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The Beauty and Cosmetics category is one of the fastest moving digital commerce areas. It is a highly competitive and innovative market with large brands quickly adopting digital models and challengers innovating their way to the top.
The emergence of the ecommerce sales channel for beauty brands has seen a long wait. The time has come for beauty retailers to align with the customer’s demand and specific requests. For example, a recent AT Kearney study showed 28 percent of online shoppers use the digital media to get informed on products. They carry this information in stores where they are sometimes more knowledgeable than the store assistants, which may pose a real challenge for beauty brands.
The AT Kearney study shows that only 16% of all online shoppers are online enthusiasts. The rest either use the digital media for information or for shopping for products they are already familiar with:
Online shoppers are more inclined to shop for particular products, such as skin, personal and hair care. Products such as beauty tools and nail care are less likely to be purchased online, unless is a very specific product, one the customer is already familiar with:
In this post we’ll get a glimpse of the eight most important type of beauty brands that engage their users through digital commerce (also). We’ll have a look at a selection of global champions with different backgrounds and different models. From digital pure-plays to established brick and mortar brands, let’s have a look at some of the most interesting approaches to beauty and cosmetics digital retailing:
As expected, Amazon leads the way when it comes to online beauty retailing also. Customers are delighted to almost 2 million products, including luxury brands.
Its Beauty category is the go-to place for most of online enthusiastic shoppers, where Amazon is available. And with Amazon’s shipment policies, that’s basically everywhere.
Amazon’s secret weapon lies in its free-shipping policy (for orders above 25$), a great motivator for online shoppers and a better threshold than challengers Sephora and Beauty.com.
Another great asset Amazon will use to gather shoppers around its beauty retailing section is the fact that more customers use Amazon (30%) than Google when doing online product research.
Sephora is generally seen as the actual leader in the digital beauty commerce. Though it lacks Amazon’s ecommerce strength, the company is part of the largest
luxury high quality goods (ahem…ahem) group, LVMH, packing a lot of beauty retailing know-how.
The company has developed a great omnichannel model that focuses on mobile as a bridge between online and offline.
One of the best things Sephora.com has implemented in its web store is the content marketing and digital assistance features. I’ve previously covered the subject and praised Sephora’s efforts to offer quality content, as praised are due.
The curated content customers find is a great choice to build loyalty. So is the Community where customers can browse among the knowledge base or post questions and interact with professionals.
As mentioned, one of the greatest assets Sephora has is its focus on digital rich content. Users are treated to:
Some other touches make Sephora a great choice for beauty products customers, not the least of which are the three free samples with each order (a great way to drive future orders) and the mobile apps that make us of barcode scanning to offer price info and customer reviews.
Beauty.com is an online retailer so it has no apparent need or intention to leverage offline or omnichannel sales. It has developed specific filters and features to cater to customers that either know what they want and want the best price or they can quickly decide.One of the features that really stands out (they have a pop-up to insure it stands out) is “Auto reorder and save” option. Simply put, the online retailer has noticed the habitual purchase beauty customers take and leveraged it.
Customers can set an auto-reorder flag for certain products, which can be shipped each 30, 60 or 90 days. Before the order is shipped, customers receive an email notifying them and they can pause, skip or cancel the auto-orders. The customer incentives are savings and free shipping.
Another great feature that lets customers reach the right product is the filtering option which is set not only for product features but also customer concerns and specific needs. In the Make-up section, the eye category, one can find brand and ingredients options, but also filters such as concerns (acne, dryness or oiliness), benefits (curling, hold or smooth) and skin type. Unfortunately, the filters are not usable on the smartphone version of the web store.
Just like its direct online competitor (Sephora.com), Beauty.com offers free samples, free shipping for orders $35 and above, free returns and 5% back through its loyalty program. It also features great content areas, such as its Beauty Blog, with Romy Soleimani, The Latest Trends section reviewing product news and a Beauty Videos section, ranked according to customer reviews. A great no-no on the video section is the fact that videos embedding is restricted to affiliates only, leaving a lot of marketing potential untapped.
The Asos Beauty section provides a great user experience and a lot of product options. As the Beauty section is built on top of Asus’ marketplace, it stands to offer the same great features and discounts.
Customers worldwide can benefit from Asos’ free shipping policy and the express delivery.
Though Asos lacks the specific concerns or personal filters the likes of Sephora.com or Beauty.com offer, it rocks when it comes to user experience, both on desktop and mobile devices. The filters are easily accessible, the search, shopping bag (cart) and comparison options work seamless and the purchase and registration sections are a pleasure to use.
Even more, the design is elegant and easy to use, in a form follows function kind of way. There are only few design elements that are not absolutely necessary and this makes shopping pleasant.
As an online pure-play, Asos does not have any specific plans to open brick and mortar stores but has been known to use pop-up stores to boost awareness.
The Beauty category from Boots.com is a great example of how an omnichannel experience can be implemented. Though the online store provides great online purchases options, it also provides easy location based options, a great store locator feature and even store information and product availability. Moreover – is a great example of how mass market and prestige brands can be distributed together.
On Boots.com, customers can either purchase online or find the nearest store, get directions and interact with the store assistant, check inventory availability and reserve products.
As L2 shows, Boots is the “ten-ton gorilla” in the UK Beauty retailing industry. Though Sephora has built quite a remarkable loyalty program, Boots has done that 10 years before. Boots registers more than 18 million purchases through its Boots Advantage Card, 60% of which are tied to the loyalty program. Boots’ ecommerce sales have grown 17% year over year in 2013, which is amazing.
One unique use of digital retailing is the brand direct store. While some brands, like Bare Escentuals or Avon have long used their own sales channels, albeit different concepts, others, such as L’Oreal have just started implementing online sales channels.
The L’Oreal Group, world’s largest cosmetics company, has traditionally relied on third parties to distribute its products. Its distribution chains included supermarket retail chains for its mass products or upper scale beauty shops for luxury and professional products. Though the company has been resisted development of its own online sales channel, that all changed in 2014.
One of the main reasons that lead to its change in distribution strategy was China’s increasing beauty market. As a recent report puts it:
“In China – the world’s number one online-purchasing market(1) – e-commerce already accounts for 10% of L’Oréal sales, and more than 15% for brands like VICHY, LA ROCHE-POSAY and MAGIC(2). These promising results are underpinned by partnerships with online distributors like Alibaba and Tmall. On Singles’ Day, a very important day of special offers, L’Oréal’s brands performed well, particularly MAYBELLINE NEW YORK – the number 1 make-up brand in the country(3) – and MAGIC, which sold over 11 million face masks in 24 hours”
So that’s one reason for the company to shift course. Another is the shift in consumer purchasing behavior. The company has invested heavily in social media and can now leverage its influence. As consumer increasingly use social media to get recommendations and share beauty experiences with friends, L’Oreal is in a specifically great place to not only help them do that but also increase sales through digital shopping tools.
