Successful Ecommerce Replatforming (Webinar)

Successful Ecommerce

Replatforming May 24, 2012

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Alexis Henderson Director of eLearning

Retail Online Integration

Brian Walker Vice President, Principal Analyst

Forrester Research

Eric Miller Director of Product Management

Monetate

Introduction by

Today’s Speakers

#ROIWebinar

© 2012 Forrester Research, Inc. Reproduction Prohibited 4

© 2012 Forrester Research, Inc. Reproduction Prohibited 5 © 2009 Forrester Research, Inc. Reproduction Prohibited

Keys to Successful eCommerce Replatforming

Brian K. Walker

VP, Principal Analyst

Forrester Research

May 24, 2012


Survey details and demographics

150 US online survey respondents

– Industry: distribution across all major verticals, but emphasizing retail, CPG, & travel

– Company size: Distribution across mid-market and enterprise in both geographies

– Small: 12

– Midmarket: 18

– Enterprise: 29

– Roles: Manager level and above; with responsibility within eCommerce

– IT: 36

– eCommerce/eBusiness/Marketing: 16

– Line of Business: 4

– Supply Chain: 3


Current State


eCommerce solutions are largely in-house today

5%

17%

10%

31%

37%

Outsourced full service (e.g. GSI Commerce, One-stop,

Speed FC)

Software-as-a-service (SaaS) commerce platform (e.g.

Demandware)

Open source ecommerce platform (e.g. Magento,

OSCommerce)

Commercial, licensed application (e.g. ATG/Oracle,

IBM)

Homegrown solution developed internally by our IT

group

“Which of the following best describes your current

eCommerce solution?”

Base: 59 US eBusiness decision makers

Source: A commissioned study conducted by Forrester Consulting on behalf of Monetate, May 2012

8%

8%

26%

59%

Other

Supported and hosted by the product vendor

Supported and hosted by a 3rd party (e.g. systems integrator or interactive

agency)

Supported and hosted in-house by our IT group

“Which of the following best describes the technology

operational model for your

current eCommerce solution?”



And on-premise solutions are used across the capability set needed for eCommerce today

20%

10%

7%

12%

5%

2%

5%

8%

51%

61%

68%

61%

68%

75%

63%

66%

22%

24%

24%

25%

27%

24%

32%

25%

Digital Asset Management (DAM)

Product Content Management (PCM)

Product Information Management (PIM)

Enterprise Resource Planning (ERP)

Order Management (OM)

Web Content Management (WCM)

Customer Relationship Management (CRM)

Contact Center Support Management Solution

Don't use Licensed / On premise SaaS

“What operational model do you currently employ for each of the following technologies?”




…As well as many marketing services

20%

22%

22%

24%

22%

22%

24%

32%

27%

22%

19%

22%

27%

24%

32%

34%

39%

41%

39%

41%

39%

37%

27%

47%

44%

42%

36%

42%

24%

20%

20%

20%

25%

22%

24%

20%

34%

24%

34%

32%

36%

32%

A/B & Multi-variant testing / site optimization

Live chat

Mobile Websites

Product recommendations

Fraud detection

Mobile or Tablet Apps

Rich media (rotating images, video etc)

Segmentation/Targeting

Customer ratings & reviews

Tax calculation

Web analytics

Email marketing

Payment processing

Site search

Using homegrown solution

Using on-premise licensed solution

Using SaaS solution

“How do you currently support the following eCommerce services?”




Perceived ROI is the leading reason features are migrated, but other less quantified reasons also lead

22%

22%

41%

51%

54%

63%

Based on out-of-the-box platform capabilities

Complexity and resource required to implement and maintain

Multi-functional team consensus

Based on competitive pressures

Based on executive wish list

Based on perceived ROI impact

“What process or criteria was used to prioritize the migration of existing and new features into the new platform?”




Average delay for replatforming projects is 4.2 mo...

%

8%

17%

17%

58%

Delayed a year or more

Delayed 6-9 months

Delayed 9-12 moths

Delayed 3-6 months

Delayed 1-3 months

“How long was your replatforming project delayed?”




… And project scope is a typical casualty

36%

36%

8%

17%

3%

The project was on time and on budget

We had to reduce the scope of the project to keep it on time and on budget

We launched on time, but were over budget

Our project was somewhat delayed and over budget, but to an acceptable level

Our project was way over budget and delayed

“Reflecting on your previous eCommerce platform replacement (migration) project, how

would your characterize the results?”




Despite how these projects are pitched, KPIs typically take a dip after redesign & replatforming

2%

8%

14%

20%

44%

12%

Greater than 1 year

9-12 months

6-9 months

3-6 months

1-3 months

Didn't take any time

“How long after the launch did it take for KPI’s (including conversion, average order value, load

time) to return to pre-launch levels?”




Conversion and load times are typically effected

20%

25%

22%

31%

44%

39%

Revenue per session

Average order value

Time on site

New customer acquisition

Load time

Conversion

“Specifically, what KPI’s (key performance indicators) were negatively affected post launch of the

new platform?”




Few respondents feel A/B & MV testing is a strength, but two thirds see it as a „must have‟.

