

Such refinements are important because they lead directly into better search results, which in turn create more sales. “The data exist to improve results,” says FAST’s Baker, “but most people aren’t doing anything about it.”

FAST’s search product includes merchandising tools that allow managers to sort results based on rules. “Usually when someone comes to a site and types in a term, it’s very ambiguous,” Baker says. “The classic problem with site search is the generic query. If someone searches on ‘digital cameras,’ the merchandising tool allows the product managers to decide what they want to promote for those queries.” Such criteria might favor products with the best margin, or that are the most popular, or for which the retailer has excessive inventory. “Search engines have created different kinds of tools in which it is easy to change business logic,” Baker says.

Tying to the back end

In addition to new ways to engage the customer, site search vendors are developing ways to make back-end information available to searchers in a way that will influence their purchases. SLI Systems, for instance, pulls product information from an inventory database so the shopper knows upfront if the product is available and its price. It will not display results for products that are out of stock.

FAST also offers an enterprise search tool that integrates with its site search offering. That allows site search results to display only items that are in stock, for instance, or items that are selling fast across the enterprise. “You usually find disparate search engines and databases throughout an enterprise,” Baker says. “That makes it difficult for unit managers to understand all the products that they have available.”

Tying together into one search platform such databases as inventory management, supply chain management and customer information “is very compelling for retailers,” Baker says. “Having one search platform that can handle everything is very popular with IT groups. They have to deal with only one vendor, one support agreement, and get familiar with only one platform.”

In addition, such an offering provides complete information about what’s happening throughout an enterprise. “It gives a 360-degree view of the organization,” Baker says, “with views into what customers are doing for supply chain managers, business managers, product managers, customer support personnel and so on.”

SLI today is pushing the role of site search even further with the rollout of two new offerings—Site Champion and Ad Champion. Both have the aim of ranking sites higher in search engine results. Site Champion optimizes a web site for search engines using popular search terms on a retailer’s site. That allows the site to appear higher in natural language search results. “We use the language of visitors to a site—what they’re actually looking for—to optimize the site for search engines,” Brash says. It’s an automated process that brings search engine optimization expertise to a retail staff, he adds. “There are still a lot of retailers using in-house technology that makes it hard to get listed in search engines,” he says.

The language of shoppers

Building on that, SLI on Aug. 1 introduced Ad Champion, which uses site search results to automatically generate paid ads in search engines. Brash says the rationale behind Ad Champion is “the language that people use on a site is the language people will use in search engines.”

Building lists of keywords for pay-per-click search engines is cumbersome and often a matter of guesswork, he says. By bidding on the terms that shoppers use at a site, retailers can increase the effectiveness of their pay-per-click search programs. “It creates the keyword list using very specific phrases,” he says.

The program comes with a monitoring component so retailers can see which keywords they are bidding on, how the keywords are doing and whether they need to adjust their bids. SLI has offered Ad Champion in beta until now and user feedback has been positive, Brash says. Because the bids are based on terms that customers are actually using, “it makes uneconomical advertising very economical,” he says.

FAST is pushing into another new frontier of search with a mobile search product. Under that scenario, which is admittedly still a gleam in developers’ eyes, FAST optimizes its search functionality and presentation so that customers in stores can call up information on their mobile phones and comparison shop right in the store. Retailers must be able to present their information in compelling ways to get customers to complete the purchase in the store and not go to a competitor’s business. “Mobile phone penetration will exceed broadband Internet penetration,” Baker says. “It’s an extraordinary opportunity for the retailer to connect with customers.”

Close customer relations

The way site search is developing, the technology is no longer a plug-and-play proposition. Mercado, SLI and FAST all offer extensive training for users. “We don’t see ourselves as software vendors where we give you two days of training and we’re gone,” Aloni says. “We really believe in a consultative approach.”

That approach allows ideas to flow in both directions. “We are our retailers’ partners,” Aloni says. “They come to us with ideas. Many are very forward thinking in what they want their sites to accomplish and they look to vendors to help them meet their business goals.” Ultimately, that benefits both the retailers and the vendors. “It makes e-commerce search part of a higher value suite of capabilities,” Lindsay says.