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.

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.

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.

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.

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.