Chapter 5

Presenting products and services online

The more relevant you make your website for each visitor, the longer they will stay, the more they will do, the more they will spend and the more they will tell other people.

I met up with the team at Red Technology, an ecommerce solutions provider, combining ecommerce agency services and authoring an ecommerce platform. For more information about them, visit: www.redtechnology.com.

We discussed how the theory of personalising your ecommerce makes sense to everyone, but that most retailers do not really know where to start and what to do to get the best results. In fact, 98 per cent of respondents surveyed by eConsultancy saw personalisation as critical to success, but only 22 per cent had implemented it in some form or other (Davis, 2015).

Key takeaway

  • It is often thought of as the preserve of huge, multinational retailers and not available to the mass market due to its cost and complexity. Not only that, many retailers often suffer from paralysis when it comes to the idea of trying to implement anything but the most basic forms of personalised content and promotions on their ecommerce sites and emails. They are unsure of where to begin, whether they already have or need to buy the technology required to do it, how to justify any time and expense and how to prove the results.
  • Retailers may display very basic recommendations, such as the items a user last looked at or what other users purchased when ordering a certain product, but little else. Most businesses tend to adopt more of a generic ‘one-size-fits-all’ approach, so are missing out on the huge potential that even basic personalisation can offer, including increased conversions, orders, average order value and customer loyalty, as well as a reduction in cart abandonment and bounce rate.
  • The capability exists to customise entire user experiences down to an individual user level – serving unique content, pricing and promotions to each, but the resources, effort and cost required to do this properly in such microscopic detail means it is unlikely to happen for all but the largest retailers. More achievable is the scope for delivering content (in the form of onsite advertising, products, offers and promotions) to more generic groups of users and providing a degree of personalisation that those remaining 78 per cent of retailers still will not be delivering.

The advice

1. Product recommendations

Often, the first, and most basic, step for the majority of retailers in delivering some form of personalisation is the use of product recommendations, which can be delivered by almost all ecommerce platforms nowadays. In fact, personalised product recommendations can help generate around 10–30 per cent of ecommerce site revenues (Agrawal, A. 2015). Depending on the sophistication of your ecommerce system and the data you have available, these may be delivered manually, via automated algorithms and metrics or a combination of both.

Types of product recommendation

There are at least three different types of product recommendations to consider, all of which can serve personalised content aimed at increasing the user’s likelihood to buy.

Similar: items that are similar to or can be substituted for the ones being viewed. These might be slightly different versions, different brands/makes or have more/less advanced features and a higher/lower cost.

Complementary: offering additional or complementary products to those being viewed. Often advertised under guises such as ‘Complete the look’ or ‘Customers also bought’ trying to upsell and increase basket size.

Recently viewed: what other items a user has recently looked at (most likely session-specific – but more advanced versions can remember users from previous visits, either via account login or using cookies).

Many ecommerce sites deliver only one of these three types of product recommendations across their entire website. Increasing the types you offer can help target different customers, with different buying requirements and habits, at the same time, whilst also providing the capability to upsell.

Placement of product recommendations

Another thing to consider with product recommendations is their effectiveness on different pages in the purchase cycle. For instance, tempting users with last-minute or special offer items on the checkout page can encourage impulse buys, whilst giving them alternative options (potentially more advanced or more expensive versions of what they are looking at to drive an increase in your average order value; you could create an algorithm that will not show an alternative product of a lower value, for instance) may work better on the product pages during their browsing and research phase.

By beginning to personalise the output of these recommendations, using more than one type of recommendation at the same time, and thinking about the most effective place on your website to put them, you should expect to see significant increases in conversions.

When you have mastered the more generic use of product recommendations, you can move on to displaying items specific to individual users based on the data you have gathered and profiled, such as demographic, interests and behavioural.

When done well, product recommendations tend to use a combination of technology and manual input for best results. As you develop, and more information is gleaned to populate product recommendations, the more personal you can get. You can begin to use customer data, such as demographics, interests or website interaction, alongside manual input from merchandisers, product experts or stylists.

Due to the time involved when trying to manually populate your product recommendations, particularly when you start, you may need to heavily rely on automated systems. However, do not let that stop you from having some human input and watch out for the following common failings with some automated systems:

  • Product recommendations being the same across all products, and thus often unsuitable, regardless of the product being viewed.
  • Seasonal items being displayed after the event – no real point showing people Christmas decorations that somebody bought before Christmas, in January, as they are unlikely to be relevant.
  • Recommendations being exactly the same item as that currently being viewed.
  • Recommending other colours or sizes of the same product (these variables should always be shown on the same product page).

2. Target content

Onsite targeted content is a method of displaying some information to your users in specific areas of your website. Most often, it takes the form of advertisement (image), but could also be some product recommendations, flash content, a video or plain text and tends to sit in a pre-defined place on each page.

Types of targeted content

There are two basic forms of targeted content both with advantages and disadvantages, as shown in the following table.

Table 5.1

Inline content: appears in an area or areas within a web page and are, possibly, less likely to attract the user's attention, but are also less likely to annoy them. These tend to be more commonly used and more appropriate in most situations.
Pop-up content: appears in a lightbox above the page and either will require user action to remove, or will have a time limit to disappear automatically. Very likely to catch the user's attention, but can be used really only once during a user's visit before they begin to annoy.
Placement of targeted content

The placement of content is key to its success. As the areas available for it are likely to be defined during your initial site build, it is important to consider where you want them and how easy they are to change. Delivering the right content, in the right form, at the right stage of the user journey and purchase cycle could be the difference between converting and not. For instance, last-minute bargains on the mini-basket and checkout pages can encourage impulse buys (particularly on low-value items), whilst a flash sale could be highlighted across all pages, so it is shown during their browsing phase. Most catalogue and transactional pages across your ecommerce site should contain the scope to include targeted content, whilst ensuring that they are easily visible to the user.

