I’ve started doing some blogging again around the e-commerce sector and e-consultancy kindly asked if I wanted to be a guest blogger for them a few times a month. I’m always keen to have a whinge in front of more people so I gladly accepted.
My first post was on a passionate topic of mine around “customer service” and I entitled the post Customer service is more important than the cheapest price. It’s had nearly 10 retweets and 10 good solid discussion comments – very pleased with it.
If you haven’t read it yet – please check it out and write your thoughts. I strongly believe in customer service needing to improve at a vast range of retailers both on and offline and focus on that above pricing.
You’ve got to love these surveys that get published that demonstrate, with stats, that your initial hypothesis all those years ago is now starting to manifest. The trick is all about the timing and riding the wave, launching to market at exactly the right point. Imagine you’re a surfer – catch the wave (trend) and go for it!
The spot in question came via InternetRetailing.net who spotted the survey from LinkShare (no they’re not getting a link as I can’t see where they published the survey!), whose findings indicated that 81% of people are now doing research online before buying a product!. That’s a phenomenal amount of individuals who want validation before making any purchase.
92% of people said they have more confidence in the information online than they do in high-street store assistants. Not unexpected considering the average person giving advice has always had to read the brochure in front of me when I asked about anything more than what was on the label. It also mentions that more people expect to shop online generally as they tighten their purse strings and seek out the best deal for that heavily researched products.
So how are people currently doing this online? Good question damn it!
Of course, most people probably start with Google in the first place.
People like Bazaarvoice are leading the way in implementing user reviews on merchants’ own websites, which adds to the massive pile of general user review and expert review sites out there on the web. Add the wealth of conversation taking place in twitter, facebook, and friendfeed around what products to buy – and you’ve got an immensely fragmented marketplace for this behaviour.
Now if only Crowdstorm can do what it set out to do… is it time to ride the wave yet?
Some great data coming in from Comscore about how the online retail space has fared in the US over the past few months and what they expect might happen in the first half of 2009.
Click on the images to see them full-size
First up, online ecommerce has slowed down in terms of growth to 7% in 2008 from 17% in 2007. Note it’s still growing!
Secondly, this is actually due to a category skew whereby consumer electronics, video games and consoles, and sports and fitness categories have continued to increase in sales. Perhaps more people staying in and/or doing active things near them.
Thirdly, early 2009 has seen some growth pickup again after a drop in Q4 of 2008 – possibly predicting a bounce, but personally it shows this is mostly sentiment rather than 100% actuals.
Lastly, eCommerce is still taking market share away from high street stores and that’s always a good thing
Lots of very useful data coming out about the offline and online retail markets at the moment. In particular, InternetRetailing and some Hitwise seminars. So what’s the status in a nutshell?
What does all this mean? Basically we’re still shopping but we’re shopping slightly less than before and moving from the high street to online to look for products and deals. I wouldn’t want to be a high street retailer right now!
These emarketer boys have provided the goods yet again with some interesting data on the top web 2.0 spending priorities for online retailers:
Some sites reporting a 50% jump in sales when they put honest reviews onto their sites. Not surprising really when you consider lots of people want that extra validation into their purchase decisions, especially in this economic climate. Also, see my previous post on where actually these reviews should sit…
Interesting day yesterday as I had a chat with a journalist from RetailWeek and also attended a Chinwag:Live event – all around the topic of how search and recommendation play a role in helping people find what they want. I was actually remarkably quiet during the event, for a change, mainly because my ankle still hurts from falling down a mountain over the weekend – but that’s another story!
So back to the topic – to me of course, my mind applies this in the context of the shopping purchase cycle and how both methods play their part.
First, some definitions of the two approaches:
We all know that most people’s journey’s start with visiting the “big G” and typing in a set of 2-4 keywords or phrases, ranging from “find me the best digital camera” to “places to eat near Covent Garden”. You will click one of the results, visit the page, and then continue your journey from there or hit the back button and try the next result down. All pretty familiar stuff. The argument of the search advocates is that this is all you ever need to find the information you are looking for, no matter where you are in the buying process.
These try and take the concept of search further in having more detailed, vertical information, and having recommendation engines and social interaction to help people in a better way to find what they are looking for. Examples, of course, are Crowdstorm, TrustedPlaces, and TripAdvisor to name but a few. In these sites you either have a lot of information in one place about a product you are thinking of buying or you can interact with the people and the engine to help you actually make the decision process about what to buy.
So the crux of the argument is which approach is currently being used by the consumers and which is the best approach to give them the best experience.
I cover off some of the points raised in the event below:
This one is hard to refute as 95%+ of journey’s start at a search engine and so if you don’t have good content to get ranked, you don’t get the traffic. End of story. Even if your site is good enough to establish a brand and get people coming back directly, even a majority of these people will be lazy and type your name into a search engine. It takes a good 4-5 years before a business is good enough to get people to come directly.
Take the example of typing in “television reviews” – pretty easy to work out what they want but this type of search is tiny traffic compared to words like “televisions” and “sony televisions”. What actually is someone looking for when they type such a generic term – are they looking for product information, ideas to browse around, somewhere to buy it, the best prices and deals, reviews and opinions, or a mixture of all of them… there’s a wide range of possible places to send the visitor to. Search here can really fall down as it really is showing only sites that have designed their content for the search engines and not necessarily relevant content. Take price comparison as an example – how many times have you typed “best price digital cameras” into google and got a range of price comparison sites which you click through to only to find a set of rubbish results. Likewise, if you type “digital camera” into Google – how does looking at one review site or going to a merchant actually help you make that decision? It’s a complex scenario that I don’t think anyone has really nailed yet.
