1

2013 Multichannel Merchant

Outlook

http://multichannelmerchant.com/mcm-outlook-2013-research-reports/http://multichannelmerchant.com/mcm-outlook/mcm-outlook-2013-catalogs-still-have-stay-ing-power-01072013/

12-pages of insights covering the latest from Merchants on what is growing their business, where they are seeing engagement, what data is most meaningful and more in these key areas:

• Ecommerce • Operations&Fulfillment • Catalog

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Despite fiscal cliff worries and woes, merchants saw their ecommerce sales grow 11.1%

collectively during holiday 2012. Online sales figures for January released by Ma-cy’s for its macys.com site were up 48.9% year-over-year, while bloomingdales.com figures, up 47.4%, indicated that consumers are shifting their patterns to include ecommerce.

Although merchants acknowledge that ecommerce growth has helped them make their sales (a 10% increase in on-line sales helped Best Buy break even over the holiday season), they may not be completely ready to serve the cross-device customer.

According to the results of MCM Out-look 2013, 41.7% of respondents are not participating in mobile commerce. But the trend appears to be moving in the right direction; in 2012, the percentage of non-participators was higher—49.3%.

Meanwhile, 30.5% of respondents said they have a mobile commerce site, and 17.1% said they have a site opti-mized for use on mobile devices. Last year, 26% of respondents said they had a

mobile commerce site, while 11.6% said they had a mobile-optimized site.

The number of respondents without mobile apps is still high in 2013. Accord-

ing to the survey, 75.7% of merchants do not offer their customers a mobile app. That number has actually grown: In 2012, 70.4% of respondents said they did not offer a mobile app.

This is the first year a question about tablet app offerings was asked in an MCM Outlook survey. More than four-fifths of respondents (82.8%) said they do not have a tablet app offering.

But merchants are leaning toward

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by Daniela Forte

MCM Outlook 2013: Ecommerce

Sponsored by

How do you measure your SEO/SEM efforts?

Traffic

Total Conversions

Total conversions

Sales

Print catalog requests

20122013

80.0%83.3%

Email newsletter signups

Social Media

50.1%51.3%

68.2%

65.3%

62.8%67.3%

73.9%68.7%

11.3%8.0%

29.4%26.7%

25.4%

32.0%

Clickthroughs

75.7% of merchants do not offer their customers a mobile app.

32

ECommErCE

making their ecommerce sites mobile friendly in 2013. According to the sur-vey, nearly one-third of respondents (32.4%) who said they are redesigning their ecommerce sites in the next 12 months will use responsive design to make their sites render across a variety of devices.

Video is the top function merchants plan to add to their ecommerce sites over the next 12 months. Nearly 40% (39.8%) said they plan to add video. That percentage is down from 46.5% last year, but it may be that merchants are already there: More than half of respon-dents (55.6%) said they are using video on their sites.

While video is a popular value-add for merchants who want the ability to better explain products to potential buy-ers, merchants also seem to want to keep control of what sorts of videos go on their sites. Only 16.4% of respondents said they allow users to post videos to

their sites.Merchants are also expanding their

use of YouTube as a place to host and share videos. This year, 51.2% of respon-dents said they have an active presence on YouTube, up from 40.3% of respon-dents in 2012.

As for other forms of user-generated content, ratings and reviews are the most-popular, with 56.2% of respon-dents allowing customers to post them on their sites. Nearly half (48.6%) said they have integrated “share this” buttons

on their sites, and 44.5% said they are using customer testimonials.

Social landscape shiftsMerchant adoption of the “old stand-

bys” of social media—Facebook and Twitter—may have peaked over the past year. Facebook is still the most popu-lar social media used by merchants, at 86.9%, followed by Twitter, at 71.4%. But both those percentages are flat com-pared to the 2012-13 survey figures.

While Twitter and Facebook adoption is leveling off, merchants are looking at activity on other social media platforms.

Pinterest, which burst onto the social media scene last year, is being used by 39.1% of merchants. That number is up from 31.2% last year.

Photo-sharing service Instagram has also jumped—11.7% of respondents said they have an active Instagram presence, while just 4.2% of respondents were on Instagram last year.

The use of Google+ did shrink slight-ly this year: 24.5% of respondents said they have an active presence, compared to 29.9% in 2012.

