SPECIAL REPORT                                                 IBM Coremetrics                                            ...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportTable of ContentsIntroduction                            ...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportIntroductionThe 2010 holiday season was huge for online r...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportTrends in Online ShoppingThe holiday season is the provin...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportConsumers Are Spending More on More ItemsAverage order va...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report                                  U.S. Retail: Average Or...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportMobile Device Usage and Social Media Are GrowingCoremetri...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report                                 U.S. Retail: Social Site...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportConsumer Attention Continues to DeclineDespite encouragin...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportCarting and Ordering Hit Record HighsIn another positive ...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report Conclusion: Savvy retailers will strive to improve produ...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportSingle-Page ‘Bounce’ Visitors Remain HighThe bounce rate ...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportBest PracticesGoing into the holiday season, how can you ...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report                                                         ...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportEven	though	online	shopping	may	differ	over	the	holiday	s...
IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report       •	 Adjust your marketing efforts based on your cus...
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
White Paper on Online Retailing Optimized - CoreMetrics
Upcoming SlideShare
Loading in...5
×

White Paper on Online Retailing Optimized - CoreMetrics

4,745

Published on

IBM Coremetrics 4th Annual Online Retail
Holiday Readiness Report
Industry Benchmark Analysis and Best Practice Guide to Maximize Holiday Returns

Published in: Education, Business, Technology
0 Comments
3 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total Views
4,745
On Slideshare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
76
Comments
0
Likes
3
Embeds 0
No embeds

No notes for slide

White Paper on Online Retailing Optimized - CoreMetrics

  1. 1. SPECIAL REPORT IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report Industry Benchmark Analysis and Best Practice Guide to Maximize Holiday Returns J U N E 2 011Did you like this white paper? Tweet about it! Twitter.
  2. 2. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportTable of ContentsIntroduction 1Trends in Online Shopping 2 Consumers Are Spending More on More Items 3 Mobile Device Usage and Social Media Are Growing 5 Consumer Attention Continues to Decline 7 Carting and Ordering Hit Record Highs 8 Single-Page ‘Bounce’ Visitors Remain High 10Best Practices 11 Focus on the Customer Life Cycle 11 Capitalize on the Mobile Channel 15 Retarget Your Browsers and Abandoners 17 Use Personalized Product Recommendations 20 Cultivate the Social Media Channel 21Make the Holiday Season Profitable 22 Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved.
  3. 3. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportIntroductionThe 2010 holiday season was huge for online retailers. Web merchants racked up double-digit increasesin total site sales and average order value as consumers shook off the effects of the recession. Thoseincreases have continued into 2011, IBM® Coremetrics® Benchmark data shows, suggesting that theupcoming holidays could well be another record-setting season for online retail.Yet pitfalls loom. Consumer attention has flatlined at its weakest levels ever, sinking to new lows in suchmetrics as average time on site and page views per session, according to Coremetrics Benchmark data.Discriminating visitors are spending a lot less time browsing retail sites than they did several years ago.They’re shopping surgically—zeroing in quickly on the items they want—and are more likely than ever to“bounce” after a glance at a single page.Meanwhile, mobile browsing and shopping has surged impressively as consumers indulge in theconvenience and rich functionality of feature-laden tablets and smartphones. Mobile sales as apercentage of overall site business nearly doubled in our reporting period, with mobile shopping poisedto break into double digits by the holidays. Social media visitors and sales have lifted modestly—yet theseshoppers are more than twice as likely to convert compared to overall site visitors.In this fourth annual holiday guide from Coremetrics, an IBM Company, you’ll find