Personalization Driving E-Commerce

Personalization Driving E-Commerce

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E-Commerce, Social Media Driving CRM, Experts Say

A Top E-Commerce Strategy Seen as Ticket to Strong Sales

E-commerce is a big market that’s growing bigger and more competitive every year, forcing companies to improve their CRM systems and break down silos between the two to better serve customers, both online and off-line. This E-Guide provides expert tips on strengthening e-commerce strategies through increased personalization, integration and real-time updates.

E-Commerce, Social Media Driving CRM, Experts Say By: Albert McKeon

Companies should think twice before proceeding with the same old website.

They should also pause before dismissing the value of mobile applications

and social CRM.

Those words of advice come from two e-commerce experts who predict that

technologically empowered consumers will either support or ignore a

business based on initial judgments of a company‟s Web, mobile and social

approaches.

“The website experience is a major contributor to overall customer

experience. If you do poorly at that, you don‟t get a second shot,” said Gene

Alvarez, a research vice president and e-commerce analyst at the Stamford,

Conn., research firm Gartner Inc.

And first impressions will matter as time passes and the technology

flourishes, Alvarez said. Gartner predicts that by 2015, companies will

generate 50% of their sales through mobile applications and from social

networking references.

Choice driving e-commerce, CRM

Until recently, when commerce still flowed primarily in the brick-and-mortar

world, a customer had only about two stores to choose from, Alvarez said.



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If a sales transaction went sour at one or even both of those stores, a

customer had little recourse and at worst would tell only a few friends at a

weekend barbecue about the bad experience, he said. In a day the story

would be forgotten.

Now, Alvarez said, with the Web and mobile applications, a customer not

only has many more choices, but can also drive discussion about a business

and its products through social media.

“This is why commerce is playing a huge role in CRM,” Alvarez said. “With

incredible customer choice, they can easily switch.”

Businesses recognize that e-commerce drives CRM and vice versa, Alvarez

said. In a recent Gartner survey of CEO concerns, CRM topped the list, with

e-commerce placing second, he said.

Executives often look to retail for clues on how to balance e-commerce and

CRM, he added, citing how retailers such as Amazon set the bar high on the

customer experience: from ease of shopping to shipping to tracking to

delivery to returns.

“Executives are understanding it,” Alvarez said. “You have the factor of

choice with the Web. Then you have the feedback model, the social

component where if you get it wrong, you‟re hung publicly.”

Understanding and doing are two different things, of course. That means

businesses need to determine how they will approach e-commerce and

CRM, according to Brian Walker, a vice president and analyst of e-commerce

and multichannel technology at Forrester Research Inc. in Cambridge, Mass.

“There are many systems challenges here. It will be difficult,” Walker said of

businesses‟ websites and other digital touchpoints.

Companies continue to have a silo approach to customer experience

management (CEM), making their e-commerce models unsustainable,

Walker observed in a Forrester study on the subject last year.



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“To create a campaign, they may have to go to one system for campaign

tracking, another for content creation, another for commerce, another to test

the campaign and yet another to measure success and determine the next

best action,” he wrote.

Dealing with Web, mobile and social channels mean companies must make

supplemental or wholesale changes when upgrading CRM systems to accept

and process the outpouring of customer interactions, Walker said in a

telephone interview. The increased use of these channels has even led to

the thought that CRM could get sidelined, he added.

Reviewing merge of social CRM, e-commerce

Gartner clients that have sites which look more like brochures now want to

make their Web presence transactional, Alvarez said.

Nothing discourages a customer more than visiting a website that looks

outdated and offers scant opportunity for interaction, he added.

“You go there and say, „Ooh,‟ ” he said. “Would you want to place your credit

card information there? Would I want to do business with them?”

But many other companies are improving their websites, Alvarez said. Where

they still struggle, though, is social media, he said. They know they should

use it, but they can‟t figure out how, he said.

“Companies will ask, „What if they say bad things?‟ But that means you have

to listen to the customer and win them back. If you don‟t, guess what? They‟ll

tell their friends. They‟ll move on. It‟s too easy now.”

Businesses also stumble over what customer personalization means, Walker

said. It‟s not a well-defined term.

“Is it recommendations? Is it adapting to the customer who wants to be

communicated with? Is it responding to something they just brought in from

another channel?” Walker said.



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Companies can‟t lose, though, when they give the customer control, he

added. All customers like improved communication and, most of all, deals on

products and services, he said.

“But there will be mistakes made, typically when a company is not thinking of

the customer,” Walker said.

A Top E-Commerce Strategy Seen as Ticket to Strong Sales By: Sue Hildreth

E-commerce is a big market that‟s growing bigger every year.

