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February 8, 2011

February 8, 2011. Housekeeping. Dial-in Information: 1 (312) 878-0218     Access Code: 292-093-510     Audio PIN: Shown after joining the Webinar Webinar ID: 272-346-304 All slides will be available after the webinar

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February 8, 2011

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  1. February 8, 2011

  2. Housekeeping Dial-in Information: 1 (312) 878-0218     Access Code: 292-093-510     Audio PIN: Shown after joining the Webinar Webinar ID: 272-346-304 • All slides will be available after the webinar • All registrants will receive a copy of the full report the week of January 21st.

  3. Today’s Presenters • Lauren Freedman • President • the e-tailing group • www.e-tailing.com Rita Brogley CEO Amadesa www.amadesa.com

  4. About Amadesa

  5. The Voice of Cross-Channel MerchandisingStraight talk from “in-the-trenches” online merchandising experts • 16 years e-commerce consulting • Author, It’s Just Shopping • 50+years traditional retail and catalog experience • Fortune 500 client projectsranging from strategic planning, merchandising, marketing, to technology development and messaging • Cross-categoryprojects spanning specialty retail to departments • Proprietary research studieson mystery shopping, merchandising, mobile and consumer behavior

  6. Today’s Agenda • 2010 Holiday Trends and Takeaways • Highlights from The Amadesa/e-tailing group Merchant Testing Survey • 5 of the 7 Secrets of Successful Testing • Testing-Ready Checklist

  7. I. 2010 Holiday Trends and Takeaways • US Internet sales rose 15.4% to $36.4 billion where sales over the Internet now account for about 10% of all retail sales 1 • Retail sales rebound rising 5.5% up from 3% predictions earlier in the year 2 • Category increases were seen in Apparel (11.2%), Jewelry (8.4%) and Luxury Goods (6.7%) 1 • Cyber Monday was the first billion-dollar spending day in history (1 of 6), and the first time we’ve witnessed Cyber Monday rank as the heaviest online spending day of the year. 3 • Ecommerce holiday spending climbed 10% per transaction in 2010 versus 2009 1 • Retailers targeted many of their promotions even earlier than usual and reaped the benefits • 1) MasterCard 2) NRF 3) comScore

  8. 2010 EG100 Merchants

  9. The Customer Experience is Ratcheted Up EG100 80+ INDEX WINNERS • Seasonal Promos • Limited-time only deals • Branding and Manufacturer videos • Top sellers • HSN Anywhere • Mobile App

  10. Elevated Search Tools Drive Shopping Efficiency 70 EG100 merchants smartly leverage navigational drop downs with 48 merchandised for greater effectiveness

  11. Promotional Creativity Bolstered By Everybody’s Favorite: Free Shipping Free shipping was used in more than half of all e-commerce transactions this season, up significantly from last year -comScore

  12. Product Information Is Category and Consumer-centric • Screen Share • Gallery • Features • Video • Ratings and Reviews

  13. Video Role Expanded and Sees Strong Customer Engagement Retail site visitors who view video stay two minutes longer on average and are 64% more likely to purchase than other site visitors. -comScore

  14. Mobile and Social on the Fast Track Mobile and social make strong inroads Black Friday 2010 as consumers using mobile devices accounted for 5.6% of visits to retail websites - a 50-fold increase over 2009 when it was just 1% -Coremetrics

  15. The Amazon Effect Continues 63.7% of consumers who shopped among 20 leading e-commerce sites in December say they shopped at Amazon.com, up from 55.1% a year ago. -Kantar Retail ShopperScape survey

  16. Customer Service Means Better Meeting The Needs of Today’s Consumers 2010 EG100 Customer Service Winners

  17. The Stakes are Higher Merchants Must Ratchet up the Shopping Experience as Customer Expectations Continue to Ascend Testing’s Time is Now

  18. II. Highlights from the Amadesa/e-tailing group Testing Survey

  19. The Future of Testing is Now • Having a great website is no longer optional • If you’re not testing today, you should be—website optimization is mission critical • Testing is easy

