Last December I wrote a post on shopping process. One of the main premises on that post was that e-commerce should be entertaining, it should somehow captivate the customers and drive them through the entire thing while making it an enjoyable experience:
Buying stuff should be fun. Or as close to fun as it can get. It must be a pleasurable experience. Once we understand that our abandonments will invariably go down.
So I click the link and head over to this newly-found reading material. What do I see? The very first post I set my eyes on is talking about e-commerce, and from a perspective that has several contact points with what my personal opinion is.
(...) during my round trip to and from the milk, I munch a free sample, and grab a box of fudgesicles, knowing that my kids’ enthusiasm will counteract my wife’s annoyance.
When we build e-commerce sites, certainly we need to know what the customer wants, and give it to them. But we also need to use our spiffiest analytical tools to optimize two things: profit (dollars, not percent) and Net Promoter Score.
So, what would happen if we combine this thoughts on making the Shopping process entertaining and tempting our customers with extra treats with that other thing that has become a buzzword lately: Targeted ads.
Forget about the “ads” part for the time being. Lets just concentrate just on the Targeted part instead.
Using smart analytics, a powerful CMS and some multivariate wizardry e-commerce sites have the potential to create a unique experience for each customer that arrives to the site.
E-commerce has three main advantages over Grocery stores: 1) you don’t have to physically move products from one side to another, shifting aisles and pushing fridges, 2) you can track every single visitor and see how they behave and 3) you know where the visitors come from and, to a certain extent, in some cases even why.
With that in mind it is quite natural to imagine scenarios where visitor segmentation serves the purpose to profile each visit and build the e-commerce experience accordingly.
Granted, the approach would require massive investment in both Analytics and CMS, but the payoff should be huge. If the analytics team can profile and breakup visitors into smartly differentiated groups (natural search visitors, ad visitors, affiliate program referrals, coupon page referrals, etc.), pass along that information to the publishing / developer / user experience people and they, in turn can create experience that present stuff in ways that maximize the buying potential of each segment you’d have a winning recipe.
Multivariate tests should help determine what works for each segment.
In-site behavior should also be tracked, studied and used to present the visitors with different options according to the path they take.
This can be taken to various levels of complexity, and an investment & experimentation to revenue ratio would be determined. In other words: how much to invest, experiment and segment to obtain the highest return.
Another ingredient comes from a suggestion Mark made in the comments of my December post:
Reading what people write about your site shopping experience can fill in the gaps in analytics. Sites like Bizrate gather customer comments, and of course, blogs and forums are another great place to learn about the barriers to purchase one may have unknowingly created.
So Social Media (monitoring) can also play an active role in enhancing conversion rates and customer spending on e-commerce websites.
The final piece would be a dashboard that "adjusts" the settings under special circumstances. It is not the same to have an e-commerce site during the seasons than in Mid September when nothing happens. Since such events can be planned, they should be planned.
Stir together, cook for 90 minutes and you’ll end up with a “Fluid e-commerce experience”.
We don’t all have the same tastes, why should our shopping experience be dull and unique for all the population? The tools exist, the expertise exists, and some sites already run similar experiments.
Finally I encourage you to go ahead to his site and subscribe to the feed. It looks like we have another very eclectic blog at hand.
The event was scheduled at 9:30 AM, and it only started at 10:30... oh well.
"I want to share with you what is possible to do through the web"
Avinash starts by presenting his book, "Web Analytics an Hour a Day". People pay for something that is free (through his blog). He started as a blog. He is passionate about it, takes risks.
"It is astounding that a company (google) that does no Advertising has so much power". Well, the "no advertising" is relative, IMHO, we see google everywhere, on every online add, ain't that advertising of sorts?
"Faith Based Initiatives": How can the success of an Ad in a magazine be measured? An ad on Yahoo's homepage for the same product is not a faith based initiative, because it is relevant and can be measured.
Online Marketing: not faith based initiative.
"I am not telling you not to run ads on magazines, just telling you that it is not as accountable as the web".
As with everything in life analytics can be as complicated as you want, but it is easy to start with it.
"Google holds your trust with us as the most important thing we can ever have, we realize how fragile it is. If you share your Analytics data is just used to benchmark; if you choose not to share there is a legally binding term that prevents us to share it".
"Nothing I'm going to share with you is unique to Google Analytics, you can use any tool"
Showing Geo segmentation, content segmentation, how to break down data within Google Analytics.
