Compete with Amazon, 2015: Growth leaves plenty of room for merchants to thrive

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The online behemoth Amazon.com is on a winning streak. North American sales were up more than 22% year over year in the fourth quarter, and for 2014 as a whole North American revenues grew nearly 25%. Amazon already accounts for more than a quarter of all eCommerce sales in the U.S., according to Internet Retailer’s Top 500 report, and the recent numbers suggest Amazon will grab an even larger slice of the pie this year.

Furthermore, despite a recent price increase to $99, Amazon’s Prime program continues to attract shoppers, with roughly 45% of its customers paying the subscription fee to access free shipping with every order and exclusive streaming content. The high percentage of subscribers is significant because they spend an average of $1,500 annually with Amazon, 140% more than other Amazon customers.

But looking beyond these impressive numbers, there’s reason for small- to mid-sized merchants to take heart. For starts, Amazon’s direct sales of products were up 9.6% in Q4 — in the same league as the 9.1% reported by the MarketLive Performance Index — demonstrating that pure direct-to-consumer sales for even the biggest of the online mass merchants were in line with the market overall. Instead, the bulk of Amazon’s Q4 growth came from marketplace fees, Amazon’s Web Services cloud hosting service, and other smaller revenue contributors, which together saw year-over-year growth of 37%.

And Amazon still faces significant challenges when it comes to matching smaller brands’ ability to deliver personal service and niche product and lifestyle expertise. As we addressed in our series on competing with Amazon, the giant’s economies of scale give shoppers discounted products and shipping on a wide selection of items, the overall shopping experience can be like using “a massive vending machine”. Attempts to tailor the experience for specific niches — such as fashion, health and B2B purchasing — are still nascent, which means that for now, at least, there’s room for merchants with compelling brand stories to compete successfully.

Among the strategies to consider:

Leverage the visibility of Amazon’s marketplace, but strategically. Nowadays, it’s commonplace for brands competing with Amazon to simultaneously take advantage of its dominant position by participating in the Amazon Marketplace program. As we’ve discussed previously, in addition to gaining SEO advantage and reaching new customers, merchants can use the marketplace to piggyback on Amazon’s international forays and establish brand footholds abroad without the headaches of launching a standalone site.

To ensure the benefits are maximized for their own brands and not simply feeding that huge Amazon bottom line, merchants should curate marketplace product selections and track performance carefully. And they should explore other marketplace opportunities that offer visibility benefits, such as via Buy.com or Sears.com, and keep an eye on new upstarts like Jet.com, set to launch this spring, which is set to offer marketplace shopping to members.

Use mobile to spotlight service. With mobile serving as the primary connector between offline and online, eCommerce and social, merchants should do their utmost to ensure that mobile shoppers feel supported by customer service. By making proactive, individualized service a centerpiece of brand offerings on mobile devices — which are now the primary way shoppers connect with brands — merchants can distinguish themselves from Amazon, whose size demands a less service-obsessed approach.

MarketLive merchant Peruvian Connection puts customer service links front and center on its mobile site, with helpful information such as a sizing guide presented along with standard service links such as “contact us”. A toll-free customer service link anchored in the footer ensures mobile shoppers can always reach a live person from any page on the site.

Mobile customer service example from Peruvian Connection

Bridge in-store and online to create an immersive brand experience. Merchants with brick-and-mortar locations have a distinct advantage over Amazon: the ability to combine the depth of product information online with the concrete experience of touching and trying items in-store and accessing face to face assistance with shopping decisions. And thanks to the ubiquity of smartphones, the opportunity to create such an immersive experience has never been greater; technology researcher Forrester estimates that 68% of shoppers use their phones in stores.

Merchants should ensure that device-empowered shoppers in store can access the brand resources they need in a swift and seamless manner, and further differentiate their brands by giving store associates access to online information and training in guiding shoppers toward a purchase decision. Currently, shoppers have low expectations of retail floor staff: close to 60% of consumers believe they’re more knowledgeable than store staff about pricing and product availability, even as 54% say they would buy more from stores where associates were knowledgeable.

MarketLive merchant Sport Chalet opened a downtown Los Angeles outlet in 2013 featuring tablet stations throughout the store where shoppers can browse the brand’s entire product offering, consult reviews and in-depth product information, and seek live help from store experts.