One of the tools that connects customers through social media, connects online and offline experience in an omnichannel environment AND offers a great functionality is the Makeup Genius, an wonderful application I’ll discuss in the sections below.
L’Oreal has started pushing ecommerce strongly into its distribution strategy. For example its USA digital presence is ecommerce enabled and customer can purchase online, but they can also find the closest store and purchase there.
One particularly interesting concept they have implemented is an user generated section featuring customers’ looks gathered from the social web, using Olapic. Customers share the products and looks they love on Instagram, Facebook, Pinterest or Twitter and can get featured on the website.
But that’s not the only feature L’Oreal USA uses to engage potential customers. The web site offers a beauty library, focused on beauty trends and advices and a consultations area focused on interactive advices for users. Last but not least, L’Oreal shines the spotlight on Women of Worth, a selection of the women that have impacted their communities the most through their actions.
Lancome, another brand from L’Oreal, is doing just great in its ecommerce efforts. One particular area that stands out is the auto-replenish (a synonym for auto-reorder) feature you may have noticed its starting to catch on.
The web-store interface is gorgeous, with elegant fonts and imagery and offers a carefully curated user shopping experience.
The Elite Rewards membership program offers access to loyalty points, free samples, free shipping, a birthday gift and access to products aimed exclusively at members.
However, not all L’Oreal brands offer purchase options directly from the brand. For example Garnier and Maybelline offer store locator features and a buy from partner online shopping features. The preferred online retail channels are Amazon.com, Drugstore.com and Target.com.
Bare Escentuals is a great example of building a beauty brand with the help of a community. Their online store is packed with info, helpful ideas and hints, special options for members and great products. Among the most interesting features and options, some stand out:
You can’t have an online beauty sales list without AVON. Though many things can be said about Avon and its approach to building a representative network and combine this network with online sales, probably one the most important features you should take note when evaluating AVON.com are:
One particular area of digital beauty sales is the Department Store. Probably the best cases are Macy’s and Nordstrom. Macy’s long history with omnichannel retail ensures that customers can bridge the online-offline experiences and skip channels.
A great these companies have is the fact they control the offline experience and they can engage customers in ways that other retailers on this list can’t.
For example Macy’s has implemented interactive kiosks in the past that helped customers discover information on beauty related products and purchase either in the store or online.
In either case, both Macy’s and Nordstrom have outstanding commercial options and their cross-channel activities, as well as customer loyalty are bound to go a long way.
There are two online shops that may not outsell others but they do have their strong points.
First of all, you’ve probably heard about …
Just to get a glimpse of what makes Birchbox so special, have a look at this unboxing video, showing what customers get:So, simply put, Birchbox is a curated product experience. All of the stores we’ve previously studied pack a lot of options but sometimes that is not the best option.
What Birchbox founders envisioned was “a way for customers—just like themselves—to easily and efficiently try, learn about, and purchase beauty products online” (Source). Basically, they’ve mixed editorial, curation and beautiful packaging and ended up with what Birchbox is now.
Ipsy is backed up by strong content marketing efforts from vlogger Michelle Phan (See the Youtuube channel here).
To fend of competition Birchbox has opened a men subscription service as well as a potentially revolutionary type of store that combines shopping, services and product experience and beauty events. Have a look at it.
Make Up Forever is a LVMH owned brand aimed at make-up professionals. Its online presence is filled with beauty information, how-to’s and information regarding the brand’s history, activity and philosophy.
A special area is provided for professionals but visitors can purchase products just as well or they can locate stores where said products are distributed. Make Up Forever is a great example of how online shopping can be applied to brands that were previously impervious to this type of sales channels.
Another great aspect that makes this online property noteworthy is the beautiful and stylish design, aligned with the brand’s care for beauty and elegance.
As Make Up Forever is the last brand that I’ll be featuring on this list, let’s have a look at the main strategies these companies employ to reach their desired audience:
The digital world is filled with information. So much that customers can get lost and sometimes they can appreciate a helping hand and a trustworthy advisor. Birchbox and ipsy are doing just this. A lot of the other brands mentioned above also have a “most wanted” or “new” section but some go a little further and offer insights rather than options.
In a world where information is everywhere, decisions are better left to a knowledgeable professional, able to recommend the right product.
If there is one thing all these examples have in common, that would be content. Beauty brands are not only product manufacturers or retailers. They need to provide customers with relevant information, in its many forms.
Probably the easiest to digest is video.
One particular form of content that seems to work rather well is video. Some of the most engaging YouTube channels feature video showcases of Beauty how to’s, product presentations and unpacking videos. Here are three of the most influential ones:
Her ipsy channel is focused exclusively on beauty and is highly engaged by her audience. The channel has been launched in 2011 and already boasts more than 400 videos and over 500 000 subscribers.
Kandee Johnson’s You Tube channel lists almost 3 million subscribers and over 300 million views. Her videos focus on make-up, how to and style. Kandee has joined YouTube in 2009 and since than her channel has grown steadily.
Her videos showing make-up techniques have become viral and are constantly gathering views and influence.
Her combination of fresh, direct videos and great recommendations has won her 3.6 million subscribers and roughly 260 million video views.
You can also enjoy her style on Instagram, along with other 1.2 million fans.
So video is here to stay as almost 50% of all beauty shoppers view an YouTube vide while shopping for beauty products. Have a look at the slideshare below, a great collection of beauty insights, starting with the one I’ve just mentioned:
Though not many retailers have managed to set up a decent subscription-based model, there is still hope. The craze started by Birchbox and the likes of DollarShaveClub (personal care products for men, delivered monthly) may be a great way to create loyalty in the Beauty retailing area. For the “creatures of habit” that purchase beauty products, replenishment at a great price can go a long way.
As seen above, a great way to implement a pseudo-subscription model is the “auto-reorder” feature for individual or grouped products, used by Beauty.com and the L’Oreal Group online stores.
Mobile has seen an explosive growth in both consumer usage and retailer adoption. As now most retailers and beauty brands have adopted some form of mobile presence, the next step is engaging consumers with rich mobile experiences designed for native apps.
One such example is L’Oreal’s Makeup Genius, a mobile application that lets users test make up products directly on their mobile devices.
Customers can browse products, “try on” make-up and test products before they buy them. With such an app, L’Oreal makes a great case of connecting channels, distributors and improving customer experience.
So the next wave of digital commerce will probably be mobile-enhanced and mobile-driven. With Google improving on its mobile search algorithm, mobile sites will get even more search traffic.
There have been countless debates on what a beauty online store should offer in terms of electronic features.
Bellow you’ll find a proposed must-have list:
Some of the most effective ways to drive ecommerce traffic are Email, Social Media and Paid Search. With a boom in Paid Search for the beauty category, most traffic seems to be coming from the search engines.
However, Email and Social Media still drive relevant traffic and conversions. A recent L2 Report emphasizes the the changes in social media landscape and the type of email marketing techniques beauty brands are using.
