Ecommerce Trends and Tactics to Get Ready for the Holidays

#holidaywebinar

§  Holiday sales are increasingly important for web retailers and interactive marketers.

§  Planning is starting earlier and earlier.

© 2012 Forrester Research, Inc. Reproduction Prohibited #holidaywebinar

Most sales are still in stores but increasingly influenced by the web


Online holiday sales have become more important to overall retail

Source: NRF Holiday Survival Kit 2011, Forrester historical online holiday forecasts

$27 $52 $60

$404 $401 $406

2005 2010 2011 (est)

Other retail sales

Online sales

Total US Retail Holiday Sales ($B)

Web as % of holiday total 6% 13% 15%


Key ecommerce metrics are much the same

2.2% 2.9%

0% 2% 4% 6% 8%

10%

2000 2010

Conversion Rates 53% 55%

0%

20%

40%

60%

2000 2010

Cart Abandonment Rates

$3 $3

$0

$1

$2

$3

$4

2000 2010

Customer service $/order

40% 35%

0% 10% 20% 30% 40% 50%

2000 2010

Repeat Shopper Revenue


To grow sales, you need a coordinated effort

§  Channel silos hinder basic, seamless experiences.

§  All teams should know the holiday promotional calendar

§  Communicate value propositions and promotions across all devices, mediums, and marketing channels.

#holidaywebinar

Recommendations §  Have a Cyber Monday and key date plan in place; deep discounts and deals

are now a cost of doing business

§  Recognize that it is difficult to put the “offer genie” back in the bottle, unless you are Patagonia and you’re willing to trade off sales for the integrity of your brand

§  Attribution modeling becomes really obvious in light of data like this –  The true value of all of your marketing channels becomes more transparent

§  Don’t neglect search, and especially email, around key dates

§  Ensure that key information is optimized for mobile, especially for multichannel retailers; that applies to tablet content too

§  Enable sharing purchases through social networks post-transaction; incentivize shoppers to share their purchases; worry less about “likes”

§  A code freeze is no longer a cost of doing business during the holidays

§  Audit your shipping programs –  Are you competitive with other offers for similar products?

–  Is a shipping club appropriate?

–  Can customers easily track their packages? © 2012 Forrester Research, Inc. Reproduction Prohibited #holidaywebinar

This year though, other days were as high as Cyber Monday

Source: Chase Paymentech Pulse Index; http://pulse.chasepaymentech.com

Cyber Monday


37%

43%

37%

39%

Shoppers spread their spend over many days

Pre-Thanksgiving (11/18-23)

Source: Bizrate Insights/Forrester Holiday Shopping Flash Surveys, Q4 2011

Thanksgiving Weekend (11/14-27)

Cyber Monday (11/28)

Cyber Week (11/29-12/4)

37% This [period] will be my

biggest online shopping period of the

year

Did you also buy online earlier [in the holiday

season]? NA

41%

37%


Cyber Monday isn’t always viewed as having “the best deals”





Cyber Week (11/29-12/4)

“Of the following, when do you think are the best online deals during the holidays?

21%

34%

11%

12%

13%

9%

Pre-Thanksgiving

Thanksgiving weekend (including Black Friday)

Cyber Monday

"Cyber Week"

2 weeks before Christmas

A couple of days before Christmas

8%

53%

11%

10%

10%

8%

4%

26%

33%

19%

10%

8%

6%

24%

13%

28%

18%

11%


Shoppers are shifting more of their wallet share online during the holidays





Cyber Week (11/29-12/4)

66%

78%

I shopped in stores less because I shopped online

instead

I shopped online instead of in stores for this purchase

because there were better deals online

72%

73%

76%

81%

59%

72%


“Cyber Season”

Holiday shopping season actually starts in Q3.

§  AOV increases by $14.08 from Q2 to Q3.

§  95% of ecommerce businesses said AOV drops following the implementation of a technology project like a replatforming or redesign.

#holidaywebinar

Recommendations §  Have a Cyber Monday and key date plan in place; deep discounts and deals are now a

cost of doing business










Customers Customers during the holidays


Few shoppers are sick of promotions





Cyber Week (11/29-12/4)

Which of the following best characterizes your feelings about online deals, promotions, and specials around the holidays?

6%

15%

23%

17%

Deals are so frequently offered that it is easy to

always buy with a sale or promotion

Taking advantage of deals is even more

important to me now than in previous years

I love deals! The more, the merrier

I will only buy if I have a deal, sale or promotion

6%

15%

23%

21%

5%

16%

23%

22%

5%

15%

22%

18%


Race to the bottom, or rising above it all?


Understand and appeal to different visitor segments

If your website doesn't provide you an opportunity to put a different offer in front of different segments based on user data, you are at a critical disadvantage.