in-depth analyses ofkey trends in online shopping and usage based on anonymous data aggregated from more than 500U.S. retailers participating in the Coremetrics Benchmark program. This report also offers best-practiceguidance on how you can adapt to fast-moving trends and make the most of your opportunities duringthe critical holiday season, including a look at: • Trends in key performance metrics over time • Emerging opportunities and challenges in online retail • Proven strategies to maximize success and deepen customer engagement • Key technological capabilities for web analytics and online marketingIn preparing this guide, our goal is to help you, the online retailer, formulate powerful programs and tacticsto take this holiday season head-on.Happy selling! Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 1
  4. 4. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportTrends in Online ShoppingThe holiday season is the proving ground for the strategies, tactics, and technologies that your companyhas in place to boost sales by attracting and retaining customers. The opportunity is huge with online retailsales predicted to increase significantly over the next several years. In support of this, the independentresearch firm Forrester has found: • 83 percent of consumers prefer to shop online than in crowded stores during Thanksgiving weekend1 • 21 percent of online shoppers expect to spend more over the web in 20112Such trends are reflected in our analysis of Coremetrics Benchmark data. The following section of thisreport examines trends in five key areas: • Consumers are spending more on more items • Mobile device usage and social media are growing • Consumer attention continues to decline • Carting and ordering hit record highs • Single-page “bounce” visitors remain highAbout Coremetrics Benchmark. Data in this report is based on Coremetrics Benchmark, whichcaptures online marketing results and commerce data from more than 500 contributing U.S. retailers.The industry’s only peer-level benchmarking solution enables Coremetrics customers to measureperformance against the competition (in anonymized, aggregated form). Coremetrics Benchmark comesstandard with IBM® Coremetrics® Web Analytics at no additional cost.1 Bizrate Insights and Forrester Research, “Online Retail Holiday Study,” December 2010.2 Forrester Research, North American Technographics® Retail Online Survey, Q3 2010 (US), September 2010. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 2
  5. 5. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportConsumers Are Spending More on More ItemsAverage order value (AOV) surged to a new high in our reporting period, hitting a record $204.58 in April2011—up a massive 70 percent from a low of $120 in June 2008. And consumers are buying more itemsonline, reaching a new high of 8.26 items per order in March 2011—nearly double the 4.8 items per orderin December 2008.Between the 2009 and 2010 holiday seasons, retailers saw a double-digit gain in AOV. Order values werealso up substantially on Black Friday and Cyber Monday 2010 compared to 2009, as shown in Figure 1. Holiday Season Average Order Value 2009 2010 % Gain November $ 175 $ 195 11.3% December $ 172 $ 190 10.7% Black Friday $ 170 $ 191 12.1% Cyber Monday $ 180 $ 195 8.3% Figure 1. Online retailers posted double-digit AOV gains during the 2010 holiday season.As the economic rebound continues, retailers have the opportunity to capitalize on consumers’ newfoundwillingness to spend. Smart retailers will not rest on their successes and blindly assume that spending willremain strong past the 2011 holidays, but will aggressively expand their emarketing, web analytics, mobile,and social efforts to maximize returns while strengthening long-term customer loyalty.Retargeting browsers and abandoners with personalized emails and targeted display ads is a proven wayto prompt return visits and conversions among would-be buyers. Product recommendations technologycan contribute 10 percent and more of total sales, Coremetrics Benchmark data has shown, boostingboth AOV and items per order. Strong mobile device support is essential to satisfying the fast-growingpopulation of mobile browsers and shoppers, while social media offers an emerging channel to deepenconsumer engagement and trigger site visits. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 3
