Maximizing Sales from eCommerce - Best Practices Deck with Approach

eCommerce Services Managing Customer Lifecycle in Online Stores Limited Edition November, 2008 Note: This is a limited edition of a comprehensive deck which includes 59 best practices. To receive the complete deck free of charge, please contact info@forteconsultancy.com eCommerce market presents vast opportunities for companies with the right capabilities and in order to capitalize on such opportunity, we help companies build and grow relations with their customers Moving online store visitors up the relationship ladder provides significant opportunities for growth:  Loyal customers have almost double visit to carts  Loyal customers have almost triple conversion rate  Loyal customers have 10% higher cart value Source: MarketLive Performance Index LOYAL PURCHASED INTERESTED UNAWARE AWARE We identify amount of customers and prospects in each stage and define targets as basis for strategic priorities. © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 2 Companies should analyze such relations for eCommerce sites across customer lifecycle… Visited Subscribed Viewed Item Abandoned Site Added Item Abandoned Cart Returned Goods Bounced Payment Initiated Check-out Paid Initiated Payment © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 3 …and develop actions and programs for opportunities identified across this cycle Only about 35% of visits are generated from search engines. Visited Subscribed Viewed Item Only 9% of visits end up in carts. Around 40% of customers have 1 and out behavior. Abandoned Site Overall cart abandonment rate is around 60%. Added Item Abandoned Cart Returned Goods Bounced Payment Initiated Check-out 80% of online customers do not have repeat orders. Over 50% of check-outs are abandoned. Paid Initiated Payment Source: MarketLive Performance Index © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 4 Information should be at the hearth of all decisions and actions throughout this cycle Mature Decisions Well-Informed Stage • • • • Decisions are based on absolute facts All actions have consistency Facts direct business Key factor for success is accuracy Decision Quality We help companies make most out of their information base and take actions based on them… • • • • Some decisions are based on facts Some actions have consistency Facts direct some parts of business Key factor for success is focus • • • • • • • • Decisions are not consciously made Actions do not have consistency Daily happenings direct business Key factor for success is luck Decisions are based on opinions Actions have limited consistency Personal motivations direct business Key factor for success is experience Impromptu Stage Guesswork Stage Free Fall Stage Maturity © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 5 Most leading retail and eCommerce companies leverage customer insights in their operations, using various tools, such as customer segmentation Purchase Behavior Needs Demographics Category Behavior Office Administrator Brand Aspirationals Price Value Shoppers Trendy Quality Seekers Price Sensitive Affluents One Stop Shoppers Conscientious Objectors Social Shoppers Business Reseller Institutional Buyer Foodservice Entrepreneur Traditional Club Shopper Demanding / Experiential Shopper Mom / Family CEO Active Boomer Caroline (Young, single working woman) Vanessa (Married with children) Sophie (Older shopper / empty nester) Value-Seeking Variety-Seeking Brand-Seeking Simplicity-Seeking Discovery-Seeking Quality-Seeking Sample © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 6 Such analytics practices require collection of right customer data, through various means… Additional Services for Information Differentiation of Corporate vs. Individual Registration Golden Questions in Registration Customer Clubs for Information Collection and Interest Identification Sample © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 7 …which can range from basic customer identification data to in-depth customer and social network profiling Personal Shopper provides highly customized recommendations and value added services in return for detailed demographics, life-style and preference information. Sample © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 8 In addition to customer data, it is also critical to analyze pure web traffic data to incorporate Internet user insights into actions Sample Seasonal search engine optimization for ‘shopping’ keyword would result in higher ROI. Search keyword analysis, as well as traffic source/destination analyses can have substantial impact on visibility of online stores. © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 9 First step in eCommerce customer lifecycle is visit to the online store, which requires effective acquisition activities Focus Area Objectives Create Visits Visited Sample KPIs  Number of Visits per Month  Unique Visitor Count per Month  Advertising Cost per Visitor  % of Visitors Bookmarked Site  Page Rank of Homepage Attract different types of visitors to site using alternative channels and approaches, providing differentiating value add Guidelines Use search engine optimization using traffic insights Utilize variety of acquisition channels Customize acquisition approach by prospect segment Provide additional reasons for visiting site © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 10 Providing alternative means for visit attracts prospects with certain channel habits Sample Case Utilize variety of acquisition channels Enriching means and media of access is inline with the global telecommunications trend towards convergence… ebay’s launch of desktop and mobile version of its shopping environment increases convenience for customers accustomed to use of certain tools and channels. Note: This is a sample out of 59 best