May02

Fresh approaches to fundamental issues in retail

By Fiona Swerdlow, Head of Research, Shop.org | Published: May 2, 2013
1 Comment | Posted in Events, Marketing, Merchandising, Mobile, Retail Companies, Social Media

Compete on something other than price? Harness word-of-mouth to increase conversion and organic search traffic? Integrate your print catalog more directly into your digital commerce strategy?  If you think there are no new answers to these digital commerce questions, just remember that innovation is a hallmark of the retail industry.

If you attended the Shop.org “Next Generation of Digital Retail Technology” First Look session at Retail’s BIG Show this year, you got the scoop on three companies that are tackling these online retail fundamentals in new ways. Moderated by retail veterans Bryon Colby of Cornerstone Brands and Kevin Ertell of Sur La Table, the ideas discussed were so thought-provoking we decided we had to share some highlights with the Shop.org community at large.

Making the print catalog digital
“We’re still shipping 22 billion print catalogs in the U.S. every year, we have 100 million active catalog shoppers in the U.S, and – perhaps most importantly – 80 percent of transactions still start with print,” said Marxent Labs CEO Beck Besecker said, citing Direct Marketing Association data. But why are U.S. consumers still flooded with print catalogs? Retailers understand that they are one of the most time-tested conduits to tell a deep story about the brand. And pulling back from a catalog – whether in the number of mailings, pages or otherwise – can lead to drops in sales. “The question becomes: If digital isn’t a replacement for print, what’s the right strategy to bridge the divide?” he asked. Retailers have certainly experimented with QR codes, but Besecker said “peppering our catalog with hundreds of QR codes isn’t really the user experience that we’re looking for.”

Marxent, a specialist in augmented reality and mobile app development, has tapped mobile image recognition as the key. The firm has developed an app for home furnishings retailer Ballard Designs whereby the user holds the app over the Ballard Designs print catalog to read product reviews, add to the cart, and shop the catalog. (Check out Moosejaw’s X-Ray Viewer if you haven’t already.). “In the next three years, we’ll expect our print catalogs to be shoppable,” Besecker pronounced. And not just catalogs – anything in print, whether a product label or tag, a movie poster, even the weekly circular. Besecker expects that image recognition technology eventually will come already built into phones, putting pressure on app developers in the future.

Besecker said mobile image recognition:

  • Matches the scale and benefits of direct marketing.
  • Creates immersive brand storytelling with frictionless shopping.
  • Leverages e-commerce features such as favorites, sharing and shopping cart.
  • Could become “the foundation for mobile wallet and loyalty programs.”
  • Creates additional content without printing and postage costs.
  • Creates new readership data such as pages viewed and pages touched.

Bringing inspiration to online retail
Marketvine CEO Manish Mehta said retailers feel a great urgency to somehow differentiate themselves from competitors, but have boxed themselves into a world of “fulfillment driven commerce” where inspiration is lacking. Uninspired shoppers are motivated by price, thwarting any hope for retailers to set themselves apart. With no loyalty in this game, Mehta asked, “Could we differentiate [ourselves] as retailers online through inspiration, rather than the [efficiency of the] fulfillment-based supply chain, rather than price?”

What does “inspiration” look like for a retailer? In a nutshell, it’s about storytelling. Noting that successful non-profits inspire and motivate donors through great storytelling, Mehta suggested that retailers ask themselves whether they can differentiate themselves from their customers, influencers and staff. “What if you could give employees the power to curate a collection of your products on your site or even other sites, then allow people like your influencers to put those products in their blogs, across social media, through digital and/or physical displays?” Mehta asked. “That’s inspiration. That’s what will differentiate you from others in our fulfillment-based world.”

Mehta cautioned that his company is still in stealth mode and still has much to learn in this area, but that early results exceeded the company’s expectations. Thanks to early adopters, as of mid-January, Marketvine had seen an average of 40 percent lift in conversion, a 7-8 percent increase in average order value and an 80 percent improvement in on-site engagement.

Creating an engine for generating strong word-of-mouth marketing
Get Satisfaction is focused on harnessing the idea of customer community to scalably improve conversion, reduce customer support costs, and increase organic traffic to one’s site. CEO Wendy Lea explained that despite significant spending on search engine marketing, conversion rates remain stuck in the single digits for most retailers.

