Friday, December 14, 2007

63% of UK buyers plan to get 50% or more Christmas presents online

A recent survey has found that a massive 87% of UK consumers will buy some Christmas presents from the internet this year. And a staggering 63% say they will get at least half their presents online.

Why? "Saving time", with convenience, ease and price also cited.

Action: make sure your site has present giver functions like present finder, gift wrap and delivery notes with no price printed.

Monday, December 10, 2007

Surfers bail fast if products unfindable

A survey by US search provider SLI Systems has found that online shoppers will leave a site within a couple of minutes if they can't find the product they're looking for.

Action: make sure your home page is uncluttered and that the search and browse functions are easy to use. I was looking for jewellery boxes yesterday and failed dismally. On too many sites a search for jewellery boxes found a mass of jewellery & browsing wasn't much better: should I be looking under jewellery, accessories or home?

Friday, December 07, 2007

"3D" virtual shopping still doesn't work

US gadget multi-channel retailer Brookstone has launched a 3D virtual shop. I'm not impressed! The software takes five minutes to install and the end result is almost impossible to navigate. Nice try, but it won't catch on. The web should be embraced as a new medium in its own right, not forced to replicate existing media, whether page turning catalogues or 3D virtual stores.

High Street gaining on ecommerce only retailers

Recent Hitwise analysis has found that the web sites of High Street retailers are getting more visitors than the sites of online only merchants such as Amazon. In previous years most ecommerce traffic has been to online only merchants - except for the Christmas and January sale period. This year the High Street retailers got more than half of ecommerce visitors in September and the gap seems to be widening.

We have long argued that the ecommerce game would be won, in the end, by the old-established retailers. Looks like we're right.

Sunday, November 25, 2007

Broadband now 88% of UK internet connections

The latest figures from the Office of National Statistics show that nearly 9 in 10 of UK internet connections are broadband. This is great news for those us who design websites. But there are still 39% of households that don't have internet access; merchants can't ignore old-fashioned media yet.

Friday, November 16, 2007

Royal Mail study: home shopping still rising

The annual Home Shopping Tracker Study 2007 from the Royal Mail puts some flesh onto the theory that ecommerce is growing the overall size of the home shopping market. 61% of the population - the highest recorded - now shop from home, and two fifths shop online. In addition, customers ordering online spend 25% more if they browse a catalogue first.

At Digivate we've always predicted that ecommerce would add to home shopping and not cannibalise it. Nice to see that we were right!

Monday, November 12, 2007

Consumer advocates take the reins

Primark announced today that it won't set up a Facebook group. Why is this a story? An existing Facebook group - "The Primark Appreciation Society", set up by Oxford Broookes student Sophie Bellchambers - is deemed by Primark to be "...of far more value than anything we could do."

Primark recognise that independent advocates have more credibility than official campaigns. This is part of the 'Open Brand' trend that is both terrifying and exciting: get it right and your customers will promote you for nothing, but get it wrong and your errors will be spread far and wide.

Comet launches video demonstrations

Comet has created about150 product demonstration videos in a bid to help shoppers choose what to buy this Christmas. It will be interesting to see if the initiative lasts longer than Dabs TV which launched about 4 yeas ago but fizzled soon after. (The announcer's voice is very annoying to me, but perhaps I'm in a minority.)

Now that YouTube has made watching video online a normal activity, I predict that Comet will find the videos both watched and helpful sales tools. How would you get product demonstration videos onto your site?

Wednesday, October 10, 2007

US electronics buyers get more satisfaction online

Most consumers prefer to research electronics online but buy in a store. US based Consumer Reports (similar to the UK's Which? magazine) surveyed 90,000 US consumers about their electronics buying preferences. The majority found shopping online more satisfying than visiting shops due to the wider choice and better prices. But most still go to a store to complete the purchase.

This survey reinforces the idea that most actual buying will remain on the high street. But it also highlights why retailers need excellent websites that provide all the answers researchers are looking for. Why is it better? What is the difference? How will it make MY life easier? If shoppers can't find the answers they want on your site then they'll keep looking and you may lose a customer.

Half of US web users will buy online this Christmas

A survey by Burst Media has found a dramatic increase in the percentage of US web users expecting to shop online this Christmas season - in 2006 37.6% bought online and this year 50.7% plan to buy something from the internet.

I wonder what are the equivalent figures for the UK?

Friday, September 28, 2007

Why you need to have an "open brand"

Kelly Mooney, a thoughtful analyst of marketing trends, has identified and named the "open brand" as a crucial strategy for success. The concept - set out in detail on her microsite - refers to the idea that the brand leaders of tomorrow will embrace dialogue with consumers enabled by the internet, and move away from old ideas of controlling a brand.