A very interesting question. The argument is about where should all the juicy reviews, product information, and recommendations actually sit – at the search engine level, at a product recommendation site, a magazine review site, a price comparison engine, or the end retailer? Take an example: If I want to buy a new rucksack right now that is big enough to take around London for the day and very comfortable to wear on the back and under the arms – where do I go? If I type that into a search engine, I’m going to spend hours wading through crap. Likewise, a magazine review site may be interesting but they rarely cover a big range and you need to dig around a lot. A price comparison site is only going to show me a list of them with prices, and a retailer site will often just show me products with images and a price. It’s a little bit of “jump around a lot and try and fit lots of bits of info together”. Now, take the situation where a retailer site such as Webtogs (note: I’m a shareholder), reaches the point where every product has user reviews and ratings, and a whole section for “Expert advice and community” is created to help users, magazine publishers, and even retailers interact and help people in their purchase decisions, directly on the Webtogs site. Would you need to go anywhere else? Surely recommendation, review, and community sites only exist because retailers can’t or are scared to implement this kind of thing? You can argue that companies such as Reevoo and Bazaarvoice help by handling the review capture for retailers, but this is only a small part of the picture.
Twitter was mentioned as a good example of this where someone asked their friends and followers “what digital slr should I buy made by Canon?” and got a raft of good responses. These ranged from actual product recommendations to pointing them to sites and discussion forums where people were already taking about this kind of thing and helping each other out. You also consider social environments such as facebook, blogs, and even traditional emails of course – and the bigger puzzle of how to interact with them. Are we actually trying something which is not possible by bringing all these communication methods together under one vertical site or product?
So one of the main arguments about why recommendation sites can top results from a search engine, is over the degree of trust they can utilise between sources and people. Google uses it’s algorithm to try and work out which sites are the most relevant and trusted by other “website owners” where as recommendation sites try and show reviews and comments filtered by trusted people in the community or network who have something valuable to say and not just trying to game the system. The question then becomes, do you trust reviews on a retailer site when you don’t know who the people are behind them, a site that comes up on Google just because it is in the listings, or do you prefer to know a bit about the people writing the content and why you should trust them. Perhaps we do, as our friends and colleagues are always trusted more than anonymous people. What would you prefer – 2 recommendations from a friend and colleague or 45 reviews from anonymous people? I haven’t found any data to support either side right now but it’s an interesting question nonetheless that needs some answers.
This entire space about how people choose and recommend products and services to each other is much more complicated than I ever imagined, and luckily I’m not the only one who thinks that! I think the issue really comes down to their being so many different ways and methods of researching things online and every type of site trying to work out where they fit into the equation. Should a price comparison site focus on that end step of finding the best price and buying or should they move more into product reviews and community?
Should retailers focus on despatching the goods to the customer and getting a good range of selection, or should they also be providiing reviews and community content and advice to help people make the right decision? Should recommendation sites fill the gaps they leave right now and if so, is it a long term solution? Finally, what about the mighty G – don’t they see themselves as the main gateway to the final destination sites and will do everything they can to own every single journey right up until the final purchase?
As Terry Pratchett once said “We live in interesting times…”
Well, if it’s true it was bound to happen but I think the statistics are skewed somewhat. Firstly, let’s take a look at the report from e-marketer that originally spawned off my post:
According to the chart, the US growth of online retail will slow between 1.5 and 2% each year from now on hitting 8.9% in 2012. This of course is natural in any type of market and online retail will definitely be maturing by then.
What it doesn’t take into account is that this varies completely by the category you look at, and they even say themselves that the chart does not include travel. For example, check out a chart from Jupiter which shows categories such as apparel including things like footwear and outdoor clothing growing 400% from 2004 – 2010.
Anyway – what do you reckon? Have they got it wrong or is e-commerce finally maturing? At least it’s going to stay ahead of off-line retail in a credit-crunch environment
I got collared by the Intruder chaps (Vincent & Eugene) the other week whilst coming out of the OpenCoffee event in Waterstones. Here’s how it went:
According to adage, Facebook will add a social shopping component among other things to it’s service tomorrow (tuesday), or at least Zuckerburg will announce it.
What I’m curious to know is whether it is more along the lines of “your friend bob bought product x” and give you an ongoing stream of whenever your friends buy something (which could get very tedious to be honest and needs the retailers to buy in) or tapping into the recommendation aspect of things more with regards to product q&a.
I can’t imagine they would release anything that hasn’t had a lot of thought put into it – so we’re waiting with baited breath here to see what they’ve come up with. Does anyone have any insight?
So this week is a really important one for us as we open the doors for the UK site to everyone on Nov 1st – this thursday. So we’re ramping up our SEO work, tidying up lots of loose ends, importing our new feed partners (we have nearly 50 now), cleaning up the design, and 25+ other things.
We should start to see some PR coverage filtering in over the coming week as we announce the first stage of our product offering and how it helps consumers. Over the weekend, two mentions of note:
The FT covered a piece on The Web’s best Incarnations being here to stay. Now to be fair, they did actually cover off the old site when talking about niche products so they haven’t actually updated their research recently – but hey, I’m not complaining.
Mad.co.uk did a piece on Kelkoo UK founder launches new site and I really do like the quote they used at the end from me:
“The biggest challenge will be getting people out of the mindset that they have to type a product into Google and then filter the information themselves.”
As the mad.co.uk site is locked down to subscribers (!), I’ve included an image of the post here – just click the link or the image below to read it.
