News

Webloyalty releases summit findings

March 16, 2010

Webloyalty, a provider of incremental revenue for online businesses and facilitator of the event, has announced the findings of its recent Webloyalty etail Strategy Summit 2010.

With online retail and travel giants such as bmibaby, thetrainline.com and Asda alongside retail researchers Verdict Research and online intelligence provider Experian Hitwise, London’s Cabinet War Rooms were a fitting setting to discuss strategies for achieving post-recession etail success, with multichannel emerging as the dominant theme throughout the event.

“With the etail market becoming more mature and shoppers more savvy, there is a demand for more sophisticated strategies," said Martin Child, MD Europe of Webloyalty. "It is important to recognize the value online plays in multichannel marketing. It needs to work hard to maximize revenue and play a driving role in supporting the other channels.”

Social media as traffic driver
At the event, Experian Hitwise presented its statistics on 2009 trends and predictions for 2010. A major finding, and opportunity for online retailers, is driving traffic from social media. With currently only 7.51 percent of all traffic to transactional sites coming from social networking and forums, compared to 40.87 percent of all traffic from search engines, there is clearly a major opportunity for increasing traffic.

“Search engines are still the key driver of traffic to transactional sites," said Robin Goad, research director at Experian Hitwise. "However, a clear opportunity for retailers lies in increasing traffic from social media sites. A handful of retailers are ahead of the curve with this, particularly in the fashion and entertainment sectors, but many others are missing a trick and therefore potential untapped revenue.”

Experian Hitwise’s statistics show that music etailers as well as video and games etailers receive 8.9 percent, and apparel and accessories etailers receive 8 percent of their traffic from social networks. House and garden etailers, by comparison, only receive 3.5 percent from social networks.

m-commerce
Some etailers are actively researching m-commerce as an additional channel. One of the etailers that has taken advantage of mobile is thetrainline.com who launched its free iPhone app in October 2009. The app has become a huge success with over 400,000 downloads; that means that roughly 1 in 5 UK iPhone owners have downloaded the app. Although the app is currently only informational and not transactional, it has become a major driver for sales and customer loyalty.

Along with thetrainline.com, other key players in the travel sector are noticing a demand for mobile information. For example, bmibaby explained that currently it does not have a tailored mobile site, however one million visitors to bmibaby.com still came from mobiles during 2009, illustrating an evident appetite for the mobile channel among consumers.

Browsing online to buy in the store
As well as retailers, customers are increasingly becoming more multichannel minded. “One of the finest recent examples of multichannel retailing was the 2009 post-Christmas sales peak," said Robin Goad. "There was a very obvious spike in searches for sales and bargains online, with people using the online channel to inform their decisions on high street purchases.”

Experian Hitwise reported that on Boxing Day 2009, 14.54 percent of all online searches containing the search term “sale” were for retailer Next and 3.69 percent for Debenhams. Meanwhile online-only retailers saw a big drop in visits a few days before Christmas, which continued beyond Christmas.

One retailer that actively integrates multiple channels is Asda which demonstrated its "Asda multi-channel strategy," with new routes to market by creating online order and collection points in its stores. “Ultimately the customer decides how and when they want to shop," said Christine Smith, general manager of digital trading and Web merchandising at Asda. "We want to cater to this with our multi-channel strategy by providing various customer touch points, in store, online, mobile and in catalogues. All your everyday needs in your store, on the move, to your door.”

Loyalty
Retail researchers Verdict Research presented the ten key trends to etail success in 2010. Key findings were that retailers will have to work much harder just to stand still. In terms of online spending, Verdict predicts an annual growth of just 11 percent from 2010 onwards compared to almost 30 percent pre-2009.

Verdict expects one of the remaining growth opportunities to lie in “channel blind customers” who use traditional channels such as online, stores, catalogues and phone and combine them with emerging channels such as social media, affiliates, kiosks and mobiles. The etailer that can encourage cross-channel interaction will see an increase in spend.

However, there will be a greater struggle for customer loyalty with the number of sites visited per purchase rapidly increasing. The average number of sites visited per purchase for clothing and footwear, the category with the most visits per purchase, were a mere 1.5 in 2005 and 2.1 in 2009; in 2013 Verdict expects it to reach 2.9. For homewares, these numbers are 1.1, 1.8 and 2.1 respectively, the largest relative increase of all categories.

Verdict Research presented a number of recommendations to overcome this. Fewer clicks to make a purchase, introducing click-to-call, cutting out surprise costs and reducing basket abandonment by emailing the basket to the customer are key ways to enhance sales. At the event, bmibaby reported a 30 percent conversion rate on abandoned basket call backs, through experimenting with these methods.