Lea showed the example of Kiddicare, a high-profile online retailer in the U.K., as a prime example of an embedded customer retail community. “Thanks to Kiddicare, we learned the value of embedding a customer community in the purchase flow, before ratings and reviews,” Lea said. In the “Community and FAQ” section located on every product detail page, customers can see questions and comments posted over time about that product, including answers from staff and fellow customers. To get the ball rolling, Lea advised retailers to tap into and connect the customer community with other information sources such as FAQs and customer relationship management databases. As for the conversations, Lea said brands need to let customers talk to each other first – don’t jump in too fast or it will discourage more peer to peer interactions. “Consumers do like companies to be involved. They want to know that there’s someone there representing the brand or the manufacturer who can weigh in.” The voice that retailers respond with must set the right tone and cadence, avoid jargon, and be truly conversational.

Consumer demand will continue drive innovation in retail. These are just a few ways technology vendors can help retailers answer the call.

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Apr09

Why Facebook, Sur La Table and Abercrombie & Fitch love serving on the Shop.org Board

By Artemis Berry, Senior Director of Content and Community, Shop.org | Published: April 9, 2013
Be the first to comment | Posted in Retail Companies

For the past five years I have had the pleasure of working directly with dozens of members of the Shop.org Board, many of whom represent some of the finest minds in digital retail. This past year we were proud to elect a number of new Board members representing companies including Saks Incorporated, Facebook and Abercrombie & Fitch (among others) to guide our community engagement efforts, members-only research, and best-in-class events.

As a community that prides itself in all things “by the community, for the community” we are excited for another election season here at Shop.org. With just a few days left to nominate candidates to join our prestigious Board, our team reached out to a few of our current Board members with one question: What is the best part about serving on the Shop.org Board? Here’s what a few had to say, rivaling some of the memorable quotes we received during nominations last year:

Driving what’s next

Michael Burgess, President, Saks Direct, Saks Incorporated: “It is great being on the Board of Shop.org. Digital retailing is such an exciting space and it is rewarding to contribute to the industry’s direction, our members and the Shop.org team. I really enjoy working with my colleagues on the board. It is a terrific group of successful, interesting, supportive people.”

Nicolas Franchet, Head of eCommerce Global Vertical Marketing, Facebook: “I joined the Shop.org Board in 2012 and am humbled by the quality of my peers and the interactions we have during and outside of our meetings. This is a shortlist of the best minds in eCommerce, dedicated to growing our industry and helping our members across all the dimensions of their businesses. I also particularly love that each time we meet, we invite prior Board members to join us for dinner and participate in the conversation. It means that your involvement with the organization extends much beyond the time you serve on the Board.”

Industry Relationships

Brad Brown, SVP, eCommerce and Direct Sales, Recreational Equipment, Inc.: “Lets face it: at many times ours are lonely jobs. Serving on the Shop.org Board with a group of industry peers who collectively are trying to tackle the same challenges fills this void. Additionally, being able to help shape the work of the organization is both challenging and rewarding. Last, Board peers and the Shop.org team are simply a great group of people, and that comes with its own rewards.”

Kevin Ertell, VP, eCommerce, Sur La Table, Inc.: “The best part of serving on the Shop.org Board is the opportunity to really impact our industry by increasing the effectiveness of Shop.org for our members. It’s also pretty great to regularly hobnob with some of greatest minds in digital retail.”

Lisa Gavales, Formerly – EVP and CMO, EXPRESS: “By far the best part of serving on the Shop.org board is the chance to have meaningful conversations with leaders in the digital world, to collaboratively chart what’s next in the space. The passion and desire of this team to make a difference and help the industry is remarkable. Being a part of it keeps you in touch with what’s going on, and in contact with people who are leading the industry. And yes, it’s also fun!”

Giving Back

Billy May, Vice President eCommerce and Customer Marketing, Abercrombie & Fitch Co.: “Managing a business and leading a team is tall order for any executive in today’s dynamic digital marketplace. Helping lead an entire industry is an even taller (but equally gratifying) opportunity. As a life-long retailer, I can think of no greater opportunity to give back than to participate directly in the Shop.org community, and, if elected, to serve on the Shop.org Board of Directors. As a member of the Board, you will shape an industry agenda, influence critical issues, and drive thought leadership. Also, you will be afforded the chance to work with like-minded, smart, driven individuals who share a passion for digital retail. While it requires work and commitment, I guarantee you will get so much more out of the experience than what you put into it.”