Sport Chalet unified store example

How are you positioning your brand for success against the commerce giants?

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Key messaging moments for winning engagement and sales

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Email marketing continues to be the workhorse of eCommerce marketing campaigns. Less sexy than social media or paid search remarketing, but decidedly profitable, email remains a top tool in merchants’ marketing arsenals.

But while merchants who rely on “batch and blast” messages may still realize strong ROI on email for now, fundamental changes in the way shoppers interact with brands require new strategies for delivering effective and profitable messages.

Topping the list of changes, of course, is the impact of mobile. Fully 59% of retail email messages are now opened on either smartphones or tablets, according to technology reseacher Forrester — making adoption of a “mobile-first” email mindset essential.

mobilefirst

Given the primacy of mobile, any consideration of email strategy should also factor in SMS campaigns, which can be an effective sales tool — but not by merely replicating email messaging content. To craft an effective dual-messaging strategy for smartphone users, merchants must understand key differences between SMS and email touchpoints, and capitalize on their unique benefits.

The second major change for merchants to contend with is personalization. As more and more brands adopt personalization techniques, the evidence is mounting that — privacy concerns aside — consumers respond positively to tailored products, content and offers. More than two-thirds of shoppers want to receive personalized emails, the E-Tailing Group and MyBuys found. The payoff for merchants is potentially significant: technology researcher Gartner predicts that by 2018, brands that have invested in personalization will outperform by 30% those that have not.

In short, when it comes to messaging, shoppers’ context matters, and most likely, that context involves using a mobile device. Merchants who can transform email marketing into situational messaging — matching recipients’ needs, location and budget — are poised to stand out among the competition and reap substantial gains. To get started, merchants should:

Adopt a “less is more” attitude — especially via SMS. While consumers by and large are receptive toward email, with nearly one in four saying it’s a great way to learn about products and offers, there’s a limit to the goodwill — and the attention span. Fully half of shoppers say they rarely receive an attention-grabbing email, and fully 58% confess that they often delete marketing messages as soon as they’re received, according to the MarketLive Consumer Shopping Survey. More than a third say they open most of their emails on their phone, but don’t pay as much attention to them as when opening messages on a computer.

Data from the ML Consumer Shopping Survey about email

To fight against this ennui, merchants should focus on quality versus quantity and on relevance over frequency. By delivering only those messages that match the recipient’s interests, merchants demonstrate that every email they send is worth reading.

 

The need to downshift frequency is especially acute for SMS campaigns. Because text messaging is not only a one-to-one medium, but an immediate one — with 90% of text messages being read within 3 minutes, by some counts — merchants should exercise caution with the timing and frequency of their messages to avoid crossing the line from relevant to intrusive.

Build a trigger-based, personalized strategy. To trim frequency, merchants should build their messaging strategy around delivering the most relevant possible message in the right format following key events and at purchase decision points. Among the situations that merit tailored messaging:

  • On signup. The “welcome email” has been a best practice for years, but merchants should update it by extending their messaging into a series that offers new subscribers a taste of the myriad ways the brand can serve them, with links to social media and value-added content alongside discount and product offers. Merchants should modernize these messages by incorporating personalized product assortments of items previously browsed and others like them, and additionally should tailor design and content depending on whether shoppers are using mobile devices or computers.While SMS subscribers likely don’t want an extensive series of welcome messages, merchants should consider sending an invitation to join the brand community via the flagship web site or social media.
  • On store visit. Subscribers who consult the store locator or reserve items for in-store pickup should be alerted to in-store events and deals. Once at the store location, subscribers who download product content via QR code promotions or otherwise interact with the brand’s online offerings can be sent coupons for redemption during their visit.
  • On wish list activity — on-site or on social. Shoppers who establish a wish list can be reminded to share it with friends. They can also be alerted when wish list items go on sale or are almost out of stock.Merchants should also be aware of opportunities to message to social media users who’ve established wish list type collections. On Pinterest, for example, shoppers can receive alerts when pinned items go on sale — a service merchants can tap by optimizing their products for “rich pins”, especially for items featured in promoted pins.
  • On cart abandonment. Just a third of merchants in Internet Retailer’s Top 500 and Second 500 send emails following cart abandonment, Listrak found — a definite missed opportunity, as abandonment emails can spur purchasing at 19 times the rate of regular promotional emails, according to Experian. Personalization is the key to driving maximum ROI from cart recovery emails: messages that displayed the exact item(s) left in the cart were more than 200% effective than generic “you have items in your cart” reminders.abandonBecause so many shoppers now use the cart for research, and as a repository of saved items to consider later on their desktop computers or in stores, merchants should craft their messages as reminders and offer the full range of options for completing the sale, spotlighting information about in-store pickup or reservation options as well as a link to buy online.
  • On purchase. Merchants have long known they can take advantage of the series of transactional messages following an online order to further promote brand offerings. Now they have the opportunity to do the same for in-store shoppers, by offering to send an e-receipt via email or text message.  Merchants can build out the series of post-transactional messages with invitations to contribute reviews and, for replenishment items, reminders that it’s time to purchase again.

