Tom Lindmeier’s Blog @ MarketPlanB

With average conversion rates running at 2.5%, there’s much work still to be done and plenty of opportunity to improve the shopping experience.  I’ve always maintained that this number is very low because most visitors come to your site ready to buy. To put this in perspective, mortar retailers could not possibly survive if only 2.5% of store visitors made a purchase. To their credit, I have yet to meet a colleague who is satisfied with their conversion rate.

The good news is that the science of ecommerce has matured significantly over past decade and most players have significantly improved the functionality of their sites by adding features and testing to refine performance. Many of my discussions with colleagues have tended to focus on the following list improvements that are designed to remove barriers to conversion:

• Ease and simplicity of checkout
• Address the shopper’s concerns with return policies, guarantees, third-party seals and security assurances
• Ease and clarity of return policies
• Provide shipping and tax totals early in the checkout process
• Offer multiple payment options (pay-by-check, PayPal, etc.)
• Offer estimated delivery times and showing in-stock availability for items
• Customer reviews
• Meet the shopper’s gift buying needs (e.g., gift wrapping, messaging or gift certificates)
• Improve the ease of locating products through navigation and site search refinements
• Improving design elements
• Rich media enhancements

All of these improvements are important steps to increase conversion. The science of removing barriers to conversion gets plenty of attention, but the art of improving the shopping experience is where many ecommerce retailers fall short. What am I referring to? Primarily the production values associated with copy and photography and the efficacy of the brand in conveying confidence. While the enhancements listed above remove barriers, copy and photography close the sale and cannot be underestimated.

Examine your website and ask these questions:

1. Copy– Does your copy answer all the shopper’s implicit questions regarding the product? Does your copy sell? If you’re a multi-channel retailer and are merely importing copy from your catalog, you may need rewrite copy and expand the product specifications.  Catalogs are restricted by space allocation costs that do not apply to web sites. If you need to justify the additional expense, run a copy test on your top selling products to determine an ROI. This is also great opportunity to SEO optimize your copy if you have not already done so.
2. Photography– Rich media applications with zoom, pan, and swatches are guaranteed conversion enhancers for most product lines. But the effective use alternate images can be your most effective tool for answering the shopper’s implicit questions.  Don’t assume that one photo can get the job done. You should insist on nothing but top-notch photography and be willing to invest a few extra dollars to achieve the production values necessary to enhance your brand and sell your product. You should also determine if video demonstrations could help close the sale and be willing to conduct tests to determine an ROI.
3. Branding– What are you doing with your presentation to be different? Do brand considerations affect all of your copy and design presentations? Do you have a cookie-cutter web site that is indiscernible from competitors and non-competitors?

Despite well-known study data that shows a trend for the use of preview panes and image blocking, many marketers appear to ignoring the need to design emails that users can see.

In 2007, Marketing Sherpa published a study with the following results:
69% of at-work users view emails in preview panes
26.6% of online consumers view emails in preview panes and 59% block images.

One year later, we can only presume that the percentage is significantly higher for online consumers as preview panes are now available in virtually every major email application.

The following examples are of what appears on a 15” monitor with the preview pane set to occupy 50% of the available screen area (a default setting for most applications). I’ll begin by showing poor uses and end by showing designs that do a great job of getting critical information in the top.

This design from SimplyWeddingStuff is the most common mistake. The logo header consumes the entire preview pane. The 5% offer is actually located at the bottom of the email.

The letters I receive from Christopher Kimball and America’s Test Kitchen are engaging and very well done. But the design is lazy because the extra line spaces could easily be eliminated to allow for the first paragraph of this text email to entice me into reading.

The practice of placing the site’s top navigation at the head of the email is in most cases, unnecessary and counter-productive. The graphic that states the offer and links to the landing page is the single most important element. If your testing proves that your home page banner and navigation at the top are a winner. I suggest compressing the graphic vertically to allow room for the offer. The ability to see even 3/4 of the graphic would be a dramatic improvement.

The redesign of the Amazon web site included a shift from rather large area of top navigation to one that is simple and compressed. In this case, the top navigation is not a problem. My only comment is that the headline could be more compelling by stating the savings one can get by clicking the email.

Here is an example of an email design from Tiger Direct that makes perfect use of the preview pane. It shouts the offer with enthusiasm and allows comprehension in an instant.

Are you making great use of the preview pane?

