Year in and year out ecommerce continues to garner a growing share of the overall retail dollar, and now with the 2011 holiday season having witnessed the blossoming of M-commerce – as in mobile – the macro ecommerce marketplace is poised to accelerate its assault on traditional retail.

The big new for the ecommerce marketplace in 2011, however, was the emergence of social media and the impact all that friend sharing and social shopping had on ecommerce and brick-and-mortar shopping alike.

This year, 2012 – and the just-passed Christmas season was a harbinger – will be the year of three key trends on the ecommerce front: the explosion of M-commerce, a much more pinpointed, personalized approach to ecommerce marketing, and a shift from SEO (Search Engine Optimization) to CRO (Conversion Rate Optimization).

Mobile dominance

Black Friday and Cyber Monday just after Thanksgiving have emerged as the measuring sticks for retail commerce, and this past season really showed how mobile, as Mcommerce, is really coming on. Over the same sales period in 2010, just 0.1% of ecommerce sales were conducted on a mobile device, according to CoreMetrics, a statistical division of IBM. This year, 2011, Mcommerce garnered 5.6% of the cyber sales – a 50-fold increase, a stunning development by any measure.

The reason for the explosion in Mcommerce, of course, is written in the explosion in the popularity of mobile devices themselves. The research firm Canalys recently reported that global shipments of smartphones in 2011 hit 487.7 million units – and for the first time smartphone sales surpassed sales of PCs, which enjoyed sales of 414.6 million units last year. Apple alone shipped 37 million iPhones and 15.4 million iPads in 2011’s 4th quarter, and Samsung reported 2011 sales of 300 million handsets, 150 million of them smartphones. It should be noted, however, that even the non-smartphone sales for Samsung still represent mobile devices capable of running the web and apps, two key drivers of Mcommerce.

Another telling statistic comes from the popular social media portal Facebook. The company, in its information release announcing its expected IPO due in the spring, reported something like 845 million active users, with half of them regularly tapping their Facebook activity on a smartphone or mobile device.

What’s driving the move to mobile, beyond the convenience, is perhaps, ironically, the downturn in the economy. Mobile devices are by nature less expensive that PCs – in the case of Apple devices, far less expensive – and with the growing use of cloud computing supplanting the need to have massive data storage and capability held within a computer, the handheld and mobile devices are actually gaining computing power without the need for self-containment. Plus, the excitement on the development side for computing is in the apps arena, with most of that excitement directed squarely at the mobile marketplace.

Personalized marketing

It has become nearly ubiquitous on ecommerce websites to offer a standard set of “suggestions” to visitors with some built-in defaults. For instance, a person buying a pair of khaki pants will get a message at check-out saying something like “other people buying this product also bought this blue V-neck sweater.” These types of build-ins, while powerful and proven to be good up-selling features, are shown to everyone looking at the item in question.

A more personalized approach would be to gather more specific information about that individual visitor, both built up over time as a recurring customer or collected on that visit based on the browsing/shopping pattern of that individual. So for instance, if that individual has a history of buying shoes, then more shoe suggestions would pop up, or even if that particular shopping/browsing session was heavy on say, screwdrivers, and then the up-sell options could be more personalized.

And there are even more sophisticated – some might say invasive – methods of finding and identifying preferences for that individual. With such programs now available on the market as PredictiveIngtent and PersonalMerchant, among others, a wider scope of behavioral information can be collected. This can be as simple as color, style and size preferences of that individual, which opens up suggestions, or drawing from the behavior of other, similar users, the so-called “crowd wisdom,” to build patterns. One imagines that the next step would be to track the sharing information of a visitor’s social media interactions to build even more personalized behavioral patterns or predictable behaviors based on one’s circle of friends, and their friends and so on.

Facebook itself indicates a move in the direction of more targeted, personalized marketing. In its IPO filing in early February, and in a letter CEO Mark Zuckerberg issued along with it, the company touted its ability to share personal information “shared” by users and their friends and connections – a particular relevance to ecommerce merchants who have tapped the Facebook feature to have a Facebook ecommerce page. The IPO itself addresses this, although the language is somewhat vague, although revealing. It states:

• Advertisers’ objectives range from building long-term brand awareness to stimulating an immediate purchase. We offer advertising solutions that are designed to be more engaging and relevant for users in order to help advertisers better achieve their goals. Facebook’s combination of reach, relevance, social context, and engagement gives advertisers enhanced opportunities to generate brand awareness and affiliation, while also creating new ways to generate near-term demand for their products from consumers likely to have purchase.
• Relevance. Advertisers can specify that we show their ads to a subset of our users based on demographic factors and specific interests that they have chosen to share with us on Facebook or by using the Like button around the web. We allow advertisers to select relevant and appropriate audiences for their ads, ranging from millions of users in the case of global brands to hundreds of users in the case of smaller, local businesses.
• Social Context. We believe that the recommendations of friends have a powerful influence on consumer interest and purchase decisions. We offer advertisers the ability to include “social context” with their marketing messages. Social context is information that highlights a user’s friends’ connections with a particular brand or business, for example, that a friend Liked a product or checked in at a restaurant. We believe that users find marketing messages more engaging when they include social context. 