Sucharita Mulpuru, Vice President and Principal Analyst, Forrester Research: “One of the biggest opportunities the Shop.org board provides is the opportunity to have a voice that influences the most influential community in the digital retail world–that voice can be to impact issues that are discussed, how topics are framed and who gets heard. Everything that Shop.org does matters to online retailers and board members are an important part of shaping the agenda.”

The answers were humbling, and we hope it inspires a few more retail all-stars to nominate yourselves (or one of your industry colleagues) to lead the Shop.org community for years to come. Make sure to submit your nomination by April 16 to be part of this group of industry pioneers.

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Apr08

How organizational structures are changing – and which questions to ask in the process

By Fiona Swerdlow, Head of Research, Shop.org | Published: April 8, 2013
Be the first to comment | Posted in IT/Operations, Marketing, Merchandising, Mobile, Research, Retail Companies

In any industry – and especially in retail – evolution comes with the territory. More often than not it’s a visible change, something customers can tangibly see or feel. But as Shop.org’s March webinar about designing the retail organization of the future showcased, retail executives are actively thinking about – and taking action on – how their internal structures should reflect consumer expectations. The topic is timely, particularly because of recent announcements about management structure changes from retailers including Saks Fifth Avenue, Belk and Sephora.

As Forrester Research’s new online retail forecast alludes to, the crux for many fundamental changes is a result of online retail representing an increasingly larger slice of total U.S. retail sales, jumping from 7 percent in 2011 to a projected 10 percent in 2017. As we found in last year’s Social and Mobile Commerce Consumer Study (a joint study by comScore, The Partnering Group and Shop.org), we’ve become a nation of digital “omnivores” – that is, consumers who engage with both retailers and the rest of the world via multiple touch points throughout any given 24-hour time period. The kicker is that this isn’t the way many retailers are traditionally set up.

With these facts in mind, REI Senior Vice President for Digital Retail Brad Brown and Okamura Consulting’s Jim Okamura honed in on five internal considerations that retail executives are broaching every day to build a less silo-ed and more multichannel company culture. These reflections were gleaned from Shop.org’s Organizational Structure Study released in January and provide a glimpse at the ways retailers are starting to shift their working environments.

  1. The senior leadership team. Getting the C-suite on board is merely the first step. Additionally, the company has to ensure it knows what “cross-channel” means to its customers and employees.
  2. E-commerce in the modern retail organization. This explores the notion of where e-commerce does and doesn’t report to. By now, this varies quite a bit – whereas it used to be seen as imperative for the head of e-commerce to report directly to the CEO, today it can just as likely be the chief marketing officer or chief operating officer.
  3. Marketing. To integrate or not to integrate? The study found a propensity among several retailers to integrate digital marketing functions within corporate marketing either on a semi-integrated or a highly integrated basis.
  4. Mobile. Among all areas, this seems to be the organizational bridge that is rapidly accelerating integration of digital functions and strategies.
  5. Metrics and incentives. The fulcrum of organizational success, or, put another way – how to get everyone to work well together and achieve long-term success. For example, Brown noted that a primary goal for REI is “seamless service” for the customer, so the company has developed a set of metrics to ensure everyone in the company is motivated to provide that – a “channel”  free from obstacles.

But our hour-long webinar barely scratched the surface of this complex topic. That’s why today, Shop.org is pleased to announce a new resource to help retailers as they grapple with these and many other questions around organizational structure: the Shop.org Organizational Structure Self-Assessment Framework. Complementing the full study results released earlier this year, our goal for this framework is to provide a structure for retail management teams to analyze, debate and start to formulate decisions on organizational issues related to digital integration strategies. The framework highlights some of the most common questions that retail organizations ask themselves as they determine where and how all things “digital” should fit into their organization, starting with the vision and strategy for digital integration. Subsequent sections cover questions across marketing, merchandising, cross-channel oversight, process and metrics, mobile and more – allowing the retailer to focus on whichever section is most pertinent to them. I invite Shop.org and NRF members to download this framework now from the Shop.org site.

