Site search has become a crucial part of a retailer’s virtual toolbox that boosts sales and conversion rates.  Often, customers will go directly to the search box to kick off their visit to a retail site. How much relevant information they find, whether they can they filter results and what related products are presented all color their experience on a retail site and their opinion of the retailer and their likelihood to purchase

But site search also provides retailers with a wealth of information about the visitors to their sites, information merchants can use to present more appealing items to subsequent visitors.

“The challenge for retailers is to take search beyond its traditional use as a tool for product location, and leverage it as key customer touch point from which the consumer and retailer can benefit,” writes Aberdeen Group research analyst Greg Belkin wrote in the October 2010 report “Choice. “These benefits can include a fast and easy research process for the consumer, and a profitable, market-responsive process for the retailer.”

The report was based on survey of 94 retailers that Aberdeen segmented into three groups:  top performers, the average group and the lowest-performing segment. The retailers were segmented based on year-over-year increases or decreases in average order values, average conversion rates and net profit margins. 

The study shows significant differences among the groups in the sophistication of their site search systems. Aberdeen found that 53% of the top-performing retailers deliver personalized search results based on a customer’s past purchase history or customer segment behavior.  But only 44% of the retailers in the average group and 15% of the lowest-performing group personalize site search results.

The top-performing retailers are also doing more with the information they get, according to the study. 80% of the top-performing retailers have a process to track up-sell and cross-sell products related to search results and 73% disseminate results from searches to other departments, such as marketing or customer service, according to the report.

Belkin says the top-performers make use of the insights they gain from customer searches.  The study found that 56% of the top-performing merchants say they use customer search analytics to re-adjust search results automatically. Belkin says astute retailers can use the insights they gain from site search data to tweak their marketing programs on search engines as well.  

He adds that the top-performing retailers display two important skills related to search: “One is the ability to have search results that are accurate, meaningful and relevant, and can turn a search into a sale. The second is being able to recognize increased revenue based on search.”

Children’s toy and play set manufacturer and retailer Step2 is an example of a web retailers that has improved its conversion rate and visitor engagement since it upgraded its site search system in 2010. The retailer caters to shoppers who spend a good deal of time and effort researching products and the old system lacked some features that could help them find what they want. For instance, the system didn’t allow for misspellings or alternate search terms. Thus, a consumer who typed in “playset” as one word instead of two received no results.

Step2’s new site search guides visitors despite any misspellings and recognizes the various search terms a consumer might use for a particular product. In adding the spelling feature the retailer is catching up with many of the top online retailers, according to a fourth quarter study of 100 of the leading web merchants by research and consulting firm The E-tailing Group Inc. That study showed that 80% of the e-commerce sites studied corrected misspelled terms, up from 67% the previous year. The report also noted a slight improvement in accuracy when retailers’ site search system corrected a misspelled term, improving to 3.7 on a five-point scale from 3.6 in 2009.

Step2’s site search technology also plays a role in merchandising by automatically tagging products that are clicked on after consumers search for particular search terms. The retailer uses that data to make sure those product are prominently featured on subsequent searches for the same terms.

The upgrades have been so effective that Step2’s visitors are two and a half more times likely to make a purchase after using the site search system than visitors that don’t use it, according to the retailer.  In addition, the number of visitors who leave Step2’s site from site search results pages proved 14% lower than from other pages on the site, the company says.  

Those kinds of results are leading some retailers to include site search as they extend their selling platform to the Facebook social network, which has attracted more than 500 million users worldwide, including half of U.S. consumers. In a recent survey, 15% of web retailers said they already were selling through social networks and another 32% said they planned to do so, according to “The State of Retailing Online 2011” report from Forrester Research Inc. and Shop.org, the e-retailing arm of the National Retail Federation, a major trade association.

As social commerce on popular networks such as Facebook gains momentum, some retailers are implementing tools to help consumers search product offerings directly on social network pages.

In May, online retailer Aquinas and More Catholic Goods launched an application that allows its Facebook page visitors to directly search its catalog of religious products. When visitors click the Shop Now category on the left side of the retailer’s Facebook page, they can use the search box at that appears at the top of the page to find items. For example, visitors searching for religious crosses can view the various types of crosses on offer along with their prices.  They can also filter by most relevant match, highest or lowest price, or alphabetical order. In addition, left-hand category filters provide additional choices, including sorting by the intended recipient, such as girl, boy, man or woman, and by brand.

“Over the past year we have seen our Facebook traffic grow tremendously and we are seeing a large percentage of the visitors to our main e-commerce site coming from Facebook,” says Ian Rutherford, president and founder of Aquinas. “We believe that by bringing our store to Facebook we have a greater chance of bringing in sales by saving our customers that extra click to our site.”

Rutherford adds that he expects Aquinas’ Facebook fans to use the products page like a catalog. “A place to casually browse product and share with their friends before making a purchase decision,” he says.

Aquinas’ extension of selling to Facebook, and its inclusion of a search and filtering system reflect the increasing sophistication of retailers’ site search implementations. In The E-tailing Group’s fourth quarter study, 42% of e-retailers allowed visitors to sort search results by color, up from 31% the previous year, and 29% to sort by size, up from 15% in 2009.

Making site search more helpful with filters like those is increasingly important as e-retailers face sharper competition, experts say. “It is way too easy online to move from one site to another,” says Aberdeen’s Belkin. “More often than not, consumers use site search to find what they’re looking for and if they don’t, they’re out.”  

That’s the last thing retailers want, for the consumers they’ve worked hard to attract to leave without finding the products they’re seeking. Not only does sophisticated site search help shoppers find what they want, but the tracks they leave behind in the course of their on-site searching can help e-retailers hone their merchandising and present products more effectively to visitors who follow.