How has your messaging strategy changed for 2015?

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Use social login to boost mobile engagement

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We’ve discussed before the benefits of using social login to connect shoppers’ experiences on eCommerce sites with their social media profiles and to smooth the account creation process. Now there’s another compelling reason to bump social login up the priority list: It can be a powerful tool for enhancing the mobile shopping experience.

As outlined in our review of the latest Performance Index data and our 2015 trends outlook,  mobile commerce must remain at the forefront of merchant’s preoccupations — after all, it’s now shoppers’ primary point of contact with brands. Close to two-thirds of all minutes spent with retail brands now occur on mobile devices, according to measurement firm comScore – and for a third of millennials aged 18 to 24, mobile is the only online touchpoint used for shopping.

Given mobile’s swift ascent, and given the dismally low add-to-cart and conversion rates and high abandonment rates most brands are experiencing, merchants ought to be hungry for tools that can help boost mobile engagement and sales. Social login is well positioned to do so, because:

  • Acceptance and usage of social login is on the rise. More than half of Internet users have taken advantage of social login, and fully 88% are at least aware of the technology, according to a study by Blue research.
  • According to Merkle/RFG, the majority of social media usage now occurs on mobile devices. Shoppers are accustomed to using social tools on their phones and tablets and may be more willing to use a familiar login tool than to set up a discrete account on a merchant web site.
  • Finally, by using social login, merchants can piggyback on the innovations of leading companies such as Facebook and Google, improving their mobile experiences in the process.

As always, the devil is in the details; a poorly-executed social login implementation can cause more problems than it solves. To make the most of social login for mobile shoppers, merchants must:

Integrate completely. A quasi-integration with social media that still requires creation of a new password and even additional data entry in order to complete account registration will only frustrate shoppers. Instead, merchants should reward willingness to share social profiles with a minimalist signup process.

Additionally, merchants should connect social login with functions across the site, from wishlist creation to sharing products to saving cart contents for later reference — a crucial piece of functionality for mobile users who may want to revisit items in stores or on desktop computers.

MarketLive merchant Title Nine offers shoppers the ability to save cart contents, and enables social login that requires nothing beyond a username and password to activate.

Social login example from Title NineHeed privacy concerns. While merchants should take advantage of social login’s potential to unlock user profile information, they must also heed privacy concerns and proceed with caution. Shoppers are wary of surrendering too much information while exploring shopping’s digital frontier, with 88% saying “there are too many technologies tracking and analyzing our behavior”  and 86% saying “consumers have lost control of their privacy” — that’s 11% higher than the global average. Nearly three in four U.S. consumers say remarketing and personalized ads are “creepy”. And on mobile platforms, 42% of consumers say accessing their geographic location is an invasion of privacy.

To allay concerns about privacy, transparency should be the norm, and merchants should prioritize what data they need to track key metrics, versus “nice to have” information that might be interesting, but provide no actionable insights. Once they’ve convinced shoppers to engage as registered site users, merchants can request further information incrementally.

For further tips about social login, see MarketLive Founder and CEO Ken Burke’s recent article in Retail Online Integration titled “Why and How to Use Social Login to Win Customers.” And check out MarketLive’s recent whitepaper on analytics, “Connecting Data Points and KPIs in a Multi-Channel World,”  for further best practices on collecting mobile user information.

Are you using social login? Why or why not?

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Performance Index: Why smartphone optimization is a top 2015 priority

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Final results are in for the fourth quarter of 2014, and a clear priority has emerged for merchants: smartphone optimization.