Customer and display conditions

Having established the types of targeted content, and the different pages and places where you can put it, the next stage is understanding when and who to display it to. It is this that will set your website apart and help to begin personalising what you display, ensuring it is delivered to the right people at the right time. Most ecommerce sites will display the same content to everybody across their entire website, but there is scope to be much smarter than that. Some techniques will require knowledge of who your customers are, whilst some can be delivered with little or no knowledge of them. The following section is an example of one way to use targeted content on your site for people using your onsite search.

Onsite search

When a user conducts a search on your ecommerce site, immediately you get an idea of exactly what they are looking for and thus can begin personalising what is displayed to them, based on that search. For example, their search query could trigger the display of an advert based on that particular search term.

You can also build up a search bucket of other similar search terms that would trigger that same targeted content, rather than creating different things for every single search term, which is unrealistic. By examining your website analytics to see the specific search terms that people are using, you can begin to build up a series of targeted content based on those, starting with the most popular. You can also check that any misspelt searches automatically return the right results and, thus, the right targeted content, too.

As the display of such targeted content is completely created and defined by you, you could choose to show ones directly related to a search term or decide that, if they are already looking for something in particular, show complementary or auxiliary products related to their search. If your web pages allow it, you could show multiple pieces of targeted content and complementary items. Remember, targeted content does not always have to be promotions or offers, it can also take the form of more generic information.

By starting with a few pieces of targeted content and then increasing the quantity and sophistication of it, you can begin to build up a portfolio based around your most popular search terms. Through rotating, testing and analysing, you can also begin to see which techniques produce the best results.

That is just one example of how to personalise advertisements, but there are loads more that you could consider, including:

  • The contents of their current basket – drive up average order value by prompting users to take advantage of bundle offers if they have not met the full criteria, or display complementary products to what they have added.
  • The value of their current basket – free delivery over a certain value is quite a common promotion, so prompting users to meet those thresholds via targeted content is a common and successful tactic.
  • The offers applied to their current basket – if you have the capability to layer multiple promotions, then using targeted content to deliver them all is a great way to ensure users keep on taking advantage of them and driving up their basket value.
  • Geographic location – even if you are not offering your customers completely localised sites, you could use GEO IP to identify international users and target them with localised content that may pertain to specific events in their country, like Thanksgiving in the USA or Bastille Day for your French customers.
  • Source (referrals) – display different targeted content to different users based on how they have reached your site. They could be different for PPC visitors, third-party referral sites like Quidco or from your own email marketing.
  • Device types – the advent of responsive web design means you can target users with different targeted content based on their device type. This may be particularly prevalent for mobile devices where users are potentially on the move and could be targeted by omni-channel retailers trying to drive them to stores.
  • Time and date – great for flash sales or, with increased customer knowledge, for delivering personalised content such as individual offers for a user’s birthday.
  • Specific customers/customer groups – assigning users to common groups based on demographics, interests or previous behaviour is a great way to segment and personalise content, i.e. different targeted content could display to all loyalty card members or people who have bought certain products.
  • Wish lists/gift lists – if you know what items are on a user’s wish list, you could deliver targeted content to prompt them or use offers to convert them, specific to those products.

3. Promotions

The clever use of online promotions can help drive the conversion phase of your ecommerce customer’s lifecycle, encouraging users to order via your website rather than one of your competitors’ and also encouraging them to order items they had not originally intended to purchase, and thus drive up average order value, too.

Types of promotions

Online promotions can take many forms and often you will be restrained by the technology they use as to what types and complexity of promotions they can deliver, but even the most basic ecommerce platforms should be able to deliver a few different promotions options and you should experiment with as many as possible to see which convert the best.

Typical options may include:

  • percentage off an order;
  • percentage off a product(s);
  • money off an order;
  • money off a product(s);
  • fixed price product;
  • free products;
  • free shipping;
  • get cheapest free;
  • bundles (e.g. buy 2 get 1 free, 3 for £10);
  • coupons;
  • buy X get Y free;
  • free gift/sample;
  • tiered spend and save discounts.

Placement of promotions

Promotions themselves are not tangible, so are not really placed. They need to be delivered with a targeted content delivery tool to inform users of the details of any offer and try to engage and convert them. It is similar to a physical store where the actual promotional details and calculations will be held in the till system, but the posters and on-shelf labels will be advertising those offers to customers. As such, promotions will depend on the use of a system to deliver targeted content and the placement of that content. As they are so heavily linked to targeted content, there is also similar scope for managing them. You can:

  • schedule offers to run at certain times or dates;
  • personalise them based on the source of the visitor;
  • automatically trigger them based on a user’s action (like adding something to their basket, or completing a review) or session;
  • include or exclude certain products, brands or customers;
  • limit the number of uses both individually and site-wide.

Delivering promotions is an art form. Ensuring that the right offer reaches the right customers at the right time requires strategic planning and customer profiling. A personalised approach to promotions and content is proven to engage, and re-engage customers, increasing average order value and loyalty.

4. Emails

The final tool to consider is email marketing, which is linked primarily to the re-engagement phase of the ecommerce customer lifecycle. The re-engagement phase of your customer cycle is vital to the ongoing success of your ecommerce site. Everybody knows the statistics about the cost of acquiring new customers versus existing ones and email plays a vital role in re-engaging users and driving them back to your website.