1. New Customer

§  Highlight service differentiators and trust factors. §  Test acquisition offers to create long-term value.

2. Holiday Shopper

§  Greet the customer with welcome-back message. §  Highlight email signup to keep them engaged all year.

3. High Value

§  Thank and reward high-value customers.

#holidaywebinar

Here’s how…

§  Personalize return trips

based on average cart or lifetime purchase values.

§  Badge products to promote seasonal callouts. Test different badges on different products.

§  Highlight the best gifts of the season, stocking stuffers, limited-time offers.

#holidaywebinar

Recommendations §  Have a Cyber Monday and key date plan in place; deep discounts and deals are now

a cost of doing business










This is more like it


While shoppers “spearfish,” their purchase path isn’t straightforward

One touchpoint

Two+ touchpoints

One touchpoint

Two+ touchpoints

46% 54% 40% 60%

Hard goods Soft goods

Source: Forrester eBusiness Research in collaboration with GSI Commerce Holidays Attribution Research (Q1 2012)


What are you trying to measure?

Measure inbound channels by more than just conversion rates.

§  Social is likely an initial touch point that influences behavior and ultimately customer acquisition.

§  Keep customers in a ready-to-buy state.

#holidaywebinar

3%

4%

3%

7%

9%

10%

12%

33%

47%

Other social site

Through traditional media (eg TV)

Retailer's social presence

Deals or shopping website

Other email

Someone told me about it

Through search engines

Via email from the retailer

I visited the retail site directly

2%

3%

5%

6%

8%

9%

8%

46%

39%

Other social site




Other email





3%

6%

3%

7%

9%

10%

10%

39%

44%

Other social site




Other email





Shoppers frequently find out about holiday deals through email

3%

4%

4%

6%

8%

9%

11%

37%

44%

Other social site




Other email





How did you learn about these special deals [from today’s purchase]?




Cyber Week (11/29-12/4)



This is reflected in clickstream data as well

Touchpoint (s) General holiday season

Thanksgiving weekend Cyber Monday

Paid search alone 17% 17% 17%

Paid search + other 15% 16% 15%

Natural search alone 14% 13% 13%

Email + other 12% 12% 13%

Natural search + other 11% 12% 10%

Email alone 7% 8% 12%

Social alone <1% <1% 1%

Social + other <1% <1% <1%

Others (CSEs, affiliates, display) alone 8% 9% 8%

Others (CSEs, affiliates, display) + others 15% 12% 11%

100% 100% 100%

Percent of total transactions (hard goods)



Email matters even more for soft goods









Social alone 1% 1% 1%




100% 100% 100%

Percent of total transactions (soft goods)



Search matters even more than email for hard goods













100% 100% 100%




Search has a smaller influence on soft goods













100% 100% 100%




#holidaywebinar

Search and email have higher AOV in Q3 & Q4

Echo the look and feel of email campaigns

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Reinforce paid search creative site-wide

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More mobile shopping during the holidays

Did you shop online with your mobile device over Thanksgiving Weekend (Thursday - Sunday, November 24-27, 2011)?

16%

9%

18%

28%

Cyber Week

Cyber Week 2010

Cyber Monday

Thanksgiving Weekend

Source: Bizrate Insights/Forrester Holiday Shopping Flash Surveys, Q4 2010 and Q4 2011


US mobile commerce is expected to grow to $31 billion by 2016

2010 2011 2012 2013 2014 2015 2016

US$ (billions)

1% 2% 3% 4% 5% 6% 7%

Source: Forrester Research Mobile Commerce Forecast, 2011 To 2016 (US)Note: eCommerce includes mobile media and content, retail, travel, coupons/deals, and services.Does not include mobile ring tones, mobile gaming, or mobile video

% of eCommerce

$31

$25

$19$14

$10$6

$3

Source: June 17, 2011, “Mobile Commerce Forecast: 2011 To 2016” Forrester report © 2012 Forrester Research, Inc. Reproduction Prohibited #holidaywebinar

Please note which of the following you do with your mobile device(s) with respect to any online retailer.

“Small screen” owners* Tablet owners

Base 1,725 recent online buyers with web-enabled mobile phone

456 recent online buyers with tablets

Read emails from retailers 64% 63%

Receive texts with special offers from retailers

49% 38%

Locate retail store/hours/directions 49% 54%

Browse or research products 47% 70%

Compare prices while shopping in stores

30% 29%

Place orders for physical goods 17% 47%

*”Small screen” includes iPhones, Android-based phones, Blackberries or other phones with web-browsing capabilties Source: Bizrate Insights/Forrester Mobile Commerce Online Flash Survey, Q4 2011

Mobile conversion rates are lower because the phone supports store shopping more


Social sharing can be promising on mobile devices

Talbot’s incorporates “likes” vs shares on Facebook;

JCPenney also integrates Kaboodle and StyleHive


Eliminating text and showcasing images is beneficial for mobile browsing

Gap enables browsing of images (without text) and

provides recommendations to support greater time on

site


Alternative payments are likely to be impactful on mobile devices

PayPal helps to reduce keystrokes at checkout on

mobile devices; PayPal penetration when offered on

mobile devices is higher than penetration on the

desktop site


Staples opted to change the tablet experience Desktop site Tablet site

Horizontal scroll; collapsed dropdowns

Elimination of units; large buttons to support cross-

channel


Encourage power mobile users to create a shortcut to your site from the homescreen


Tablet optimization means tweaks like spacing lines appropriately for a touchscreen


How do tablet and mobile compare?

