State of Online Retailing

The full results of the first State of Retailing Online (SORO) 2010 survey conducted by Shop.org and Forrester Research were released today, covering interactive marketing, social media and mobile.

Results are broken out by company type (multichannel vs. pureplay), size (annual Web revenue), and Web selling tenure, as well as by category for apparel, accessories & footwear; beauty & personal care; general merchandisers; home; and sporting goods & accessories.

A few highlights:

    * Retailers surveyed reported an average of 29% growth in Web sales for 2009 vs. 2008.
    * Search still takes the lion’s share of interactive marketing budgets, with paid search dominating as the largest single allocation of marketing spend. Furthermore, nine out of 10 retailers surveyed noted search engine marketing was among the most effective customer acquisition sources last year.
    * Retailers are investing this year in browse and navigation functionality, as well as product page content.
    * Four out of five retailers surveyed said that this is a great time to pursue social marketing strategies so they can experiment and learn from them – even if the return is as yet unclear.
    * To date, social marketing initiatives implemented include social network pages, microblogs, and customer ratings and reviews, among others. Anticipated investments going forward center on further leveraging customer/user-generated content.
    * Mobile is another significant focus for online retailers. While many are still developing their mobile strategy, retailers surveyed have big plans for functionality for this emerging channel, anticipating an average investment this year for mobile of about $170,000 (and quite a bit more for large and multichannel retailers specifically).

2010 Cloud Computing and IT Staffing Survey

Information Week Analytics has produced a 2010 Cloud Computing and IT Staffing Survey that you can download as a free PDF. The survey reports that as enterprises of all sizes are beginning to evaluate the business agility and cost saving benefits that could be had by moving internal operations to public cloud service providers, their IT staffs—from CIOs to middle managers to systems administrators to help desk workers—are left wondering what the impact is going to be on them.

To figure that out, you need to ask a few key questions:

• How is our business going to change? 
• Who will determine what functions are cloud-ready and which are not? 
• How do I move adoption forward in a way that maximizes benefit and minimizes risk? 

The issues get more specific as they dig deeper:

• Which IT operations must stay in-house, perhaps because of compliance or criticality? 
• What job skills and roles will we need to add or retain, and which will decrease in importance? 
• Will the enterprise need more or fewer managers?
• In what areas?

Several essential points emerged that will have profound impact on the future of your business, your IT organization—and your career.

• The public cloud is here to stay, and usage will grow. Even cautious organizations will consume services, including business-critical functions, as providers mature and build trust relationships with enterprises.
• Internal IT staff levels will generally either stay static or contract slightly, depending on the types of services adopted.
• Traditional IT technical roles will be less in demand, replaced by “softer” but broader skills, such as provider contracting and management.
• The staffing levels and job skills required in any given organization will depend heavily on the public cloud service models adopted: software as a service (SaaS), platform as a service (PaaS) or infrastructure as a service (IaaS).

Find out how 828 technology professionals interviewed by Information Week are answering these questions.

Live Chat Boosts Online Sales

As reported by CNBC, about 28 percent of retailers currently provide services where customers can click a link on the Web site to start a "live chat" session, a Forrester Research survey said. But by the end of the year, 26.5 percent more retailers will add "click-to-chat" capabilities on their Web sites, according to the research firm.

Although the technology has existed for nearly a decade, retailers have been slow to add it to their sites because of several hurdles. "It's been slow to get adoption," said Sucharita Mulpuru, retail analyst at Forrester, because “It’s an expense. It’s not just ‘plug-in a button.’ It requires human resources and management and making sure the call center is trained. Frankly, it’s not a standard. It’s nice-to-have, but it’s not a must-have.”

Also, when customers make a high-priced purchase or when product information gets complicated, 67 percent of consumers prefer "click to call" compared to 33 percent that prefer "click to chat."

However, Nordstrom, which offers live chat from specialists in beauty and cosmetics, saw its online and catalog sales rise almost 35%. “If you want to talk to someone specifically on beauty and cosmetics, we have tabs so you can get there directly,” said Colin Johnson, a spokesperson for Nordstrom. “We found that customers have responded (favorably) to having those additional specialist chat buttons on the Web sites.” While the significant growth in sales can't be attributed solely to online chat, it certainly didn't hurt, either!