There are three specific types of email, each having the capability to be personalised to some extent:

  • Bulk/blast emails – general marketing emails delivered to everybody or specified groups based on demographics or other segmentation.
  • Transactional emails – individual emails with account, ordering and fulfilment information.
  • Automatic/triggered emails – automatically sent to individual users based on behaviour.
Bulk/blast emails

Whilst most retailers will be sending out bulk/blast email campaigns to their customers, the capability to personalise them is an opportunity not to be missed. Campaign emails can be segmented using all of the traditional demographic information, as well as using previous transactional data to target existing users who have purchased a certain product, range or brand with other complementary items or services.

Transactional emails

For transactional-type emails, there is further scope to personalise by adding recommendations or offers to these emails based on what items have been ordered at that time. For instance, adding cross-sells to an order confirmation email or incentivising users to re-order on a delivery confirmation email can be effective methods for re-engagement.

Automated/triggered emails

Triggered emails take the re-engagement phase a step further by automatically targeting users based on their behaviour, including things like what they buy, whether they order, how much they spend, whether it is their first order and much more.

These campaigns can be set up in advance and delivered on an individual level, making them ideal for things like abandoned basket campaigns, re-ordering reminders (for items that require regular purchasing) or welcome emails. They deliver true personalisation with a minimal amount of work, as, once you have created the campaign, you can set it up to work automatically for each user that meets the criteria. They are great for increasing customer loyalty and conversion and have a significantly higher open and click-through rate than generic bulk emails.

Recommended actions

  • Short term/quick win
    Use a few of the more basic ideas that you feel are easier and cheaper to implement and prove they work. These may not require as much effort, money or complicated technology as you think; you may be able to do them relatively quickly with the resources you currently have. This will help you gain buy-in from other stakeholders, improve confidence in what you are doing and, potentially, help secure investment for more sophisticated systems in future, if required.
  • Medium
    Continually test and optimise your strategies to improve their efficiency and see what works well and not so well. Ensure you use analytics to provide facts, rather than relying on instinct or opinion, as this combination of data and knowledge can help when further increasing your personalisation output and applying other techniques.
  • Long term
    Once you have proved it works and seen the results, start to expand your personalisation strategy in terms of both quantity and complexity to increase its effectiveness. Think about tying all of the four tools together to harmonise everything and shape your user’s journey, remembering the key phases of engagement, conversion and re-engagement.

References

Agrawal, A. (2015) ‘Ecommerce Marketing: 5 Tips to Boost Product Sales’, Customer Think. Available at: http://customerthink.com/ecommerce-marketing-5-tips-to-boost-product-sales/ [Accessed 7 March 2016].

Davis, B. (2015) ‘17 ways to personalize ecommerce for four types of customer’, Econsultancy. Available at: https://econsultancy.com/blog/67211-17-ways-to-personalize-ecommerce-for-four-types-of-customer/ [Accessed 7 March 2016].

5.1 Case study: The Board Basement

A passion and love for snowboarding and a decision to approach retailing differently gave birth to The Board Basement, www.theboardbasement.com.

This case study will show you how a small online store developed into one of the UK’s top independent snowboard retailers by selling via more channels.

Key findings

  • Simple, targeted adjustments to broader order management can generate impressive improvements.
  • Efficiency comes from identifying the right areas on which to focus.
  • Customers want to feel supported, whether online or instore.

Interviewees

Two friends, Luke Martinez and Stuart Tait, have spent the last seven years passionately growing a specialist online retailer of winter sports and snowboard equipment, clothing and accessories. Founded on Martinez’s 20+ years’ experience in snowsports and surf retailing and Tait’s background in digital marketing, the two of them decided to take a different approach to traditional high-street retailing.

Like any successful example of entrepreneurship, The Board Basement’s story has humble beginnings. The company was started with an investment of just £3,000 and born out of a simple idea – to help lovers of winter sports fight against the growing cost of enjoying their passion.

The pair’s journey has been different from most in the retail industry. The Board Basement was founded during the last recession when external investment in retailing was minimal and retailers were cautious of adapting their business models to meet the needs of the modern consumer.

Martinez and Tait perceived these challenges as an exciting growth opportunity and the chance to provide customers with quality equipment at affordable prices. The Board Basement achieves this by putting its customers first, whether that be passing on deals the team has found in the marketplace, selling stock from past seasons at a reduced price or buying the latest in-season equipment.

About The Board Basement

The Board Basement sells across multiple marketplaces including eBay, Amazon, Rakuten, its own online store and, due to customer demand, its own physical retail space in Exeter, Devon. Its broad product range includes everything from snowboards to boots and helmets, as well as streetwear, footwear, luggage and bags and other specialist items.

Since The Board Basement was founded, the company has grown fourfold with an annual revenue of £1 million in 2015 and a staff count of six full team members, all of whom are keen snowboarders, skaters and surfers.

The Case

One of The Board Basement’s founding principles was to treat customers as the team would like to be treated themselves.

This drive for excellent customer service and a desire to meet the expectations of customers led Martinez and Tait to assess how a business in their sector should support its customers. They applied the lessons they learned during their time in a traditional retail landscape to ecommerce and started to build the business.

Part of delivering on these promises meant the company needed precise marketplace management across each channel and throughout the entire sales process. Furthermore, because of the company’s commitment to selling previous seasons’ product lines as well as in-season, there was an added layer of complexity in terms of order management and fulfilment.

For example, a customer’s purchase instore, on eBay or on the company’s online shop front, would need to be reflected instantly on other marketplaces, as well as in the company’s warehouse and its physical store.