Fascinating stuff. What are the implications for your brand?

Tuesday, September 18, 2007

Amazon launch widget

Amazon have launched a range of 16 widgets that can be added to any website. Sales made via clicks on a widget earn the site owner up to 10% commission.

We think: This development is yet another pointer to the future of selling online - etailers will increasingly use tiny elements on other sites (ie widgets) to drive traffic into the buying process on the etailer's own site.

Friday, September 07, 2007

"Spoiled shoppers" expect cross-channel integration

A survey of 5,000 US shoppers provides numbers to support the feeling that modern shoppers expect a high level of integration between retail channels.

For example;
* 57% want to be able to return or exchange at a store items bought online or by telephone
* 65% want to be able to change or cancel orders in a different channel to the one used to place the order

Full integration is tough, but retailers can no longer afford to duck the issue. I'm looking forward to the day when all retailers' websites allow me to search for which local store has stock of the product I want.

Print still alive and kicking

A survey of US 'millennials' (13-24 year olds) by the Harrison Group for Deloitte has found that despite their massive use of new media, the millennial generation still enjoy reading magazines and watching TV.

This comes as no surprise: reading print is still easier than reading a screen. The lesson is that a business strategy needs to combine all possible channels, including print.

Ofcom: over-50s are quarter of web users

Ofcom's 2007 report into the UK communications market has plenty of stats to chew on. What struck me were the figures on 'silver surfers' - the over-50s comprise a quarter of web users and account for 30% of all time online. 16% of over-65s use the internet.

It is time to lay to rest the myth that only businesses with younger customers need a web strategy!

Thursday, August 09, 2007

Large study proves online advertising increases offline sales

US web behaviour monitor ComScore & search engine Yahoo! have released the results of a large scale study that demonstrates the link between online advertising and buying in stores. 175,000 consumers were tracked over 9 months, with some being exposed to online advertising from the five brands in the study.

The results were conclusive. Store sales were an average 41% higher for the consumers who'd seen both display and search ads for the tracked brands. For every incremental $1 spent online, $6 was spent in a store. The group exposed to online advertising looked at an average of six more pages while researching online compared to the group that didn't see the ads.

What does this mean? It shows that brands must operate both on- and offline to maximise the effectiveness of their promotional spend. And that consumers are using the web to "pre-shop" so even if you don't think you will sell much online, you still need a website (and online ads to drive traffic to the that site) to catch these researchers.

Friday, July 27, 2007

Asda to sell clothes online

Asda has announced that it will sell the George range online from February 2008.

It is getting harder and harder for UK retailers to claim that "our customers aren't online" or "our prices are too low to sell online" or even "we have so many stores that our customers don't need to buy from us online". All these are excuses I've heard in the past.

Wal-Mart adds reviews

US retail giant Wal-Mart (owners of UK's Asda) has just added customer review functionality to its website, in response to customer requests.

Few UK retailers have dared to add customer reviews despite mountains of evidence that customer love reviews, that reviews reduce returns rates and that most reviewers give high ratings to most products. I wish I knew what was holding UK retailers back!

Friday, July 13, 2007

Over half of UK shoppers value reviews

A recent survey by US review provider Bazaarvoice has found that 53% of UK shoppers have more trust for retailers if their sites include consumer reviews. This is significantly lower than in the US, where 78% felt the same way.

I personally love reviews and when I researching any potential purchase of an unfamiliar or expensive item rely on reviews to guide me.

Action: Add reviews to your site. If your products aren't really appropriate for reviews (furniture, for example) then show reviews of your customer service.

Mobiles get comparative shopping edge

US mobile phone provider Sprint Nextel has launched a product search service for GPS enabled mobiles that allows users to find suitable local stores. GPS enabled mobiles are becoming standard in the US since the FCC ruled that mobile companies have to provide location details in the event of an emergency call. This has lead to a drop in the price of GPS chips and experts agree that sooner or later mobiles in all countries will include GPS features.

If consumers start to use this kind of service then it will bring the same relentless price pressure seen online into high street stores. It will also bring promotional opportunities for retailers to use hyper-targeted keyword search advertising.

Action: If you haven't already started getting your store inventory into an accessible format, do so now. Whether consumers are searching at home using postcodes or on the move with GPS, retailers will need to be able to provide shop by shop stock and price data.

Wednesday, June 27, 2007

Searchers spend 10% more on electronics

Research by Yahoo! and ChannelForce has shown that US buyers of TVs and cameras spent 10% more if they had searched online first than if they'd just walked into a store.

