November 21, 2008, 12:00 AM


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The centerpiece of its new site is the Magic Shelf search and navigation feature, built with Flash technology by Allurent Inc. and search technology from Endeca Technologies Inc.

The Magic Shelf brings online the in-store shopping experience of browsing book, CD and DVD titles on a shelf-a shopper can make the shelves on the Magic Shelf move vertically or horizontally without moving the rest of the web page. Shoppers who use the Magic Shelf place 62% more orders per shopping session than shoppers who don’t use it, says senior vice president of e-business Kevin Ertell.

In addition, Magic Shelf users are 13% more likely to buy online, 9% more likely to return to shop, and 11% more likely to recommend to other shoppers, he adds.

“We realized we had an opportunity to bring a real bookstore experience online in a way no one else had,” Ertell says.

That’s a story Borders is now in a position to tell. Back to top

Bookshelves tell the story
A peek at the books on someone’s bookshelves reveals a lot about that person. This is the foundation of Indigo Books & Music Inc.’s social network. Rather than write extensive personal profiles, community members express themselves through what they opt to place on their shelves.

While more retailers are turning to Facebook, MySpace and other social networks to market their brand, it’s rare today for a retailer to operate its own social network. Indigo Books & Music does, and does so in a way that benefits customers and itself.

“There are customer reviews and lists, but there still is a lot of anonymity in those. We did a lot of research and discovered customers wanted to go deeper, to have their own voice,” says Carolyn Beatty, senior vice president, online. “They also wanted to go deeper to see if they relate to other customers. Now they can filter reviews based on that reviewer’s bookshelf, which shows how much they have in common with that reviewer. It lets community members know if that’s someone whose perspective they would value.”

Indigo receives numerous benefits from its social network, an integrated part of its e-commerce site. Customers who are community members visit the site more frequently, buy more often and spend more per order, Beatty reports. And community has helped in natural search, increasing Indigo’s ranking with Google because members generate so much new content on a daily basis, she adds.

“Community is heavily promoted; it’s clear they’re trying hard to encourage user-generated content and interactions,” says Craig Smith, founder and managing director of consulting firm Trinity Insight LLC.

Indigo launched its social network late in 2007. Membership topped 180,000 in 2008 and is growing by 400 members a day, Beatty reports. Some members are contributing a great deal to the community section and turning other members into buyers. Indigo is considering a plan to reward these members financially.

“We’re using analytics to track the revenue members are generating,” Beatty explains, “and we’re looking into a program that can turn members into affiliates.” Back to top

A stroke of Genius
Apple knew it had to create a digital music and video store for iPod users that matched, if not exceeded, the hip and sleek iPod’s rep. And that is exactly what it did with iTunes, which this year sold its 5 billionth song.

Album, film, TV show and promotional images are crisp and powerful. Images are presented in new and different ways, such as in the iTunes film library where customers can browse through titles as if the titles were on a rotating rack. The store offers a formidable search tool, PowerSearch, that gives customers myriad ways to find what they’re seeking. And the store integrates seamlessly into the downloadable software that customers use to manage their digital collections.

That software received a big boost this year when Apple unveiled iTunes 8. The highlight of the latest update is its Genius feature. A user selects one song, then clicks on the Genius button. The software scours the user’s digital music library and, through an anonymous data link, the libraries of other users who have opted in to the Genius feature. It then instantly creates a playlist of songs it believes complement the original selection.

What’s more, Apple merchandisers had a stroke of genius: Not only does Genius pull together a list of songs in that user’s library, it also recommends songs he doesn’t own that are sold through iTunes.

Once a user decides to purchase any music or video in iTunes, he has one of e-retailing’s greatest tools at his disposal, a tool not often seen on e-commerce sites-one-click buying. When a user first implements iTunes on his computer, he fills out a private profile with default billing information. From that point on, to purchase content all he need do is click on the Buy button and the file automatically is downloaded into his iTunes library.

By offering one-click buying, says Craig Smith, founder and managing director of consulting firm Trinity Insight LLC, iTunes creates a smooth and convenient shopping experience. Back to top

Popping a musical hit is what you get when three brainy grad students at the University of California/Berkeley figure out what’s wrong with the music industry-and decide to fix it on the Internet.

“This was our master’s thesis project,” says co-founder Kevin Lim. “We started out brainstorming about why the sky was falling in the music business, and we identified the basic problem as a lack of incentive between the people who use music and those who make it.”

Lim and co-founders Hannes Hess and Yiming Liu realized that much of the passion in choosing and sharing music comes in getting recognized by peers as a music trendsetter. “It’s often about who heard of great new music first, or which friends showed off great new bands,” Lim says.

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