With almost 100% social media adoption, few social media outlets are still unused by beauty brands. Facebook has seen near total adoption but with the drop in organic reach, it has turned marketing teams to other more creative solutions and/or optimized media budgets.
The one channel that has seen an increase in both traffic and conversions driven has been Pinterest. The graphic social network is far better suited for digital commerce.
When it comes to emails, most of them are using different incentives to drive traffic and increase sales. Free shipping, commercial discounts, gifts with purchases and samples with purchases are among the most used by beauty brands with ecommerce capabilities:
With the launch of its first digital edition of the annual report, L'Oreal steps into a new era.
The report is an impressive tool on its own, aimed at investors, shareholders and journalists. But the real change comes with the overall shift to digital as a tool to engage consumers.
For example, the "Digital" section of the annual report states just how important naming the first Chief Digital Officer actually is. This move shows L'Oreal as an up and coming major digital player. The company will probably focus on ecommerce, data technologies as well as engaging consumers both online and offline.
An example in the digital report shows just how promising ecommerce is, especially in China:
"In China – the world’s number one online-purchasing market(1) – e-commerce already accounts for 10% of L’Oréal sales, and more than 15% for brands like VICHY, LA ROCHE-POSAY and MAGIC(2). These promising results are underpinned by partnerships with online distributors like Alibaba and Tmall. On Singles’ Day, a very important day of special offers, L’Oréal’s brands performed well, particularly MAYBELLINE NEW YORK – the number 1 make-up brand in the country(3) – and MAGIC, which sold over 11 million face masks in 24 hours"
The shift towards omnichannel marketing AND ecommerce is spectacular. L'Oreal has traditionally relied on third parties to distribute products to consumers through retail shops. Could this shift be a change in strategy with a direct-to-consumer approach or will it be an improvement in dealing with online and omnichannel retailers? Nevertheless, the move will probably ripple trough and be adopted by others.
It may be a tectonic shift in manufacturers switching from traditional models to new digital models, engaging their customers, as well as providing them with the opportunity to purchase. How will this affect traditional partners remains to be seen.
Here we are. The fifth and final part of the guide to starting your online store. It's been a fun ride for me and I hope it hase been fun and informative for you. Before we dive right in, let's take a moment and go through a quick recap of the steps we've covered so far.
As you remember, Part 1 covered planning and finding the right business model. Part 2 was focused on registering your business, finding and negotiating with suppliers. Fulfillment operations and making your back office work were the main subject of our third part and last week we've covered branding, ecommerce software and content in part 4.
Now … it's marketing and sales time!
During this section of the guide you'll discover how to expand your reach through additional sales channels, market your brand and products and finally – how to test the main areas in your online store.
So let's go ahead and have a look at…
First of all – what is a sales channel? The answer is quite simple: any method of getting products to the market so customers can purchase them. For example, your online store (the actual web store) is a sales channel. It showcases products, it tells their price and allows customers to purchase these products.
Let's assume that by now you have already started your online shop. The web store is up and running and customers start showing up. But the web store should not be your only sales channel. Your customers are complex and their habits diverse. One day they're browsing your store, the next they're hanging out on Facebook and meanwhile they search product info on their mobile phone. You should be there also.
You could have your products lined up in a Facebook store. You could build a mobile app that engages customers outside your store and collects orders.
It's not just online, either. Offline engagement shouldn't be a taboo either. Maybe a brick and mortar showroom for your main products is not cost – effective. But you could set up a pop-up shop occasionally.
There are numerous ways you can add sales channels to increase your market reach and some are really easy to set up. Others are a bit more complicated but in the end it's mostly about your product, your brand and of course your budget. Let's see which are the most popular sales channels and how you could benefit from them.
Out of all the sales channels you may choose, one really complements the online store. The call center can be a simple line you for customers to demand information on products.
(Zappos' call center is legendary and effective. It's both a sales and suppor channel.)
It can just as well be a full fledged call center with operators answering calls and helping customer choose the right product, handling orders and managing complaints. It can also mean people calling prospects or indecisive potential customers or just plain cold calling sales leads. No matter the choices you will be making, the phone is a great connection to the customer and you should build a smooth phone support operation.
You could ask – isn't social media more about marketing and communication, connecting and understanding your customer? Yes it is but it can work just as great as a sales channel.
For example – Twitter is testing purchase options (right now with just a few high profile retailers such as Amazon) and ways to drive targeted traffic to stores through offers. Pinterest is also testing options to drive targeted customers to your online store and they do that through their ads. That is great news as Pinterest is more efficient into turning views to sales than any other social network. It works awesome for industries such as travel, home-deco and fashion.
And let's not forget Facebook. Being the largest social network in the world it is a place you should be digging into. For a while, the network was so popular with retailers that a term was coined to split Facebook commerce from everything else: f-commerce. Recently, the company lead by Mark Zuckerberg has focused more on advertising revenues than helping retailers get close to their customers but it is a great channel to study, nevertheless.
There are some companies that will make selling on Facebook as easy as it gets. And if a Facebook store may look like a great option for your store, this involves apps connecting your store to Facebook.
(Shopify, among others, built options for users to connect their stores to their fan pages and sell directly on Facebook.)
On the previous chapter we've discussed the most popular ecommerce software choices. Turns out most of them get some sort of support for a Facebook store by third party apps. Here are some of them:
There you have it – these applications are easy to set up and you can start selling directly on Facebook thus adding a new sales channel. And once you start adding sales channels, you now you have to look into …
What is the device you think customers use the most throughout the day? It's the smartphone. Mobile usage has gone through the roof lately and its bound to continue.
(Number of smartphone users in the US (millions). Source)
So you want to be close to your customers. Mobile apps provide a special sales channel, one that's personal and it makes impulse buying all the more attractive.
How do you add a mobile sales channel?
There's an app for that. Actually more:
Give mobile apps for your store a try. The more smartphones become a part of our daily lives, the more we will use them. Your store can benefit from users that are not strapped to their desktop or notebook. And speaking of that, a great way to interact with customers are the …
Pop up shops are temporarily stores, in the real world, where online store owners can showcase their products and interact with their customers. The pop-up shop sales channel has really taken off recently and store owners have started adopting this online-offline connection.
(Adidas pop-up shop. Not exactly low-budget but hey – one can dream, right?)
Setting up a pop-up shop is a personal choice but works great if it's posted either in a high-traffic area (such as a popular shopping center) or at an industry event. For example you could set up a pop-up shop at a home-deco event if you are a store selling home decorations. It is a great way to interact with customers and get feedback on your merchandise.
Companies such as Storefront help shop owners find retail space temporarily by connecting them with retail space owners. To help online stores they've put together an ebook that is free for download. I encourage you to have a look at it as it explains the main steps in setting up (pup-up) shop.