In 2015, U.S. companies are expected to rake in $280 billion in sales through

e-commerce efforts, according to Forrester Research Inc. in Cambridge,

Mass. Only two years ago, U.S. online retail sales amounted to $176.2

billion.

Business owners who want a part of this growing market will need to invest

more resources into providing exactly what their e-commerce customers are

demanding, industry observers say.

Online customers expect useful product information, access from any mobile

device, intuitive interfaces, full support, a fast checkout process that accepts

all payment methods and a place to rate their experiences. They don‟t

tolerate screen freezes, transactional snafus or confusing menus.

"Customers today expect their [shopping] experiences to be relevant, to meet

their needs and to not require a lot of time," said Haluk Nural, a senior vice

president for dunnhumby, an international retail consulting firm with

headquarters in London.

Those expectations sound deceptively easy. But they require a well-honed e-

commerce strategy and a large investment in time, not to mention

technology.



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What should an e-commerce strategy contain, and how should a business go

about evaluating its website? Experts point to six key factors that can make

or break a customer‟s shopping experience and, ultimately, an e-commerce

business.

Navigation. A site that is hard to use or confusing to navigate can cause a

visitor to give up and leave, so any customer experience strategy needs to

start by taking a look at website design, said Brian K. Walker, an analyst at

Forrester.

Ask employees and customers to give feedback on how easy or difficult it is

to find product information, connect to customer service or navigate the

checkout process. How many clicks does it take to buy something? Are the

menus clear and comprehensive or confusing?

"Look at the usability of your interfaces as well as customer abandonment

rates," Walker advised. "There‟s a lot of low-hanging fruit to be had by

improving simple things like that."

Integration. To provide a seamless e-commerce experience, the site must

be integrated with back-end enterprise systems, including CRM, billing and

order fulfillment.

"You have to have to have control over all your data in order to deliver

consistent and relevant experiences across various touch points," Walker

said. "It‟s no longer OK to have e-commerce be a standalone system."

Personalization. This involves anticipating a customer‟s needs and

automatically serving up information and products that match those needs.

Personalization can be done at a very basic level using cookies and IP

tracking, which can show the visitor‟s geographic region.

At the high end, personalization technologies use rules engines and real-time

analytics to match unknown visitor data and existing customer CRM data

with product characteristics and marketing offers. How sophisticated the



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personalization needs to be depends on how many different products a

business has and how many consumers it targets .

Dunhumby‟s Nural creates informational content such as videos, blogs and

articles for consumer goods manufacturers and their retail partners‟ e-

commerce sites. To maximize the value of that information, Nural and his

colleagues use pre- and post-purchase data to estimate customer needs and

provide customized Web views.

"Some consumers are looking for value or diversity of selection or best price

or convenience. We want to understand the customer‟s needs state and

make sure that the right communication happens at the right time," he said.

Denis Pombriant, CEO of Beagle Research LLC in Stoughton, Mass., added

that he would like to see more businesses collect and study customer

information for better business insight. "We need to work at capturing and

analyzing customer data for unmet needs," he said.

Product associations. Nural also uses data to provide complementary

product options to businesses so they can entice customers to buy more.

These complementary products might urge the customer to purchase organic

maple syrup to go with their organic waffles, for example, or wrapping paper

to match party plates.

"Retail e-commerce sites that can link multiple products into a complete

solution will be the most successful," he said.

Mobile access. Yankee Group Research Inc., a Boston research company

focused on mobile technologies, found that 54% of consumers downloaded a

mobile shopping application last year, while 83% were "interested" in mobile

e-commerce.

"Smartphone shoppers have changed the face of retail," noted Sheryl

Kingstone, a director at the Yankee Group.



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She advised e-commerce companies to stop treating mobile shopping as a

separate experience and start integrating it with main e-commerce systems.

Otherwise, mobile shoppers will continue to face "dead ends" such as click -

to-call buttons that don‟t work, she said.

She also suggests investing in mobile e-commerce apps that natively support

smartphones and other devices, as opposed to being limited to supporting a

minimized website designed for mobile browsers.

Updates. The constant change in products and consumer culture means e-

commerce sites must keep up to date on customer sentiment as well as

product information and content. Old product information and articles on

yesterday‟s trends can make a site look abandoned.

"E-commerce managers must regularly re-evaluate their strategies and

update their sites," said Kate Leggett, a Forrester analyst. "You can‟t publish

content then walk away from it."

Neglect can tarnish brand image and sales. Walker said, "Consumers don‟t

think, 'Hey that site's not very good,' but rather, „Your company‟s not very

good.' "



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Personalization Driving E-Commerce