  6. 6. IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report U.S. Retail: Average Order Value April 2008 - April 2011 $220.00 $200.00 $180.00 $160.00 $140.00 $120.00 $100.00 2008 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2009 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2010 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2011 Apr U.S. Retail: April 2008 - April 2011 Average Number of Items Per Order 8.50 8.00 7.50 7.00 6.50 6.00 5.50 5.00 4.50 4.00 May Jul Sep Oct Dec Jan Feb Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2011 Apr 2008 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2009 Apr Jun Aug Nov Mar 2010 Apr May Figure 2. Both average order value and average number of items per order hit record highs in early 2011, signaling opportunities for a banner holiday 2011. Conclusion: Increases in average order value and average number of items per order should prompt savvy retailers to look for ways to smartly engage online shoppers and capitalize on consumer use of social media and mobile devices. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 4
  7. 7. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportMobile Device Usage and Social Media Are GrowingCoremetrics Benchmark data reveals strong and steady increases in mobile device usage in both sitevisits and sales. Though our snapshot is somewhat limited, from October 2010 to April 2011 as mobiledata was first launched in Coremetrics Benchmark at the end of 2010, mobile usage is clearly rising and isa critical channel that no online retailer can afford to shortchange or ignore. For instance, in our six-monthreporting period, the mobile channel as a percent of total site sales nearly doubled, from 3.4 percent to6.5 percent.We expect that mobile site traffic will grow well beyond the 7.6 percent recorded in April 2011 and be inthe double digits by holiday 2011. Sales via mobile devices—at 6.5 percent of all site sales as ofApril 2011—is impressively high and illustrates that consumers are using iPhones, iPads, BlackBerries,and Android devices for more than just finding directions to a store. U.S. Retail: Mobile Site Traffic November 2010 - April 2011 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% Nov Dec Jan Feb Mar Apr U.S. Retail: Mobile Sales Percent November 2010 - April 2011 7.00% 6.00% 5.00% 4.00% 3.00% Nov Dec Jan Feb Mar Apr Figure 3. The mobile channel shows strong growth in percent of both site visits and sales.Site visits and sales by social media visitors were less than 2 percent in our limited reporting window ofOctober 2010 to April 2011, rising incrementally over those six months. Interestingly, as seen in Figure 4,the percentage of social-driven site sales is higher than social-driven site visits (1.6 percent versus1.2 percent respectively in April 2011). This indicates that social visitors (often Facebook fans or Twitterfollowers) are uniquely predisposed to purchasing and are responding to offers exclusively on socialmedia. Though the population is relatively small, it’s a promising segment that retailers are smartto cultivate. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 5
  8. 8. IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report U.S. Retail: Social Site Traffic November 2010 - April 2011 1.25% 1.00% 0.75% 0.50% 0.25% 0 Nov Dec Jan Feb Mar Apr U.S. Retail: Social Sales Percent November 2010 - April 2011 1.75% 1.50% 1.25% 1.00% 0.75% 0.50% 0.25% 0 Nov Dec Jan Feb Mar Apr Figure 4. Social-driven sales exceed social-driven site traffic, indicating social visitors are highly inclined to convert.A comparison of key metrics across overall, mobile, and social visitor populations reveals some interestinginsights: • Social visitors. They’re more than twice as likely as the overall population to convert, at a rate of 10.7 percent versus 5.2 percent. Many of these social visitors are likely responding to offers, as their bounce rate (62.8 percent) is high and their time on site (3:26 minutes) is low. • Mobile visitors. They’re less engaged than the overall population, with fewer page views, less time on site, lower conversion, and higher bounce rates. Though this is not unsurprising, it does underscore the need for retailers to monitor and optimize the mobile user experience. All Means Mobile Social Page views per session 7.5 4.8 5.2 Average time on site 7:20 3:42 3:26 Conversion rate 5.2% 3.9% 10.7% Bounce rate 35.1% 44.8% 62.8% Figure 5. A comparison of key metrics across the overall, mobile, & social segments of retail site visitors. Conclusion: Mobile and social visitors are rapidly becoming a force to be reckoned with. Retailers need to move fast to ensure they meet the expectations of fickle mobile visitors, and should continue cultivating the important segment of social media users. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 6