Data from the MarketLive Performance Index shows that year over year mobile usage surged by close to 50%, with fully 44% of all traffic to merchant sites and 25% of all revenues derived from mobile visits.

2014q4_index_mobile

What’s perhaps surprising is the marked surge in smartphone contributions specifically. Not only did smartphones’ share of revenues surge close to 125%, but conversion rates on smartphones jumped as well, by 88%.

Tablet growth, meantime, was more moderate, with traffic actually dropping year over year, share of revenue increasing by just under 12%, and conversion by 21%. While these numbers are solid, they represent a marked slowdown from just a year ago, when tablet traffic and revenue both grew by more than 50%, overshadowing smartphone activity.

2014Q4_INDEX_mobiledeepdive

Now the situation is completely reversed — and the trend is set to continue. Indeed, MarketLive forecasts that smartphone contributions to the bottom line will overtake tablets in the second quarter of this year.

2014q4index_mobilerevshare

In the past, tablets’ relatively large form-factor compared with smartphones allowed merchants to skate by with near-replicas of the desktop experience — if not with sites that failed to optimize for mobile altogether. With tablet conversion rates edging close to those on the desktop browser, and with order sizes and overall revenue contribution higher than smartphones, predictions were rife (including on this blog) that tablets were the key to achieving mCommerce success.

Now, though, merchants can no longer be complacent and rely on tablet performance to shore up mobile sales. Instead, they must re-imagine their businesses to cater first and foremost to smartphone shoppers — and confront and master the challenges of delivering a user-friendly, secure and context-aware smartphone experience for both research and purchasing. In so doing, merchants will be positioning themselves well to take advantage of two key trends driving smartphone primacy:

The tablet plateau. Forecasts call for tablet penetration to plateau in coming years, with growth in the number of worldwide users set to dip below 20% this year and into single digits by 2018 as the market for tablets matures and stabilizes in the U.S. and other developed regions. With tablets perceived as an optional second device after the mobile phone, their penetration into emerging — and high-growth — markets is in doubt. By contrast, smartphones are poised for worldwide ubiquity, with some forecasts calling for fully 90% of the world’s population over the age of six to own one by 2020. Even within the U.S. smartphone ownership has the potential to growth significantly, with ownership hovering just below 70%.

The seamless store. As discussed in our 2015 trends  webinar, the surge in smartphone usage is leading more and more shoppers to consult mobile devices in physical store outlets. During the 2014 holiday season, more than 45% of shoppers said they planned to consult price and product information in-stores, as well as access promotional offers and coupons, according to the MarketLive Consumer Shopping Survey. That usage is paying off for brick-and-mortar retailers: Performance Index data shows that merchants with physical store outlets saw the percentage of revenue from smartphones jump from 5.02% to 13.18% — a whopping increase of more than 162%.

Our trends presentation outlined a few of the ways merchants can cater to smartphone shoppers — digitized store experiences, adoption of responsive design, and platform-agnostic loyalty rewards. We’ll explore each of these topics in greater depth in the month to come, as well as dive deeply into mobile KPIs and best practices and further emerging trends influencing smartphone usage.

Meantime, consult the official Performance Index press release and download the report with data tables for more in-depth analysis of Q4 performance.

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Why responsive design is the starting point for 2015 success – webinar recap

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As our prior post explained, the need for merchants to unite their disparate online commerce initiatives into a cohesive brand presence has never been greater. But it’s a tall order to tie  together touchpoints to create a shopping experience that’s both consistent and context-relevant, and for many small-to-mid-sized merchants, defining a starting point — and a starting budget — can be a tricky process.

To help merchants get the ball rolling, last week MarketLive CEO and Founder Ken Burke hosted a webinar outlining the top strategies to support the goal of unified commerce. Underpinning them all: the need for a responsive design framework to support nuanced and highly-differentiated iterations of brand sites.

Responsive design — which uses a single code base to deliver information across touchpoints — is on the upswing, thanks in large part to merchants acknowledging the need for comprehensive mobile sites. In 2014, 63% of online business leaders ranked responsive design as a technology priority. That’s a jump of nearly 58% compared with 2013, when just 40% did so. Specifically within retail, just 9% of the top 100 sites employ responsive design — but among mobile leaders, the number is much higher, with more than 20% of Internet Retailer’s Mobile 500 using responsive techniques, according to MarketLive and Fit for Commerce.

