Mobile accounted for 25% of Ulta's e-commerce revenue during Q2.
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Even if rules are in place to manually review suspect transactions, those reviews can delay the processing of orders by several days, during which time good customers may grow impatient and cancel their orders. Putting off customers in such a manner can cost retailers repeat business.
“Retailers need to have models in place that identify the characteristics of fraudulent behavior, not the individual characteristics of a fraudulent transaction,” says Michael Long, co-founder and chief product strategist for Accertify Inc., which specializes in helping e-commerce companies prevent online fraud. “As a retailer’s transaction volume grows, they need payment screening tools that do more than just flag and deny suspect transactions.”
Accertify’s transaction screening models can be built using all relevant customer data retailers hold, such as whether the consumer has purchased a gift card online then used the card to make an in-store purchase only to return the item at another store for cash. Such behavior can indicate the individual, possibly a criminal, may be trying to take advantage of more liberal in-store return policies, while creating a convoluted fraud trail.
Important data can be obtained in real time on shoppers new to the site. Tools can detect whether a shopper is looking at products that are prime targets for criminals because they can be quickly resold on the street, such as electronics, or if he spends a lot of time reviewing the retailer’s return polices. Those may be indicators of fraudulent behavior.
“By aggregating consumer data across all sales channels, retailers can spot behavior patterns that indicate fraud,” says Long. “Data are the key to effective fraud screening.”
A simple solution
Fraud detection is not the only aspect of a retailer’s business where consumer behavioral data is playing a larger role. Understanding how consumers navigate a web site is playing a critical role in how the site is designed.
“Site design is the starting point for how retailers interface with their customers, so retailers have to understand the needs of their audience so they can create a home page that gets them to where they want to go within the site quickly and through multiple navigation paths that are easy to follow,” says Americaneagle.com’s Svanascini. “The more user-friendly the site design, the better the conversion rate.”
Americaneagle.com is in the process of redesigning the global site for gun manufacturer Beretta S.p.A.. Taking into account that many consumers enter a search string that lands them on the home page for the holding company, when they may actually being looking for Beretta’s U.S.A. subsidiary, Americaneagle.com is creating a simple landing page featuring the Beretta logo and a map of the world. Consumers are instructed to click on the country of the Beretta subsidiary they want to visit. Americaneagle.com recently redesigned the Beretta USA site.
“It sounds like an obvious design solution, but a lot of multinational e-commerce sites don’t necessarily think to create such a logical path that allows a general audience to drill down into the site,” says Svanascini. “The first rule of thumb in site design is to ask, ‘Does my design confuse the consumer?’ If it does, retailers must find a way to simplify it.”
Changes in consumer behavior are also playing a bigger role in organic search. More consumers are entering complex, multi-word, long-tail search phrases. The goal for retailers is to tap terms beyond the head of popular search terms to the millions of specific long-tail search phrases that follow behind.
As the popularity of long-tail searching grows, it is not uncommon for consumers to include a specific product name, product feature, color and price range in a search string, hoping to find exactly what they want right away. A consumer looking for a specific laptop computer might enter a string such as “Red Dell Inspiron laptop with Intel Core i7 processor 2Mhz of RAM and Windows 7 under $1,000.”
While such a detailed search string, which is commonly referred to as the ultra-long tail, may seem too esoteric to support a landing page, Dell EMEA has discovered that is not the case. Dell uses YourAmigo’s Spider Linker service to mine its global keyword database and create thousands of new landing pages for hundred of thousands of distinct ultra-long tail search strings. Dell has found such pages can collectively generate hundreds of millions of dollars of incremental sales revenue.
“When the collective power of the ultra-long tail search string is weighed, creating thousands of landing pages for these search strings is not such an esoteric concept, even though each landing page may get as little as one click a month,” says YourAmigo’s Smith. “The landing pages for these search strings are so specific, they immediately take the consumer right to where they want to go, which dramatically increases the conversion rate.”
Smith adds that Dell EMEA’s YourAmigo campaign started 12 months ago and generates 67% of current revenues from ultra-long-tail and one-click phrases, with 11% incremental revenue growth on a monthly basis. In addition, YourAmigo generates $25 million in new revenue a month for its largest client through Spider Linker’s ultra-long-tail search strategy. “There are huge untapped revenue opportunities in organic search using artificial intelligence to find millions of unique search phrases and creating landing pages to capture those high-converting searchers,” says Smith.
Social and SEO
Consumers’ growing use of the ultra-long tail is just one behavioral change retailers need to keep pace with when it comes to SEO. The growing popularity of social networking on the web is now being recognized by search engines like Google and Bing, which include on their search results pages social network postings relevant to search queries.
As retailers build their presence on fan pages, they are adding content that can be tagged and made visible to search engine spiders, which now crawl social networking sites. The more a retailer engages consumers through its fan page or Twitter account with news, such as a promotion or sneak previews of new arrivals, the greater the odds consumers will spread that information through their own networks of friends. The farther the content spreads through the social web, the higher the content will rank in search engine results.