Is it Time to Drop the 'e' from e-Commerce?

| by Jason Goldberg
Is it Time to Drop the 'e' from e-Commerce?

Most e-commerce executives are focused on online sales, even though their actual contribution to the organization is far broader. In order to maximize the effectiveness of digital marketing, executives need to think about their roles differently.

Imagine that you are the VP of e-commerce for national cross-channel retailer. If you are like most of your peers, you probably rose through the ranks of a retail IT organization, or perhaps an IT vendor. You likely report to a CIO, and your primary success criteria is the profitability of your e-commerce business. Your business is growing year over year, and you spend the bulk of your busy days figuring out how to get more traffic, improve your conversion rate, and increase your average order value. Your job is challenging but rewarding, and thanks to your year-over-year growth (which, by the way, you achieved in spite of being understaffed,) you feel like a success.

Unfortunately, your role and your perceived success are likely based on a false premise. That false premise is that your job to is to sell merchandise on your website.

While online sales and profitability are certainly important, they likely contribute far less to your organization's overall success, than your effect on brick-and-mortar sales via digital marketing. If your business mirrors that of Best Buy and Home Depot's recent disclosures, a majority of all your brick-and-mortar sales originates with a visit to your website.

"45 percent of in-store visitors pay a visit to first" – Hal Lawton, President Home Depot Online.

"We know that 60 percent of our U.S. store sales are influenced by our customers' experience on" - Brian Dunn, CEO Best Buy

Your online sales last year may have been $250M, but you influenced $2.5B in your retail stores. Saying that your primary success criteria is online sales is like saying that the primary success criteria for Victoria's Secret catalogs is to increase mail-order sales.

Your Real Job

Your e-commerce website, and the digital marketing initiatives that drive traffic to them, are the very top of a marketing funnel that ultimately results in sales at your retail POS. Think of your e-commerce site as the first 2,000 sq. ft of a 20,000 sq. ft store. It's great if a shopper walks in your front door and quickly buys the product displayed in the window, but it's even better if that windows display entices them deeper into the store to make an even bigger purchase!

So how much of your day is dedicated to meeting the needs of those brick-and-mortar shoppers who start their trip on your website? Consider these questions that you ought to be asking:

  • Do you have a feature-rich store locator that lets shoppers find stores based on criteria important to them? (store hours, product categories, etc…)
  • Can shoppers check if a product is in-stock at a particular store, and see the price she'll be charged at the POS?
  • Can shoppers buy online and pick-up in store (as 40% of all shoppers do)? Can she buy online and have it shipped to a store?
  • Are your wayfinding nomenclatures, products names, and part numbers consistent from the website to the stores?
  • Does your site feature local store pages, with information about hours, special events, departments in the store? Can shoppers schedule appointments with a sales associate or for other professional services offered in the store? Do your local pages include store-specific best sellers, new products introductions, staff recommendations, and staff profiles? Do those pages promote location based services like FourSquare, ShopKick, and Facebook Places? Can local store managers update the content on their store pages? Have you verified your Google Places pages and linked them to the store pages on your site? Do you do local SEO and reputation management for each store location?

Meet the New VP of Digital Marketing

So it's time to redefine your job to reflect its true breadth. Goodbye VP of E-Commerce … hello VP of Digital Marketing. Unfortunately, your professional background is probably not a perfect fit for your new role.

It might be time to start reading some new books (Why We Buy: The Science of Shopping by Paco Underhill) and publications (Shopper Marketer, VM+SD), participate in new trade organizations (POPAI, In-Store Marketing Institute), and attend some new trade shows (GlobalShop, Shopper Marketer Expo).

Most importantly, you need to meet your colleagues in the Marketing and Merchandising departments. That's going to mean getting out of the IT ivory tower, and all too often getting on an airplane. You might even consider spending time in stores (yours and your competitors'). Shadow a retail store manager for a day; ask to go through sales associates new hire training. Talk to shoppers in the store. Never visit a new city without visiting the local stores. Introduce yourself to the regional store managers and establish a feedback mechanism for the stores to tell you what they need in terms of digital marketing. You're no longer an IT professional, you are a merchant and a marketer, congratulations!

New Success Criteria

Last but not least, you're going to need new success criteria that truly reflect the benefits of digital marketing to a cross-channel retail organization. Ideally, you'll want to be able to link on-line visitors to retail store visits.

Customer affinity programs that reward customers for online and offline purchases are a great tool for creating cross-channel success criteria. It's even better, if the program incents shopper visits to the store and website (even if they don't make a purchase). Consider linking your customer affinity program to a check-in service like Facebook Places.

Digital coupons redeemable in-store are another great way to track shopper migration from your website to your store.

Mobile shopping tools also provide another opportunity to accurately track shoppers. Give shoppers a reason to use your mobile application or mobile-optimized website while they are in the store and you can turn the smartphone into a digital cookie that tracks behavior throughout the store. Use 2D barcodes such as QR codes to merge your digital marketing with your physical store.

If your organization isn't ready for one of the enterprise-wide solutions above, then consider a pilot program in a few stores to establish trends about online/offline behavior. Store exit interviews are another option for collecting qualitative data on a limited basis.

Chief Digital Officer

Digital marketing and e-commerce was already one of the most dramatic changes to the world of retail since the advent of mass-marketing. Now the explosion of mobile and social marketing have moved digital marketing even further up the priority list for retailers that want to grow.

E-commerce leaders are pioneers in the new field of digital marketing. You don't have predecessors to learn from. It's only a matter of time before we see the first digital marketing moving into corner offices and assuming president/CEO roles for major retailers, but before they do that, they'll need to drop the "e" in e-commerce.

Topics: Consumer Behavior, Customer Experience, Marketing, Merchandising

Jason Goldberg
A shopper marketer with 20 years of experience with major brands including Best Buy, Procter & Gamble, Sony, Target, Walmart and many others. Jason leads the Strategy practice for CrossView, a leading provider of cross-channel commerce solutions. wwwView Jason Goldberg's profile on LinkedIn

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