The problem

With the company growing rapidly – in the last four years, turnover grew from £250,000 to £1 million – understanding how to solve this challenge was a major strategic initiative for Tait and Martinez.

Seasonality, competitive cross-border sales tactics and supplier demands also added to the challenges facing the team. Another lesson has been how to adapt the company’s business model to drive growth whilst countering European retailers that have capitalised on a weaker euro in recent years and undercut heavily on price.

This led the company to extend its product range to include popular equipment from past seasons. Customers often grow fond of a certain brand or product line, but find it difficult to purchase equipment elsewhere due to other retailers focusing only on the latest equipment. The Board Basement has addressed this requirement by providing a comprehensive range of in-season and previous season products.

This enthusiasm for supporting customers over the long term translates to the company’s wider shopping experience. Customers can now buy online or, unusually, in the context of ecommerce, visit a physical store for buying advice, equipment support and a shared appreciation of winter sports.

In fact, the opening of a physical store reflects the customers’ growing desire to ask questions to an expert, as well as the winter sports sector’s sense of community and how customers need to be nurtured throughout the entire sales process.

The solution

The growth of The Board Basement’s physical store proved to be the turning point for The Board Basement. For example, a customer would choose an item, be served and then a sales representative would have to log into each online marketplace to adjust the stock accordingly.

At that moment, Tait and Martinez recognised the potential value of a solution that could offer a centralised overview of the entire order and sales fulfilment process. Manual workflows were just too laborious and time-consuming. There had to be a simpler way that would prevent both founders being pulled away from their strategic role of growing the business.

At this point, Gustaf Antti, The Board Basement’s website director, joined the company from Oliver Sweeney and, along with Tait, started on the project. They began by assessing how technology could help and what options were available. There were three strict criteria to be met. Any solution would have to be efficient, deliver the control the team was searching for and be future-proof.

To the duo’s initial dismay, they found that many solutions were overly simplistic, quickly outdated, or offered minimal support in how to implement the solution into The Board Basement’s own operations.

Eventually, this led to Volo Commerce (www.volocommerce.com), which provides online merchants and brands with the tools, knowledge, confidence and sense of community they require to succeed in key ecommerce marketplaces.

From the outset, the implementation had the desired effect, as the team started to automate key components of its existing sales and order processes.

The team began with stock visibility across each marketplace to ensure everyone was spending less time on general control processes and more time on sourcing and selling great products.

The Board Basement then assessed how to use the service to improve customer communication. A common challenge was with equipment sizing and ensuring that customer questions were answered in a timely manner. The team worked closely with its service provider to improve the quality of its product listings in an effort to cut repetitive inquiries.

The team have also applied the lessons learned from day-to-day liaison with its service provider to other operational areas. This includes automating product packing, shipping and customer communication around fulfilment, and overall internal logistics within the warehouse and the physical store.

Once the immediate challenges were solved, the team moved on to leveraging its new partnership to drive growth in new marketplaces. This included expansion into cross-border trade on both eBay and Amazon to face domestic and international competitors head-on without any negative impact on business or operational efficiency.

Results

New internal efficiencies and rapid sales growth have made The Board Basement’s initiative a major success for a number of reasons:

  • Revenue of £1 million last year, an increase from £250,000 four years prior.
  • Sustained expansion into new marketplaces and international channels.
  • Ongoing success for physical store (the largest independent in the South West of England).
  • Simplified order, sales and operational management.
  • A strong, growing reputation in the global sector.
  • Impressive staff productivity that prevents unnecessary hires.

Everyone in the company was on board with the new system and willing to endure short-term, small-scale disruption for the sake of the long-lasting benefits possible.

Critical success factors

Because of the service provider’s unique revenue share model, the capital investment required by The Board Basement was minimal. Both companies are able to grow together and, due to the partnership relationship, The Board Basement has gained numerous team members without any extra costs, in turn releasing the existing team to focus on marketing and selling products.

The Board Basement is simply better at what the company promises to do and deliver to the customer. The team received a service that the business needed, not just the latest tool, and one that is growing with the business.

Lessons learned

This focus on value was critical for The Board Basement and Tait, as he concludes:

‘This kind of project can be daunting at first because all the possibilities are in front of you and you see all the things the system can do. Start slowly, focus on what’s important, be patient, and you will get to use all of the things you saw at the very beginning of the project. For us, at the end of the day it’s all about your data and seeing what your data can do. Now all our customer touch-points are integrated, regardless of the channel they come through, with the reporting at the back end. It has been phenomenal.’

Recommendations

  • Start slowly – rushing ahead creates mistakes.
  • Focus on what is important – not everything is an urgent priority.
  • Be patient – results often take longer than first thought.
  • The goalposts are continually moving; keeping up with changes is paramount.

5.2 Reducing shopping cart abandonment

Billions of pounds in revenue can be recouped by addressing shoppers who exit a website and leave behind unpurchased goods in their digital shopping cart. Techniques commonly employed by ecommerce retailers may be high-cost quick fixes; however, there are practical solutions that are being overlooked.

I met up with the guys at Spot Studio, a digital marketing agency and technology company, to explore this topic further. For more information, visit: www.spotstudio.net.

In the event that an online shopper does not proceed to buy goods that have already been placed in their e-shopping cart, the cart is said to be abandoned. When statistics resulting from 31 studies into abandoned carts are averaged, the median rate at which carts are abandoned stands at 68.53 per cent (‘33 Cart Abandonment Rate Statistics’, Baymard Institute). Placed against the accepted understanding that ecommerce brought in approximately $1.7 trillion (‘B2C E-Commerce Sales Worldwide 2018 – Statistic’) globally in 2015, it becomes clear that abandoned carts are a massive source of potential revenue for ecommerce vendors.

