The e-retailer puts out a fulfillment call that could, by one estimate, increase its warehouse workforce by 10%.
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HauteLook views the mobile channel as an ideal way to keep in touch with its typical shopper—a woman in her mid-20s to early 30s with above-average income and an iPhone in her purse—wherever she is. "She may be standing in line at Starbucks or sitting in traffic," Sobie said. "The limited inventory, timed element of HauteLook lends itself to a mobile experience."
As mobile grows, retailers are finding ways to get into the game without spending a bundle. GourmetGiftBaskets built its mobile commerce site for $20,000 and now gets 3% of sales from mobile devices, said CEO Ryan Abood in another presentation.
Crutchfield Corp., the web and catalog retailer of automotive audio products, used a popular classified ad web site to recruit a focus group, said Todd Cabell, the retailer's senior manager of web strategy. "We posted an ad on Craigslist and asked mobile shoppers to come in and navigate the site, and tell us what they find and what they feel about our site," Cabell told attendees.
Back to basics
For all the attention paid to new forms of e-commerce like mobile and social, there were dozens of sessions in which retailers explained how they were improving such bread-and-butter skills as search marketing, analytics and customer service.
Women's apparel retailer The Talbots Inc. has used paid search ads to attract younger women who would not think first of Talbots, for example by bidding on fashion-specific terms like "high-waisted black skirts" so that Tablots.com ads appear next to search results for that term. "We have a modern look to our clothing and we're trying to get that brand message to a potential customer that would never think of our brand as one for 35- or 40-year-olds," said Katherine Goodman, Talbots' vice president of e-commerce, during the Advanced Search Engine Marketing workshop.
Wine.com bids on broad terms like "buy wine" and "top rated red wine" as a way to attract new customers, explained Cam Fortin, the e-retailer's director of business development, during another workshop session. "We'll spend more money to get someone new in the door rather than on someone we've sold to before," he said.
Wine.com also learned from analytics data that iPad users were visiting the site frequently on weekends and evenings, times when the e-retailer typically lowered its paid search spending. Fortin said Wine.com now bids more on paid search ads only for iPad users during those times; while Wine.com pays more for each click on an iPad ad, those clicks convert at a rate of 9.54%, versus 6.49% for clicks by wine lovers using computers, justifying the extra cost.
Retailers get more from analytics data that non-technical managers can use, Best Buy Inc. found after reworking its analytics strategy last year, reported speaker Lynn Lanphier, director of digital analytics at the consumer electronics chain. With 25% of merchants and category managers pulling their own analytics reports, instead of relying on analytics experts, the expanded analytics team—15 specialists instead of nine—has more time to test new ideas; those new ideas have generated $20 million in incremental sales, Lanphier said.
Testing is a crucial part of any e-retailer's planning process, and can yield unexpected results, explained Kevin Churchill, director of e-commerce at Patagonia, a manufacturer and retailer of outdoor apparel. For example, when the company offered free shipping for orders over $75 it tested listing the shipping fee as zero versus displaying the word "FREE"—"FREE" lifted conversions 20%, Churchill told attendees.
Customer service agents, too, can be measured, but what you measure is important, said Tammy Van Donk, director of customer care at web-only retailer Hayneedle Inc. Hayneedle has shifted from measuring contacts per hour and cost per contact to instead recording how often agents convert calls into sales, Van Donk said. It was part of a strategy to rebrand the company, formerly NetShops, that also involved bringing customer service back to its headquarters of Omaha after outsourcing some call center operations to Guatemala.
Small no more
Along with such large retailers as Best Buy and Walgreens, many small retailers spoke at IRCE about how they're using the web to grow.
Act bigger than you are by employing artful photography, multiple views and offering a variety of payment options, said Sophia Amoruso, founder of trendy apparel retailer Nasty Gal Inc. She buys vintage items that are poorly presented on eBay, photographs them on models that capture the sassy, punkish "nasty gal" look—and charges 10 times the eBay price. "You've got to be visual," Amoruso said.
At WrestlingGear.com, president Jeff Pape handles search marketing for the small e-retailer, adjusting word combinations daily or even hourly. "Be fast," Pape told attendees. "If you learn something here at IRCE implement it fast and see how it works. It's not uncommon for me to tweak something while sitting in a session."
A big part of getting bigger is acquiring the capital needed to expand, and this is a good time to do it, Norm Colbert, managing partner at investment bank Petsky Prunier, told the Financing Growth workshop at IRCE.
He noted that merger and acquisition deals in 2011 already amounted to $60 billion in value, ahead of the $54 billion for all of 2010, with 46% of those deals involving e-commerce and digital media companies. Web retailers are especially attractive to investors, Colbert said, if they can demonstrate a strong market position, high lifetime value customers, revenue growth and profits, and the ability to leverage hot technologies like online video and social media.
Also speaking at that workshop, Glen Kayll, chief financial officer at e-retailer Coastal Contacts, explained that investors can have a hard time putting a value on web retailers that have fewer fixed assets than traditional bricks-and-mortar merchants. But, Kayll added, web retailers that can show they offer something unique, can attract cash.
"Buyers understand the world continues its relentless shift into Internet retailing," Kayll said. "Internet retailers are a hot commodity."