  9. 9. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportConsumer Attention Continues to DeclineDespite encouraging gains in AOV, consumer attention hit record lows in the past year. The average timespent on site fell to its lowest point of the past three years in October 2010, down to 7:04 minutes from10:04 in April 2008—a 30 percent decline. Average page views per session also found a new bottom inDecember 2010—7.44, down 45 percent from a high of 13.5 in April 2008.As shown in Figure 6, the new lows are small dips in lines that are relatively flat over the past 1½ yearsafter dropping precipitously from levels of 2008. Discriminating consumers are clearly engaging in surgicalshopping, while the growth of social media and mobile usage and general information overload has cutinto the time that they used to spend on retail sites.To counter these trends and shrunken windows of engagement, retailers should redouble efforts to makesites personalized and compelling. Use of relevant product recommendations, product review sections,and social media are proven techniques to lengthen site visits. Retailers should also revisit fundamentalweb analytics and A/B testing to optimize site navigation and the overall experience. U.S. Retail: Time on Site April 2008 - April 2011 10:33 10:04 9:36 9:07 8:38 8:09 7:40 7:12 6:43 2008 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2009 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2010 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2011 Apr U.S. Retail: Page Views Per Session April 2008 - April 2011 14.00 13.00 12.00 11.00 10.00 9.00 8.00 7.00 Sep Feb Mar 2010 Apr May Jun Jul Sep Oct Nov Dec Jan Feb Mar 2011 Apr 2008 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2009 Apr May Jun Jul Aug Oct Nov Dec Jan Aug Figure 6. Average time on site and page views per session hit new lows in late 2010. Conclusion: A leveling off of consumer attention spans illustrates a new reality of discriminating customers and surgical shopping. Retailers need to diligently test and implement techniques, such as relevant product recommendations and site optimization, to improve these important metrics. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 7
  10. 10. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportCarting and Ordering Hit Record HighsIn another positive development, both shopping cart and ordering sessions reached new highs during ourreporting period. Shopping cart sessions (when a shopper has carted an item) reached 10.9 percent inFebruary 2011, up from a low of 8.3 percent in September 2008. Ordering sessions peaked at 5.3 percentin February 2011 as well, more than double the 2.6 percent of September 2008.But product page views per session fell to a new low of 1.7 in November 2010, trending steadilydownwards in the 12 months preceding, and less than half the 3.7 product page views per sessionof April 2008. Combined, these three data points corroborate observations on the surgical shoppingphenomenon—shoppers are visiting fewer product pages, but they’re carting and purchasing more items. U.S. Retail: April 2008 - April 2011 Shopping Cart Session Percent 12.00% 11.00% 10.00% 9.00% 8.00% 7.00% May Jul Sep Oct Dec Jan Feb Mar Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2011 Apr 2008 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2009 Apr Jun Aug Nov 2010 Apr May U.S. Retail: Order Session Percent April 2008 - April 2011 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0 May Feb Jun Sep Oct Nov Dec Jan Feb Mar 2011 Apr 2008 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2009 Apr Jun Jul Aug Sep Oct Nov Dec Jan Mar 2010 Apr May Jul Aug U.S. Retail: April 2008 - April 2011 Product Page Views Per Session 4.00 3.50 3.00 2.50 2.00 1.50 1.00 May Jul Sep Oct Dec Jan Feb Mar 2010 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2011 Apr 2008 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2009 Apr Jun Aug Nov Figure 7. Consumers are carting and ordering more items, but they’re viewing fewer product pages. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 8
  11. 11. IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report Conclusion: Savvy retailers will strive to improve product page views per session, using relevant product recommendations and social media techniques, to capitalize on consumer inclinations to cart, order, and spend.New visitor and shopping cart conversion. Retailers are increasingly successful at converting newvisitors, with new visitor conversions hitting a high of 4.9 percent in December 2010, more than doublethe roughly 2 percent typical during 2008. This metric has trended gradually upwards for more than a yearand reflects growing consumer trust of web sites they haven’t dealt with before, and in online retailin general.Shopping cart conversion, however, has been erratic over the past two years, with less than one-third ofcarting sessions ending in conversion. With no sustained gains in this critical metric, retailers can benefitby applying web analytics for a fresh re-examination of their ordering funnel, and retargeting abandonerswith personalized emails and display ads. U.S. Retail: April 2008 - April 2011 New Visitor Conversion Percent 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0 Feb Jun Nov Jan Feb Mar 2008 Apr May Jun May Jul Sep Oct Dec Jan Mar 2010 Apr Jul Aug Sep Oct Dec 2011 Apr Jul Aug Sep Oct Nov Dec Jan Feb Mar 2009 Apr Jun Aug Nov May U.S. Retail: April 2008 - April 2011 Shopping Cart Conversion Percent 40.00% 38.00% 36.00% 34.00% 32.00% 30.00% May Jul Sep Oct Feb Mar 2010 Apr May Jun Jul Sep Oct Nov Dec Jan Feb Mar 2011 Apr 2008 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2009 Apr Jun Aug Nov Dec Jan Aug Figure 8. New visitor conversions are rising gradually, but retailers haven’t been able to make sustained improvement in shopping cart conversions. Conclusion: Erratic and unsustained movement in shopping cart conversion trends suggest the need for retailers to re-examine their carting and ordering processes, using web analytics to identify key drop-off points. Testing and optimization towards improving this key metric can pay off with sizable increases in top-line revenue. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 9