practices available in complete deck. To receive the complete deck free of charge, please contact info@forteconsultancy.com 11 © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group Once visitor traffic is created, the next step is subscription of visitors, in order to enable tracking and acting on customer information Focus Area Objectives Subscribe Visitors Visited Subscribed Sample KPIs  Subscriber / Visitor Ratio  Total Unique Subscriber Count  Number of Subscriptions per Month  % of Subscribers with Full Data  Duration From Visit to Subscription Motivate subscription at first sight, providing additional value add and good first impression Guidelines Call to action for subscription on landing page Make subscription fast and convenient Provide immediate value add for subscription Promote competitive value propositions © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 12 Over 70% of customers are interested in in-store pickup service, which can differentiate multi-channel retailers against pure eCommerce players Sample Case Promote competitive value propositions In-store pickup is a lower cost option for retailers, where speed and lower pricing can also be attractive for customers… Circuit City provides in-store pickup for faster and cheaper delivery of online purchases. Note: This is a sample out of 59 best practices available in complete deck. To receive the complete deck free of charge, please contact info@forteconsultancy.com 13 © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group In order to have subscribers make purchases, the first requirement is creating interest in items and making merchandise easily accessible Focus Area Objectives Create Interest in Items Subscribed Viewed Item Sample KPIs  Number of Items Viewed per Visit  Number of Items Viewed per Subscriber  % of Subscribers Viewing Items  Number of Categories Viewed per Subs.  % of Items Not Viewed for Long Time Make items of interest easily accessible and pro-actively communicate relevant information on merchandise Guidelines Use effective and alternative categories for items Pro-actively recommend items Provide ability to search with alternate means Provide creative and instructive item views © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 14 Using alternative categorization schemas for items increase usability and are proven to increase conversion rates by 34% Sample Case Use effective and alternative categories for items Providing alternative categorizations for products let customers reach out to searched items faster and easier… Schwan’s provides alternative categorization, making its products more accessible for customers looking for certain types of offerings. Note: This is a sample out of 59 best practices available in complete deck. To receive the complete deck free of charge, please contact info@forteconsultancy.com 15 © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group Conversion of interest into purchase intent is a key step, where high performing retailers can increase their bottom-line significantly Focus Area Objectives Create Purchase Intent Viewed Item Added Item Sample KPIs  % of Views Resulting in Item Add  Number of Items per Cart  Value per Added Item  % of Items Viewed but not Added Freq.  % of Subscribers Viewing Items Only Translate interest into action by learning from customers’ interests and following up effectively Guidelines Follow-up and promote viewed items’ purchase Follow-up interest in out-of-stock items Identify and act on subscribers using site for viewing only Translate interest into wish lists for future purchase © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 16 Customers who were interested in out-of-stock items are the most likely targets for these items after replenishment Sample Case Follow-up interest in out-of-stock items Personalized e-mails after restock do not only create good sales opportunities, but also provide a good experience for customers… Roots sends e-mails to inform customers about restocked items, which they could not purchase earlier due to stock-out. Note: This is a sample out of 59 best practices available in complete deck. To receive the complete deck free of charge, please contact info@forteconsultancy.com 17 © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group Keeping customers on-site and cross-selling before check-out require pro-active actions, which can create substantial ROI Focus Area Objectives Create Check-out Intent Added Item Init. Check-out Sample KPIs  % of Item Adds Abandoned  % of Item Adds Removed  % of Cart Value Proceeded to Checkout  Average Item Time in Cart  Average Time to Checkout Avoid abandonment of added items providing convenient transition to checkout and following up Guidelines Provide one click checkout Make single item purchase faster Cross-sell before check-out Make added items accessible even if abandoned site © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 18 Single item purchase should be even easier, using already provided information about customer Sample Case Make single item purchase faster Especially for non-grocery retailers, one item purchases are frequent transactions, which should be given extra attention… Amazon provides ability to purchase single item right away without need for visit to check-out screen. Note: This is a sample out of 59 best practices available in complete deck. To receive the complete deck free of charge, please contact info@forteconsultancy.com 19 © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group Cart abandonment is a major issue for eCommerce sites, where convenient check-out process as well as rigorous follow up are keys to success Focus Area Objectives Sample KPIs  % of Check-outs Abandoned  % of Potential Value Abandoned  % of Abandoned Carts Purchased Later  % of Abandonment to Competitor Site  % of Subscribers with Abandoned Carts Avoid Abandonment Init. Check-out Initiated Payment Ensure completion of check-out with convenient processes and cart follow-up Guidelines Provide convenience and speed in checkout Remind and follow up abandoned cart Motivate abandoned cart purchase with benefits Make cart available in next visit if abandoned © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 20 Providing extra benefits for checking out abandoned cart can motivate this transaction Sample Case Motivate abandoned cart purchase with benefits A multi-step reminder and benefits system for abandoned carts can create the highest response rate while keeping cost as low as possible… Note: This is a sample out of 59 best practices available in complete deck. To receive the complete deck free of charge, please contact info@forteconsultancy.com 21 Zales uses multi-step approach in its offers, first reminding customers about their abandoned cart without any promotions, than offering a discount in second reminder email. © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group Problems experienced in payment process not only mean lost cart sales, but also could become a reason for customers lost forever Focus Area Objectives Sample KPIs  % of Payments Bounced  % of Potential Value Bounced  % of Bounced Payments Abandoned  Payment Attempts per Purchase  Number of Fraudulent Cases Identified Ensure Payment Initiated Payment Paid Process payment securely and using alternative means Guidelines Provide alternative means for payment Ensure and promote payment security Keep customers informed about payment process Follow-up and recover failed payments © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 22 Providing gift cards as payment alternatives can even attract those who do not usually shop online Sample Case Provide alternative means for payment Gift vouchers are effective for acquiring new customers and facilitating payment by alternative means… Amazon provides gift cards for both retail and corporate customers, to be used as gifts and incentives for employees or own customers as alternative means for payment. Note: This is a sample out of 59 best practices available in complete deck. To receive the complete deck free of charge, please contact info@forteconsultancy.com 23 © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group With a first purchase completed, the next stage is to close the cycle, getting customers revisit and repurchase Focus Area Objectives Create Repeat Visits Paid Visited Sample KPIs  % of Subscribers with 2 Purchases  % of Subscribers with >2 Purchases  % of Subscribers with >1 Visit  % of High Value Loyalists  % of Subscribers with Returned Goods Identify and motivate non-returning customers providing additional information and value add Guidelines Regularly provide new content and offerings Pro-actively take actions for dormant visitors Provide value add for repeat business Recommend for cross and up-sales © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 24 Pro-active communication offering additional benefits is also necessary to reactivate dormant customers Sample Case Pro-actively take actions for dormant visitors Showing that the company cares about doing business with the customer and offering additional benefits can motivate customers return to site… Note: This is a sample out of 59 best practices available in complete deck. To receive the complete deck free of charge, please contact info@forteconsultancy.com 25 Avon pro-actively communicates with its dormant customers and uses free shipping to motivate re-activation. © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group Forte Consultancy Group provides services in increasing eCommerce performance, through effective strategies and tactics across customer lifecycle Forte Consultancy Group can assist you … Contact us for details at info@forteconsultancy.com Do you know your own performance across Visited Subscribed customer lifecycle? We can assist you in  Definition of eCommerce KPI and targets  Analysis of current eCommerce performance  Design and set-up of performance reporting Are you aware of the untapped potential of your site Viewed Item and have strategies and tactics to realize them? We can assist you in Assessment of eCommerce current state Re-engineering of customer experience Added Item Design and execution of marketing communications Design and execution of one-time and repeating campaigns Refinement of product portfolio and value propositions Abandoned Cart Refinement of web site design features   Abandoned Site    Can you use customer intelligence effectively to  target customers and take the right actions? Returned Goods with customized approach for each of following objectives Bounced Payment  Creating visits We can assist you in        Definition of ideal data elements to be collected Segmentation of visitors and customers Prediction of site abandonment & churn risk Analysis of cross and up-sales likelihood Prediction of customer response to offers Paid Automation of advanced recommendations Discovery of main and niche targets for campaigns  Subscribing visitors  Creating interest in items  Creating purchase intent  Creating check-out intent  Avoiding abandonment Initiated Payment  Ensuring payment  Creating repeat visits Initiated Check-out © 2008 Forte Consultancy Group. All Rights Protected and Reserved. Forte Consultancy Group 26 The information contained in this document, much of which is confidential to Forte Consultancy Group, is for the sole use of the intended recipients. No part of this document may be reproduced in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of Forte Consultancy Group. Forte Consultancy Group | Istanbul Office  @  Dereboyu Sok. Sun Plaza Kat:13 Maslak, Istanbul - Turkey info@forteconsultancy.com +90 212 366 02 66