The tradition at MarketPlanB has been to pack as much information into the fewest words possible. Keeping with this tradition of nutshell summaries, I present the following checklist that can be used to evaluate your email campaign planning. The list is a result of evaluating the metrics of thousands of emails over the past 7 seven years. I invite you to add to this list.

1. Offers must reflect a genuine value to your customers. 90% of your effort should go into the development of a rich variety offers with the goal of getting your recipients to look forward to receiving the next offer. Compelling offers is the name of the game. When your merchants ask you to try to move an item that is a poor seller or excess inventory, you can anticipate poor results and a surge in opt-outs. Great copy and graphics can never make up for a less-than-compelling offer.
2. Your offer must be instantly recognized. Clever and cute muddles the message. Clearly stating the offer in the fewest words possible within the preview pane is a must. Get down to business as quick as possible. Your “Presidents Day” or “4th of July” theme is of very little value and can hurt if it dilutes your offer message. Dramatic colors almost always work better than soft, muted colors.
3. The timeliness of your offers is the key to improving results. That’s why triggered emails work so well. Offers that address post-purchase, abandoned carts, wish lists, time spent on-site and other key performance indicators are well worth the effort. Fine-tuning the launch dates for seasonal product offers will result in improved gains.
4. The depth of products in the offer has a direct correlation to the number of orders and order value. Try to expand your offer to cover as many products as possible to obtain maximum revenue. Build item counts into your email results summaries– it will help you build more accurate forecasting.
5. The urgency of quick expiration dates increases response. Themes that stress 24 hour, 48 hour or lunchtime windows are some of the most lucrative offers available. Follow-up emails that announce the final days of a promotion with a longer time window are well worth the effort. The measurement and evaluation of lag patterns is a key performance indicator.

I missed the Google Optimizer webinar: What should I test? but found it on YouTube today. I strongly recommend this to MarketPlanB clients and contacts. It’s an hour long, so you’ll need to do this with lunch in your office or sometime soon before spring fever distracts and you forget. The recording quality could have been better, but it’s perfectly suitable. You can also watch the WebEx version.
[youtube]http://www.youtube.com/watch?v=rNaKaPt71kQ[/youtube]

If you missed the first introductory webinar. I have also included it here.

[youtube]http://www.youtube.com/watch?v=AU87ozKYY4M[/youtube]

The multi-site business model is based on marketing to tight vertical segments. They typically include the product category name in the domain and then take advantage of critical mass to build dozens and sometimes hundreds of niche sites. This concept is apparently alive and well and is still quite promising for entrepreneurs who are seeking opportunity.
Internet Retailer recently reported that CSN stores grew by 85% in 2007.

With more than 200 niche web sites selling home furnishings ranging from wall art and woks to waterbeds, CSN Stores Inc. grew sales by 85% last year to $202 million, up from $109 million in 2006, the retailer says.

CSN Stores, No. 107 in the Internet Retailer Top 500 Guide, is continuing to explore new merchandise categories for presenting on individual web sites, says Eric Klose, vice president of marketing. “We continue to identify categories we feel are underserved on the Internet,” he says.

This also demonstrates that the number one SEO tactic continues to be the descriptive domain.

With recent news of French president Zarkozy pecking away at his Blackberry during a visit with the pope, I can’t resist the urge to rant on the subject of social behavior and technology.

Back a number of years ago (OK more than a few). I recall an annoying problem with people answering the phone while I’m in their office or even at their homes while we’re engaging social discourse, It always bothered me so I made to never do the same. Whomever was calling could wait until I picked up the message.

Then cell phones came along and exacerbated the problem. Now it could happen anywhere at anytime. As we all know, this resulted in a social backlash and created in an awareness of social etiquette. Now you can even be ticketed for driving while talking the cell.

Then text messaging came along and created a whole new set of problems. It seems that some people thought that non-verbal interruption in person-to-person settings was OK. there is a perception that if you turn your back or place the device under the table while pecking away with your digits no one will mind…

Now cells are wired to the web and you can surf, email, instant message and twitter away. So we now have another new set of problems and new learning on social interaction is in order. Digital prowess does not impress. The Blackberry does not contain the codes for an emergency nuclear missile response. It can wait; believe me, almost nobody that important.

I love being wired and would not have it any other way. But there is a good deal of social behavior that needs to be refined as technology changes.

Ecommerce marketers typically take a closer look at the promotion strategies of competitors during the 4th quarter holiday season because aggressive competitors may steal a substantial portion of business with the right offers. This is also true during economic downturns as marketers struggle to achieve revenue targets and are willing to give up margin to maintain market share and move inventory. Some will strive to take advantage of the downturn with the purpose of dealing fatal blows to weaker competitors.

