August 1, 2005, 12:00 AM

Internet Retailer 2005: Report from the Conference

(Page 3 of 10)



Creating the Ideal Web Shopping Experience


Using analytics the right way
Harnessing Analytics to Create a Better Shopping Experience
Eric Peterson, senior analyst, Jupiter Research
Steve Hawco, vice president, Lego Shop at Home

Most online retailers don`t use analytics data effectively because the information isn`t circulated often enough among different departments, Eric Peterson, senior analyst with Jupiter Research, told the conference. "If you`re not communicating this data, if people aren`t integrating this against their databases, it just falls off top of mind," he said.

That means retailers can`t deal effectively when web site problems crop up. "If you`re not watching, you`re not going to notice," he says.

Peterson cited a Jupiter survey that found only 29% of senior executives and 41% of all executives review the data on a regular basis. "Once a week, you need to push the data out so everybody thinks about it," Peterson says.

Jupiter also found that companies that don`t dedicate staff to web analytics are least likely to use the data effectively. Many companies assign the IT person or a marketing manager to keep an eye on analytic data, "somebody who occasionally pops in and out of the system, and figures out `are we doing okay?`" Peterson says. "That`s simply not enough."

Online retailers also should bundle web analytics data with other customer information to help them identify problems and give them clearer insights into customers, said Steve Hawco, vice president of Lego Shop at Home.

Web analytics data also must be presented in an easy-to-understand format so management can zero in on problems, Hawco said. "You want to get your KPI (key performance indicators) to look like the front page of the Wall Street Journal--something you can glance at on a daily basis and understand the pulse of your business," he said.

Staying alive
Being Ever Vigilant: Don`t Become an Online Horror Story
Carol Carpenter, senior director of product management, Keynote Systems
David Jilk, president and CEO, Xaffire

Broken links, slow response times and browser incompatibility all can drive an online retailer`s customers to a competitor`s site. That`s why e-merchants need to closely monitor their web site`s performance.

Problems that can affect site performance include application bugs, content errors, browser incompatibility, and bad internal and external links, said David J. Jilk, CEO, Xaffire. And retailers should not underestimate the damage those problems can inflict on their sales and reputations, Jilk says. For example, a site requiring a log-in to purchase but doesn`t provide a link or instructions on how to create an account when a log-in fails makes it hard for customers to buy, he says.

One approach to avoiding web site problems is by taking a holistic approach, said Carol Carpenter, senior director of marketing for Keynote Systems. "It`s taking the end-to-end view," she said.

Leading web sites know that each portion of the infrastructure and application of a site affect the users` experiences, Carpenter said. They judge performance from the users` perspective, add technology to improve that performance, and build good communication between business teams and IT to ensure a positive user experience, she said.

That approach has enabled leading sites, such as Office Depot, J.C. Penney and Eddie Bauer, to have consistent transaction speeds, giving consumers a better shopping experience, Carpenter said. Their home pages load in less than 1.5 seconds, perform log-in/authentication in less than 2 seconds and execute complex back-end queries in less than 3 seconds.

Making the most of site search
Site Search: The Underutilized Super Tool
Nate Miller, director of e-commerce, Northern Tool and Equipment
Geoffrey Smith, president of e-commerce and new business development, Personal Creations

Retailers who overlook the importance of site search are missing out on increased profitability, Nate Miller, director of e-commerce at Northern Tool and Equipment, told the conference. Northern Tool redesigned its site search in June 2004 after discovering that only 25% of the products it returned were valid. Consumers also found it to difficult to navigate because it returned large result sets and offered no way to refine the search, he said.

The redesign of Northern Tool`s site search had an immediate impact on conversion rates and order size, Miller said, with conversion rates up 18%. In addition, ease of use increased by 17% based on customer feedback, he said.

After six months, the site search conversion rate was twice the overall average and 54% of sales were driven by site search, he said. In addition, there was a 72% increase in natural search sales, Miller reported. "We paid off our three-year investment in three months," he said.

What`s more, carefully constructed site search can give retailers more knowledge about what customers want. At Personal Creations, a review of search analytics produced an idea for a new product, said Geoffrey Smith, president of e-commerce and new business development.

To come up with the best site search, retailers need to know how shoppers use their sites; understanding, for example, whether they mostly search or whether they browse, Smith said. Retailers also need to test any changes to the site for value, he said.

What shoppers want
Personalization Plus: Right Content, Right Shopper, Right Time
Joe Devine, CTO,
Lauren Freedman, president, The E-Tailing Group

Personalization technology is changing how grocery chain Safeway Inc. builds relationships with customers, Joe Devine, CTO of, said at the Internet Retailer Conference.

Because all online orders are fulfilled through Safeway`s stores, the company processes all sales through its in-store POS system, making multi- channel customer shopping data available for marketing and personalization, Devine said. "We see total shopping behavior, offline and online, as a single integrated view," he said.

So when a shopper comes to, the grocer presents her with offers for products she`s purchased in the past. The offers, on personalized web pages as well as in e-mail messages, may also include discounts for products the customer has not purchased.

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