This shows that the informed customer will, on average, spend more money than the uninformed customer.

Action: make sure that your website clearly explains why the more expensive products are worth the extra expense.

Why customer reviews improve profits

US retailer Petco Animal Supplies has revealed that customer reviews reduce return rates by an average of 20%, and that more reviews means even lower return rates. Products with more than 50 reviews have a 65% lower return rate than products with no reviews.

Action: even if reviews aren't as relevant to your product area as for others, you should still have customer service reviews. Potential customers can't get too much information to help them decide to buy from you. And if you're scared of what your customers might write then you need to improve your customer service!

US survey: web essential to most women

A survey of 1,800 women by US publisher BurstMedia shows that over half of women turn to the internet first when researching products and two thirds say that their lives would be disrupted if they didn't have online access for a week.

Even amongst the over 65s 31.8% turn to the internet first for product research - showing that there are no age segments where the internet is unimportant.

Action: even if you can't sell your products online, you should ensure that you have a comprehensive website.

Monday, June 18, 2007

PwC: 'nearly all under 55 will buy online in 2011'

A report by PriceWaterhouseCoopers provides some hard numbers for the general feeling that ecommerce has plenty of growth left.

PwC surveyed 1,500 consumers and studied online penetration by product category to come to their conclusions. They cite three reasons why ecommerce will continue to grow rapidly:

1) As web-savvy youngsters age they'll bring their online habits with them
2) At all ages there is a sizeable group intending to start buying online soon
3) Greater online confidence means consumers will tend to increase the variety of categories they buy & the size of each purchase

Overall PwC predict that online sales (excluding eBay & travel) will account for 10% of retail spend by 2011.


1) Remember that 10% is the average across all sectors. Some sectors are already seeing significant high street impact from online sales - cameras being a good example, with Jessops announcing the closure of 25% of its stores this week.

2) Don't wait until your online competitors have the size and strength to hurt you, as it may be too late. Why isn't Jessops selling more cameras and prints online? They didn't start early enough.

Thursday, May 17, 2007

What you need to know about multi-channel shoppers

Multi-channel shoppers are fast becoming all shoppers.

As buying online becomes a mainstream activity amongst internet users (currently at 78.5% in the US - see eMarketer) and as the world of 'internet users' gets closer to 'everybody' (85% of UK adults earning more than £20,800 accessed the internet in the 3 months preceeding April 2006 - see ONS, and 79% of all connections are broadband - see ONS), multi-channel shoppers are increasingly the same group as shoppers.

The ONS reports that the most frequent online activity is 'searching for information about goods and services' - carried out by 84% of adult internet users. Yet only 44% of adults had bought online in the 3 months preceeding the April 2006 survey.

This shows (if you didn't know already) that there is an immense amount of online shopping research going on though much of it results in real world buying.

What does this mean? Success in retail will depend on creating informative and up-to-date websites to empower consumers to get the answers they want. All of them!

Wednesday, April 11, 2007

Finally - a measurement scanner to ensure clothes that fit!

The science fiction fantasy of a machine that takes your measurements has arrived in the form of Intellifit. So far there are only 13 such machines (Most in the US, but there is one in the Regent Street Levis store). The machines take 200,000 measurements from your fully clothed body in about ten seconds.

The company charges nothing as it collects a commission from the retailers (so far only 8, all US brands) it suggests you use.

This sounds like a very interesting device though limited in usefulness until more brands have bought into the system. One to watch.

Tuesday, April 10, 2007

Who else wants lower returns for clothes?

Newly launched claims to have half the return rate of the average fashion retailer. The secret? Only showing clothes that both fit AND suit your body shape. The site asks women for their measurements and style preferences. This allows MyShape to present clothes chosen specifically for a shopper's shape, size and lifestyle.

Getting sizing right is rare. My wife found the Boden website very hard going when searching for sale items because she had to open every product page to see if her size was still in stock. In the end she just gave up. A 'filter by size' function would have made her experience much better.

Friday, April 06, 2007

Traditional mail order is dying. Long live mail delivered retail!

Verdicts' latest report about the UK mail order business shows that traditional mail order is fading away. The 'Big Books' such as Shop Direct, Littlewoods, Otto, Freemans, Grattan and Redcats relied on local agents and an ability to offer credit. Now that credit is freely available to all and with the rise of discount retailers on the high street, this once dominant sector of the mail order market seems to have few prospects.

And yet more and more customers are buying remotely and getting products delivered.