Key takeaway

  • Projections carried out by industry experts place ecommerce revenues at $3.551 trillion by 2019 (Lindner, 2015), a twofold increase that makes abandoned carts an even more pressing concern for vendors. Currently, ecommerce sales make up 7.3 per cent of a total of $22.822 trillion in retail purchases, a figure obtained from Emarketer.
  • Narrowing the field to the UK, e-shopping brought in around £93.89 billion in 2015, which means that the cost to retailers of abandoned carts in the UK alone is also in the billions – and, more than that, is set to increase exponentially.

The advice

The top eight reasons for cart abandonment

Carts are most often abandoned due to one of the following, says a recent study:

  1. The cost of mailing an item.
  2. Mailing would take too long.
  3. The cost of the item.
  4. The original intention was browsing rather than purchase.
  5. The customer questions the trustworthiness of the retailer.
  6. The website prevents the customer from making payment in the manner they wish.
  7. Making the purchase is overly convoluted.
  8. The customer prefers to purchase with a discount.

What most retailers do about it

The four key methods we will be focusing on in this section are:

  1. Exit intent technology.
  2. Retargeting shoppers via email.
  3. Retargeting shoppers online.
  4. Storing purchases as cookies.

This data is based on answers from 50 leading UK retailers, supplemented with visual observations from the 60 retailers with the most visitors (SimilarWeb, 2016) and the top 200 SMEs, as determined by Trustpilot.

1. Exit intent technology

Tracking the tempo and patterns of mouse use through exit intent technology can result in accurate anticipation of cart abandonment by e-shoppers. Pop-ups can then target the shopper and incite them to follow through with their original intent to purchase.

However, this method is not being used commonly to address cart abandonment by leading etailers. Just 2 per cent of the 50 most popular online clothing vendors and 1.64 per cent of the 60 most popular sites resorted to exit intent technology as a tool.

Instead, discount vouchers offering 15–20 per cent off original prices were being offered to prompt shoppers into completing their purchases.

The mark-up of mark-downs

The use of discount vouchers directly hurts revenue to the tune of £1.33 billion in the UK and is not a supportable business tactic. This figure is calculated considering the UK market of £52.25 billion, consumers who only buy on discount 17 per cent of the total, and the typical voucher offering 15 per cent savings. The number of online shoppers who do not buy at all if a voucher is not present is rapidly mounting, increasing by 70 per cent to 17 per cent (‘Are UK Shoppers Getting Savvier?’) of all shoppers. A further 16 per cent customarily search out discount codes, which means that regular users of online discounts now make up 33 per cent of the market altogether. These figures should be taken with a grain of salt, considering that they come from a voucher website. The consistent upping of the numbers are, nevertheless, quite revealing of the general tendency.

What is more, cunning shoppers are manipulating ecommerce algorithms to benefit from discounts offered in response to abandoned carts, as evidenced by testimonials across message boards and websites offering online shopping advice (‘Abandon Your Online Shopping Basket And Unlock Secret Discount Codes’).

This is a further sign that discount vouchers should not be considered long-term solutions to the problem of abandoned carts.

Back to exit intent technology

SpotStudio put exit intent technology into action on an ecommerce website and tracked action with the thought to provide another, more substantial option to the use of discount codes. In this experiment, exit intent technology was used to encourage customers to preserve the contents of their shopping carts by caching them into email. At the end of three months, 9.43 per cent of users had opted to receive these emails; 68 per cent of emails were opened, resulting in a click-through rate (CTR) of 22.05 per cent.

Although this is not as high as the usual abandoned cart email, this may be down to differing levels of engagement on the part of the shopper at this point. An advantage of using exit intent technology to prompt shoppers to sign up for emails, which are the most lucrative tactic for addressing abandoned carts, is that only the email address is needed instead of all the fields of the standard form. The vendor has the option to remarket to these shoppers also, with 94 new entries on mailing lists per 1,000 abandoned carts.

Because the rate that the CTR translated into sales stood at 10.2 per cent, altogether 1.53 per cent of consumers who opted to receive their abandoned carts via email when prompted via exit intent technology went ahead with their purchases, at prices unaffected by discounts.

2. Retargeting via email

Abandoned cart emails (ACEs) cue shoppers back to the purchases they have left behind. In order for an ACE to be sent, customers must be signed into the retail website; this is essential for any company selling goods online.

Systems can be programmed to send ACEs at very little cost, taking into account individual user preferences and buying tendencies. Interestingly, a relatively low percentage of 22.95 per cent of the leading UK ecommerce vendors (Next, Argos and Asos among them) sent ACEs, and just 26 per cent of the leading UK clothing vendors did so. In contrast, 29.5 per cent of the leading 200 SMEs and 34 per cent of the leading 50 utilise ACEs.

This is especially important when looking at the statistic that 44.1 per cent of ACEs are opened, with a median CTR of 11.61 per cent. Of these, 29.9 per cent lead to sales. Remarkably, shoppers purchasing after prompting by ACEs escalated their average order value (AOV) by a mean of 14.2 per cent. Taking this into consideration, each series of ACEs brought in a median of £5.20 (‘Basket Abandonment Emails: Why You Should Be Sending Them’).

The following table clarifies the loss to online businesses that do not utilise ACEs, estimating that businesses retain contacts and information from 40 per cent of online shoppers:

Spot Studio

Source: Spot Studio (www.spotstudio.net).