  12. 12. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportSingle-Page ‘Bounce’ Visitors Remain HighThe bounce rate (the percentage of single-page sessions) has remained fairly steady over the past 1½year, rising slightly over that period and hitting a record high of more than 35 percent in December 2010.Despite remaining flat, the bounce rate is up sizably from 22 percent in April 2008. Multi-page sessionsare down in concert, hitting a record low of 65.5 percent in March 2011.Corresponding with the surgical shopping trend, the elevated bounce rate makes clear that discriminatingvisitors are likely to click away if they don’t find content that’s personalized and relevant. It underscores theneed for online retailers to ensure that landing pages reached from a display ad, email promotion, or paidsearch listing are spot-on with what was advertised.Retailers can also combat high bounce rates with personalized recommendations, product reviewsections, videos, and social media, encouraging visitors to click on. In addition, complementing on-sitesearch results with product recommendations helps ensure relevant search page content and can triggeradditional conversions. U.S. Retail: April 2008 - April 2011 Bounce Rate (Single Page Sessions) 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% ’08 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar ’09 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar ’10 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar ’11 Apr U.S. Retail: April 2008 - April 2011 Multi-page Session Percent 82.00% 77.00% 72.00% 67.00% 62.00% ’08 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar ’09 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar ’10 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar ’11 Apr Figure 9. The bounce rate hit a record high in Dec. 2010—conversely, multi-page sessions fell to an all-time low. Conclusion: To improve bounce rate performance, retailers need to ensure that landing page content corresponds with what was highlighted in an email promotion and display or paid search ads. They should also test and optimize page content to entice visitors into clicking through to multiple pages. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 10
  13. 13. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportBest PracticesGoing into the holiday season, how can you take advantage of increases in online sales and AOV, whilecombating the decline in consumer attention? Online retailers that excel will relentlessly pursue theseobjectives: • Learn from a customer’s browsing path over an extended period of repeat visits • Use historical behavior data to optimize all online marketing efforts • Deliver highly personalized and relevant customer experiences across all channels • Invest in processes of continuous improvement to create and execute marketing programs that get better and betterThose best practice principles apply to five areas of strategic focus for the holidays and beyond,which we examine in the next section of this report: • Focus on the customer life cycle • Capitalize on the mobile channel • Retarget your browsers and abandoners • Use personalized product recommendations • Cultivate the social media channelFocus on the Customer Life CycleCustomer-centric marketing has been a theme that has resonated for years in traditional channels: print,media, advertising, etc. In the digital landscape, it has more recently come into the spotlight as customersare becoming more discriminating in their online behaviors and are being exposed to more information.According to data gathered in IBM® Coremetrics® Lifecycle, on average it takes a consumer 6.8 digitalinteractions before converting.Whether it’s through display advertising, email, search, customer reviews, mobile or social campaigns,consumers are exposed to numerous digital channels influencing their online purchases and decisionmaking. As a marketer, it’s important not only to be measuring each of these digital channels, but alsocapturing these individual consumer behaviors over time. While a consumer may have clicked through ona paid search campaign and made a purchase, there were likely a number of other activities that ultimatelyled to the conversion.He or she may have clicked through from natural search to gather information, then been exposed toa display ad, then saw customer reviews, then read about a sales promotion on Facebook—all beforeclicking on that one paid search campaign. By understanding this full customer life cycle, marketers canmore clearly define what campaigns, content, and products influence customer life cycle progression andadjust marketing spend appropriately. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 11
