For retailers in recent years, an online presence has grown from “nice to have” into a mission critical revenue channel and competitive business necessity. No longer are retail Web sites focused solely on the distribution of content and information about offline stores and merchandise. Now, retailers rely heavily on their online storefronts as major contributors to topline revenue. In fact, in the 2004 holiday season alone, online shoppers rang up holiday retail sales of US$23.2 billion-25 percent more than the same season in 2003.
Why did shoppers flock to online stores in such numbers? According to the report, almost one third of all survey respondents reported a better online holiday shopping experience in 2004 over 2003. Moreover, the opportunity to avoid crowded stores, the availability of lower prices, and the accessibility of a wide selection of goods drew buyers onto the Web. The message for retailers is clear: in addition to price, a customer’s online shopping experience is perhaps one of the most important contributing factors in his or her decision to buy.
In addition, major marketing campaigns by brick and mortar retailers such as WalMart Stores Inc., Target Corp., The Home Depot Inc., and Best Buy Co. resulted in significant traffic increases to their Web sites. In the midst of a recovering economy, retailers are taking advantage of growing advertising and marketing budgets to conduct cross channel marketing between their online and offline stores-aggressively driving buyers to their sites. Retailers today rely heavily on their online presence to help maintain the strength, consistency, and quality of the brands they have worked so hard to build in offline stores.
Regardless of whether they are driven to an online store as a result of an ad campaign or simply a desire to avoid crowded offline stores, once a potential buyer arrives at a Web store, that retailer’s sole mission is to convert them into a customer. To improve conversion rates and reduce abandonment rates, retailers must ensure a high quality, rich, and exceptional user experience every single time. In this manner, they can improve overall topline revenue and capitalize not only on the advertising investment, but also on their significant investments in the Web channel itself.
To do so, many mature retailers today are implementing sophisticated Web functionality such as 3D models to help customers virtually “try on” clothing, behavior based shopping assistance to suggest additional purchases, personalized buying guides, and more. They are implementing speedy “oneclick” express checkout options, rapid transaction times, and other conveniences to improve the online user experience. And for companies that sell high value products such as jewelry, whose buyers often conduct research online but actually make purchases at brick and mortar locations, providing rich and speedy search and information oriented functionality is key.