3. Retargeting shoppers online

Through software that detects online user footprints, vendors can remarket themselves to shoppers who venture to other places on the internet after abandoning a shopping cart. Consumers who are targeted with remarketing efforts are 75 per cent more inclined to engage with a promotion than those unfamiliar with the vendor. Thus, remarketing initiatives are much more effective than the usual PPC promotions.

Google and Facebook (FBX) remarketing were considered in this study, as shown in the following table.

Segment Do They Remarket Via Google? Do They Remarket Via Facbook?
Top 60 Shopping  78.69% 9.84%
Top 50 Clothing 78.00% 24.00%
Top 50 SMEs 54.00% 12.00%
200 SMEs 47.50% 8.50%

Source: Spot Studio (www.spotstudio.net).

As seen above, again the leading clothing online vendors are the most ambitious, with 24 per cent working with FBX compared to only 9.84 per cent of the top online shopping companies. Surprisingly, the number of leading SMEs using FBX is higher, at 12 per cent. The percentage of the leading 60 online shopping companies and the leading 50 online clothing vendors utilising Google for remarketing is similar at 78.69 per cent and 78 per cent respectively.

Remarketing via Facebook means access to the broadest online market in the world. Specifically, this means approximately 936 million dynamic users per day; 798 million dynamic mobile users per day; 1.4 billion dynamic users per month; and 1.25 billion dynamic mobile users per month, all figures as of 21 March 2015 (‘How Facebook Retargeting Increases Advertising Conversions’). Although not every user can be reached via remarketing, the potential is there and can be expanded upon with the utilisation of existing technologies.

Not only that, AdRoll has stated that retargeting efforts via FBX resulted in a quarter over quarter increase in CTR of 1.3x; in conversion rates of 1.7x; and in ROI of 1.1x in a case study conducted in 2015 (‘All-in-one advertising for all-in-one apparel’).

As for Google, not only does its Display Network offer contact with 10 per cent of the web, according to its marketing materials, but efforts can be aimed directly at what Google terms ‘shopping basket abandoners’. Looking at case studies reveals that retargeting efforts via Google resulted in cuts in cost per acquisition (CPA) within 25–67 per cent, also according to marketing. AdWords dividends also went up by 30 per cent.

4. Storing purchases as cookies

With persistent carts, the customer will find their intact basket in just the same place when they click on the website again. This tactic, possible through the use of online cookies, is widespread among all types of online retailers considered in this study. Consider that 90 per cent of the leading 50 SMEs, 89 per cent of the leading 200 SMEs, 93.75 per cent of the leading 60 online vendors and 96.72 per cent of the leading 50 clothing vendors are utilising it.

The small percentage who do not employ persistent carts are practically asleep at the switch; their rationalisation may be that cookies are optional and they wish to avoid confusing the sales process. They may be convinced when they see that, according to the SpotStudio investigation, more than half (56 per cent) of online shoppers intended all along to purchase another day; 28 per cent extend the buying process longer than a day, 21 per cent by 3 days and 18 per cent prefer to leave it for a week or longer. Furthermore, when Internet Retailing took a look at buying patterns, it found that online shoppers in the UK habitually stretch purchases of electronics, health and beauty products over a median of 6.69 days (Skeldon, 2015).

Let us now look again at cookies. When online businesses retain carts, how long do they keep them for? Surprisingly, the study shows that it is a matter of hours for 42.6 per cent of etailers and of days for only 31.7 per cent. Evidently, numerous sales are being lost due to this oversight.

Lessons for you

The leading 50 online clothing vendors set a standard for the rest of the industry, adopting a variety of innovative and accepted techniques to address abandoned carts. Looking at findings by group, the leading 60 online shopping vendors are not far behind the clothing retailers, with occasional overlap between the groups. Even taking into account varying budgetary considerations, techniques that are relatively quite inexpensive with high potential returns often are being overlooked.

SMEs often are not utilising Google remarketing; this may be due to the cost. We postulate that many are just not retargeting shoppers with abandoned carts elsewhere on the internet. Interestingly, a higher percentage of SMEs utilise ACEs in comparison to the leading 50 clothing retailers.

Although the cost of remarketing via Facebook is low, not many of the top 200 SMEs or top 60 online retail companies were using this technique. Admittedly, FBX remarketing results in a lower sales conversion rate than Google remarketing; however, this is because users targeted on FBX are in a different mindset about purchasing than those using Google. The use of this technique by clothing retailers implies that more companies should be considering it, especially given the low cost.

Although honing in on discounts and remarketing (often pricey) as solutions for abandoned carts may result in momentary gains, the often forgotten ACEs are inexpensive and effective in the long term for companies and their committed customer bases.

It is worth bearing in mind that consumers habitually stretch the process of making an online purchase over five days. This important window of time allows the company to contact the shopper and encourage them to buy. All ways in which retailers are able to do so, especially the low-cost ones, should be fully considered to maximise earnings.

Recommendations

Thought and care should be given to search out suitable long-term solutions to abandoned carts and secure real customer loyalty. The consequences of band-aid solutions that mask long-lasting problems with fast sells should be looked at with clarity. Focusing on discounts and spending more on remarketing will affect the entire industry negatively, if continued to be implemented indiscriminately.

References

‘33 Cart Abandonment Rate Statistics’, Baymard Institiute, 14 January 2016: www.baymard.com/lists/cart-abandonment-rate, 2016 [Accessed 16 March 2016].

‘Abandon Your Online Shopping Basket And Unlock Secret Discount Codes’, This is Money, 2015 [Accessed 16 March 2016].

‘All-in-one advertising for all-in-one apparel’, AdRoll, 2015 [Accessed 16 March 2016].