Also shrinking was the number of respondents who said they plan to add more social media tools to their sites in the next 12 months—36.9% this year,

compared to 52.7% in 2012. “Engagement and conversation” is the

primary reason cited by respondents for using social media. In 2013, 73.5% of respondents are using social media for this reason; in 2012, the number was

Specifically with your SEO & PPC efforts, which of the following are you tracking?

Offline purchases

Customer lifetime value

Bounce rate

Shopping cart abandonment rate

Conversion rate

20122013

22.3%9.7%

ROI

Average order value

48.3%50.3%

36.2%27.6%

46.1%51.0%

40.0%39.3%

Percentage of custom-ers that are new-to-file

70.1%74.5%

55.3%53.1%

55.6%61.4%

10.0%9.0%

None

According to the results of MCM Outlook 2013, 41.7% of respondents are not participating in mobile commerce.

43

ECommErCE

higher—76.9% of respondents.In 2012, 73.9% of respondents said

they were using social media to monitor what consumers were saying about their brand; this year, 67.1% are tracking the number of followers/fans.

But do they love it? According to sur-vey results, 59.2% of respondents said they are somewhat satisfied with the use of social media. Last year, the number was lower, at 51.4%.

Search engines To measure SEO/SEM, traffic pulled

the highest percentage of respondents (80.0%). In 2012, that number was 83.3%.

This year, optimizing their landing pages is the way 64.5% of respondents plan to improve their search engine rankings—nearly identical to 2012’s re-sult of 64%.

So how much are respondents willing to spend to measure SEM? According to survey results, 31.9% of respondents said they would spend 0% to 4% of their over-all marketing budget on SEM this year. In 2012, the number of respondents was much lower at, 20.6%.

Specifically with SEO and PPC ef-forts, respondents said they are track-ing conversion rates, named by 70.1% of respondents this year. In 2012, tracking conversion rates was higher, at 74.5% of respondents.

Shopping cart abandonment/payment

For 45.1% of respondents to this year’s survey, email is the way merchants are marketing to shopping-cart abandoners. This number grew from 2012, which saw special offers via email named by 36.2% of respondents.

Some things haven’t changed, how-ever. According to survey results, 42.0% of respondents said they don’t target shopping cart abandoners, essentially the same as in 2012.

According to the MCM Outlook 2013

On a scale of 1-10, with 10 being most valuable, how would you rate the value of each

of the following to your online strategy?

Online display ads

Affiliate marketing

Social media

Mobile

SMS

20122013

8.23%

Sending offline traffic online

Marketing to shopping-cart abandoners

8.46%7.5%

7.83%6.06%6.31%

5.03%5.08%

4.97%4.72%

4.3%4.43%

6.06%6.31%

4.93%4.2%

3.38%2.81%

4.81%4.79%

5.1%DID NOT ASK

DID NOT ASK5.77%

Retargeting

Opersonalization

Email

SEO

Paid search

Aside from email reminders, how are you marketing to shopping-cart abandoners?

Pop-up window reminder

Telemarketing

E-mail

Remarketing ads on other Websites

We do not market to people who have

abandoned carts

20122013

Live chat

13.1%

10.1%

7.5%8.0%

7.5%

3.6%

45.1%36.2%

22.8%

27.5%

42.0%42.0%

53

ECommErCE

higher—76.9% of respondents.In 2012, 73.9% of respondents said

they were using social media to monitor what consumers were saying about their brand; this year, 67.1% are tracking the number of followers/fans.

But do they love it? According to sur-vey results, 59.2% of respondents said they are somewhat satisfied with the use of social media. Last year, the number was lower, at 51.4%.

Search engines To measure SEO/SEM, traffic pulled

the highest percentage of respondents (80.0%). In 2012, that number was 83.3%.

This year, optimizing their landing pages is the way 64.5% of respondents plan to improve their search engine rankings—nearly identical to 2012’s re-sult of 64%.

So how much are respondents willing to spend to measure SEM? According to survey results, 31.9% of respondents said they would spend 0% to 4% of their over-all marketing budget on SEM this year. In 2012, the number of respondents was much lower at, 20.6%.

Specifically with SEO and PPC ef-forts, respondents said they are track-ing conversion rates, named by 70.1% of respondents this year. In 2012, tracking conversion rates was higher, at 74.5% of respondents.

Shopping cart abandonment/payment

For 45.1% of respondents to this year’s survey, email is the way merchants are marketing to shopping-cart abandoners. This number grew from 2012, which saw special offers via email named by 36.2% of respondents.

