E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
Hot 100 retailers do more than give lip service to the notion that they must know their customer well, and give her exactly what she wants.
It's common to hear phrases like "it's all about the customer" and "customer focus" bandied about by retail executives speaking at industry conferences. Members of the audience bob their heads, taking in this bit of sage advice, and then many promptly go back to scrolling through their e-mail or Twitter feed on their smartphones.
But somehow—maybe in part due to the sheer repetition of the customer-this and customer-that talk compounded by the fact that consumers are everywhere online and sharing an unprecedented amount of information—retailers' focus on customers has become real. Enlightened web retailers realize customers are more than just an e-mail address in the marketing database, and that their influence has the power to affect the bottom line.
The net effect of this has been an improvement in how online retailers serve their customers' needs and actively involve their customers in their decision-making. That shows up in an annual ForeSee customer satisfaction study of the 100 leading e-retailers by sales. In 2012, they collectively scored 82, after posting scores of 81 in 2011 and 80 in 2010. ForeSee considers scores of 80 and above as excellent.
Examples of how online retailers are pleasing shoppers—110 of them in fact—appear on the pages that follow (no, that's not a misprint; a bonus 10 profiles that specifically evaluate mobile-optimized sites and mobile apps start on page 16). Approaches to customer-focused improvements vary, ranging from entire sites that have been designed to be more intuitive and easy to use across devices, to common-sense product page features, like item-specific size charts, that dispel the uncertainty that sometimes comes with shopping online. Other retailers are shining the light on consumers themselves, from encouraging shoppers to interact with them socially—and then sharing those interactions with the world—to straight-up asking them for their opinions about products under development and taking their answers into account.
It's a different retailing world, and each retailer included in this year's Hot 100 knows it.
Take B & H Foto & Electronics Corp., which sells consumer electronics online and through its store in New York City. It dove into mobile commerce early on, launching an iPhone app in 2009, and hasn't stopped innovating since. The goal, says director of mobile commerce Eli Weiss, has always been to deliver consumers a comprehensive shopping experience. "Customers have expectations that you consistently need to be aware of," he says. "That information is invaluable and should bring forth the ongoing goal of continuously updating to meet those expectations."
To that end, B&H just last month launched a web site that follows responsive design principles, which means B&H manages one site that automatically adjusts how a page is presented across desktop and mobile devices. As a result, consumers on smartphones don't have to pinch, zoom and scroll right to left to view content—everything is in the right place. It also added a universal app for Apple Inc. iOS devices that optimizes content to render correctly regardless of whether it is being accessed by a small iPhone screen, an iPad mini or a full-sized iPad. Weiss says the B&H team reviews online customer feedback everyday and uses it to inform future site and app developments.
E-retailers on this year's Hot 100 also pay close attention to details that show they know who their customers are and what they want. Abe's Market Co., which sells natural and eco-friendly products in conjunction with the small manufacturers that make them, for example makes it possible for consumers to get every question they have answered by the people best qualified to respond, the manufacturers themselves. AbesMarket.com built a module that appears on each product page that encourages consumers to submit a question directly to the maker; the questions and answers are there for all to see. "Our sellers are an amazing resource and deep in the space," says chief revenue officer Kimberley Grayson. "The expertise they provide is very focused." Some sellers also write content for the e-retailer's editorial pages, which are updated daily.
Further, consumers shopping the site want detailed information about the ingredients and processes that go into making the products, and the more the better, Grayson says. That's why for each product the e-retailer says why it likes the product, highlights reviews, product qualities and certifications such as certified organic or GMO-free, that is free of genetically modified organisms. It all goes full circle, Grayson says. "[Content] opens the dialogue about products available on the site and social media programs enable a larger reach. That draws in a new audience," she says.
Providing detailed information helps e-retailers move consumers from browsers to buyers, and shows consumers that the e-retailer really knows the products it is selling. For example, at MonthlyClubs.com, which operates seven "of the month" clubs for products like cheese, wine and cigars, the aim is to overwhelm consumers—in a good way—with product information that demonstrates MonthlyClubs.com staffers' depth of expertise, says CEO Kris Calef. For MonthlyClubs.com that means writing 650-plus words about each of the three cheeses it ships each month, for example, and maintaining a calendar that details past selections and goes back four years, just in case a consumer wants to know what cheese she loved in March 2011. Consumers on the site can also get to know the club's cheese mongers, wine buyers and cigar aficionados and get an understanding of how they select each clubs' products.
Perhaps less overwhelming, but just as effective at giving consumers the level of detail they want, are Hot 100 e-retailers like Mizuno Corp. and Unionmade. Mizuno, the consumer brand manufacturer of athletic gear and apparel, helps consumers select the athletic shoe right for them with a shoe-fitting questionnaire that analyzes the consumers' foot type, rotation, strike and more, along with a video tutorial that simulates a professional fitting. At high-end apparel e-retailer UnionmadeGoods.com, each product page includes the product's exact measurements and an illustration that shows how the measurements are taken. For men buying a blazer, there's no question whether the proper fit is a size 48 or 50. The pop-up window for the measurements is the same as what consumers find at many online apparel sites, but Unionmade has actually made it useful. That's what consumers want.