But many merchants face significant hurdles when it comes to implementing responsive design. After all, the pitfalls of a poorly-executed responsive design project are by now well-known, and require significant time and investment to avoid; by one measure, the development timeframe can average anywhere from 25% to 200% longer than a conventional desktop-based site relaunch.

To justify investment in responsive design, merchants should factor in the potential gains across touchpoints. By investing in responsive, they can more easily execute Total Commerce strategies across touchpoints, including:

The united storefront. Overwhelmingly, shoppers turn to their mobile devices when seeking information while in stores. Consumers by far prefer to consult their phones to check product prices, seek further product information and even to find out where an item is located in the store, rather than seeking out a store kiosk or a live sales associate. And they expect product, price, and promotional information online to be consistent with what they see on store shelves; more than 75% of participants in the 2014 MarketLive Consumer Shopping Survey said consistency in those three categories was crucial. Responsive design supports that consistency by serving content across touchpoints from a common database, making in-store/online connections more seamless.

Loyalty 2.0. With the growth rate for U.S. eCommerce revenues projected to slow to below 10% by 2016, competition for digitally-savvy shoppers’ loyalty will become increasingly fierce. To win repeat business, merchants with rewards programs must update their offerings to include seamless portability among touchpoints, so that shoppers can tap exclusive content and offers in whatever format they choose. And merchants must also recognize new forms of loyalty, from new social followers to shoppers looking to save cart contents for later access on mobile devices. Responsive design enables functionality across touchpoints to unlock the benefits of deep brand engagement — as on the sites for Beauty Brands, where members of the Take 10 program can access their account both on the desktop or laptop site and via mobile device.

20150113_080805beautybrands_desktop_loyaltyEach of these topics — responsive design, digitization of the physical store, and loyalty 2.0 — will be the subject of an upcoming whitepaper. Meantime, download the trends webinar replay and the companion whitepaper for further details and more 2015 priorities. Is responsive design on your 2015 to-do list, and why or why not?

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Why unified total commerce should be your top 2015 priority – webinar preview

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If there’s one lesson merchants should take away from the 2014 holiday season, it’s that plenty of opportunity remains to perfect brand offerings to match the new shopping reality — and to realize significant gains, even with the eCommerce market maturing.

Revenue growth for the holidays was strong, according to MarketLive Performance Index data — thanks to continued traffic growth and steady average order values that indicated merchants were winning the battle for sales without resorting to desperate discounts. But while holiday mobile traffic and revenue soared year over year, sub-par mobile performance dragged down overall conversion rates and pushed cart and checkout abandonment upwards.

And mobile is just one area ripe for improvement. With more than half of all retail transactions set to be influenced by the Web this year, according to technology researcher Forrester, merchants should be focused on delivering fluid brand experiences across the board, not just on individual devices, social networks or browsers. That’s a change for most merchants, who tend to design single-platform linear experiences, resulting in fragmented brand strategies and internal silos that can stymie sales and loyalty.

For 2015, then, merchants must adopt the consumer point of view — one that calls for a unified approach. After all, while consumers appreciate the convenience of being able to shop via a variety of touchpoints, research shows they also crave consistency when it comes to products, pricing and promotions. When asked which aspects of the shopping experience should be consistent, participants in the 2014 MarketLive Consumer Shopping Survey ranked product pricing, free shipping policies, and other promotions as the three key areas where they sought a standardized approach.

In response to this expectation, merchants should approach shopping tasks from the consumers’ point of view of the brand as a single entity, and strive to understand at what points different research tools come into play and what spurs purchase decisions, whether in-store or browsing a tablet. Then, by offering contextually-relevant products, content and offers that match shoppers’ needs in the moment, merchants can create a truly meaningful brand experience — one that has the potential to create a lasting connection.

Join us tomorrow for a webinar with MarketLive founder and CEO Ken Burke to examine how the concept of unified total commerce translates into 2015 strategies — including the five key areas merchants should prioritize to position their brands for success in the year ahead.

You can download the companion whitepaper now, and moving forward, look for in-depth whitepapers and blog posts exploring in detail each of the five focus areas over the coming months.

What are your top 2015 priorities, and how do they serve the unified total commerce imperative?

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MarketLive News: Forrester Recognizes MarketLive for its Global eCommerce Suite

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MarketLive’s global commerce suite has been recognized by Forrester Research in its most recent analysis of commerce vendors.