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Apr04

How retailers should prioritize the demand for same-day delivery

By Vicki Cantrell, SVP, Communities, NRF and Executive Director, Shop.org | Published: April 4, 2013
Be the first to comment | Posted in Research

Members tell me they like being part of the Shop.org community for many reasons: our community spirit, networking, events, research, and thought leadership, just to name a few. My team and I are committed to bringing you the best from all of these areas throughout the year. I am very pleased to focus today on a group dedicated particularly to developing thought leadership from within and for our community – the Shop.org Think Tank.

Formed in the quintessential Shop.org spirit of “by the member, for the member”, the Think Tank brings together experienced individuals who have many different roles at a variety of companies involved in e-commerce. Led by Think Tank chairman Kevin Ertell, vice president of e-commerce at Sur La Table and Shop.org Board member, each individual brings different perspectives and experience to the table for a thoughtful discussion about a particular topic that they see our industry grappling with right now.

Today Shop.org is releasing the first of a quarterly series of articles capturing thinking and synthesis from the Think Tank – “Same-Day Delivery – Should It Be a Priority for Your Business?” If you’re wondering whether same-day delivery is something you need to offer your customers, I urge you to read this article – and without delay. On the heels of recent announcements by Google and Shutl, and as competition in the same-day delivery space heats up from the likes of Amazon and eBay, the collective analysis from the Think Tank advises retailers to turn their thinking from “Can I do it?” to the more pragmatic “Should I do it?” The Think Tank article reviews why retailers should think about same day delivery as a strategic and competitive lever, outlining all of the important questions that companies need to consider as part of that analysis.

The thought leadership pieces that come from the Think Tank are the “bottom line” on what you need to know now on a given topic from some of Shop.org’s best and brightest minds who, just like you, are managing retail operations day to day in some way.

Stay tuned for the next topic that they decide to wrestle with – I myself can’t wait to hear what this terrific group explores next!

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Mar25

A ‘new face’ for Shop.org’s Board Nominations

By Vicki Cantrell, SVP, Communities, NRF and Executive Director, Shop.org | Published: March 25, 2013
Be the first to comment | Posted in @Shop.org

We have our own sort of March Madness underway here at Shop.org. We’ve made a strategic decision to move up the annual nomination process for Shop.org’s Board of Directors to the spring each year. This marks one of many changes to the election process, and there’s a particularly exciting new addition that allows candidates to add a bit of personality to explain why they’re a perfect fit for the Shop.org Board.

Members nominating themselves for consideration can now include a short (no longer than one-minute) video as part of their nomination application. As one of the more dynamic new staples to our nomination process, we wanted to give nominees a short list of tips to think about from the technical side. Thanks to our friends at Invodo, we’ve put together a short checklist of considerations – and things not to do – to get some of the logistical pieces out of the way that should help nominees focus more on the artistic aspects of their video.

  1. Don’t leave your camera hanging. This will be a “talking head” type of video, but make sure your head isn’t bouncing around the frame. Use a tripod to keep the camera stationary.
  2. Make your presentation audible. Your one-minute pitch has to be heard. Avoid using a microphone on the camera. Attach a microphone to your shirt instead.
  3. Be visible. Make sure you can be easily seen by placing lights on both sides.
  4. Dress to impress. A little bit of powder – on men and women – will go a long way to eliminating glare. Avoid wearing clothes with any stripes, checks and patterns.
  5. Don’t be shy.  Most likely each video will be watched on a computer in a small video window, or even on a mobile device. Maximize the screen space with a close-up of yourself.

We’re looking forward to some creative submissions and believe this gives the Shop.org community a fun way to show just how innovative they are. There will be 16 nominees up for consideration this year – a total of eight retail member candidates vying for four open spots, and another eight associate member candidates competing for four seats. Stay tuned throughout the nomination season by following Shop.org on Twitter as we’ll be sharing the best quotes and videos using the hashtag #ShopElections. Shop.org is accepting nominations through April 12 for the new board term, and we’re confident the digital industry will once again deliver another brilliant group of Board members to help shape Shop.org’s contributions.

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