  20. Methodology and Objectives Goal: Explore retailer sentiment regarding testing online and cross-channel along with desire to add the capability in the future Methodology: 160 merchants completed an online survey to explore retailer sentiment regarding testing online and cross-channel or one’s desire to add the feature in the future where 79% (127) were testers/ 21% (33) were non-testers Survey Objective: To understand the following surrounding testing: • current state • tools and tactics employed • organizational approach • performance results • perceptions

  21. Topline Findings • Testing emanates from a culturethat believes in its value • Most merchants believe testing is valuable • When not testing they are simply resource-challenged • Merchants perceive strong ROI results will be forthcoming from testing where both user experience and improved site conversion are seen • A/B testing is the favored methodology while a broad array of areas are being tested

  22. Testers tend to be either very active (33%) or“once in a while” users of the tool (38%)

  23. Testing has the most impact on improving the user experience (61%) and increasing site conversion (57%) but also has influence on multiple areas of the site

  24. A/B testing is the standard (82%);other tools are deployed based on merchant choice Q7

  25. 63% of those who test, do so monthly or more frequently

  26. III. 7 Secrets to Successful Testing We’ll go through 5 today!

  27. TESTING SECRET #1TRY IT! Always test first, be it style, content, functionality or features. Go out on a limb!

  28. What are the three key actions to get started?

  29. TESTING SECRET #2: SEEK SHORT-TERM WINS creative execution (65%) and copy (50%) are the two areas tested most, followed by promotions (46%), marketing campaigns (45%), images (43%), key page templates (42%), and more See the full report for the rest…

  30. TESTING SECRET #3 SEEK SHORT-TERM WINS The KIS (Keep it Simple) Factor • Start small • Think apples and oranges Extra Credit Points - Tactical • Divide up testing creative • The more specific you can fashion the test the better • Test items individually and hone in on them • Give tests enough time to reach statistical confidence levels

  31. Where should merchants begin?

  32. General Mills: Pillsbury Q: Should we start the form on the homepage? • A: Yes! • 113.8% Conversion Rate Lift Amadesa Control • Showing the first step of the form increased member registrations by 113.8% after one week!

  33. MEC Q: Can we remove product description, move products above the fold without impacting revenue? • A: Yes! • 12.2% RPV Lift • = $1.6MM added annually • Hiding the product description moved more products above the fold AND increased revenue per visit by 12.2% after only 9 days!

  34. TESTING SECRET #4 TARGET WISELY • Know your user groups • Identify which groups are most impactful to KPIs • Test within each segment

  35. Q: Does message matching enhance user experience and increase revenue? A: Yes! New Car Used Car Home, Mortgage Credit Cards 70.7% RPV Lift 45% RPV Lift General Terms • Showing a geo targeted value proposition message across the entire site increased revenue per visit between 8% - 25%!

  36. TESTING SECRET #5SELECT THE RIGHT PARTNER The Four Pillars • Information Technology • Strategy and Planning • Creative Development • Budget

  37. What should a retailer look for in an ideal testing partner?

  38. D.TESTING-READY QUESTIONS Strategic • Is my organization ready for testing? • What is the right way to sell in testing’s value to my organization? • How can I justify the investment? • What performance expectations should our team have in place? • How can we best create a testing plan and how in-depth should our strategy be? • What industry or retailer insights can be shared regarding testing proof-of-concept and potential ROI? Resources • Who are the right members of our team to drive the testing initiative? • What level of investment is required to do testing right? • Can we handle it internally or should we seek the support of a designated testing partner? • How much time should we expect to allocate to our testing efforts in Year 1? Year 2? Execution • What should we test first and where do we build from there? • How can we maintain testing momentum within the designated group to continue improving on performance results? • How do we best read the results and subsequently share within our organization? • What is the optimal process that we should follow to test smart?

  39. Q & A Rita Brogley Amadesa rita@amadesa.com 866-321-8245 www.amadesa.com Lauren Freedmanthe e-tailing group LF@e-tailing.com 773-975-7280 www.e-tailing.com

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