The just-released research study, titled “The Forrester Wave™: B2C Commerce Suite Q1 2015,” evaluated the leading 11 vendors of enterprise-class suites, as determined by selection criteria including revenues, mindshare and market share. The report cites MarketLive’s positive momentum:

“…with the return of founder Ken Burke to the helm, things are looking up for MarketLive. The core commerce engine is effective with a surprisingly robust feature set and the firm has a positive client win momentum. MarketLive is having success closing larger enterprise level deals, bringing it upmarket from its previous focus on SMB and midmarket online retailers. In support of this goal, MarketLive has been maturing the platform by migrating its cloud infrastructure over to Amazon Web Services (AWS) and focusing on improving its upgrade processes.”

The report also points out that MarketLive has seen strong client growth and fills a gap in the market between SMB solutions and the larger enterprise vendors.

“We’re always pleased when a top-tier analyst firm like Forrester recognizes what we feel is MarketLive’s significant contribution to the commerce sector,” said Ken Burke, founder and CEO of MarketLive Inc. “Among other things, we believe the report validates our market focus and the tremendous investments we’ve made in our technology and in servicing our customers.”

Forrester Research forecasts the market for commerce suite technology to almost double in size in the next five years from $1.2 billion in 2014 to $2.1 billion in the US alone by 2019.

Read the full press release for more details, and watch for final Q4 2014 results as reported by the MarketLive Performance Index later this week.

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MarketLive News: Astound Commerce Joins MarketLive ‘Implement’ Program to Scale Platform Sales Globally

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MarketLive announced today the selection of Astound Commerce, a leading integrator of e-commerce solutions, to its ‘MarketLive Implement’ certification program. Under the terms of the agreement, MarketLive will license its award-winning platform while Astound Commerce will promote MarketLive’s platform globally to its customer base as well as sell deployment and integration services.

MarketLive’s scalable, non-proprietary SaaS ecommerce platform, was a perfect match for the needs of Astound customers.  Built in Java on the latest technology stack, the platform scales with retailers as they grow while still maintaining a competitive price. MarketLive’s architecture allows new features to be implemented quickly and in many cases the platform becomes less expensive as retailers expand.

“Astound Commerce is looking to expand its technology platforms practice to serve unmet demand among our mid-market customers, and MarketLive is the undisputed leader in that segment. There is a great need for an affordable but full-featured commerce platform,” said Igor Gorin, CEO of Astound Commerce. “MarketLive has mature technology and compelling features at a price that makes sense for mid-market retailers.”

For more information, read the full press release or visit MarketLive at NRF’s Big Show, booth 4448.

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MarketLive Performance Index: Holiday season finishes strong

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The 2014 holiday season has drawn to a close, and the initial results from the MarketLive Performance Index are promising. From the period beginning the Monday before Thanksgiving and ending the Sunday after New Year’s Day, revenues are up 11.7% compared with the corresponding timeframe in 2013, and traffic grew 13.3%. The average order size grew a substantial 4.2%, suggesting that Index merchants held the line when it came to pricing and devised creative promotional strategies that succeeded while maintaining margins.

Mobile shopping made its mark, with fully 46% of all eCommerce site traffic generated by smartphones and tablets. And more than a quarter of total online revenues were attributed to mobile devices — with smartphone revenue in particular growing exponentially, at 111%.

But the surge in mobile usage proved a double-edged sword. Overall conversion rates for the season dropped by 4.8% and cart abandonment rose by 3% due to mobile users either consulting sites and adding items to the cart purely for research — or, worse, finding mobile usability impediments too great to continue with their purchases. With mobile poised to make an even greater impact throughout 2015, improving the mobile site experience should remain at the top of merchants’ priority lists.

Holiday results from the MarketLive Performance Index

In addition, the results suggests merchants should:

Front-load the holiday 2015 calendar.  Despite criticism of stores doing business on Thanksgiving day and hand-wringing over tepid Black Friday sales, Index results show that the first part of the holiday season is crucial, with fully 65% of holiday revenue earned before Dec. 14 and the conversion rate for the season peaking on Cyber Monday, Dec. 1, at 5.2%. Data from IBM Digital Analytics suggests that holiday impacts were felt even before Thanksgiving, with revenues the weekend before Thanksgiving surging more than 18% thanks to pre-Black-Friday and “Black Friday Week” deals.  As merchants look ahead to the fourth quarter of 2015, they should plan to launch and promote holiday initiatives earlier than ever in order to accommodate shoppers who seek to buy gifts early in the season.