The cruel reality for retailers is that unless you own a vertical market, you’ll need to get very aggressive and give up margin because that is exactly what the competition will do. Don’t delay because the competition is most likely eating your lunch right now. Or you can hunker down, lay off employees, cut expenses and hope things will turn around soon.

If you’re thinking about rolling out the free shipping offer again you may want to re-evaluate. It is typically the most expensive offer with the toughest ROI of your available options. Now is the time time to get creative by offering a diversity of awe-inspiring promotions and increasing your ad spend. You need to be different enough to separate your business from the competition and the standard free shipping offer may not do the job right now.

ExpoTV is a site that aggregates user-generated product review videos. Its’ a great concept that moves beyond the traditional text-based product reviews. Judging by by the funding they have recently received, investors believe it is very promising.
I recently encountered ExpoTV videos posted on YouTube that caused me to pause and sniff. Although these are genuine user-generated reviews, my impression is that they are somewhat disingenuous. So I investigated further and found ExpoTV has chosen to directly pay for reviews. Users can earn cash for every review that is accepted. ExpoTV states that “Our consumer reporters work from home and earn up to $10.00 for each approved review they submit. That’s enough to cover their time and effort but not enough to give you anything other than the straight scoop. The real deal. Your consumer guide.” This seems like a reasonable assertion but it’s my impression that users are putting up reviews to earn money. Though this is a very modest amount, I believe that it still amounts to a bribe and affects the nature of the reviews.
The presenters appear to be stay-at-home moms and good number of others from the now swelling ranks of the unemployed. Some presentations are “so bad that they’re good”; like the review for Kingsford Charcoal. But most are very milquetoast and uninspired with generous user ratings. Users know that they need to pass a screening process and it appears to affect the nature of the reviews. Take a look for yourself and let me know if it raises your BS meter.
The biggest hurdle for any business in the product reviews arena is to create a critical mass of content in order to establish credibility. This is many times accomplished through incentives such as contests and give-aways and seems to be accepted. But I question the strategy of directly paying for reviews. Time and time again the public has rejected content that does not serve them. This may be the undoing of ExpoTV.

[youtube]http://www.youtube.com/watch?v=SuD5v_WjXJM[/youtube]

Because of the proliferation of video sharing on the web, you may have considered or deployed video for branding and public relations on your online retail site. Most of the discussion relating to eCommerce up to this point has been pointed towards viral marketing campaigns. But the real payback may come from product demonstrations that are added to your rich media mix. Companies such as Ice.com have reported conversion increases of 40% for products with video presentations.

Up to this point, the large scale users of product demonstration videos are those who have re-purposed existing video such as HSN, and ShopNBC or deep pocket retailers such as Circuit City and Home Depot. ROI concerns on the high cost of video production have also limited usage to retailers who market products with high price points. But this has now changed as many retailers with in-house studios have figured out how to efficiently produce videos at a low cost. Vendors who specialize on website video production such as NextWebStudios are everywhere, offer very competitive pricing and services such as green screen imaging that allow spokespeople to walk directly over your web page.

Online retailers have been using product videos for years and I have seen my share of lousy productions and boring presentations that leave me anything but awe-struck. The risk is that inadequate production values can harm your business by leaving a poor impression. In my previous life as a creative director, I gained plenty of experience in the production of fashion location photography and will share some tips on moving forward.

1. The secret to producing effective videos is very detailed and comprehensive pre-production planning and assembly line efficiency that allows you to shoot the maximum number of videos per day. Your fixed costs per day for studio time, photographers, stylists, models and assistants can be substantial so you need a well-oiled process that runs at maximum efficiency.
2. Your choice of a spokesperson will make or break your videos. You or one of your staffers may be just the right person to make the presentation. But the use of well-chosen professional models and actors is the single best investment you can make to guarantee success.
3. Take the time to write a script and consider rehearsals before bringing in the production staff.
4. Choose a studio environment over outdoor location if at all possible. Controlled lighting and better staging to allow you to shoot 3 to 4 times more sessions per day.
5. Screen size and resolution issues limit the amount of detail you can show. Use alternate still images with zoom rather than video to show minute details.
6. Don’t be shy about re-shooting videos that don’t meet your standards. Chances are that some will bomb. Plan for this when creating a budget.

I referenced the following resources for this article.
New York Times
Internet Retailer