Some things haven’t changed, how-ever. According to survey results, 42.0% of respondents said they don’t target shopping cart abandoners, essentially the same as in 2012.

According to the MCM Outlook 2013

On a scale of 1-10, with 10 being most valuable, how would you rate the value of each

of the following to your online strategy?

Online display ads

Affiliate marketing

Social media

Mobile

SMS

20122013

8.23%

Sending offline traffic online

Marketing to shopping-cart abandoners

8.46%7.5%

7.83%6.06%6.31%

5.03%5.08%

4.97%4.72%

4.3%4.43%

6.06%6.31%

4.93%4.2%

3.38%2.81%

4.81%4.79%

5.1%DID NOT ASK

DID NOT ASK5.77%

Retargeting

Opersonalization

Email

SEO

Paid search

Aside from email reminders, how are you marketing to shopping-cart abandoners?

Pop-up window reminder

Telemarketing

E-mail

Remarketing ads on other Websites

We do not market to people who have

abandoned carts

20122013

Live chat

13.1%

10.1%

7.5%8.0%

7.5%

3.6%

45.1%36.2%

22.8%

27.5%

42.0%42.0%

4

ECommErCE

results, 41.3% of respondents are not offering alternative payment options, while 40.1% are offering PayPal. In 2012, 44.7% of respondents offered PayPal, while 40.4% of merchants did not use any alternatives.

Sites today are less likely to have trust-marks of approval from a third-party company. According to survey results, 60.4% of respondents said they use a trustmark from a third-party company, down from 62.2% of respondents last year. SSL Security was named by 49.3%

of respondents this year, and by 52.0% of respondents in 2012.

QR codesThe growth in QR code use seems

to be slowing among this year’s re-spondents. According to survey results, 42.4% of respondents this year are using QR codes; in 2012, the percentage was 45.8%.

If respondents are using QR codes, it is mainly in catalogs, according 59.4% of respondents this year. In 2012, 50%

of respondents were using QR codes in catalogs?.

In 2011, the U.S. Postal Service pro-posed a QR code promotion. The pro-gram offers a discount to catalogers who use two-dimensional mobile barcodes be-tween July 1 and Aug. 31, according to an article on MultichannelMerchant.com.

Commercial retailers that include a mobile barcode inside or on the mail piec-es received an upfront 3% discount on the rates for first-class mail and Standard Mail letters and flats, according to the article. Nonprofit mailers are now eligible for the promotion as well—they weren’t included in the initial proposal from the Postal Ser-vice, according to the article.

METHODOLOGYThis report is based on the online

MCM Outlook 2013 survey, which was fielded by Multichannel Merchant from Mar. 5 through Mar. 18, 2013, and drew 1,110 respondents. Of those respon-dents, 556 described their primary re-sponsibilities at their company as ecom-merce marketers.

Are you using live chat on your site?

Yes

No, but considering it

20122013

No

30.6%

33.8%

51.6%47.6%

17.7%

18.6%

According to survey results, 31.9% of respondents said they would spend 0% to 4% of their overall marketing budget this year.

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In discussions about 2013 ecom-merce branding trends, the same buzzwords continually arise: so-

cial media, responsive design, smart-phones and tablets, and emails. So while using a catalog might appear to be an outdated marketing tactic in the ecom-merce world, it’s not.

Catalogs still have staying power in the direct-to-customer sector, according to results from the MCM Outlook 2013 survey. In fact, more than half of the respondents said their companies mar-ket products directly to consumers and businesses through a print catalog.

Additionally, catalogs were the fourth most-popular channel for respondents

1

MCM Outlook 2013: Catalogs

In what ways are you considering changing circulation within the next year?

B2B

Increase

42.5%

Make No Change

30.1%

Decrease

27.4%

B2C

Increase

52.6%Make No Change

24.1%

Decrease

23.3%

by Erin Lynch

Sponsored by

72

Catalog

to market their companies (53.8%). More than 80% (80.7%) said they used email to market their companies. More than 80% (80.2%) said they use social media as a marketing tool, and 76.9%

use their ecommerce site to market their business.

Although the catalog did drop slight-ly in popularity compared to last year’s report, when nearly 60% of respondents

cited the old-school tactic, it’s still a heavily used tool in the ecommerce in-dustry.