Develop a refined promotions strategy to maintain margins. Index merchants successfully navigated the holiday season without sacrificing average order value — but with competition tightening for online attention and dollars, they must deliver ever-savvier promotions to entice shoppers to buy. In 2015, with mobile usage poised to dominate, merchants should focus on relevance as the primary goal of promotions — delivering the optimal pricing, products and information to consumers exactly when and on which touchpoint they need it. Connecting in-store and online promotional strategies is an important step toward the goal; with usage of mobile devices to download coupons, check prices and access additional product information while in-store at an all-time high, the time is ripe to develop messages targeted at these online/offline crossover users.

Stay tuned for further discussion of mobile and in-store strategies, plus a 2015 trends webinar and more resources for planning the year ahead. Meantime, how was your holiday, and how will the results impact your 2015 plans?

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MarketLive Performance Index: Holiday sales growth accelerates, with help from social (yes, social!)

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With the holiday shopping season entering the home stretch, merchants are on track to achieve solid sales growth. While much media hand-wringing ensued following smaller-than-anticipated increases in revenue on Thanksgiving weekend, results from the MarketLive Performance Index show that once off the starting block, merchants are seeing increased sales growth rates as the season progresses.

For the week that included “Green Monday,” Dec. 8, MarketLive merchants achieved a year-over-year revenue growth rate of 11.5% — especially impressive given that visits grew just 8.6%. With the conversion rate trailing last year’s by more than 5% and abandonment up 6.7%, the revenue growth is likely thanks to merchants holding the line on pricing — and, indeed, average order size for the week was up 4.6% year over year.

greenmonday_flash

Combined totals for the season to date follow the same trend, with revenue up 9.4% on increased visits of 13.5% and average order values averaging 4.1% higher than last year.

 

The increased average order size is especially impressive given the continuing downward price pressure exerted by the largest online mass merchants. The growth in average order value demonstrates that MarketLive merchants are presenting unique finds, relevant promotions for their target audience and stellar service that trump bargain-basement pricing.

In this light, the potential value of social media becomes clear, as it connects merchants with an audience predisposed to be receptive to their products and offers. Although overall, the percentage of visits and revenue directly attributable to social media remains small, a select group of MarketLive merchants have capitalized on the opportunity social media affords to drive a significant percentage of sales and visits from social networking sites.

For the season to date, the merchants with the 15 highest sales figures attributed to social media achieved average social media revenue gains of 212.31% and average social traffic gains of 210.12% year over year — significantly higher than the Index as a whole, which saw gains of 135.7% for social revenue and 113.1% for social traffic. Some individual sites among the top 15 are seeing more than 20% of their traffic and 10% of their revenues originating from social media.

greenmonday_socialanalysis

To maximize social impact in the remaining days of the holiday season — and in the year to come — merchants should:

Display an array of targeted discounts. Merchants can avoid decimating their margins by judiciously targeting discounts to focus on top gift categories, and then promote them socially using imagery that displays the full array of possibilities on offer. MarketLive merchant The Cartoon Network Shop employed this strategy for its extended Cyber Monday sale, offering an array of discounts on top items that were promoted via its Facebook page with a large image showing an assortment of products.

greenmonday_cartoonnetworkshop_social

Showcase social recommendations. Social media is a rich source of word-of-mouth recommendations, and merchants should capitalize on them by boosting visibility of endorsements and reviews. Developing last-minute campaigns focusing on top-reviewed products is one way to go, but merchants should also boost visibility within social media itself using the “share”, “retweet” and other like functions. MarketLive merchant Neutrogena actively retweets posts featuring product recommendations. Not all of them are gift-related — such as a post from BeautyBlitz promoting the opportunity to win makeup removal wipes, which “every girl needs … near her bed,” the post points out, especially during the busy holiday social season. Also retweeted by Neutrogena: mentions in major media outlets such as InStyle, whose feature on celebrity gift picks lends authority to the brand.

greenmonday_neutrogena_social

Watch for our final wrapup of holiday results after the New Year, along with 2015 trendwatching and more.

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