Groupon says its focus is on the bottom line, rather than top-line growth.
Retargeting helps retailers make their case to shoppers who were close to buying but gave up.
65% of online shoppers abandon their shopping carts, according to research firm eMarketer Inc. Yet only 14.5% of web retailers have a plan in place to recoup those lost sales, according to a new study from e-mail marketing firm Listrak.
But some e-retailers, like Adam Golomb, do have a plan. And it involves retargeting consumers who leave shopping carts without purchasing.
Golomb, director of e-commerce at Eat'n Park Hospitality Group, which runs a chain of restaurants and e-commerce site SmileyCookie.com, says he was shocked when he moved over from the restaurant side of the business to find the web marketers were not addressing shoppers who left without buying. "From the restaurant side, we convert nearly 100% of the people who come through the door. So I was looking for ways to get the traffic that came to the site and abandoned a cart to come back to the site. This presented an easy way to grow our sales."
Eat'n Park implemented a retargeting system from SeeWhy and integrated it with its e-mail system from ExactTarget. When shoppers abandon a shopping cart, the systems automatically send them follow-up e-mails at different intervals coaxing them to come back and make the purchase. Some e-mails ask if the company can be of assistance, others offer discounts.
"We've influenced 18% of those who have abandoned their carts to come back and make a purchase," Golomb reports.
Results like that can significantly improve the return on the money e-retailers spend attracting consumers to their sites. Retailers are finding retargeting systems easy to deploy and maintain—and retargeting is steadily moving into new fields, including online display ads.
Retargeting can take many forms, but the one Eat'n Park employs is perhaps the most popular.
Eat'n Park's SeeWhy system drops an anonymous cookie on each shopper's web browser to collect data about the session. If a shopper places an item in a cart and then abandons it, SeeWhy sends a message to ExactTarget, which automatically generates an e-mail, written by Golomb and staff, and sends it 15 minutes after the shopper has left the site. Eat'n Park is likely to have the shopper's e-mail address because its site requests it early in the checkout process.
If the shopper does not respond within 23 hours, she receives another e-mail, and then if still unresponsive another e-mail in six days.
The first e-mail asks if there is something Eat'n Park can do to help the customer with her SmileyCookie.com experience. The second and third may include discounts.
"We've created seven levels of cart abandonment throughout the sales funnel; one is putting something in the cart, two is doing the next part of the checkout process, seven is making it to the end of the checkout process but not buying," Golomb explains.
"The biggest area for abandonment is where people check the shipping charges. We have a couple different e-mail messages for the different levels. The first has my signature on it and some personality to it. Others include free shipping on $40 or more if you abandoned while checking shipping charges."
Golomb has begun A/B testing to see what works best. For example, what can be done to convert an $80 cart versus a $20 cart? And is six days too long a period to wait for the third e-mail?
He adds that retargeting is a very simple process. "Once we got SeeWhy talking with ExactTarget, we just turned things on and it worked," he says. "This is a highly automated system."
Besides recovering 18% of consumers who abandoned carts, Eat'n Park increased average order value by 30%, though that increase could also stem from a redesign of SmileyCookie.com.
"The other thing on return on investment is I get a good amount of feedback from customers on why they abandoned their carts," adds Golomb, who declines to say how much he pays SeeWhy. "And I've taken that feedback and put it back into the site design. For example, we now show a delivery date option. In our new system we hold the order rather than ship the next day to make sure it hits the delivery date."
E-mail and more
E-retailer LaptopsforLess.com has a very similar e-mail retargeting program, working with e-mail marketing and retargeting technology provider Listrak. Brian Jones, vice president of marketing at LaptopsforLess.com, likes the system because it enables the e-retailer to send a personalized e-mail to the shopper.
"Instead of being a universal marketing message, it is one-to-one communication, a conversation with that one person," Jones says. "And based on the actions by that person it determines through our business rules what happens next."
The custom retargeting messages have generated 20% click-through rates and 30% open rates. The system cost about $5,000 to set up and requires a monthly fee of about $375, and Jones says the retailer is getting a good return on its investment.
"The highest click-throughs and conversions are with that first message," he says. "If that person doesn't purchase off that first message, the numbers decrease. Our most aggressive offers are our last because it is our last-ditch effort, but that offer sees far less activity than the first message, which is a reminder and customer support. It has more to do with timing than the offer you are providing them."
If a shopper gets to the point early in the process where she's asked for her mobile phone number and then later abandons her cart, LaptopsforLess.com sends that shopper a text message, a retargeting tactic similar to e-mail but with a much shorter message. The e-retailer uses text messaging services from UpSellIt to enable this retargeting.
The text message focuses on customer service, such as, "Did you have a question about the product in your shopping cart?"
While text messages can be viewed as intrusive, Jones says these messages, which contain no discount offers, have not prompted complaints. "This is personalized customer service, it's follow-up," he says. "And we have never had a single person call or write to complain about the e-mail or text message follow-ups."