Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
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The SaaS model also provides retailers an alternative to completely outsourcing management and maintenance of an e-commerce platform to another company, and the subsequent loss of control outsourcing entails. Instead, a retailer can easily add a new feature by linking to the vendor's data center just for that feature.
"SaaS allows us to add new capabilities to the site search engine as needed so that retailers don't have to burden their I.T. department, which usually has a long list of projects, with yet another task," says SLI's Hoffman. "Implementing ongoing upgrades through the SaaS model is a substantial benefit to retailers with limited I.T. resources."
SLI's site search engine is built on a redundant, distributed architecture that spreads copies of the search engine database across multiple servers around the world. This redundancy allows SLI to manage search with fast response time and high availability.
"Fast results that are always available give consumers confidence that the retailer's site search engine can deliver the results they want, when they want them," says Hoffman. "By using a redundant, distributed architecture, we can get the information consumers want to them faster by using the closest and least crowded pathway."
Helping retailers get the most out their technology dollars includes leveraging new marketing technologies, such as social media and mobile. Retailers that integrate social media and text messaging to mobile phones into their marketing campaigns can further enhance their brands, engender loyalty and increase sales, which is the ultimate goal of any marketer.
Posting birthday greetings to customers on a retailer's Facebook fan page or sending a birthday greeting to a consumer's Twitter account is a way for retailers to connect with consumers through these new channels, and at the same time deliver an offer as a birthday gift.
"A birthday greeting sent via social media is a relevant, personalized communication that most consumers won't mind having posted on Facebook where others can see it," says Bronto's Colopy. "It also lets others viewing it know the retailer takes a personal interest in staying in touch with the consumer."
What's more, social media can be used to take marketing messages viral. Retailers can create contests that reward consumers for forwarding an offer posted on Facebook or sent via Twitter hundreds of times over. For example, contests can be created where the 200th person forwarding a promotion for 15% off an iPod Nano gets the product for free.
"Effective marketing requires a social element that can create greater public awareness around the marketing message," says Colopy. "The link between social media and the consumer can be a powerful marketing tool."
Bronto's platform features a visual drag-and-drop interface, which it refers to as sophisticated automation, that allows users to build marketing workflows with a sequence of events and business rules. The workflows run automatically, reacting to behavior triggers and pulling in dynamic data so users can create marketing messages that are more relevant and engaging, and lead to higher conversions. In addition, e-commerce integrations—connections with partner systems built for e-commerce—help marketers deliver more customized marketing campaigns by accessing outside sources of data and content, including real-time customer behavior, from within the Bronto platform.
Text messaging, also known as short message service or SMS, is an offspring of e-mail and a way for retailers to open another communication channel with consumers through their mobile phones. Using SMS texts as a way to summarize a prior e-mail message is an ineffective use of the medium. Instead, retailers should view the technology as a way to keep up a dialog with a consumer or provide time-sensitive messages.
The key to making SMS texts work is to create a need for an immediate reaction to the message. "Consumers can also be notified by SMS when a highly anticipated product, such as the newest iPhone, has arrived," says Colopy. "The message can include an incentive that drives them to the store or to order online. Relevancy and value are the keys to SMS text. Consumers usually read the messages as soon as they arrive on their phones, so retailers need to be sure the messages are important."
Speak their language
Relevance is an integral part of success in site search, too. Returning relevant site search results requires a site search tool with a solid relevance ranking algorithm. Even better is a search tool that helps retailers understand the terms consumers use to search e-retail sites.
A consumer looking for a blue blouse, for instance, may include the phrase "powder blue" in her site search query. If the term "powder blue" is not part of the retailer's site search dictionary, chances are the customer will be dissatisfied with the results.
"When a consumer enters a search query, they are essentially creating a way to describe the product, so retailers need to be paying close attention to those descriptions and constantly weave those keywords into their product pages," says SLI's Hoffman. "We pay attention to the search terms consumers use and whether those terms deliver the results consumers want or if they have to perform another search."
Paying attention to search results that don't lead the consumer to what she seeks helps retailers zero in on what changes need to be made to improve search results. "It requires some analysis to determine why consumers are not clicking on search results, but by performing that analysis retailers have a deeper understanding of how consumers search for products," Hoffman adds.
As retailers up their investments in e-commerce technology to grow their overall business, some are opening multiple online stores that cater to specific consumer demographics, carry specialty items or simply are an extension of their multi-brand bricks-and-mortar retail strategy.
One potential drawback to managing multiple online stores is not being able to integrate the order management systems so that orders for each store can be viewed at once. Typically, retailers operating multiple online stores only see orders coming from one e-commerce site at a time. If they want to check orders at another web store, they have to call up that site's order management system.