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Prep for tablet and smartphone traffic

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Some say “the silence is deafening”


Unfortunately, social has yet to make a mark on the web marketing funnel













100% 100% 100%


Source: Forrester eBusiness Research in collaboration with GSI Commerce Holidays Attribution Research (Q1 2012) © 2012 Forrester Research, Inc. Reproduction Prohibited #holidaywebinar

Social has a bigger impact on soft goods













100% 100% 100%


Source: Forrester eBusiness Research in collaboration with GSI Commerce Holidays Attribution Research (Q1 2012) © 2012 Forrester Research, Inc. Reproduction Prohibited #holidaywebinar

Consumers reinforce this data

3%

4%

3%

7%

9%

10%

12%

33%

47%

Other social site




Other email





2%

3%

5%

6%

8%

9%

8%

46%

39%

Other social site




Other email





3%

6%

3%

7%

9%

10%

10%

39%

44%

Other social site




Other email





3%

4%

4%

6%

8%

9%

11%

37%

44%

Other social site




Other email





How did you learn about these special deals [from today’s purchase]?




Cyber Week (11/29-12/4)



Consumers do however report sharing through social networks

I have shared online shopping deals with others through my social network (i.e. Facebook) within the last month.

30%

32%

31%

32%

Cyber Week

Cyber Monday

Thanksgiving Weekend

Pre-Thanksgiving



Consumers say they like to read what about what their friends recommend

48%

40%

17%

15%

11%

8%

It is a great way to discover new products, brands, trends, or retailers

It is a great way to discover sales and promotions

I have bought something based on a friend's post

No reaction, I usually ignore these types of updates

I notice the post, but generally do not take great interest in it

I don't like these posts

Base: 5,578 recent online shoppers who use social media

Source: Forrester/Bizrate Insights Social Commerce Flash Survey, Q3 2011

Which of the following do you agree with in response to social media posts, "likes," or links to products or retailers made by friends?


Consider social log-in to increase sharing

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monetate.com/infographics

§  80% of U.S. social network users prefer to connect to brands through Facebook.

§  40% of consumers prefer social log-ins rather than creating a new/guest account.

§  When consumers can use social log-in, time on site and page view metrics more than double.

How “agile” are you?

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Consumers now expect free shipping

“Which of the following do you expect from a retailer or brand?”

Base: 4,731 US online adults

Source: Q1 2011 US Retail Online Survey

28%

32%

44%

52%

55%

Physical retailers to price match if I find a price cheaper on my mobile device

Physical stores to be able to place orders online for me

To see the same assortment of products no matter where I shop

Free returns on all my purchases

Free shipping on all my orders


Free shipping offers were popular this past holiday season





Cyber Week (11/29-12/4)

Which types of special deals did you take advantage of for today's purchase?

20%

25%

30%

Free shipping with no minimum order value

Free shipping with a minimum order value

A discount on my total purchase (% off or $ off)

26%

29%

37%

33%

26%

46%

23%

25%

30%


Many retailers offered free shipping with no threshold


Shipping clubs are growing “Are you a member of a shipping club or program (i.e.

Amazon Prime, Shoprunner or Williams-Sonoma Reserve)?” 9%

91%

Source: Bizrate/Forrester Online Retail Holiday Study, Q4 2010 and Q4 2011

N= 10,017 recent online buyers

12%

88%

Yes No

5%

40%

55%

I shop less with the retailer after joining the shipping club

The shipping club has not changed my shopping behavior with that

retailer

I shop more (or plan to shop more) with the retailer(s) whose shipping

club I have joined

N: 714 recent online buyers

“How does your membership in a shipping club or program affect your shopping frequency?”

2010

20

11

N= 15,520 recent online buyers


Shipping offers: Test what are you trying to achieve

§  Test to know where to put the thresholds (which offers, based on what costs?).

§  Test to learn quickly. Remember, peak traffic differs from off-peak.

§  Target based on visitor geography to leverage location, logistics for maximum efficiency.

#holidaywebinar

#holidaywebinar

Ecommerce Trends and Tactics to Get Ready for the Holidays

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