I've always maintained that the most interesting figure to examine would be the split between delivered retail sales versus sales of goods collected from a store. Sadly no-one seems to be capturing or estimating this. I'm confident that if the delivered/collected percentage was calculated over the last decade it would show that although mail order is in steep decline, mail delivered retail (which would cover ecommerce, TV shopping and catalogue sales as well as multi-channel sales from high street brands) is rising.

Verdict - over to you!

Monday, March 12, 2007

IKEA ecommerce rockets towards the top

Despite launching a pilot scheme with no fanfare and restricted to the East Midlands & Cambridgeshire, IKEA's ecommerce website has crashed into the UK's top 50 ecommerce websites at number 49, as measured by Hitwise. Given that about half of the entries are for travel or ticket sellers this is more like becoming the 25th biggest etailer in the UK.

This goes to show that the latent demand for ecommerce from well known retail brands is huge & that the etail laggards are leaving substantial sums on the table by refusing to play.

Online shopping research gaining ground

Research into the shopping habits of US broadbanders shows that the internet is now the primary source of shopping research. The study showed that 50% were influenced by the internet in a recent purchase. Other sources of shopping influence were: ecommerce websites - 36%; search engines - 15%; TV ads - 11%; user-generated content (reviews, blogs etc) - 9%; print ads - 6%.

What does this mean for retailers? Don't judge your website by online sales alone. Find ways to measure the pounds and pence effect of your website on your high street sales.

Friday, March 09, 2007

Borders video: brand building or cash wasting?

US bookstore giant Borders - which has outsourced ecommerce to Amazon - is none-the-less using the internet for marketing. Following hot on the heels of Borders Book Club videos, the company has launched 'Borders Live at 01' (warning: link will start a video with sound), a series of videos taken at the original Borders store in Ann Arbor Michigan. On a decent broadband connection the quality is far superior to YouTube, though viewers will need the latest version of Flash.

This type of retailer produced event could be the future of brand building. In a multi-channel world where consumers are looking for authenticity, relevent videos could serve to both draw in suitable prospects and demonstrate the retailer's credentials.

The questions are:
* Will people shift from TV to watch specialised content like this?
* Will enough of them go on to visit the retailer's website or physical store?

Until Borders reports on the success or otherwise of this experiment we won't know the answers. But any forward looking retailer should be thinking about what sort of content would be suitable to help create and sustain their chosen brand values. And any product creator (think author, designer, factory) needs to think about their role in creating content that can be used by retailers.

Thursday, March 08, 2007

What everybody ought to know about vouchers

One of my colleagues emailed me yesterday with details of a £5 off voucher from Habitat - from the Barbican Art Gallery website - that appears to be intended just for Barbican members. But although the voucher page can't be found by searching on the site, it isn't password protected so the page can (and clearly has been) emailed to all and sundry.

No word yet on when this voucher was posted or whether its 'escape' to the wider world of non-Barbican members has led to increased sales at Habitat.

This reminds me of the Threshers voucher intended for suppliers that was distributed virally to millions of consumers in December last year. But there are significant differences - Habitat's is only for £5, & 40% off booze is much more appealing than £5 off homewares!(NB: The Threshers deal isn't as generous as it appears because they have a long running '3 for 2' offer that is effectively a 33.33% discount.)

But both vouchers have found themselves emailed to people not (officially) intended to get the offers. So the action point is: ensure that if a voucher 'goes viral' you'll make money. Simple, really.

Thursday, February 22, 2007

Dixons' boss: ecommerce heading for 20% of UK retail sales

Hot on the heels of the Toys 'R' Us CEO's prediction that ecommerce growth will level off when it represents 10% of total retail is much more bullish statement from John Clare, the CEO of DSGi (a group which includes Dixons and Currys). They already get 12% of turnover online and expect this to rise to at least 20%.

The percentage of goods sold online varies by product category; both electrical goods and electronics are categories with fierce price competition and strong manufacturer brands so in some ways it is not surprising that DSGi is getting far more online sales than Toys 'R' Us.

Toys 'R' Us boss: ecommerce to rise to 10% of retail

At the recent ETails 2007 conference and exhibition, Jerry Storch (the CEO of Toys 'R' Us) predicted that ecommerce would top out at 10% of retail spend. His argument seems to be based on the idea that the cost of driving to a store is much less than the cost of shipping items to homes.

But this is only true if customers place a minimal value on their own time. It is hard to spend less than 15 minutes in a shop and if the trip entails driving, parking and then searching within the store it can easily stretch to 45 minutes. Even at the minimum wage of £5.35 per hour, 45 minutes is 'worth' £4 - a figure that is close to a typical P&P charge. Add in more time, petrol and parking (not to mention other car costs) and costs can easily exceed P&P.