Last but definitely not least – the marketplaces. Amazon, Ebay, Etsy, Sears, Buy.Com, NewEgg.com and more. You name them. They provide lots of options to lots of users and chances are your next customers are there shopping right now.
( Ebay – the original online marketplace )
The reason marketplaces are the last on potential sales channels is because I want to emphasize just how important they are. Just like the "old" shopping centers, customers go to marketplaces because diversity means options and options mean they can find what they are looking for.
Diversity drives customers. It drives sales. So you want to be there but plan ahead before you dive in.
As an online store start-up you should be looking for as much exposure as you can get but still try to focus on the right marketplace. Amazon and Ebay are the obvious choice but before you join them you have to ask yourself:
Listing your products on all marketplaces can seem like the right choice but it's usually not. Each marketplace is a sales channel itself. You should be sticking to those that work for you and improve your experience there. Until your business is large enough to allow you to handle orders from more marketplaces, focus on fulfilling orders effective and quickly.
Most marketplaces offer some form of integration with your existing store and you should use those. Product information should be going out of your online store and orders should be synced with your order management system. This way, the order management team can have a single point of entry for orders instead of getting lost in a dozen of order management systems scattered throughout the marketplaces you are using.
Marketplace orders will continue to be a large part of your business. So large that they will, in the future, dwarf those from your online store. The reason is people tend to gather and shop where they will find diverse products and retailers. Just like in the real world. Online is even more so – marketplaces get even more traffic from search engines, have more money to spend on ads and are better at keeping customers returning.
Each sales channel you will be adding will bring you more exposure and more sales if handled correctly. The sales channels I've described so far are the most popular ones right now. But they are not the only ones. As technology evolves, so will commerce. New channels will pop-up and some I haven't mentioned here will probably increase in importance.
Think about the impact Internet of Things will have. Maybe in the future the greatest sales channel for groceries will be smart appliances. Think of a refrigerator than can place orders for customers when it's depleted. It sure is going to be an interesting challenge to integrate those in a sales channels mix.
( Omnichannel means connecting all sales channels in a way the customer finds natural )
By adding sales channels you wil turn from an online retailer to an multichannel retailer and if all channels work seamless together you will become an omnichannel retailer. If you want to know what that means – have a look at Macy's omnichannel strategy. And if that is not enough dive into this omnichannel report I've wrote to help retailers integrate their sales channels.
Marketing is one of those concepts that's so hard to understand and yet so overused. Most of the times its meaning is so cluttered by useless acronyms and buzzwords that people have trouble understanding what it actually is.
I am not saying that marketing is easy. It's not. Yet is not the Holy Grail of human knowledge either. It's just communication. Talking, showing, describing products to the people most likely to buy it.
It's that simple. The basics need to be simple.
If you are going to survive as an online store owner, you need to keep your marketing basics simple. You have a product. Hopefully a great one. There are people who want to buy that product. Most don't know they want to buy it from you. You need to show them why they should buy the product you're selling. You need to show them why they should buy it from you. And then, if everything I've shown you so far has been decently implemented, just let them buy it.
Everything else is gimmicks. If you've got the basics right, everything else will fall into place.
To get people to buy your product, you need to know who these people are, what they want and how they act. Most likely not everybody will want your product. But if you've done your planning right, you pretty much have know a lot about your market.
Yup, your customers are "the target". Why is it called that you ask? Well, because your communication targets them. Until the internet became the norm and we've started gathering more data than we can handle on customers, we used to define them through demographics. That means basic info on consumers. Age, sex, marital status, location, education … this kind of data.
( Pictured here: advertising in the 60s. Not pictured here: Google algorythms and tabacco advertising ban )
These targeting methods were made popular when mass marketing was just blooming, in the days of TV, print and outdoor ads made by the likes of Mad Men. When you ran your ad in the magazine or on national TV, you needed to know who's going to use your product, make sure you understand their psychology and shout from the top of your lungs how cool the product is. Once the ad was approved, there was no going back. Advertising agencies would research, create and test the ad before the campaign was launched because there was no way you could change, tweak or even pull back a campaign in real time.
So demographics were the bread and butter when you would push your message to the market. But the Internet changed that into …
Basically, if you were a mid-class urban wife with no college education in the 60's there were slim chances you would receive ads trying to sell you repair tools for your car. Even if you were actually a mechanic. The same would hold true if you were a man and would be looking for a sewing machine to fulfill your lifelong passion of becoming a fashion designer.
You would have to find those products yourself. We've come a long way and thanks God, we now have the freedom to fix our own cars and sew our pants, no matter the gender
That happened when contextual marketing (the ads you might see when searching on Google), interactive marketing (information instantly delivered when interacting with say an website) or behavioral marketing hit the shelves.
The last one, behavioral marketing, is probably the single most important aspect in online retailing. Technology now personalizes marketing and responds to customer behavior.
For example Amazon's recommended products ("See what others have purchased") is a form of behavioral marketing that is based on a complex research on previous customers behavior before they purchased something. Simply put, when people would purchase something, their interaction trail (the products they've seen so far) becomes an indication that people taking the same or similar steps would most likely purchase similar products.
The ads you see on Google feature a similar concept. They are shown as to answer your needs. Some ads respond better than others at what you are looking for and thus have a better chance of getting clicked. Google trusts this system so much that they invoice advertising on clicks, rather than how many people have viewed the ad.
So basically we went from effectively targeting people to targeting people's behavior. Still, demographics and customer profiles are very important and a lot of what you will be doing is to try to guess customer responses based on demographics assumptions. Such assumptions might mean you will favor ladies over men if you are selling women's clothing (doh!) or rather more complex assumptions such as "Men over 32, employed and married are more likely to buy a family car".
Indifferently of your assumptions, test them and always quantify your results with …
Here you go … numbers. Charts. Estimates. Hope Miss N., your math teacher, was your favorite back in school, because this is going to be damn complex. Nah, just kidding. Most analytics software is pretty much plug and play and the numbers and charts I mentioned are usually generated on the fly and in such a manner you can easily understand.
You can't have marketing without analytics and research. Fortunately, it is a lot easier now for a small online store than it was 40 years ago for the largest companies in the world. What is not so fortunate is that it's easier for everybody so you'll have to dive deep and understand what your analytics are saying. So will the competition.
Once you have installed Google Analytics or one of these other ecommerce analytics software, you will probably dive in and see what your customers are doing. What you will want to look for is patterns that lead to increased sales. Special products, a certain type of copy, products featuring media versus those that don't have media. Look for what makes your sales increase.
So you know the target, you have the analytics figures, now it's time for the actual marketing. The web is full of resources to fine tune your online marketing understanding. I will show you which are the most effective ways of marketing so you will have a bird's eye view on what makes an online store sell.