‘Are UK Shoppers Getting Savvier?’, Voucherbox.co.uk, 2015 [Accesssed 16 March 2016].

‘B2C E-Commerce Sales Worldwide 2018 | Statistic’, Statista, 2016 [Accessed 16 March 2016].

‘Basket Abandonment Emails: Why You Should Be Sending Them’, Econsultancy, 2016 [Accessed 16 March 2016].

‘How Facebook Retargeting Increases Advertising Conversions’, CyberInnovation.com 2016 [Accessed 16 March 2016].

Lindner, M. ‘Global e-commerce sales set to grow 25% in 2015’, Internet Retailer, 2015 [Accessed16 March 2016].

SimilarWeb, 2016 [Accessed 16 March 2016].

Skeldon, P. ‘Indecisive Shoppers And Cashback-Savvy Brits Among Unexpected Mobile Buying Habits Across Europe – Internetretailing’, InternetRetailing, 2015 [Accessed 16 March 2016].

5.3 Case study: STA Travel

With the increasing expectations of consumers for a personalised digital experience, STA Travel knew that its new online customer account area had to provide a relevant cohesive experience across channels. And, by doing so, it was able to increase cross-sell, upsell and loyalty amongst its customers.

Key findings

At the outset of the project, it established a key performance indicator (KPI) framework that would allow it to measure the outcomes of the project against the business objectives. The ultimate focus was to improve cross-sell and upsell from existing customers and, as a result, increase customer lifetime value and average transaction values.

STA Travel used a combination of Google Analytics and internal sales reporting to create a reporting dashboard that allowed it to measure the following results:

  • 15 per cent above target for mobile app downloads;
  • 35 per cent above target for active users of the customer account area;
  • 323 per cent increase in social sharing.

Interviewee

For businesses to survive in today’s digital environment they must be nimble, experimental and intimately connect with their customer to encourage repeat business

John Constable recently celebrated his 10-year anniversary with STA Travel. CEO of STA Travel since 2012, he joined the company as managing director for the UK in 2006. Constable has been a driving force behind the company’s growth and has played a lead role in repositioning the brand to appeal to a broader group of customers with a business vision, global store refresh, new website and savvy digital presence.

About STA Travel

STA Travel is the world’s largest student and youth travel company. Started by two students in 1979, every year it sends more than two million passengers on life-changing adventures. STA Travel has more than 2,000 employees in over 200 stores in 11 countries.

Its online sales strategy

A deep knowledge of its Millennial customers and a passion to deliver them the best adventures that money can buy is at the heart of STA Travel’s online retail strategy.

Since 1979, STA Travel has continuously adapted to the ever-changing needs, aspirations and behaviours of its core audience – youth and student travellers. And, during the last three years, it launched a number of new initiatives to make it easier for Millennials to find and enjoy adventures around the globe, through their channel of choice.

STA Travel connects with its audience through contextual content – bite-sized targeted entertainment. It creates exclusive, relevant and original content, with a strong focus on music, video, STA Travel’s own travel experts and customers’ real travel stories. This content is woven throughout its social channels – YouTube, Facebook, Twitter, Instagram, Tumblr, Snapchat, blogs and, soon, WhatsApp – as well as screens across its global retail network, digitising an historically offline environment through real-time social feeds.

Millennial customers are social and are online 100 per cent of the time. They expect to connect with brands on any channel, at any time. That is why STA Travel has adopted a ‘mobile first’ mindset and continues to make significant improvements to STA Travel’s mobile sites worldwide. The company is trying to make it easier for customers to find and buy the right flight, insurance, destination or round-the-world adventure whilst they are travelling.

Recently, STA Travel digitised its global brochure suite, championing a paperless world and giving its customers access to rich, interactive content on mobile and tablet. Last month, it became the first global travel agency to offer a meta-search capability for adventures and tours that brings the same level of expertise and product choice that customers are used to receiving in its retail environments.

STA Travel is bringing peace of mind to its travellers. All customers can now access their itineraries and personalised recommendations, plus last-minute deals on MySTA, an online customer account that can be accessed via the website or the STA Travel App. And, if they run into problems, they can always reach STA Travel on Twitter through @STATravelCares. Its people are available 24/7 to deliver customer service and answer questions from any corner of the world.

STA Travel understands that music and travel are intrinsically linked and, in 2015, it launched STA Travel Sounds – a digital platform to showcase young, unsigned musical artists from around the world. STA Travel Sounds illustrates the adaptability of the brand to hone in on the needs and wants of its audience, who favour ‘experiences over stuff’.

The company’s innovations are underpinned by STA Travel’s core value of being experts in student travel. Its BlueTicket – exclusive student and youth fares to under 30s – and price-beat guarantee contributed to a double-digit increase in online sales in 2015 and 2016.

The future of the STA Travel online retail strategy is firmly about bringing together an omni-channel approach and continuing to personalise the customer experience. Its aim online is to offer tailored content and expertise to help customers choose the best adventures and give them ownership over their itinerary, still with the knowledge that they are in the safe hands of a trusted brand.

The Case

The problem

STA recognised that the experience expectations of its target audience had changed significantly. Ubiquitous mobile access, social networks and an on-demand/convenience culture had resulted in customer journeys that were more complex than ever before as customers move between channels and use multiple devices to accomplish their goals.

They expect their experiences to be consistent across channels and contextually relevant and personal to them. Whilst the company had always been able to offer that in its retail stores, it also needed to be able to provide that personalised experience online to both its new and existing customers.

Consumers want to be able to leverage the benefits of each channel and choose whichever different platform they wish for different tasks, e.g. discuss a destination with a travel expert and book flights instore, read peer reviews of hotels on mobile and then purchase hotels and adventure tours for their trip online.

