By Steve Rowen, Managing Partner
October 27, 2009
In all of the research we conduct at RSR, we ask our survey respondents to provide us their view of individual technologies from both a value perspective, as well as from a current/intended use perspective. Our recent study on eCommerce, Online Commerce in 2009: The Game Has Changed – Have Retailers?, was no exception.
Interestingly, a few days ago, USA today featured an article that asks the question, “Are retailers going too far tracking our web habits?” Within, the editor’s contention is that as an industry, retail potentially tracks more private, individual behavior than any other vertical, and may be doing it via spooky, unknown methods that consumers – if they were more aware of the methods and potential methods – would object to. However, as it stands, apart from a few up-in-arms privacy and consumer activist groups, no one seems to care quite yet. In other words, we beg to differ.
The consumer’s apathy is certainly good news to retailers. We can see in the figure below site analytics (63%), product recommendations (59%), and site performance monitoring (46%) are highly prized.. User tagging for personalization purposes and product reviews also hold significant interest (44% of the total pool assign “very valuable” status to each).
Source: RSR Research, October 2009
Practicality and feasibility permeate our retail respondents’ thinking. They are focused on the tools that provide the insights (and core operability) to hone the basics of online retailing: - determine who is shopping the site, what general patterns emerge from their overall behavior, and insuring availability of cheap and easy recommendations and reviews to help sway and connect shoppers with products.
Retailers have consistently been leveraging the easiest-to-implement systems, like site analytics (75% already have basic systems in place, including such tools as Google analytics). Further, roughly half our retail respondents have already folded in site performance monitoring, product recommendations and product reviews. These tools are now table stakes for an effective, operative site.
More budgetary dollars are allocated for mobility than any other technology. 60% of respondents reported that mobile applications remain a big untapped opportunity for their companies. Twenty percent have discretionary dollars set aside for development of a mobile (WAP) site, while an additional 20% have funds allocated to developing mobile applications; another 43% have plans in place awaiting funding. While few are willing to bet the farm on how shoppers will really use online communities and social networks, a safe bet is that consumers will appreciate the ability to shop from wherever they happen to be – in a store, in an airport, or in an airport store.
There is much more detail available in the full report, available here, but some notable differences by performance, revenue, and percentage of goods sold online include:
· Pure-play retailers have more plans (though still no budget) to examine social networking opportunities than any other group (50% vs. 6% of mixed-model and 16% of multi-channel retailers);
· Nearly half (47%) of multi-channel retailers have no plans to utilize employee or corporate Twitter accounts in any way;
· Pure-play and mixed-model retailers are already far more invested in call center/CRM solutions than are multi-channel retailers (50% and 47%, respectively, vs. multi-channel retailers’ 25%). This represents a viable opportunity to steal away market share based on an enhanced service model;
· Mobile is the domain of Retail Winners – 22% of Winners have budget allocated for new mobile applications, while 24% have budget set aside for mobile sites;
· Average and lagging retailers have much work still to do getting product information on their sites up to date: 38% of laggards and 40% of average performers have no plans to integrate to manufacturers’ product and content information; but,
· Laggards DO lead in adoption of product reviews (75%), recommendations (76%), and site performance monitoring (75%). The best performing retailers are well-advised to take a page from their playbook, as the first two have become guaranteed fan favorites among online shoppers, the third a prerequisite to completed transactions. This statistic may be one of the few reasons struggling retailers have been able to hang in, online, for as long as they have.
The bottom line is that retailers have just begun to tap the data availlable online. Consumers aren't complaining. In fact, they want to be served with relevancy.
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