As a startup there are really little things you can do better with smaller budgets than writing quality content and optimizing for search engines. SEO (Search Engine Optimization) is a really large concept and many people earn their living through SEO services. You will probably ask a SEO expert to help you find the perfect balance so your store will show up in search engine results. But before you do that, have a look at the basics. These are the things you will need to keep in check so Google will bring the right customers to your store:
Ask your customers to leave you their email address so you can update them on news and offers. This is a great way to get people right back on your store.
But don't annoy them and don't do spam! Everybody hates unsolicited email. Make sure your customers give you their permission to send them emails. You can use apps such as Mailchimp or CampaignMonitor to save customers' emails and then send them newsletters.
Where would you go if you were to market a product? The answer is fairly simple: where people gather and interact. Social media outlets such as Facebook, Twitter or Pinterest are now used by billions of people. That's where your online store should be.
Just like interacting with friends, some things work better than others. Here are some tips on how to use social media to interact with potential and existing customers:
If your social media strategy is not going the way you'd want it to, there are always the ads. Most social networks provide ways for you to get closer to your potential customers, faster. Most people call them ads . Facebook, Twitter and Pinterest – they all provide advertiser with the possibility of engaging fans through ads.
And speaking of ads, one of the most effective way of advertising your store and products is …
Remember those Google ads I've mentioned earlier? That is Google AdWords, a very effective form of advertising that places ads on search results, ads that are directly related to your search.
For example, if you were to search for "cars", you will be shown the natural search results AND special search ads. These ads are fueled by advertisers that pay each time someone clicks one of their ads.
You can be one of those advertisers. By carefully analyzing traffic and allocating search ad budget, you can determine with high accuracy the number of clicks you need to convert visitors to buyers. Because search ads are contextual, this means you can optimize your ads in such a way that only those interested in purchasing your product might click it.
However, paid search campaigns are usually better managed by professionals. Even though you might spend a little extra for someone to handle your ads, just leave it to the professional.
Performance – well that sounds nice. What is it?
Performance marketing is a broad term that means advertisers pay a fee depending on how well an action is performed. This action can mean showing an ad a certain number of times or making that ad transform into a special action. The standard actions you might want to encourage are:
And because marketing people happen to love acronyms, you might find the info above coded in three-letter words:
Performance marketing is sometimes used interchangeably with affiliate marketing. That is more of a misconception, as affiliate marketing, though popular, is a subset of performance marketing. It works as a shared revenue deal, where the retailer shares a portion of the revenue with the publisher (the one displaying the ad), whenever advertising turns into purchases.
Affiliate marketing is ran through affiliate marketing services, that cover three very important aspects: they connect advertisers to publishers, they make sure all sales are registered and attributed to the right publisher and they handle transactions between advertisers and publishers.
If you decide to go along the affiliate marketing path, here are the most important affiliate networks that can help you sell your products:
A great way to get your product out there is place it in comparison shopping engines. These applications gather information from more online stores and show potential customers what is the best way to shop in terms of pricing.
It basically works for those that are price competitive so before you join such a program, make sure your prices are aligned with the market.
(Shopzilla is one of the most popular comparison shopping engines)
Most comparison shopping engines are CPC based and you will pay anytime people click your products, arriving at your web store. The top four most popular are Google Shopping, Shopzilla, Shopping.com and Pricegrabber. Getting listed can draw targeted traffic and can mean a very scalable way of converting traffic to sales.
So there you have it – these are the most effective ways you can market your new online store. But don't stop here, don't settle. Marketing in the digital world is usually a matter of imagination. Be curious and try new things that might be fit for your online store.
For example you can attract relevant bloggers to mention your store and review the products. You can put out press releases and talk to the media. You can run contests and sweepstakes to increase reach and turn fans into loyal customers. Once you have the basics up and running, you will be ready to add more and more marketing options to your online store.
Remember: your work is never done. If you want to keep your customers happy and sales growing, you need to constantly optimize and tweak your store. To do so you can run tests that determine what works and what does not. When testing you will be looking for either errors, bottlenecks or usability issues. Do so through:
A great way to see how customers interact with your company is drawing customer journey maps. These "maps" show your existing sales channels and how customers interact with them. Customers may find you on social media, browse products on the web store and place orders through the phone. This is a customer journey map.
When these journey maps get too complex you have to constantly test and look for signs of problems of sources of frustrations for your customers. It may be a poorly designed checkout cart or the voice of your phone operators. By understanding your target customers and their journey maps you can have a guide to testing what works and what doesn't on your store.
( A blank example of potential sales channels. By connecting the channels you can draw journey maps )
Testing means improving and you should strive to make your store better and better. Little improvements and constant focus on making the customer experience better turns your store into a success. So keep testing :).
We've got this far. Wow! Testing is the last section in our guide to starting an online store. It's been a great ride and I hope these posts will help you build the store of your dreams. If you've managed to get this far I believe you are ready to start your own store. Give yourself a pat on the back for having the patience to get through all this data. It's not easy, I know, but it is a lot easier than just starting a store and then figuring it all out along the way.
I am more than happy if I've managed to help you on your path to becoming an ecommerce entrepreneur. If this guide was useful to you, please refer it to someone else who may be in the need for know-how.
You've taken a large step ahead to running your own business and online store. You may be anxious and a bit scared but rest assured. So was Jeff Bezos when he started Amazon. Knowledge, hard work, innovation and persistence will get you far. Have a safe trip in reaching out for your dream!
Featured image source. Modifications made to the photo.
They say a picture is worth a thousand words. Add a cool filter in Instagram and it may be worth more. So luxury retailers have taken up on the chance of showcasing offline products in the most popular photo-sharing app in the world.
It’s definitely worth it. With more than 300 million Instagrammers, the social network is a colorful powerhouse, just waiting for fashion retailers to tap into it. And it’s not just the numbers. From Taylor Swift to Robert Downey Jr everyone who’s anyone is walking the red carpet of Instagram.
Along these stars came the most popular and desired luxury brands in the world. With social incentives, aspiring fans can become customers and customers will become brand lovers. So photo sharing on Instagram is a go for brands looking to connect online and offline sales and marketing.
Let’s have a look at these three most effective brands on Instagram:
Hermes is unconventional and creative, focusing on outlining the brand identity without being too pushy. It’s rather “modest” fan base of just over 670k followers shouldn’t be bigger either. After all, Hermes addresses a special kind of audience – the kind that doesn’t come busting doors in look for discounts. They discreetly shop online for $11.300 leisure bicycles and $7.600 bags.
You’ve spotted that special kind of turquoise and the must-have diamond ring that’s globally recognized. 1.8 million Instagrammers are constantly connected to the stylish social media outlet Tiffany’s employs.
The Instagram page is a mix of colorful illustrations, products showcased in glamorous yet simple and stylish photos and fashion advice from models and designers. The whole philosophy is outlined by Francesca Amfitheatrof, Tiffany & Co. design director: “I believe there is great power in simplicity.”
Just like its brick and mortar stores, as well as the online store, the Instagram page is a stylish, simple and elegant work of art.
