Whether a web site is successful depends on the definition of success
By Jeff Schueler
Here’s an example all retailers can learn from: Managers of the Internet operation
of a national retail chain were having a hard time getting their budget increased
because the site was converting only 1% of visitors to buyers and senior executives
of the parent weren’t convinced the web site was producing a return. Seeking
to justify their operation, web managers implemented a measurement system to
figure out how their web shoppers were using the site and what it meant in sales.
The astounding results: Unbeknownst to management, the web site was driving
$12 million a month in sales to the stores and had the potential to drive more
than twice that amount. Not surprisingly, executives’ attitudes toward the site
underwent a dramatic change. Budgets have been freed up. They now realize that
the most important visitor, in terms of overall ROI to the corporation, is the
visitor who comes to gather information or comparison shop, and they are focused
on ensuring those shoppers’ success.
That example underscores one of the new realities of web-based retailing:
Internet retailers who focus only on satisfaction surveys or abandoned shopping
carts are missing the boat. The key metric in determining how effectively an
e-retail site executes its mission is visit success. And how does a retailer
define success? The only real answer to that question has to be: the way the
customer defines it. Success is not measured only in terms of whether the customer
takes some action that the retailer wants her to take. A visit is successful
if the customer accomplishes what the customer set out to accomplish.
Customer intent is all-important because purchasing is a process made up of
phases, and intent differs by phase. Before shoppers buy, they generally gather
information and compare options. Usability Sciences’ data indicate that only
14% of retailing web site visitors arrive with the stated intent to buy. More
than three times that number, however, arrive with the intent to gather information
(47%), and 24% say they come to price or comparison shop. A whopping 71% of
e-retail site visitors do not come with the intention of buying. They’re investigating.
These shopping phases are sequential, so people who are unsuccessful in gathering
information on a site are unlikely to graduate into comparison shoppers. People
who fail at comparison-shopping are unlikely to make the transition to buyers.
These data support the fact that the Internet is becoming an increasingly
integral part of the consumer shopping process. Consumers are coming online
to do the initial investigation of purchases because what could take hours in
the brick-and-mortar world takes minutes online. The important realization for
Internet retailers is that if consumers fail in this initial online investigation,
they are much less likely to convert to customers either online or offline.
Success in this initial step of the purchase process has a huge effect on conversion.
Usability Sciences’ data illustrate how dramatically this failure can affect
qualified buyers coming to a site. 85% of information gatherers and comparison
shoppers who succeed in these preliminary phases report that they are likely
to return to the site. Only 63% of information gatherers and comparison shoppers
who were unsuccessful report that they are likely to return. Failure to meet
the needs of those who arrive as information gatherers and comparison shoppers,
therefore, means that 37% of visitors are likely never to come back as buyers.
The message for Internet retailers is that they need to be focused not just
on sales conversion rates but also on the broader picture of why visitors come
to the site and whether they are successful in their stated intent.
Listening to the visitor
Kohls.com launched a measurement project in the fourth quarter of 2002 to
quantify visitor demographics, visit intent, visit success, and the impact of
the site on brand affinity. One of the significant learnings from the study
was that the site’s search functionality was not performing up to visitor expectations.
Visitors who repeatedly searched reported visit failure at a rate 46% higher
than the general site population.
“Based on the measurement results,” says Kohl’s vice president of e-commerce
Terry Rowinski, “we knew we had to enhance how our search results are returned
to the consumer. We made the search results more specific for users so they
could find exactly what they were looking for by category, brand, color or size.
Because we undertook a site measurement strategy, we were able to identify and
quantify our shortcomings and take direct action to address them.”
Kohl’s bolstered its primary search function with this four-part sort function
then gave it even more muscle by implementing a parametric search capability
within the result. In doing so, Kohl’s enhanced the effectiveness of the search
function and its impact on visit success for all visitor groups.
In the case of the multi-channel retailer whose web site was driving $12 million
a month in offline sales, the site was evaluated on online sales and profitability.
Without evidence of sales volume improvement, budgets were frozen.
Site management implemented a measurement system to quantify demographics,
visitor intent, visit success, and next intended action, tied into content value
and pathing metrics. Management discovered that 26% of the site’s visitors used
the site only as an information resource and then went to the store to buy.
This segment had no intention of purchasing online, but the site experience
exerted great influence on the eventual purchase decision. Data revealed the
site was in fact doing a very effective job of meeting the needs of customers
who wanted to research online but buy at a store. This group reported a 67%
success rate.
This group’s impact on offline sales is enormous. 17% of site visitors reported
(at the conclusion of their visit) that their next step was to purchase at one
of the chain’s stores. 17% of the site’s monthly traffic translates into 115,000
visitors. An average store sale for this retailer is $250. If all 115,000 visitors
followed through on their intent to purchase at a store, they would represent
$28.75 million of revenue driven to the stores from the web site. In actuality,
follow-on surveys reveal that 7% consummate a store purchase within two weeks.
At a minimum, then, the site drives close to $12 million a month to the stores.
The next step in the improvement process is to focus on barriers to online
conversion, but the site has fixed this priority not on its own needs, but according
to the dictates of its visitors. These include: a desire to see the site’s search
function work better, larger product images, and several basic usability issues.
Once the site addresses these, success rates will climb further.
Committing to measurement
So how can Internet retailers take advantage of this knowledge? First, put
a measurement system in place to establish intent distribution and then determine
success within each intent category. Find out through clickstream analysis,
surveys, or a combination of both, why those who fell out didn’t take the next
action in the sequence. This step is executed most efficiently if the survey
and clickstream data are captured as an integrated record. Finally, prioritize
actions to fix the areas causing failure. Typical contributors to failure include
search functionality, category management, product comparison features, and
usability issues.
The message is clear: forget the abandoned cart; forget satisfaction surveys.
Focus, first, on understanding why your visitors have come to your site, then
on identifying the barriers to success and removing them. That’s what will make
the cash register ring.
Jeff Schueler is president of Usability Sciences Corp., provider of online
customer research and usability testing services to improve the effectiveness
of e-retail sites. He can be reached at jeff@usabilitysciences.com.