Why use the catalog?We said it last year in the MCM

Outlook report, and it still holds true in 2013: Catalogs can do it all for both business-to-consumer and business-to-business retailers. When respondents were asked to rate, on a scale from one to 10, why they use the catalog (aside from selling merchandise), the number-one reason was as a branding tool (8.05). Coming in a close second was to drive web traffic (7.67); followed by prospect-ing tool (7.02), then driving store traffic (4.01); and coming in last was as a mo-bile driver (3.93).

Compared to the results in last year’s MCM Outlook report, the number-one reason for using a catalog, besides sell-ing products, was once again branding (8.01), followed by driving web traffic (7.70), as a prospecting tool (7.40), driv-ing store traffic (3.97), and then to drive mobile traffic (3.40).

For B2B catalogers, according to the 2013 survey, branding was also the top driver, with a ranking of 8.33. This was followed by driving web traffic, (7.1); as a prospecting tool, (6.99); as a mobile driver, (3.25); and to drive store traffic, (3.38).

For the B2C community, branding (7.88) took the second spot, just behind web-traffic driver (7.96). Prospecting tool ranked third (6.94), followed by as a mobile driver (4.28), and then as a store-traffic driver (4.25).

ProspectingWhen it comes to prospecting, 2013

respondents are starting to prefer social media over catalogs. Although last year’s results showed that a majority of respon-dents believed that catalogs would be their go-to tool in the next 12 months, with 71.7% planning to use them, mov-

Are you using QR Codes in your catalog?

B2B B2C

Yes

49.1%

Yes

53.4%

No

50.9%

No

46.6%

Why are you using QR Codes in your catalog?

B2B

To enable click-to-call

7.9%

To drive customers

to a product page

52.4%

To drive customers to a video

23.8%

Other

15.9%

B2C

To drive customers

to a product

page

62.3%

To enable click-to-call

10.4%

Other

10.4%

To drive customers to a video

16.9%

83

Catalog

ing into 2013 it appears that the Internet is now king.

When respondents were asked, “In ad-dition to using your own house file, what methods of prospecting will you use dur-ing the next 12 months?” there was a tie for the top spot with Facebook and email each garnering nearly 72%. Catalogs fol-lowed closely behind with 66.4%.

While cooperative databases were once a popular prospecting tool for cata-logs, the 2013 results show that a major-ity of respondents are no longer using them. When asked, “Which of the coop-erative databases are you using?” 52.5% of respondents said none; 27.6% said Epsilon Abacus Co-Op; 17.9% said I-Be-havior; 17.9% said Wiland Direct; 11.3% said Experian Z-24; 9.7% said MeritBase Direct; and 7.4% said American List Ex-change (ALEXA).

QR CodesWith shoppers becoming more and

more reliant on their smartphones for showrooming, product review check-ups and QR codes, it’s more and more important for retailers to have a mobile relationship with their products—and this holds true for the catalog industry. Fifty-two percent of those surveyed said they were currently using QR codes in their catalogs.

Of those using QR codes, nearly 56% said it was to drive customers to a prod-uct page; nearly 20% said it was to drive customers to a video; and 8.9% said it was to enable a click-to-call action.

One reason catalogers are interested in using QR codes could be that the U.S. Postal Service is offering special promo-tions to encourage direct mailers to use mobile technology, such as QR codes, on their mail pieces in 2013. In return, mail-ers will receive a 2% discount on postage.

Cost-cutting measures in the catalog industry

With shipping and paper costs con-

In addition to selling products, what is the purpose of your print catalog today?

(on a scale of 1 to 10)

Branding

20122013

Drive Web Traffic

Prospecting Tool

Drive Store Traffic

Mobile Driver/ Driving Mobile

Traffic

8.058.01

7.677.70

7.027.40

4.013.97

3.933.93

In addition to using your own house file, what methods of prospecting will you use

during the next 12 months?

Facebook

Email

Catalog

71.5%

71.5%

66.4%

50.4%Print advertising

tinuing to rise, retailers are looking to printed alternatives for catalogs, such as postcards and fliers, as ways to grab shoppers’ attention while spending less money.

When asked, “What print formats (other than catalogs) have you used to cut costs in the past 12 months?” the number-one response was postcards, with 52.6%. This was followed by direct mail, with 50.7%; fliers, with nearly 45%; and solo mailers, with 30.3%. When re-

spondents to the 2012-13 survey were asked the same question, postcards were still the number-one choice—but with only 44% of respondents naming them.