Burberry is almost unbeatable in terms of using technology to connect to its esteemed audience. Digital retail is so important to Burberry that they’ve designed a flagship store that resembled their website, in 2012. Talk about omnichannel.
Digitally connecting to their customer has been the main ingredient to Burberry’s recent growth and Instagram was not bound to be left behind. The 2.4 million followers can get a glimpse in the lives of the rich and beautiful through Burberry’s Instagram channel.
Models, carefully crafted products and celebrities all mix to give followers, customers and aspiring Burberry product owners, that warm “I’ve got to have this” feeling.
And once that feeling kicks in, the monogramed scarf is just a step away in the online store, ready to be picked up in the closest store. Or sent home. Worry not, there’s free shipping and returns.
Twitter seems bullish about its place in the omnichannel retail arena. After hiring Nathan Hubbard, former Ticketmaster president, the company started seriously developing ecommerce features for its users.
It all started with rumors leaked online about Twitter dipping its toes in ecommerce. The news were soon followed by a “buy now” button tested for a while and a few months back the “#AmazonCart” partnership was announced. The Amazon Cart project allowed customers to add Amazon products to their carts by linking their accounts and adding them to their carts via Twitter.
Twitter now launched Twitter Offers, a way for advertisers to drive social media traffic directly to brick and mortar stores. The process is pretty straight forward or Twitter users: they link their credit cards to Twitter, claim rewards from advertisers and then redeem said offers in store.
As it seems Twitter sees commerce not just online but offline as well. The vision includes online and offline shopping, social media, Amazon accounts linked to Twitter and … payments.
Long story short: everything Twitter has done so far is outlining a strategy where the company targets more than social media. It’s targeting omnichannel retail as a way to increase its revenue. It has the user base and it’s building the payment infrastructure. Its focus and drive may lead it where Facebook failed – setting foot in commerce land.
As an online retailer, you probably have your ecommerce site up and running already, quite possibly bringing you some sales and revenue too. At this point in time, you are probably wondering how to increase the sales.
This post will show you three effective methods to achieve just that – grow your website traffic and boost sales.
This is an online advertising service provided by all the three major search engines today (namely Google, Yahoo and Bing). The following steps will allow you to start advertising your site online using the PPC method. (You’ll have to repeat these steps for each search engine where you wish to advertise):
And that’s it. Within a day or two from the time you finalize your campaign (often faster), the search engine/s will start displaying your ads and the traffic (and sales) will start rolling in.
Of all the web marketing methods this article will cover, PPC advertising is the only method that delivers almost instant gratification. It is also a highly accountable method that provides totally measurable ROI.
You can read up some more on PPC advertising as it relates to online retailers at Entrepreneur.com.
SEO is the art and the science of getting your website to show up at or near the top of the results when the prospective buyers of your products search for keywords related to your business and products at various search engines.
High search engine result rankings for the keywords relevant to your products achieved via SEO will almost certainly boost the traffic of potential customers flowing in to your web site, with the resultant increase in sales and revenues.
SEO, however, is not a path that you should tread lightly, for two reasons. First, it is not an easy or a trivial task. In order to be executed successfully and effectively, SEO requires deeply entrenched knowledge, expertise and experience, backed by ongoing study and knowledge update processes. Secondly, if executed in a manner that violates the arbitrarily and rapidly changing best practice guidelines of the search engines in any way, SEO can potentially backfire drastically, causing your site to get blacklisted by the search engines in the worst case scenarios.
To get up to speed with the most current SEO scenario, you can go though this useful 90-slides presentation from Rand Fishkin.
Insomuch as you have an online retail operation going, it is quite likely that your website has been built using one of the several ready-made ecommerce software platforms.
While most of such software platforms provide at least some basic features to facilitate SEO, there are huge differences in SEO features across different platforms.
SMM, you can say, is the ‘newest kid on the block‘ so far as online marketing is concerned. As you can readily imagine, there are gad-zillions of people (including your potential customers) spending untold numbers of hours everyday at various social networking sites and services like Facebook, Twitter, Instagram, Pinterest etc. And therefore, marketing your online retail business at these social media sites can certainly be a very lucrative way of growing your brand visibility, traffic and sales.
Most of the popular social networks offer their own self-service advertising programs under various pricing schemes and models, including PPC (that we looked at above), with Facebook, as is to be expected, leading the pack in terms of reach as well as ease of use.
And then, there are many third-party services and agencies that help you grow your website traffic and sales using various social media platforms.
You can read this article at the InternetRetailer portal to get interesting information on social media vis-a-vis small retailers.
Online retailing is a highly competitive business so make the most of the tips above to enhance your marketing operations.
Author bio: Catalin Zorzini is the founder of Mostash.com (a digital marketing studio). He likes hot soup and hot jazz.
You’ve chosen the best products for your customers, you’re spending top dollar for advertising and your customer service works great. Yet something seems to be missing. Your online store does not yet stand out. If so, you may be in need of some content marketing.
Now content – this is a rather big word and it may mean lots of things for lots of people. For me, content is about more than keywords stuffed on product descriptions or carefully changing your product title to match whatever Google is into these days.
It’s about your shop’s personality. It’s about standing out and standing up for something. It’s your story to the world.
So let’s have a look at five ways to build great content for your online store:
What do you do when you meet someone? You try to look as interesting, smart and great looking as possible. You wouldn’t just go ahead and show them your ID card and recite a bunch of boring facts about you.
You tell a story.
Ecommerce sites all have a story. At some point someone thought – hey, I can do better than my competitors. They decided to stand for something. Yet most of the times they miss the opportunity to show this. They get lost in boring and useless “About us” statements that fail to transmit anything else than the fact that someone bothered to fill in some words on that page.
Others, however, they make it personal. They tell everyone what they stand for and why should you choose them. Meet Warby Parker:
Warby Parker decided they would have none of that boring “About us” corporate double talk. No sir. They went on and shared everything the company stands for. The history, their social responsibility program, even why they’re named Warby Parker (Turns out they’ve named the company from two characters in a Jack Kerouac book).
The point: tell a story, not just a few facts about the company. After all, your customers are people, not robots.
So you’re selling lots and lots of products. That means you should be some kind of expert on how they could be used. As shocking as you might find this, your customers are probably not.
So tell people how to use your products.
Even the products have their own how to’s and user submitted gallery:
The point: make your customers understand how to use the product. You probably know a bit more about the products than they do.
You know who’s the best at saying great things about you? That’s right. You.
Don’t rely on others to say great things about your products. You know they’re great. Otherwise – why would you sell them?
Build a magazine for your niche and stick to it. Explain what your customer should do to look better, feel better, spend better. After all, you have already picked those “whats”. The times where media was owned by large corporations and they alone could make or break your business – those times are gone.
Just go ahead and build a blog and fill it with great advice, just like the good folks at Gilt.com did. The Gilt MANual is a great resource for men interested in fashion. It’s ran by Gilt and very popular.