CRO

More personalized, targeted marketing leads directly to Conversion Rate Optimization. The object of all these services for advertisers, and presumably those with Facebook ecommerce connections, is not only to draw in visitors to an ecommerce site, but also to then convert them to actual buyers. This is where the rubber meets the road in ecommerce.

To date, the buzz in internet circles, and for ecommerce merchants, is SEO – the Search Engine Optimization techniques that rank a website higher in the search results and, therefore, delivering more visitors to the site. For ecommerce operators this has been a big deal so that they are at least part of the conversation when someone is searching for their particular product or service.

The next step is to convert the visitors to buyers. While it is difficult to get hard numbers on conversion rates, there are reports that many ecommerce operators, even very sophisticated ones with high SEO scores, consider conversion rates of 1% to 2% to be extremely good. Obviously, moving that needle only a fraction of a point is a significant sales development.

Further, using the more targeted, personalized marketing techniques, turning each conversion into a higher per-transaction sales number is also a great method of making each conversion one of higher return.

The chief methods for attacking conversion rates are directly related to enhancing the consumer experience on a particular website. For instance, such things as error messages – where a particular page being sought won’t appear – and broken links need to be constantly monitored and eliminated. Nothing is more frustrating to the shopper that hitting the proverbial brick wall; they may be well on their way to purchasing, but even a minor stymie will halt that action.

Studies also show that the checkout process bothers visitors and streamlining it can improve conversion rates. Apparently, many sites prompt people to create an account before moving on to the steps involved in checking out, and consumers have shown a preference for doing this at the very end.

In both of these frustrations – error messages and the checkout order – studies also show that conversions can be enhanced by using an Abandoned Basket Rescue tool; in other words, the ecommerce merchant should maintain a shopping basket even if the sale is terminated before checkout and then restore it for a visitor who overcomes a frustration and returns later.

Another key factor in boosting CRO is a method called A/B/ testing. In this technique, different designs of the same page, or similar pages – say the opening product page in each category – are displayed for real visitors, and the sales of each are measured against each other. The idea is that while the sire’s designer or owner may have an affinity for, say, pink, a site utilizing blue as the predominate page color may sell more and have visitors spend more time on the site. Same thing for headlines and other features – try out different headlines, copy blocks, sub heads, photographs, flash players, video, voice overs, and through testing – A/B, A versus B and so on – discover which of them resonates more with the visitors and buyers. 

Additional steps to boost CRO include measuring and monitoring content speed and adjusting wherever relevant, adding in more testimonials in more visible locations (like right on each product page rather than just a “Testimonials” page), and making clear to visitors that the site is adamant about its security guarantee and any product guarantees and warranties (the web is full of charlatans, and visitors want reassurances from both the site and other users’ experiences).

And, of course, all this has to be done for all aspects of the ecommerce site, including all of its platforms for smartphones and pad mobile devices. The key here in boosting CRO is test, test, test…

CRO is also evolving into the targeted, personalized marketing mentioned above. One of the best methods of attaining a high conversion rate is to present the visitor/shopper with options custom designed to fit that individual’s web-browsing behavior, such as the pages they have visited or the searches they have made.

Much of this type of work and capability is just beginning to come to the fore, but it is clear that as the internet and its social media entities collect more data and begin to share it in more sophisticated ways that ultimately the battle ground will be about conversions.

Just a few years ago there was no way anyone could have predicted the ways in which ecommerce has evolved. Indeed, just a year ago no one had any idea that the Mcommerce aspect of it would take off so quickly. Change happens, and while it is difficult to predict exactly how it will manifest over the next year and beyond, it is probably safe to conclude that ecommerce will become ever more sophisticated and specialized as time marches on.

For all of your ecommerce needs, call on Unleaded Group, a premier website, mobile site and mobile applications design and development firm. Ecommerce – and now Mcommerce – is our passion. Call 855-UNLEADED for complete details.