While the number of merchants us-ing catalogs has dipped slightly, most retailers found that catalog production, in terms of paper stock and the num-ber of pages, changed little in the past 12 months. According to the results, 44.6% said their page counts had stayed the same, 28.1% said they had increased,

93

Catalog

ing into 2013 it appears that the Internet is now king.

When respondents were asked, “In ad-dition to using your own house file, what methods of prospecting will you use dur-ing the next 12 months?” there was a tie for the top spot with Facebook and email each garnering nearly 72%. Catalogs fol-lowed closely behind with 66.4%.

While cooperative databases were once a popular prospecting tool for cata-logs, the 2013 results show that a major-ity of respondents are no longer using them. When asked, “Which of the coop-erative databases are you using?” 52.5% of respondents said none; 27.6% said Epsilon Abacus Co-Op; 17.9% said I-Be-havior; 17.9% said Wiland Direct; 11.3% said Experian Z-24; 9.7% said MeritBase Direct; and 7.4% said American List Ex-change (ALEXA).

QR CodesWith shoppers becoming more and

more reliant on their smartphones for showrooming, product review check-ups and QR codes, it’s more and more important for retailers to have a mobile relationship with their products—and this holds true for the catalog industry. Fifty-two percent of those surveyed said they were currently using QR codes in their catalogs.

Of those using QR codes, nearly 56% said it was to drive customers to a prod-uct page; nearly 20% said it was to drive customers to a video; and 8.9% said it was to enable a click-to-call action.

One reason catalogers are interested in using QR codes could be that the U.S. Postal Service is offering special promo-tions to encourage direct mailers to use mobile technology, such as QR codes, on their mail pieces in 2013. In return, mail-ers will receive a 2% discount on postage.

Cost-cutting measures in the catalog industry

With shipping and paper costs con-

In addition to selling products, what is the purpose of your print catalog today?

(on a scale of 1 to 10)

Branding

20122013

Drive Web Traffic

Prospecting Tool

Drive Store Traffic

Mobile Driver/ Driving Mobile

Traffic

8.058.01

7.677.70

7.027.40

4.013.97

3.933.93

In addition to using your own house file, what methods of prospecting will you use

during the next 12 months?

Facebook

Email

Catalog

71.5%

71.5%

66.4%

50.4%Print advertising

tinuing to rise, retailers are looking to printed alternatives for catalogs, such as postcards and fliers, as ways to grab shoppers’ attention while spending less money.

When asked, “What print formats (other than catalogs) have you used to cut costs in the past 12 months?” the number-one response was postcards, with 52.6%. This was followed by direct mail, with 50.7%; fliers, with nearly 45%; and solo mailers, with 30.3%. When re-

spondents to the 2012-13 survey were asked the same question, postcards were still the number-one choice—but with only 44% of respondents naming them.

While the number of merchants us-ing catalogs has dipped slightly, most retailers found that catalog production, in terms of paper stock and the num-ber of pages, changed little in the past 12 months. According to the results, 44.6% said their page counts had stayed the same, 28.1% said they had increased,

4

Catalog

and 26.2% said they had decreased. When respondents were asked if they had trimmed the size of their catalogs within the past 12 months, nearly 74% said it had stayed the same, 17.2% said it had decreased, and 5.2% said it had increased.

When it came to paper stock and catalog weight, 68.5% of retailers opted to make zero changes in the past 12 months. Although 3.7% said they had increased the weight, nearly 25% said they had decreased it.

As for circulation, 48.5% of respon-dents said they plan to increase circula-tion within the next 12 months; 26.3% are planning to decrease it, and 25.2% said they are making no changes. For those who plan to make circulation changes, according to the results:

• 26.4% will increase it by 1% to 10%• 17.1% will increase it by 11% to 20%• 7.8% will increase it by more than 20%• 14.9% will decrease it by 1% to 10%• 5.2% will decrease it by 11% to 20%• 3.3% will decrease it by more than 20%

The catalog is shipped, now what?

How do retailers tell if their marketing campaigns were successful? Some retail-ers might simply wait to see how much merchandise is purchased through their catalogs, but most decide through pur-chase analytics.

When retailers were asked how they track their catalogs’ effectiveness, nearly 57% said keycode capture, while 46.9% said matchback programs. Nearly 28% of retailers said they did not have a for-

mal effectiveness program, and 6.5% cited allocation agreements.