"Bounce rate is one of my favorite metrics. I think it is a sexy metric, I love it because beyond pageviews and visits (which are analytics currency) it shows the user experience, it shows how much you suck"
"I came, i puked, i left, that is bounce rate"
"It is also a very actionable item."
"Look at the top entry pages in your website and see which of those suck".
Avinash is analyzing Clarin.com; it has 419 links, not counting buttons. They fotocopy the newspaper and make it a website. Shares http://tr.im/hmSG which is an article that tells where newspapers are going.
Reports should be focused on outcomes. What you should care about (and what your boss cares about) is how much money you made.
"We improved customers satisfaction by n%" is another possible outcome, that can be shared.
"Life is not like a one night stand, people come many times to your website. You have to understand the behavior of the customers on your website" (picture of a conversion funnel).
"3 pages can account for most bounces. You can fire most of your company, fix those 3 pages and make a lot more conversions"
"It is idiotic to measure the number of members, it is not important how many sign up to your site (Using facebook as example, but when they start actioning on the site. If you are Facebook you want people to come over and over again, you need to analyze whether people spend a lot of time on the site or not"
Shows an example that shows that 66% of people return within the day to the website"
"A newspaper should measure the depth of the visits, this makes you think very differently about your business"
"See what the important segment of people need and want from your site. Take a look at people who puked and left, try to understand why they left"
"70% of the people working on a Newspaper we recently analyzed were writing content with a high bounce and no - return rate"
"The average convertion rate for the US on e-commerce sites is 1.72%. What was happening to the other 98%? It is very important that you quantify the value of that 98%. You can set different goals to see if there are other types of conversions"
"In my blog I measure hits to my about page, it makes me happy, in your company measure the ammount of people who visit the executives page, they will love it, they wont admit it, but they'll love it."
"All of the clicks on my blog are tagged, because the conversions happen elsewhere"
"The web is also reducing costs, there are a lot of different conversions of different types going on"
"Look at the whole company, always compute the total economic value of the site. For example, in my last company we saved $3,000 in consultants each time someone applied jor a job through the website"
"If you do adwords don't just measure visits and pageviews"
"Getting Visits is OK, making money is astounding"
"In my blog I had 64K visitors, 23K came from Search Engines, searching 11,5K different keywords. That is the power of the web. How do you find those keywords? You can use 'search based keyword tool', what the tool does is bringing the search queries and the indexed pages back together"
"Custom reporting: every individual needs and is interesting in a different set of metrics"
"When you don't segment your data don't be surprised when you can't make any important decisions"
Last part of the the talk: "Fail Faster; Experiment or 'Die'"
"Most web sites suck because the HIPPOS (Highest Paid Person's Opinion) created them. Never let your Hippo think they are the customer of the website. You need to prove them wrong fast. I recommend you use google website optimizer. I worked with a company that reduced the number of ads in their web page by 30% and increased their ROI"
"Don't guess, don't impose, Partner."
Analyze trends, Identify Audience in smarter ways. You can even look at the competitor's trends and audience of your competition.
"If you share your data on Google Analytics you get access to 6 different metrics as benchmarks"
"Privacy is extremely important. People will share data with you if you are clear enough about what you are collecting. Google has created a plugin that prevents google from collecting data. We believe that Yahoo! and Microsoft will follow this trust mechanisms."
"A+B testing makes each website more unique. A good example in teh US is if you go to BestBuy and CircuitCity websites, they look alike. Circuit City filled for bankrupcy, Best Buy invests on targeting their audience and testing to optimize the site for their audience"
"There are few things that are shared by most sites. Internal searh (on top right) is one of them. Carts are usually to the right, but a site improved conversions by moving it to the left"
I was Investigating on the evolution of Argentina's Foreign Debt over the past 150 years or so (history is a pasion I tend to keep offline, for reasons unknown), when I came across CIA's World Factbook entry on this country. Upon other interesting (and rather unbiased) facts one can read this tidbit:
Inflation rate (consumer prices): 22% based on non-official estimates; the much lower official rate lacks credibility (2008 est.)
The official rate (as measured by INDEC) was 7.2% for that same period.
I can't help but wonder how is it that we, Argentines, can allow a government to systematically lie to us. It is plainly unacceptable.
Yet there are many people who benefit from this double standards situation. No one on the middle class does, but Argentine governments have proved a serious expertise on slaughtering Argentina's middle class.
As part of a global community, and part of a global (or worldsourced) company it is very difficult to explain this kind of crap to people in places that make some more sense.
