Internet Retailing Expo is over for another year. With an entire conference stream dedicated to the customer experience the show certainly got stuck into one of the hottest current topics in ecommerce – how to create truly integrated, multi-channel merchandising functionality that reflects and complements the physical high street experience.
WorldPay’s 2012 ecommerce basket survey dominates the retailing media this week, demonstrating that British ecommerce is showing the world how it should be done. The average UK shopper testifies to spending an impressive £3,370 per year online. What’s more, the UK is currently the leading internet economy in the G20 according to a new study by the Boston Consulting Group. Internet business contributes 8.3% to our GDP – set to increase by a further 11% by the year 2016. Mix in the fact that 60% of consumers shop online up to three times each month and the outlook is undoubtedly bright for the ecommerce industry.
Retailers are responding accordingly with an increased focus on multi-channel shopping services. One in four high street stores look set to close over the next ten years according to Internet Retailing. Meanwhile, at the end of 2011 GI Insight reported that 63% of shoppers combine their purchases across the high street and the internet. Many consumers still favour physical shopping to touch, test, and try. They then go online to effect the final purchase. As GI Insight’s Managing Director Andy Wood rightly points out, “there is logic to consumer behaviour across multiple channels. Understanding this on an individual level can be crucial to managing customers and getting them to remain loyal, buy more with each transaction, and purchase more frequently”.
Given that the high street and the internet remain inherently entwined, it follows that ecommerce retailers must strive to translate high street aesthetics to the internet for continued industry growth, especially if predictions of a bricks and mortar decline are borne out. This means a compelling and tightly aligned experience for every user. Yet ecommerce engines that promise personalisation have in reality delivered impersonalisation for years. To deliver a user journey that truly engages and retains individual consumers a new approach is needed.
Aligning the ecommerce experience for the individual – the red heels conundrum
So why is personalisation a myth? Because in reality unless you know the exact identity of your shopper you cannot, by definition, personalise to them.
Consider, for instance, making product recommendations to two shoppers with a similar profile, both searching for an iPad. One is a businesswoman who buys an iPad and also decides to treat herself to a pair of red high heeled shoes. The next is a businessman. Traditionally, ecommerce engines adapt results according to group trends. Thus the logic tells your site that because the first customer bought an iPad and a pair of red heels, the next user (the businessman) who selects an iPad should also be recommended a pair of red heels. The logic is essentially flawed.
Another example is search categories. A shopper browses for sofas and is returned a number of items crossing related categories such as sofas, sofa beds, cushions, cushion covers and chairs. Many ecommerce engines simply do not have the capacity to weight results so that search terms reflect the user’s chosen category closely.
An ecommerce experience with a multi-faceted memory
IRX2012 speakers certainly covered the scope and importance of the customer experience – from optimising data response to achieving multi-channel customer satisfaction and blending the consumer experience with marketing priorities. What has not yet emerged, however, is a definitive answer to how ecommerce merchants can achieve displays, search results, category listings and product recommendations that are truly joined up with both the user’s intention and the retailer’s strategy. When I talk to retailers they are typically frustrated by these limitations, which carry massive implications in terms of both sales revenue and operational input.
To truly serve the consumer, internet retailers need to create powerful, unique user journeys that inspire shoppers to buy. That demands a multi-dimensional approach, responding instantly to a myriad of internal and external variables. The search experience must be quick and convenient, the visual display compelling, the product recommendations acutely relevant – and this must adapt across all the digital zones in real time. Plus, behind all this, the retailer’s own priorities needs to be included in the mix to achieve the desired results.
Even our highest profile clients have found this difficult to achieve in the past. These are not small start-ups, but the likes of Tesco, Boohoo and Superdry. We have responded with a sophisticated, constantly evolving feature-set operating within one platform. It applies advanced cascading rules-based merchandising as well as behavioural, ranking and analytical algorithms via a “Balance Factor” technology unique to Locayta. Crucially, the technology can respond to user behaviour in real time as they search. It then adapts search results, displays, sequencing, recommendations and brand presence accordingly. Plus, the retailer can manipulate every functionality via a single dashboard that makes light of automatic as well as manual configuration.
Armando Roggio discusses the benefits of retaining consumers by focusing on the long term win rather than the individual sale. His example of prioritising cross-selling against up-selling to build customer loyalty is a perfect example of the potential of Balance Factor. Such strategies can be weighted behind the scenes – as can stock levels, popularity, newness and the like. However, because Balance Factor integrates and cooperates with Locayta’s user responsive technology it also aligns the retailer’s priorities with the user’s individual behaviour for an optimised result.
We call this system Freestyle Merchandising and we have specifically developed it to liberate retailers. It’s simple to respond and adapt at every point in the user journey via a single system. The capacity extends to mobile search technology, third party sites, e-mail marketing, bespoke merchandising displays and much more. To see for yourself visit Locayta for a free demo or contact us to find out more.