These stats held relatively steady compared to last year, when 63.3% said keycode capture, 52.5% said matchback programs, and almost 25% said they did not have a tracking program. We did not ask about allocation agreements in last year’s survey.

MethodologyThis report is based on the online

MCM Outlook 2013 survey, which was fielded by Multichannel Merchant from Mar. 5 through Mar. 18, 2013, and drew 1,110 respondents. Of those respon-dents, 336 identified themselves as cata-log marketers.

Are you planning on changing your catalog circulation within the

next 12 months?

Increase

48.6%Decrease

26.3%

Make no changes

25.2%

How are you capturing your catalogs effectiveness?

20122013

Keycode capture

Matchback

Do not have a formal plan

Allocation agreements

57%

63.3%

46.9%

52.5%

28%

25%

6.5%

Catalogs are finding a new role as an ecommerce driver. Go to bit.ly/mcm-catalogs to download Multichannel Merchant’s executive summary on the catalog industry.

10

Big challenges face B2B and B2C merchants as they try to keep up with the always-connected

customer. Shoppers armed with smart-phones are showrooming at major re-tailers and scanning QR codes to order parts and replenish supplies. Consum-ers with tablets are placing orders while watching television. And customers want their online orders to arrive faster than ever—and are paying extra for overnight delivery; in some cases, they want their orders the same day.

All this round-the-clock, direct-to-customer activity has made fulfillment and contact centers even busier. As be-hind-the-scenes activity increases, mer-chants are doing their best to keep their processes flowing. At the same time, they are working to keep up to speed with technology while keeping costs down.

This report is based on the online MCM Outlook 2013 survey, which was fielded by Multichannel Merchant from Mar. 5 through Mar. 18, and included 1,110 respondents. Of those respon-dents, 430 described their primary re-sponsibilities at their company as) op-erations and/or fulfillment.

Ship-from-store Helping bricks-and-mortar

In January, when a reporter at a Na-tional Retail Federation event asked Ma-

cy’s president and CEO Terry Lundgren about his company’s ship-from-store ini-tiative, the smile on his face grew bigger.

In fact, Lundgren told the reporter something the company had not yet made public: Macy’s had decided to ex-pand its pilot ship-from-store test from 290 Macy’s and Bloomingdale’s locations to Macy’s Inc.’s entire chain of stores.

Although Macy’s may be the largest cross-channel retailer to roll out a ship-from-store strategy, it is not alone.

According to the results of the MCM Outlook 2013 survey, 33.8% of mer-chants with retail stores now have ship-from-store as a method of fulfilling cus-

tomer purchases. And another 17.6% of respondents said they plan to add ship-from-store technology within the next 12 months.

Why is ship-from-store an important initiative for merchants with retail loca-tions?

This past fall, Sharon Gardner, presi-dent and co-founder of VendorNet, told Multichannel Merchant that ship-from-store allows retailers to use the entire inventory in their traditional stores to serve the masses, no matter where those people are or how they shop. For ex-ample, even though customers walking into the bricks-and-mortar store might

1

by TIM PARRy, SENIOR CONTENT MANAGER

What contact center technology are you using?

CRM applications

Live chat

VoIP

Automatic call distributors (ACDs)

Web Chat

MCM Outlook 2013: Operations and Fulfillment

Sponsored by

Workforce management software

44.3%

38%

35.4%

32.9%

31.6%

31%

112

OperatiOns + FulFullment

not be interested in a blue sweater, size XXXL, someone online might. Instead of that size XXXL sweater going on clearance, it can be sold online at full price.

Also, as Macy’s Lundgren notes, ship-from-store can help keep shipping costs down.

While ship-from-store is transparent to the customer, the very-visible ship-to-store option is also growing, according to the survey results. While just 5.9% of cross-channel merchants with retail locations said they plan to offer ship-to-store in the next 12 months, 42.6% said they already are.

FulfillmentAccording to the survey results,

52.6% of respondents currently use an order management and fulfillment sys-tem, and 13.8% said they plan to pur-chase an OMS in the next 12 months.

In 2012, 17.3% said they use a third-party fulfillment provider. That number dipped to 14.6% this year.