Oh, and before I forget, according to the same CIA factbook, Argentina Ranks #211 out of 224 in inflation. Hey! lets look at it from the bright side, at least this is not (yet?) Zimbabwe with a 11,000,000% inflation in 2008.
Also, we are in good company with countries such as Venezuela, Iran or Nicaragua.
I know I repeat myself, but here's the twist: there are several pressing matters in Argentina today. The one that makes the most headlines is the lack of security. As in going out to the street and being mobbed, robbed or killed. That has started an idiotic discussion on installing the Death Penalty.Needless to say I oppose it without any contemplations.
The thing is, such discussions are nothing else than mere distractions of the real issues we face. insecurity is nothing else than a by-product of the lack of serious and permanent policies. Each government is more interested in trying to be as corrupt as they can, instead of trying to make life better for the same people that voted them.
How can we even suggest giving a state that lies on a permanent basis the power to kill? It is plainly stupid. We are being idiotic.
Is Argentina beyond saving? I fear so. The only reason we are not Ethiopia or Afghanistan is because we are blessed enough to have an abundance in natural resources.
Until we realize as a nation that changin reality is something that needs to be done collectively we will be lied to, stupidized, and led to think irrelevant matters we will not surge from the downward spiral we've been in since the 1930s.
We are corrupt, at all levels. We are all corrupt. We like the easy way out from all situations. Nothing can be built until we extirpate that from our national DNA.
I have been thinking about this post for several months now. I even mentioned at a conference I gave some time ago. The final push to actually put my arse in the chair and actually start typing the text came from a post entitled: "deliberately unsustainable business models".
This quote is quite inspiring, in my honest opinion:
The problem arises when the desire to sustain overcomes the desire to be awesome and more resources go to surviving than succeeding. This is abundantly clear in the case of US automakers and banks, whose current arguments for financial support rest on their need to survive, not their ability to succeed.
Although the post is talking about Museums I think the extrapolation to business is an easy to do.
A good example of this is Apple. Yes, I know, I work for Lenovo, but forgive my sacrilege; I'm trying to make a point here.
History tells us that years went by, Apple then became a successful company, with a board of directors and everything. Then Jobs got fired.
That was probably the best thing that ever happened to Apple Inc. Distance from the company he had founded and, doubtlessly, a desire to go medieval on those who turned their backs on him by the sheer weight of success, re-boosted Steve's desire not only for success but for awesomeness. Upon his return in 1998 he reinvented the company and drove it to an unprecedented (and unimaginable) level of success (and awesomeness).
A similar evolutionary arc can be spotted on many companies. The change from cool startup to serious company usually slaughters or silences that desire and need for awesomeness. Need I say "Yahoo!"?
The study of complex systems, on the other hand, demonstrates that a delicate balance between change (innovation) and stagnation is required for such systems to subsist. Furthermore, this balance is leaned towards the stagnation side.
How can we marry this two theoretically opposed concepts?
Imagine a well established complex system, for example the dinosaurs ecosystem reign. Now picture a violent change in that system, a meteorite hitting near Yucatan, for instance. A somewhat stagnated (thus efficient) system is wiped out in a single moment.
Now imagine the world's economy. A pretty well established system. Suddenly a sub-prime mortage crisis hits and creates a credit crunch... You get the picture, aye?
My interpretation is that during normal times "business as usual" is king. Yet, during crisis things have to shift rapidly.(And yes, Apple was at Crisis when big Steve returned to the company)
The interesting thing about crisis is that once they are over things are never quite the same, thus people and companies should not adapt to the crisi, but rather make the changes needed to survive and be in a good position when things get back in track.
To follow with the Dinosaur extinction analogy: species that were well adapted to live in an environment where the atmosphere was saturated with dust probably boomed for a short while. Yet, the real winners were those that were sturdy enough to make it through the worst times but had the evolutionary weapons to take full advantage of the post-crisis conditions. In the case of the dinosaurs this were Mammals.
Smart companies should not focus too much on the current crisis situation, but rather just enough to ensure survival (even in less-than-ideal situations). What those companies should do instead is to try to understand the changes going on during the downturn, and how those are going to shape the next "normality".
If the interpretation is close enough to what reality will be, and actions are taken to be on a good position under such circumstances not only survival will be ensured but also unprecedented growth.
To put it in just one phrase: don't focus too much on adapting to dire conditions, but rather on adapting to the reality that will follow.