E-retailers must focus on their specific goals and examine a vendor’s reputation and market expertise, not referrals.
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When data are aligned in comparable formats, retailers will need analytic software that automatically integrates transactional and behavioral data seamlessly across channels. Technology vendors will work on new analytic products to bridge the gap, potentially in partnership with CRM providers, says Dougherty. A number of technology vendors offer solutions that integrate transactional data across channels. Coremetrics Inc., San Francisco, for instance, has developed software that provides a complete profile of customers’ online behavior, beyond transactions. On request, it can format specified data sets pulled from online activity for comparison with retailers’ existing analytics for catalog and store data.
Analysts such as Wissman speculate that further development of new cross-channel analytics could be driven from the retailer side, with resource-rich do-it-yourselfers like Wal-Mart leading the charge.
The web is a new ball game and so, to some degree, are the metrics that best define a retail web site’s real value. As best practices emerge, they may differ markedly from the ROI that has traditionally applied. “At the end of the day retailers have to justify the expenditures on their web sites. They have to have a way to compare the options at their disposal,” Wissman says. “I find it hard to believe we’ll ever get completely away from an ROI perspective, but we’re going to have to get a little less strict and systematic in terms of how we apply those numbers.” l
Conversion rates still important
Retailers are measuring the success of their online endeavors by more than just sales these days, it’s true. But conversion rates are still important. And retailers have adopted a number of techniques that improve conversion rates. Among the tactics that consultants/researchers Compete Inc. of San Francisco, which obtains data from clickstream analysis of 8 million Internet users, has observed in its review of web sites:
- Retailers are bundling products and services: “When they display a Palm Pilot, for instance, they are also displaying a case for it and a USB cable,” says Marc Engel, director of analytics for Compete. “They’re making it easier for people to buy things together.”
- Retailers are more closely analyzing where shoppers bail from their sites and where they go next. “They are looking at where customers are leaving and trying to determine if maybe the price point is wrong or if customers can’t find what they’re looking for,” Engel says. “They want to know if the customer is going to another site and completing the transaction.”
- They are analyzing their search contents. Much attention has been paid, rightly so, to the importance of returning correct responses to searches. But success of a site can also be helped by knowing what shoppers are searching for, Engel says. “Searches are a leading indicator of demand,” he says. “Knowing what customers are searching for can help you with your product mix and predict what products you’ll need to stock.”