Respondents also indicated that they are growing the number of fulfillment centers they operate. While 9.4% of re-spondents in 2012 said they operated four or more fulfillment centers, 13.6% said they’re operating four or more ful-fillment centers this year. Also, 68.6% of respondents said they operate just one fulfillment center, down from 74.5% in 2012.

Drop-shipping is relatively flat com-pared to last year: In 2013, 59.2% of respondents said they are drop-ship-ping 17.08% of their merchandise. Last year, 59.5% of respondents said they had 16.38% of their merchandise drop-shipped.

Merchants are social, not chatters

More merchants are monitoring so-

How do you anticipate your IT spending compared with what you spent last year?

Will increase more than 10%

Will increase 6%-10%

Will increase 1%-5%

Will remain the same

Will decrease 1%-5%

2012 vs. 20112013 vs. 2012

 17.7%

14.7%

13.2%

14.9%

37.2%

38.0%

4.1%

3.3%

22.3%

17.3%

Will decrease 6%-10%

Will decrease more than 10%

3.0%

5.0%

6.0%

3.3%

Approximately what percentage of your overall orders are returned?

1% or less

2%

3% - 4%

5% - 9%

10% - 14%

20122013

53.2%

18.8%

11.9%

5.8%17.5%

8.0%

5.6%

4.7%3.2%

58.0%

15% or more4.7%

8.7%

123

OperatiOns + FulFullment

cial media in the contact center (46.5%) than offering live chat (21%), according to the results of the MCM Outlook 2013 survey.

Of the respondents that indicated they monitor social media in the contact center, more than half (54.4%) said they monitor and respond to customer com-plaints and praise on Facebook; 15.8% said they follow and engage in conversa-tions on LinkedIn, and 11.4% said they do the same on Twitter.

Live chat, on the other hand, seems to be disappearing from the contact center. (ast year, according to MCM Outlook 2012-13, 37.8% of respondents said they use live chat on their sites, compared to this year’s 21%.

Although the question about social media in the contact center was not asked in 2012, it does appear to be a growing trend. Speaking at IRWD 2013 in Febru-ary, Jason LaRose, senior vice president of ecommerce at Express, said 20% of the people in its contact center focus solely on responding to customer queries in so-cial media channels.

Contact center: Measuring success

Almost half the respondents (46.2%) said they rely on service level as a contact center measurement. Customer satisfac-tion scores came in second, with 34.9% of respondents measuring them, while 31.5% said they measure average call handle time.

The call abandonment rate was mea-sured by 29.1%, and 28.4% said they measure the average speed of answer.

But the biggest surprise, according to Penny Reynolds, co-founder of The Call Center School, is that 32.2% of respon-dents claim to not measure anything in the contact center.

Other numbers coming from the con-

Approximately what percentage of your overall orders goes on backorder (partial or full)?

1% or less

2%

3% - 4%

5% - 9%

10% - 14%

20122013

56.8%

11.7%

15.2%

13.9%13.6%

9.9%9.6%

4.7%3.2%

58.4%

15% or more1.5%1.6%

FedEx and UPS have changed the dimensional weight factor used to calculate delivery charges, from 194 to 166 for domestic shipments and from

166 to 139 US export shipments. How has this change increased your shipping costs?

None

1% - 10%

11%-20%

21%-30%

Don’t know

20122013

37.6%

22.5%

22.4%

9.1%12.8%

1.1%2.4%

33.7%24.8%

33.7%

133

OperatiOns + FulFullment

cial media in the contact center (46.5%) than offering live chat (21%), according to the results of the MCM Outlook 2013 survey.

Of the respondents that indicated they monitor social media in the contact center, more than half (54.4%) said they monitor and respond to customer com-plaints and praise on Facebook; 15.8% said they follow and engage in conversa-tions on LinkedIn, and 11.4% said they do the same on Twitter.

Live chat, on the other hand, seems to be disappearing from the contact center. (ast year, according to MCM Outlook 2012-13, 37.8% of respondents said they use live chat on their sites, compared to this year’s 21%.

Although the question about social media in the contact center was not asked in 2012, it does appear to be a growing trend. Speaking at IRWD 2013 in Febru-ary, Jason LaRose, senior vice president of ecommerce at Express, said 20% of the people in its contact center focus solely on responding to customer queries in so-cial media channels.

Contact center: Measuring success

Almost half the respondents (46.2%) said they rely on service level as a contact center measurement. Customer satisfac-tion scores came in second, with 34.9% of respondents measuring them, while 31.5% said they measure average call handle time.