If the item you want is out of stock then you either have to come back or find it somewhere else, adding even more time to the transaction. Buying online can also remove risks from the process - research is easier and you are much more likely to find your item in stock.

So perhaps ecommerce will go well beyond 10%.

Wednesday, February 07, 2007

US survey: bad websites drag down high street stores

A recent email survey of 638 US online shoppers found that 41% said yes to the question "When you have a frustrating shopping experience online, does it make you less likely to shop at that retailer's physical store (if they have one)?"

This is markedly up from the 29% with the same answer last year. The increase in respondents saying that a bad site negatively affects their opinion of the brand was up from 55% to 59% and the number claiming that a bad site means they're less likley to return to the site stayed level at 82%.

So it seems that - as one would expect - bad sites don't just waste money and leave money on the table. A "frustrating shopping experience" also makes it less likely that a shopper will visit a brand's high street stores. Given that online shoppers are getting more demanding and expecting ever more complex functions on ecommerce websites, it is clear that high street retailers need to work hard just to stand still.

Monday, January 29, 2007

Profit by segmenting web-acquired customers

A US commentator writes that it pays to segment web-acquired customers before treating them like more traditionally acquired mail order customers.

Although the average web-acquired customer has low average order values and a low lifetime value, the figures vary significantly depending on the exact source: search, affiliate link or whatever.

Action: segment like crazy and make sure that your data file contains multiple flags to keep track of where your web-acquired customers come from and what they were doing on-line. Once you have identified the lifetime values for your web-acquired segments, factor that in to your online marketing decisions.

Tuesday, January 23, 2007

More evidence that customer reviews are good

Building on the experience shared by BazaarVoice in September last year, Forrester Research has just revealed the results of an analysis of 4,000 customer reviews on Amazon. 80% of the reviews were positive, and the negatove reviews were almost all rated as "useful" by other shoppers.

I love reviews and wish I could persuade more of our clients to offer them!

Jupiter predicts online's share of retail in 2011: 10-15%

Jupiter Research has published a report "US Online Retail Forecast, 2006 to 2011" . I haven't paid $1,500 to get it, but apparently Jupiter is forecasting a number of interesting figures:

* Online's share of total US retail in 2011 - 10-15%
* Percentage of offline sales influenced by online research in 2011 - 40%

Jupiter claim that most future growth in online sales will be from existing buyers spending more online, and not from new online buyers.

My view of this?: The 10-15% is an average, of course, so some product categories will have the majority of products sold online. If you're a merchant you need to assess what percentage of YOUR market will be online and act accordingly.

Friday, January 19, 2007

Christmas figures reveal importance of ecommerce

The figures are mostly in and it is clear that the rise of ecommerce in December 2006 was even greater than most commentators expected.

The John Lewis Partnership saw online sales rise by a staggering 88.5%, which compares very favourably with the national retail growth by value of 4.7%. Average ecommerce growth figures for December 2006 vs December 2005 seem to vary between 50% and 30%, but both are pretty impressive numbers.

More significant is the fact that almost all of the retailers in trouble - Woolworths being a good example - don't have a working internet strategy.

Despite the relatively small proportion of total sales that ecommerce represents, it is clear that all retailers need to have an integrated multi-channel approach if they wish to succeed.

Friday, January 12, 2007

M&S trip proves value of ecommerce

I visited 2 different M&S stores recently - one of them twice - looking for a known garment in a certain size and colour. It seemed like a good idea at the time. I was passing the stores in question & just nipping in appeared to be an easy option.

I didn't get what I was looking for, but I did learn a lesson. The customer service at the stores depended heavily on the assistant I happened to talk to. One was very helpful, one tried to be helpful and one was simply not interested.

In the end, going to the website provided me with the item I wanted, as well as a smooth buying experience untainted by the variability of shop assistants' moods.

This story highlights why even a ubiquitous retailer like M&S needs an ecommerce website - until every store carries every item in every colour and size variation, customers have to gamble that what they want is in stock. Going online has a much higher chance of finding what you want without wasting time.

Wednesday, January 10, 2007

US surveys: people like commercial emails & free shipping offers

A recent US survey asked 2,541 online adults various questions about commercial emails. Amongst other findings, three-quarters found emails from frequently used companies to be 'valuable or very valuable' and 30% had bought something after getting a promotional email.

A second US survey found that free shipping is the most preferred type of offer, and that more customers claim to prefer a percentage off to an amount off.

These customer-reported figures match the experiences of our clients, who are still finding promotional emails to be a very profitable source of business.