Retailers shift their ad spending from TV, radio and print ads to digital ads.
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Boosting web sales
Further, having data on a multitude of products instantly accessible and being able to present those data in a user-friendly way at MicroWarehouse.com have increased web sales, Hafiz says. “With that combination, we have definitely increased conversion rates,” he says. “We would not have been able to increase our product offerings to 130,000 if not for the CNET data.”
CNET Channel, a 7-year-old company that was acquired by CNET in 1998, specializes in compiling and normalizing product data for the high-tech and consumer electronics market, then creating databases that it sells to retailers, resellers, distributors and portals. It produces data in 12 languages and serves 40 markets.
But if compiling a database based on publicly available information sounds easy, it’s not, Bowers says. “The format and content are different with every manufacturer,” Bowers says. “It’s totally inconsistent between manufacturers.” Furthermore, manufacturers are constantly adding, deleting and modifying products. “It’s a real pain for retailers or resellers,” he says.
While some retailers would question whether using an outside vendor for product data would lessen their control over the information on their web site, that has not been the case with Micro Warehouse, Hafiz says. For one thing, he can request information to be compiled on specific products if the information is not in the database already. For another, he can request that data be structured differently for certain products if that fits Micro Warehouse’s needs. “There have been quite a few SKUs that we have wanted structured differently,” he says.
All about presentation
Nor does uniform data available to many retailers create a sameness among web sites, he says. “Selling on the web is about presentation,” he says. “It’s not the use of the data but how you present it that makes the difference.”
In fact, it is the presentation that concerns cosmetics manufacturers and that was one reason they were cautious about selling through online retailers. “We were getting pressure from our retail partners to sell our products with them online as we do in the store,” says Chanel’s Roider. “But we had a concern that, from a branding point of view, the Internet was uncontrollable. So we had to ask ourselves how we could do e-commerce and still protect the brand image.”
Chanel decided to take an online approach that mirrored the cosmetics industry’s offline approach: provide the virtual sales counter to the retailer, which would allow Chanel to control the content and image, and let the retailer handle the payment transaction and the relationship with the customer.
The same worldwide
But while Macys.com receives content and presentation from Chanel, Macy’s maintains control of the customer relationship. The customer adds the products to the Macys.com shopping cart and checks out via the Macy’s process. Macy’s accepts payment and ships the order from its own inventory. It also handles all returns either back to the warehouse or at a Macy’s store.
In addition to Macys.com, Chanel has taken its web site global to such retail sites as Korea’s Lotte.com, Germany’s DouglasBeauty.com and France’s GaleriesLafayette.com, all of which present the same view of Chanel. “We are able to produce our mini-site throughout the world,” Roider says.