And Gilt is not the only case where ecommerce sites built their own media outlets. Bonobos publishes great fashion advice on Equateur. Alex and Ani, one of the fastest growing online retailers in the US runs a great blog that showcases events, company news and things customers would take interest in.
The point: start writing and earn media instead of paying for it. It’s a great way to share insights with your customers and build relationships.
Fab.com is dying.
The ex-gay Yelp, ex-gay Social Network, ex-gay Amazon, ex-Design Flash Sales site struggles on its death bed. The company’s spectacular rise and fall is a lesson in how to go from rags to riches and back to rags again. It is a story on how growth can sometimes make investors, founders and management oblivious to threats.
I was never a big fan of the concept of flash sales. I covered it, I studied it but I didn’t like it. It is short-sighted way of running online retail operations. It is a great way to create market demand. It may even be a good way to develop customer base. But it will not handle growth forever.
Flash sales need three things to function: good-to-great products, relatively low prices and consumers willing to try overpriced merchandise at a discount. All of these factors come at the expense of two very “un-scalable” variables:
None of these variables scale very well, because they are human-based. Fab and especially founder Jason Goldberg, the one taking most of the heat have learned this the hard way.
Of course, it easy for me and other bloggers to watch events unfold and point fingers at who done what and why the business model was wrong. It was a bit harder when Fab.com was getting millions and millions in financing and customers were anxious to find new products and buy on Fab in 2012.
But this post is not about pointing fingers. It’s about looking beyond the failure, at what lies ahead for Fab.
Fab started as a gay community service that reviewed local business. In 2011 it pivoted and went on to offer daily discounts to its users, later on connecting users in a form of social network. As the model didn’t really took off, founders Jason Goldberg and Bradford Shellhammer decided they need to pivot yet again and rethink their market.
As it seems, the duo thought the company was great at a very specific thing and decided to focus on that: design. Specifically: interior design. They re-positioned Fab.com as a source for inspiration and sales of design-related products.
One can of course notice the stereotypical positioning (being a former gay community) but it nevertheless worked. The response to this new pivot was great. The number of registered users went form 175 000 in June 2011 to 350 000 in just a month. In just 12 days the company sold more than $600k worth of merchandise.
The new Fab.com was available by invite only and when it opened more than 125 000 had already registered to receive offers. The reviews were awesome and in just a short month after the Fab relaunched, Menlo Ventures invested $8 million in the company.
Fab’s usage of social networking and social-shopping features further increased the number of users and sales for the company. In just 5 months since launch (nov. 2011) the company boasted over 1 million registered members. Then came the holiday shopping season and sales skyrocketed. As a result of fabulous sales and increasing media traction, Andreessen Horowitz invested … wait for it … $40 million.
After just 7 months since relaunch, on Dec. 7, legendary Andreessen Horowitz VC’s are chosen by Fab.com founders from 15 willing investors.
At the end of 2012 numbers are in and they show a spectacular growth fueled what went from a 4 people company to a 140 employee design force.
CEO Jason Goldberg then posted on its now gone blog “Betashop” a slideshow detailing the successful year his company had. It shows the brave startup growing from a small yet promising group of passionate people to a company selling in 26 countries, with 10 million members.
In 2012 Fab sold over 4.3 million products. During the holidays that meant a rate of 17 products sold per minute. While other companies still try to cope with the idea of mobile commerce, Fab’s sales in 2012 had 33% of all sales coming from mobile. During holidays, 56% of sales came from smartphones and tablets.
The customer lifetime was great and two out of three purchases came from repeat customers. In 2012 sales grew 600% over 2011 and Goldberg boasted that Fab’s 15.000 products were 33% more than IKEA’s. Fab was the largest design store.
In hindsight, past the astonishing numbers, some statements showed something was not exactly right. There was a sense of too much pride: everything Fab was doing was absolutely great and everybody else was just the loser left behind. Jason felt like Fab was the only company with the right attitude and operations. Even Amazon and IKEA didn’t seem like a match for them.
The company was so incredibly self-assuring that it was doing everything internally. In 2012 it employed more than 600 people across the world, it built and operated its IT systems in-house, it even built its own warehouse. How ’bout renting, man?
The 2012 presentation goes on and on about the greatness of Fab, about superstar employees, about the huge vision ahead, about how Fab has to beat IKEA and Amazon at design and deliver more than $30 billion in sales. In the end Jason shows a 6 point plan on how they’ll achieve that:
These 6 points up there – these are the reason Fab failed. What they leave untapped is just what matters. They are all great for rallying the troops but they lack substance. Amazon and IKEA’s steady growth happens from the ground up. The infrastructure these companies rely on to build, handle, ship and sell products – these are their secret weapons.
Marketing is just the illusory panacea startups reach for when hoping it would suffice in their struggle against the big guys. It doesn’t. That’s where they get their smaller competitors.
Retail, even if it happens online, is a logistics game. Walmart, IKEA and Amazon manage to stay on top with a lot of help from their supply chain. Everything moves smoothly behind the scenes and that’s what Fab failed to acknowledge. By spending too much time on social media, mobile and interviews, the management failed to see the large logistic wall that suddenly halted their growth.
In 2013 things got from great to bad and then to awful. The company did raise an additional $150 million in venture capital in July 2013 but as CEO Jason Goldberg these were definitely not great news:
“What a lot people don’t know is that we set out to raise $300 million. […] And when you set out to raise $300 million, and you raise $150 million, you have to change your business plan. And that’s what we did.”
The change of business plan meant a lot of things that hurt the company’s credibility. Layoffs throughout its offices left employees unhappy. The company had to reconsider its position. At the turning point it was burning through $14 million each month and still not reaching sales projections.
The job cuts took Fab from more than 750 employees to less than 380 at the end of 2013. It started in Europe and than spread through its offices. Every office was restructured to help the company reach a balance point. It didn’t. Even C-level executives had to take a hit. It’s unclear if they left willingly or have been laid off but Co-founder Bradford Shellhammer and COO Beth Ferreira left the company.
Meanwhile traffic came down abruptly and so did sales. The company was heavily relying on ad spending to reach customers. Its 2012 marketing costs were $40 million. In 2013, the figure dropped to $30 million. But as the chart on the right shows – that was not the only factor that lead to the drop in traffic and sales. People were just not interested in Fab’s products anymore. Buzzwords and social media didn’t cut it anymore.
All these bad news took the company by storm. A lot of people took shots directly at Goldberg for shifting focus, delaying layoffs and generally the could-be death of Fab.com. It was not surprising: he was the one taking the spotlight when Fab was growing, he would be the one taking the heat for the fall.
The media took turns at hitting Fab.com whenever it could and it was obviously an easy task. There were plenty of laid-off employees out there to leak inside info about how bad the company was being ran. They were jobless, pissed-off and needed someone to take the blame.
