E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
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She said the retailer devotes more space in its catalogs to highlighting the availability of a wider selection on its e-commerce site, and is putting more effort into segmenting customer lists, so that it mails catalogs to prime prospects.
“We’re still mailing catalogs and doing it profitably,” she said, noting that her customers include grandmothers more comfortable with writing a check than entering credit card data online. “But it’s important to know who your customers are. If you are marketing to twenty-something males, maybe you can cut out your catalog because maybe they are buying online.”
Another change that generated much discussion at the conference was how online retailers can take advantage of online shoppers’ penchant for communicating with each other online, whether through social networks, blogs, forums or writing product reviews.
Under Armour Inc., a manufacturer of sports apparel, knows the teenaged athletes it targets constantly communicate with each other through text messages, e-mail, phone and social networks, Mark Kuhns, vice president of e-commerce, said in a featured presentation. With that in mind, Under Armour tries to draw athletes to its web site, creating its own “social currency” by integrating local clinics and competitions it sponsors with web site features that allow athletes to track their progress, solicit advice from coaches and contribute to blogs.
Listen and learn
Customer reviews have become an important part of the e-commerce site of computer maker Dell Inc. “because this is the voice of the customer,” explained Stuart Wallock, Dell’s senior manager of global community and personalization. “One review won’t cut it, but 50 makes it legitimate. Don’t censor the reviews and exclude the ugly. Show it all, and this demonstrates you are listening to the customer.”
His fellow presenter, e-commerce head Nathan Decker of evogear, said his company solicits negative feedback and displays it prominently. “People seek out negative information and omission erodes trust,” said Decker, who noted evogear posts 97% of reviews submitted.
Another change wrought by the web is the ability of retailers to allow consumers to personalize thousands of products-from mugs and T-shirts to calendars and jewelry. And the founders of one of the most successful of these e-retailers of personalized goods, Zazzle.com Inc., offered attendees the secret of their success: technology.
Enabling consumers to choose from more than 3,000 products and instantly visualize how a personalized item would look has helped Zazzle grow traffic by 900% and sales by 1600% in the past four years, said Bobby and Jeff Beaver, brothers who founded the web-only retailer. They keep innovating, demonstrating for attendees their new animated Stitch Player tool that responds to user commands, showing in detail how embroidery would look as it’s added to a product.
Their session, called “How a small retailer harnesses the power of the web,” was one of many aimed at smaller web merchants, who also could attend a full-day, pre-conference workshop focused on their concerns.
Those sessions offered many tips for making fast gains at low cost. For instance, Au-Co Mai, CEO of Emitations.com, said the e-retailer generated more sales by adding “Customers also bought” recommendations on product pages, a no-cost move because it was an existing feature in her software package she hadn’t turned on before.
Her co-presenter, analyst Adele Sage of Forrester Research, advised retailers not to require shoppers to register before they get to the Buy button. “We found that 23% of shoppers abandon the cart when required to register to complete a purchase,” she said.
At a pre-conference search marketing workshop, Marissa Colwell, director of media at online hardware and appliance retailer Improvement Direct, offered 10 tips for improving natural search rankings. One tip: give each page on a site a unique title tag that helps search engines grasp a page’s focus, avoiding such tags as “untitled” or “page 1.”
In a later session on paid search, Steven Broussard, director of marketing and e-commerce at Golfballs.com Inc., illustrated the value of negative keywords that withhold a bid when certain terms appear. Golfballs.com, for instance, doesn’t want to pay for traffic from shoppers who enter such words as clearance, free or discount. Not bidding on those searches helps improve ROI, Broussard said.
The day following the main conference featured two final workshops on e-mail marketing and mobile commerce.
How to use e-mail to reactivate dormant customers, a particularly important question during a recession, was addressed by Neil Kjeldsen, vice president of e-commerce at Perricone MD, a manufacturer and retailer of skin care products.
Working with e-mail service provider iPost, Perricone MD sent one-time customers e-mails offering small samples of products at a discount with free shipping; once a customer responded with two purchases, the retailer followed up with full-price offers. That e-mail tactic, combined with other marketing efforts, helped boost online sales by 40%.
But e-mails work only if customers see them, and a quick way for a retailer to be labeled a spammer by e-mail inbox guardians is to send e-mails to many inactive e-mail addresses. A customer not opening any e-mails for months could be a sign of an inactive account, said Austin Bliss, president of e-mail change-of-address and appending services company FreshAddress.
“Over 30% of your customers will change their e-mail addresses this year,” Bliss said. “Watch for inactivity.”
The Mobile Commerce Workshop on the conference’s final day registered the steady gains retailers are making in selling to consumers through the mobile phone.
A prime example is 1800Flowers.com Inc., which has been building its m-commerce capabilities since 2006, starting with marketing through text messages then creating an m-commerce site, and then apps-small programs that make use of the computing power of advanced handsets-for the Blackberry in 2008 and the iPhone this year. It all came together in a concerted mobile marketing push this Mother’s Day that resulted in a 173% increase in mobile sales over the year before, reported Kevin Ranford, director of web marketing.
“Mother’s Day gave us an opportunity to really get mobile out in front of people,” Ranford said. One new feature of the campaign: 1800Flowers.com puts its ads into mobile apps of other, non-retail companies, a tactic he predicts will become increasingly common as more marketers dive into the mobile realm.