FGH (UK) Using Analytics for Credit Risk

Freemans Grattan Holdings (FGH, the UK arm of Otto Group, the world’s largest mail order group and the second largest retailer on the Internet) has deployed KXEN analytics in its credit risk team after three years of using the solution in marketing. With bad-debt-propensity scoring that relies on internal customer data as well as third party information, FGH is set to reduce customer debt by as much as one-third, according to predictions.

“We’d used KXEN successfully in marketing for three years and saw no reason to consider a different solution for credit risk modeling,” says FGH head of customer management Andy Bryan. “The target was to improve our ability to predict which customers would default. The new KXEN scorecard has significantly improved our authorization process and retrospective analysis suggests we can cut debt by as much as 33% with only a 3% lower acceptance rate for credit.”

Combining three of the biggest names in the UK home shopping market, FGH holds a dominant position with some 1.5 million customers and sales of more than £250 million in its last financial year. Its customers come from all age groups and many of them are fiercely loyal, having shopped with FGH for years. The availability of credit to people who are unable to get it through other sources is a key USP.

“We’re still accepting a similar number of credit orders. The big difference is that now we’re accepting more orders from good customers and fewer from bad customers. That’s because with KXEN we’re able to use things we know about how customers have managed their accounts with us in the past, rather than having to rely on a single external score,” says Andy Bryan. “It also means that our long-standing customers who have built up a level of trust with our brands are being treated fairly.”

“Now we can be much more granular in our approach to credit scoring. We have a better way of making decisions and a better way of limiting our exposure,” says Andy Bryan. “It’s having a major impact on debt but only a minor impact on overall sales.”

About KXEN
KXEN, with headquarters in San Francisco and offices in other US cities plus Paris and London, calls itself "The Data Mining Automation Company," delivering Customer Lifecycle Analytics solutions for CRM lifecycle analytics to drive improvements in customer acquisition, retention, cross-sell and risk applications. KXEN’s solutions are based on patented innovations and have been deployed at over 400 customers including Bank of America, Barclays, Cox Communications, Lowe’s, Meredith Corporation, Overstock.com, Rogers, Vodafone, and Wells Fargo.

Lilly Pulitzer Launches mCommerce Site

DM News reports that apparel and accessories retailer Lilly Pulitzer launched its first mobile commerce website in early July. The portal will be compatible with all Web-enabled mobile phones and optimized for the iPhone and Android devices.

The mobile site will allow customers to search Lilly Pulitzer's full catalog, read product descriptions, view photos, purchase items and locate nearby stores. The site was created by mobile services provider Digby and utilizes Venda's e-commerce platform.

Kendall Swenson, senior promotions associate at Lilly Pulitzer, said she expects the new platform to increase sales and be popular among customers of all ages.

“We want our customer to be able to buy her Lilly products instantly, no matter where she might be running to,” Swenson said. “We have upwards of 85,000 fans on our Facebook page, and the fastest growing demographic is the 45-plus range. We're looking to continue to capture an older customer and grow this base.”
Swenson said the company also will release an iPhone application in the coming months, and is considering adding iPad, Android and BlackBerry apps.

Ten Free Web Analytics Tools

From Six Divisions (Useful Information for Web Developers and Designers): Web analytics is the process of gathering and analyzing your web content’s data in order to glean meaningful information about how your site is being utilized by your users. There are plenty of Web analytics applications out there, and you probably already know the big guns such as Google Analytics, Crazy Egg, and remote-site services such as Alexa and Compete.

But here are 10 other free tools and applications to help you gather and analyze data about your web content.

Broswer Tool Separates Potential Customers From Surfers

New Scientist Tech reports that a new tool examines the cursor behavior of search-engine users to decide if they are shopping or merely surfing, based on how users react to sponsored results displayed above the non-sponsored ones, which can be annoying for someone who's not shopping, say Eugene Agichtein and Qi Guo at Emory University in Atlanta, Georgia.

People often use cursor moves to help them pick their way through a screen of text, so the pair wondered if these could be analysed to discern if a person was reading the sponsored ad or not, and so infer their intention. They created a Web browser add-on that tracks the cursor, and found that the data could help to distinguish between a "browsing" and "shopping" search session over 96 per cent of the time.

Users often reword their query several times in a search session, so surmising propensity to purchase can help to determine whether or not it is appropriate to display ads in later searches, Agichtein says. "As the session progresses, our system would be able to make increasingly accurate predictions of intent."

The pair will present their study at the SIGIR 2010 conference in Geneva, Switzerland, this month.