To enable that to happen, the company needed to create an online customer area that understood who the customer was, what they had purchased and what else they may need before, during and after their trip.

The background

In order to capture the younger target audience and achieve growth in its online business, the company needed to invest in its digital offering to bring together a disconnected digital real estate and move forward towards a single customer view.

Some of their competitors already provided an online customer area to view existing orders, but they were not using that opportunity to enhance their understanding of customers. And, as a result, were not able to provide the personalised experiences that customers are expecting.

STA wanted to provide an online experience that differentiated it from its competition and that resembled the type of personalised experience and brand tone of action that customers receive within its retail stores.

The company knew that delivering a seamless and integrated experience across channels would require it to bring together the data from all its systems and third parties into a single customer view. Without it, the company would not be able to provide the personalised customer experience it needed. But, doing that would require integration with a range of back-end systems, different data silos and third-party APIs.

The company considered the option of a large-scale IT re-platform, but the significant costs and long leads made the option unviable.

By delivering a personalised experience within the customer account area, the company expected a range of overall business performance improvements:

  • An increase in online revenue per customer through upsell and cross-sell: by displaying associated products and services that were tailored to a customer’s profile and related to their upcoming and in-progress trip, the company expected to be able to grow attachment rates to different products and the overall customer value.
  • An improvement in customer retention: alongside improving cross-sell and upsell, STA expected personalisation to increase customer advocacy and retention.
  • Help to provide more effective marketing: with the volume of content, products and services available, the company knew that its marketing would have better cut through if it was targeted to each customer’s individual needs.

As a consequence, STA also expected to achieve operational efficiencies through decreased calls into retails stores and the call centres querying previous purchase information.

The solution

STA chose to leverage its in-house teams and partner, Rockpool Digital, and the STA Travel online customer account area is today available on web, iOS and Android apps across its four key markets (USA, UK, Australia and New Zealand). It gives customers the ability to control their bookings and travel documents in their own personalised itinerary. It offers up personalised, location-based cross-sell and upsell suggestions for hotels, activities and tours and allows users to share their travel plans with friends and family.

Making interaction easy and social

The social take up and convenience expectations of its target audience meant that STA wanted to use social media login for the website and the mobile app. By allowing customers to use its social media login credentials to sign in, STA provides convenience for them and the ability to personalise the online experience, based on their social graph information. This includes being able to provide a different online experience for group bookings in the future.

Social media logins also make it easier for customers to share their travel plans with friends and family, which was key for helping with the acquisition of new customers and facilitating group travel.

Bringing the data together

By bringing all the data together into a single customer view that is used across digital platforms and instore, the company can use a number of different signals to create personalised and tailored digital experiences:

  • the device or interface they are using;
  • their location and environment to understand where a customer is in the world geographically and provide localised information;
  • their current situation and need state, including relative elements such as time zones to provide timely messages before, during and after travel;
  • their behaviour, which includes historic interaction, personal data, browsing behaviour and social graph.

This also provides a better ability to track customers and their communications across different channels, enabling more consistent and continuous conversations as customers traverse channels.

Continue to understand the customer

The company also wanted to use the platform to continue learning about its customers. So STA made it possible for its customers to provide additional information about themselves, their travel preferences and how they wanted us to communicate with them. This was coupled with analytics information to build a more complete view of each and every customer.

Provide what they want

By understanding each customer, the company was then able to interlace its online itinerary with tailored content, products and services that were relevant to the customers, their travel plans or their friendship groups. The unique customer experiences that this creates demonstrates to its customers the value it places on understanding them and anticipating what they need, when they need it.

Continuity across channels

STA knew the digital experience had to work seamlessly across all channels, so it ensured that the technology choice supported that. It used a bespoke version of the Umbraco content management system for a responsive design across desktop, tablet and mobile web. The team at STA then integrated the new customer account area into both the iOS and Android mobile apps to allow customers to go from web to mobile seamlessly.

Delivering at speed

By working in 2-week sprints, the web platform was turned around in an ambitious timeframe of 16 weeks, with both mobile apps following just 6 weeks later. Achieving this speed to market was ambitious and challenging for both STA’s internal team and its partners.

The future

STA’s next round of optimisation aims to give customers a direct channel to its instore Travel Expert to discuss their personalised Travel Wish List. They will be able to pin to this whilst browsing STA’s wealth of online content and access it at any time through their online account.

Results

At the outset of the project, STA established a KPI framework that would allow it to measure the outcomes of the project against its business objectives over time. The company’s ultimate focus was to improve cross-sell and upsell from existing customers and, as a result, increase customer lifetime value and average transaction values.

As stated at the start, STA used a combination of Google Analytics and internal sales reporting to create a reporting dashboard that allowed it to measure the results.

Lessons learned

Speed to market was a key driver for the project and, so, what made the project a success was the ability to deliver a personalised experience across different channels so quickly. The company’s initial expectations were that it would take 6 to 12 months to deliver the new platform, but, working with its partners, it was able to do it in a fraction of that time.

The agile delivery approach also allowed the company to respond easily to the inevitable changes that arise in such a complex project. By all teams and suppliers working closely together, STA was able to accommodate new requirements and deliver an experience for the customer that matched the original expectations, releasing something that outperformed its competitors.

Recommendations

  • Make sure that the customer experience you are trying to create is consistent across different channels.
  • Take every opportunity you can to personalise the experience for your customers to create 1:1 interactions.
  • Focus on an implementation approach that allows you to accommodate inevitable change, deliver quickly and then learn and iterate, based on the results.
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