The call abandonment rate was mea-sured by 29.1%, and 28.4% said they measure the average speed of answer.

But the biggest surprise, according to Penny Reynolds, co-founder of The Call Center School, is that 32.2% of respon-dents claim to not measure anything in the contact center.

Other numbers coming from the con-

Approximately what percentage of your overall orders goes on backorder (partial or full)?

1% or less

2%

3% - 4%

5% - 9%

10% - 14%

20122013

56.8%

11.7%

15.2%

13.9%13.6%

9.9%9.6%

4.7%3.2%

58.4%

15% or more1.5%1.6%

FedEx and UPS have changed the dimensional weight factor used to calculate delivery charges, from 194 to 166 for domestic shipments and from

166 to 139 US export shipments. How has this change increased your shipping costs?

None

1% - 10%

11%-20%

21%-30%

Don’t know

20122013

37.6%

22.5%

22.4%

9.1%12.8%

1.1%2.4%

33.7%24.8%

33.7%

4

OperatiOns + FulFullment

tact center results were not a surprise to Reynolds.

For example, only 14.2% of respon-dents said they are using an outside pro-vider for contact center services (down from 15.4% last year), and just 4.5% said they have an offshore contact center (which is actually up from 2.4% last year).

“I would guess that 10% to 15% of com-panies outsource, so 14% is right in line,” Reynolds told Multichannel Merchant. “And while 4% offshore looks a little low, it’s not too surprising given the trend to pull back some business to onshore.”

Systems: What they want Nearly 60% of respondents (59.6%)

said their biggest IT objective is to up-grade existing systems. That’s up slightly from 57% in 2012, and a sound strategy for several reasons, says Ernie Schell, di-rector of Marketing Systems Analysis.

“It’s much cheaper than installing a new system, it requires little or no train-ing for users, and it helps to maximize ROI on the existing system,” Schell told

Multichannel Merchant. “And it offers the opportunity to exploit aspects or modules associated with the current sys-tem that they may not have used effec-tively before, especially if those are areas that are being upgraded.”

Meanwhile, 21.7% of respondents said they will install new systems in 2013, compared to 20.6% last year. And less will be spent on IT this year as well, according to the survey results. Last year, 22.3% of respondents said their IT spending will rise by more than 10% over their 2011 levels. This year, 17.7% said their IT spend will rise by more than 10%.

More merchants are also looking to decrease their IT spending by more than 10% this year (6%) than last year (3.3%).

As for systems purchases merchants plan to make in 2013, 25.2% of respon-dents said they will invest in customer relations management, 15.1% in ware-house management systems, and 13.8% in order management systems.

In 2012, 35.1% of respondents said

they planned to invest in order manage-ment systems, 23.4% in customer rela-tions management, and 18.2% in ware-house management systems.

ShippingAccording to the survey results, UPS

is still the most used parcel shipper for both domestic and International. But FedEx and the United States Postal Ser-vice are gaining some ground.

Forty-two percent of respondents said UPS is their primary domestic carrier, which is down from 45.2% in 2012. Fe-dEx is the primary domestic carrier for 23.9% of respondents, up from 17.7%; and 19.6% use the USPS as their primary domestic carrier, down from 21.8%.

Rob Martinez, president and CEO at Shipware, told Multichannel Merchant that while growth trends for both the USPS and FedEx in its ground shipping product, it is important to note that Fe-dEx has slowly been chipping away at UPS’s ground market share.

But the gap is closing when it comes to International shipping. While 25.4% or respondents said they primarily use UPS to ship International, 23.9% said they primarily use FedEx, and 23.9% said they ship International primarily with the USPS.

Martinez told Multichannel Mer-chant that many carriers single source due to convenience and cost efficiencies, which means that UPS is losing Interna-tional volume to FedEx and USPS with some of its customers.

“The USPS actually outsources its Global Express Guaranteed product to FedEx, so it could be that shippers cited USPS as primary not knowing it’s actual-ly moving FedEx,” Martinez said. “In any event, I do think it’s interesting that UPS loses some ground to FedEx and USPS for international parcels in your survey.”

What are your general plans for IT in the next 12 months?

Upgrade existing systems

Integrate various hardware and

software platforms

Cloud systems

Install new systems

59.3%

22%

22%

21.6%

Hire more IT personnel

13.1%