  14. 14. IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report Natural Display Search Direct Ad Load Paid Email Search Searched Came directly to Responded to Returned via a Came to the for HDTV the site, bought Newsletter TV Display Ad click. site via Natural on Google. a Blu-Ray player. Clearance link. Picked a Product Search, entered Recommen- discount code dation on site. and purchased. Figure 10. Marketers must understand the journey—the complete conversion cycle and all of the key points of influence—in order to appropriately allocate marketing spend.Furthermore, marketers must be aware of where customers are in their customer journey outside ofunderstanding all of those points of influence. First time visitors to a web site may be responding todifferent campaigns through different channels. A first time buyer may respond differently and perhapshave an affinity for certain products or content on the site compared to a repeat buyer. Each of these ‘milestones’ are an important point to help map the customer journey for your web site. Each retailer may have different characteristics as to what should define a milestone: visits, purchases, product reviews,or perhaps social media. Figure 11. In this Coremetrics Lifecycle report example, milestones are mapped based on shopper frequency. Of the 399,311 visitors over the last 400 days, 239,132 were unique visitors while 8,855 were 3x buyers. Furthermore, 9,995 visitors migrated from 1x buyers to 2x buyers. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 12
  15. 15. IBM Coremetrics 4th Annual Online Retail Holiday Readiness ReportEven though online shopping may differ over the holiday season as gift shopping is more common than personal shopping, these life cycle analytics provide new opportunities for marketers to retargetcustomers and build loyalty.The IBM® Coremetrics® Explore and new Coremetrics Lifecycle solutions offer the tools marketers need to prepare for the holiday 2011 season and beyond. Some techniques include: • Track customer behavior over time. Versus a campaign-centric or page-view centric analysis, beginning to understand individual customer behavior over time will help to develop the broader context and story for how customers engage with your brand. IBM® Coremetrics® LIVE (Lifetime Individual Visitor Experience) Profile™ tracks customers and prospects as they interact with your business online, across multiple ad networks or via email, video, affiliate sites, social media and more, providing a single comprehensive view of each visitor’s behavior over time and across channels. • Define your customer journey. With the customer behavior information in hand, look at what segments or milestones define your customer journey or what your goal is for how you want customers to interact and engage with your brand. With the right solution, you may even be able to look at segments from last year’s online holiday shopping season to see if certain behaviors, patterns or segments stand out that should be tracked this year. Figure 12. Within Coremetrics Lifecycle, standard out-of-the box reports provide pre-made milestones or you can create your own customized milestones. In this figure, milestones have been mapped based on a more high-level customer journey starting from customer awareness evolving to customer advocacy. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 13
  16. 16. IBM Coremetrics 4th Annual Online Retail Holiday Readiness Report • Adjust your marketing efforts based on your customer life cycle. Begin to nurture your customers based on where they are in the customer life cycle. As the holiday season approaches, start looking more closely at the content, campaigns and products that are most heavily influencing their behaviors. Figure 13. In this example, Coremetrics Lifecycle shows that the marketing channel that most heavily influenced the 2x buyer segment was an email campaign. Marketers should pay attention to these analyses to adjust investment appropriately—not only for marketing campaigns, but for web site content and product recommendations as well. As the holiday season approaches, begin tracking these types of reports more closely to make real-time decisions and execute campaigns in response to how customers are progressing through the milestones. Copyright ©2011 Coremetrics, an IBM Company. All Rights Reserved. SPECIAL REPORT 14

×