36%

25%

25%

39%

22%

34%

31%

36%

22%

25%

29%

25%

25%

22%

15%

25%

24%

25%

17%

29%

20%

22%

19%

22%

24%

22%

31%

32%

34%

31%

32%

29%

24%

41%

32%

37%

Multi-channel Integration

Analytics

Mobile Apps (phone/tablet)

Online Merchandising

A/B & Multi-variant testing

Segmentation/Targeting

Back-End Integration

Content Production

Fraud Prevention

Brand Marketing

Fulfillment

Payment Processing

Online Marketing

eCommerce Technology

Mobile Website

Customer Service

Site Design & Usability

Site & System Security Compliance …

Somewhat of a strength Industry leading

78%

88%

92%

66%

93%

88%

88%

85%

90%

85%

68%

83%

71%

66%

71%

66%

78%

61%

% believe it is a must have

As you think about all the areas you need to be successful in marketing to and transacting directly with your customers online, what areas do

you feel you are a leader in or have room for improvement in order to meet customer expectations and compete effectively to deliver value to

your company?

Base: 59 US eBusiness decision makers Source: A commissioned study conducted by Forrester Consulting on behalf of Monetate, May 2012


Future State


Replatforming remains a key initiative for many

29%

2%

14%

12%

12%

22%

10%

We are not planning to re-platform in the foreseeable future

More than 36 months

24-36 months

18-24 months

12-18 months

Within 12 months

We already have a project underway

“When, if at all, are you planning to change your eCommerce platform technology solution?”




Nearly all those projects bundle a redesign, & include significant complexity and multiple touchpoints

17%

24%

36%

32%

32%

34%

31%

36%

42%

44%

42%

41%

49%

51%

66%

71%

APIs for adding partners or new customer touchpoints

New in-store kiosks

A new metrics solution

A new segmentation/targeting solution

A new recommendations solution

Apps for tablets

A new A/B, multivariant, or optimization solution

A new product search engine

Mobile apps for smartphones/tablets

A new order management solution

Website optimized for tablets

A new customer service (call center) solution

Mobile website optimized for smartphones

Many new site features

A new eCommerce platform

A new website design

“What aspects were included in the replatforming project?”




Replatforming is driven by conversion and AOV

3%

12%

7%

7%

15%

17%

19%

20%

Improved site up-time

Improved cross channel interactions, such as traffic to stores or in-store order pickup

Reduced marketing costs

Reduced customer contacts for service needs

Improved time on the site

Improved site performance

Improved average order size

Improved conversion

“What goals did you have for your replatforming project?”




Complexity of the web environment is increasing

36%

24%

14%

20%

2%

2%

20+

15-19

10-14

5-9

1-4

None

19%

12%

36%

22%

10%

%

20+

15-19

10-14

5-9

1-4

None

“How many different solutions do you estimate you

have integrated to support your website capabilities

today?”

“How many solutions do you anticipate you will

have integrated into your website 2 years from

now?”





SaaS has become an area of high interest for companies moving forward

11% 3% 86%

Unlikely

Unsure

Likely

“How likely are you to consider a cloud (SaaS) eCommerce platform as a replacement?”




Best Practices


Use a cross-functional team to lead replatforming projects

8%

17%

27%

47%

The marketing team, led by the CMO

The eCommerce team, led by the eCommerce leader

A highly integrated , cross-functional, multi-discipline team

The IT team, led by the CIO

“Who led the replatforming project?”




Testing is critical to replatforming success

25%

15%

14%

32%

19%

15%

39%

25%

15%

19%

17%

29%

42%

41%

27%

44%

51%

25%

37%

34%

49%

46%

46%

42%

24%

31%

42%

12%

15%

47%

24%

32%

25%

31%

31%

22%

7%

10%

8%

7%

14%

8%

0%

5%

10%

5%

3%

5%

2%

3%

8%

5%

2%

3%

0%

3%

0%

0%

3%

2%

User acceptance testing of the business tools

Use of site optimization tools to pre-launch features on our existing site

Use of independent resources to provide input to decisions

Usability testing of the current site(s)

Soft launch or BETA testing

Scenario based evaluation of the solutions

Rigorous technology testing prior to launch

Proof of concept testing (POC)

More focus on integration best practices

Greater due diligence on platform

Greater due diligence on integrator

Architectural review of the technology

Critical Important Nice to have Take it or leave it Not necessary

“If you had to do it over again, how would you rate the following best practices as must-dos?”




Test new platform, design, and functionalities extensively

50%

39%

6%

3%

0%

35%

52%

13%

0%

0%

We tested the new design, content and features thoroughly with users before launch

We tested the new design, content and features in a controlled (BETA) launch before full release

We tested only wireframes and initial design with users

We tested the existing site but not the new designs

We only tested some of the initial design, but not the final designs or content we launched

IT

Non-IT

“How would you characterize the decision making process that went into the

replatforming project planning?”


Base: 36 IT professionals

23 Non-IT professionals


Recommendations


11 Things to Do Before You Start Your Project

1. Pick the right model, product, and vendors

2. Plan on a program and not a project… define a roadmap

3. Form a strong cross functional core team

4. Define & communicate success metrics

5. Test your cx design & feature hypothesis before committing to the spec

6. Be clear on the business tools & resources required to be successful

7. Define & share user, business & technical requirements

8. Define and validate the technical specification, including integration

9. Develop a rational project plan

10.Develop an operations plan - post-launch

11.Do not go for the big-bang

© 2009 Forrester Research, Inc. Reproduction Prohibited

Thank you

Brian K. Walker

[email protected]

blogs.forrester.com/brian_walker

Twitter: @bwalker

www.forrester.com

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