How could a company with $336 million in funding fail so bad? Where did the company on everyone’s lips go? What happened with all that value investors just … lost?
All these questions left out some seemingly uninteresting investments Fab was running in Europe. While dealing with layoffs, decreased sales, management layoffs and media hits, Fab acquired custom furniture companies MassivKonzept and One Nordic Furniture Co..
By doing so the company combined the MassivKonzept’s mass customization tools and One Nordic Furniture Co.’s talent and technology. The new company took over Fab’s sales in Europe and now leverages Fab’s customer base, experience and of course – cash.
Fab’s European venture received the name Hem (Swedish for “Home”) and now employs 150 employees in Berlin, Helsinki, Warsaw and Stockholm. Some of them are previous Fab employees, some are new hires.
Hem is a designer, manufacturer and retailer and it is an integrated company. It is the technology company that Jason Goldberg wanted to build for a long time.
But most importantly, Hem is something Fab never was: its own company. An unique organization that goes beyond comparing itself to others. It is not the Amazon of Europe or the IKEA of online. It is Hem. It allows its customers to build custom, beautiful furniture and products for the home and it can now deliver on this promise. It seems to be a company that may lack sales and the buzz Fab had but it has something more important: purpose and substance.
It seems that a more mature Jason Goldberg has finally decided to leave marketing and PR aside and focus on building a real company. An unique company that goes beyond buzzwords and solves real problems, in a real environment, where the team is not made of superstars but rather a group of passionate people that put the product ahead of their own egos. And it started with its leader.
I believe Hem has a bright future, unlike Fab. It is built to last, just like its products. I must say that when I set out to write this post, it was going to be yet another bashful take on Fab’s fall. But the more I read about it, the more I found about Jason and his company and the more personal it felt. And a lot of it resonated through this interview he gave at TC Disrupt. A sense of grit and humility echoed through this talk. As an entrepreneur I know what it feels to fail. I too made mistakes and I too delayed laying off people. I too mistook marketing for product and company development. I too believed sky was no limit and failed. So there is a lot of Jason’s actions that I get from being in a similar, yet smaller scale, place.
Yes, Fab is dying and it’s a great thing. Hem now takes its place and it has the potential to be a far better company. In the end this might be not a cautionary tale of entrepreneurship gone bad but a lesson in resilience and willingness to adapt.
Jason Goldberg took some courageous steps into transforming the company he’s built and it will probably pay off in the future. After all, he runs a company that is pretty close to break even, with $120 million in the bank and a large customer base. And now it has a real business model. How hard can it be?
We’re reaching that point in the world where technology has evolved to a micro-level. Computers that used to be the size of large walls are now as sleek and light as a stack of papers, and what was once a brick-sized mobile phone has become the size of a small child’s palm. By now, computers are practically mobile phones.
More people in America use and own mobile phones than toothbrushes. Fifty-four percent of these phones are smartphones, and by 2017, there will be over 10 billion mobile devices. As mobile traffic rises, so too does the need for mobile apps. With 90% of Tweets and 40% of Google searches coming from mobile phones, the way to get and spread day is becoming handheld. While two years ago most of this traffic was coming from teens with cell phones (teens increased mobile consumption in 2012 by 256%, with the standard teen sending an average of 3339 texts per month), mobile usage has extended far beyond teens. Most recently, with the continual creation of mobile apps reaching out to various targeted consumers, many companies have begun a new form of marketing for the mobile online shopper.
In fact, four out of five consumers use their smartphones to shop, and the majority claim that shopping from their phones is more enjoyable than shopping in person. No more long lines, parking tickets, unnecessary purchases, or exhausting traffic jams – consumers can buy what they want, when they want, how they want. And it gets shipped straight to their homes. 56% of consumers use their smartphones to search for a store’s location and directions, 51% to look up product information, 59% to do price comparisons on products, 45% to write up product reviews, and 41% to search for coupons. Smartphones make shopping easy and reliable, even more so than shopping in person. With many stores creating apps or green “Buy Now” buttons, shopping no longer requires physical salesmen.
Not only do mobile apps make shopping easy, but it also allows for information about products to be spread more reliably. 78 – 84% of consumers rely on social networks when researching new products. By 2015, it’s predicted that the amount of goods and services consumers purchase through their mobile phones will total roughly $119 billion. Mobile coupon usage is expected to rise to 53.2 million, and retailers say that 67% see a greater value in having their customers use mobile apps to shop rather than shopping in person. Overall, mobile apps bring five times more engagement – both in the product being sold and in the dialogue between targeted consumers.
Ivan Serrano is a web journalist and infographic extraordinaire from Northwest California. He particularly likes to write about the technology world, social media and global business.
When it comes to computers, 127.0.0.1 is the “localhost”. In computer networking the local host is “this computer”. Or home. We have a changing landscape in computer usage (shift to mobile) and we notice the same trend in human behavior. People change places more than before. Decreased cost in transportation and relocation means we can move from one place to another without much hassle.
But there is no place like home, right? Well – what is home? Apparently our digital hubs have become our homes when we are on the move. Social networks are now our go-to place when we want to connect with our friends, even when we are away. Photo sharing apps like Instagram or Flickr store our memories and we can access them on the fly whenever we are away.
Even our local shop gets replaced by the increasingly present favorite online shop brand. There is a pattern that shows mobile buyers (those that change residential areas) are more prone to purchasing online and staying loyal to their favorite online store brand:
“For example, customers at Diapers.com who change locations become more or less likely to shop online, depending on the increase or decrease in their offline shopping costs in their new neighborhoods. Specifically, shoppers who have some experience shopping online and then move to a new location with homes with more storage capacity and relatively few stores will increase their online shopping activity.” Source: MIT Sloan Review
We, human beings, do not enjoy change all that much. In a fast moving world – we need stability. We need a fixed point. And after all it is all relative. If we’re constantly on the move – the only fixed point is that which moves with us or is everywhere around. Brick and mortar stores are fixed and therefore always moving for the traveler. Our fixed point is in the cloud. Our fixed point is the mobile.
Achieving clarity in Omnichannel Retail is no easy task. Retailers, especially large ones, need to get all departments, all sales channels, suppliers and fulfillment operations on the same page. And that’s just the first step. Then comes the IT integration where legacy systems are connected to a central management tool that handles at least inventory transparency, CRM […]
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Shopping cart abandonment is one of those dreaded issues both online and omnichannel retailers hate. There are many reasons for customers to just leave a webstore after they have picked their products, instead of completing the order. Some customers find better prices elsewhere, some fail to navigate the store but most (56%) give up on their order […]
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Henry Ford said “People can have the Model T in any color – as long as it’s black”, in the early 20th century. That’s when Ford’s innovation, the assembly line, vastly improved productivity thus reducing production costs. Lower costs meant companies could manufacture cheaper products and still be profitable. The assembly line made possible the mass […]