eTail West 2012 Redux: Commerce Across Channels

A Summary of Lessons Learned & Best Practices from eTail West 2012 Charles Wiedenhoft, Director of Business Planning & Optimization February 25th -28th 2012 Palm Desert, California

 A steady torrent of rain changing over to snow set the stage for a theme of change as we trekked our way to this year’s eTail West Conference in Palm Springs, CA. The event once again lived up to its reputation as the leading source of trends and insights from the world’s largest multi-channel retailers. Just minutes into the opening keynote it was made crystal clear that the influence of technology on consumers and commerce continues to grow. Most notable was the rapid acceleration of the mobile channel as a legitimate touch point for engaging shoppers and driving transactions. Through the course of two days we took pages of notes and sent just a few more than our fair share of tweets (follow @ eTail_Events to see the archived feed). The following summary includes our top-takeaways: Rise of big data Making sense out of the volumes of transactional and consumer data that is captured each day requires sophisticated analysis. It’s a growing concern for many retailers who don’t have the infrastructure to support visibility into live data sources. Companies like HSN are scrapping legacy systems entirely for platforms developed with data integration as a core competency. Panelists at eTail said it’s far simpler just to start from scratch rather than orchestrate the technical resources required to make connections across disparate sources of information. That’s a big reason why CMOs are expected to outspend CIOs on technology in 2012. Large investments in marketing technology are warranted because access to a single customer record has many benefits. An integrated view helps companies understand who their most profitable customers are. It also allows retailers to deliver a superior overall experience regardless of touch point. A representative from NetSuite demonstrated how its new commerce system ties together brick and mortar retail data with online operations. It’s enabling brands like Serena Lily to deliver a unified customer experience across multiple channels including catalog, call center, desktop web, tablets and mobile. Another marketing services provider SteelHouse showcased a solution for targeting customers with real-time offers wherever they go on the web. The incentives are personalized to shoppers and shaped by behaviors such as frequency of website visit, interaction with specific products and purchase history. The tailored offers convert better than one-size-fits-all approaches and have proven to increase AOV.

Mobile is now
Considerable attention at eTail was given to the mobile retail channel. Consumer adoption of tablets and smartphones shows no sign of slowing down. Oracle reported that in 2015, transactions made from mobile devices will reach $165 billion in sales. Panelists from Anthropologie, Pacific Sunwear and Red Door’s client, Smith+Noble, shared mobile insights and examples of its growing impact on their businesses. All speakers underscored the importance of tailoring the user experience to meet unique device interaction styles and designing for context. There are special design considerations that need to be made when engaging shoppers on tablets and smartphones. Of the two devices, smartphones are far more personal. We feel anxious to let others borrow them. Our phones fill “boredom gaps” throughout the day. They are primarily used in short bursts of time for utility tasks such as checking email, getting driving directions and sending or receiving texts. We heard at eTail that up to 40% of email sent by retailers is opened on mobile devices. This signifies the importance of optimizing email for mobile display. It also illustrates the need for mobile-friendly landing pages. Tablet devices, on the other hand, are rapidly replacing PCs at home and are far more likely to be shared between people than are smartphones. Tablet screens are larger so they are better suited to longer form content like games and movies. The use of tablets peaks during “me time” which includes nights and weekends. This makes tablets more inviting for exploration and discovery. It also affords brands the opportunity to connect with an audience that is receptive to meaningful experiences with increased emotional impact. We overheard plans from several retailers at eTail to launch websites specifically designed for tablet devices. This motivation is driven by the success of companies like Anthrolpologie who reported a 15% higher conversion rate on its iPad optimized website compared to the desktop version. Quidsi, parent company of wag.com and diapers.com, is forecasting tablets will contribute17% of online sales in 2012. For an example of a tablet optimized user experience check out Staples website (t.staples.com) and compare it to the company’s desktop web experience. You’ll find the tablet interface is far less information dense. The site navigation is streamlined and oversized graphical links are designed for “tap” and “swipe.” The speed at which pages load on tablets and smartphones is a top concern in mobile ecommerce. Akamai presented statistics showing that mobile websites take an average of 9 seconds to load while desktop sites take just 3 seconds. That’s a huge difference and a major problem because 60% of visitors will leave a website after waiting longer than 3 seconds. Failing to deliver a streamlined mobile website will result in fewer sales and a frustrating customer experience. Each click in a conversion funnel will cause10% of shoppers to abandon their orders. Online retailer Crutchfield overcame this hurdle and increased conversion rate by 37% after implementing a mobile optimized checkout requiring fewer clicks.

Customers at the center
Customers expect you to be everywhere and you must understand how to interact with them. Ideas for continuous improvement can be found by actively listening to customers across all retail channels. Unfortunately, many retailers are struggling to integrate voice of customer insights due to organizational barriers. For example, a customer objection placed through a sales call center isn’t shared with the e-commerce team who could make a simple content update and solve the problem permanently. The Little Tykes Company has institutionalized measures that enable employees to act on customer feedback immediately. It has removed complicated content review processes in favor of an employee driven crowdsourced approach. This allows members from various teams to modify product information on the company’s websites without having to wait for approval. Several retailers gave tips on various approaches to elevating the customer experience. Barnes & Noble said that taking the time to process qualitative feedback will reveal the most powerful insights. The company’s online survey typically has a 7% response rate. Stakeholders gather once a month to review customer comments entered in open-ended survey text fields which provide the richest data. They’ve also found that taking action on this data requires an agile and flexible ecommerce operation where everybody is empowered to solve customer problems. All presenters unanimously extolled the power of online reviews to build customer advocacy when problems are resolved in a positive manner. They also seemed to agree that product information is contextual to customers. When shoppers are provided the tools to help each other learn and make better decisions conversion rates soar. This means that organizations must learn to manage and distribute content that is social, dynamic and constantly changing.

The future is now
A private networking mixer hosted by marketing services partner Experian at the famous Elrod House offered another perspective on the theme of change. The residence was featured in the James Bond film Diamonds are Forever. It’s an architectural gem designed by John Lautner who was a student of Frank Lloyd Wright. The mid-century design aesthetic was complemented with musical entertainment from an original member of the Village People. The 1970’s James Bond party theme offered a chance to reflect on how far technology has evolved as it invades nearly every aspect of our lives. At Red Door we’ve already started to shape e-commerce strategy recommendations from these insights. Let us know if you’d like to hear more. We’re excited to share our ideas with you.

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