E-commerce Benchmarking Insights – cleverbridge Networking Event (CNE)
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E-commerce Benchmarking Insights – cleverbridge Networking Event (CNE)

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cleverbridge head of SaaS solutions, Doug Caviness, presents “E-commerce Benchmarking Insights,” looking at benchmarking statistics drawn from aggregate data on the cleverbridge e-commerce ...

cleverbridge head of SaaS solutions, Doug Caviness, presents “E-commerce Benchmarking Insights,” looking at benchmarking statistics drawn from aggregate data on the cleverbridge e-commerce platform.

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  • Before we start --- I’d like to ask a few questions:Do you know your conversion rate?What are your KPIs?
  • Not only do you have the tools to measure your own statistics, but you have to have to figure out what makes the most sense for your own business.[Reference Building Keystones posting about collecting emails addresses]For example, we generally recommend not doing anything to limit customer visits to your shopping carts. However, a client might evaluate the lifetime value of capturing email addresses in their database and decide that it makes the most sense for them to collect an email address – that the company can use for follow up marketing in case the customer doesn’t complete the purchase. Similarly, in a posting in our Building Keystones blog, we discussed some of the consideration considerations around using a Freemium model. Perhaps by orders of magnitude you might increase the total population of potential customers using your products, but on a percentage basis there might be a much lower conversion rate compared to customers that try a free trial.
  • Explain that we are particularly strong in the USA and Germany (where we have much or our roots). And Japan recently moved up to the 3rd largest country on an orders basis. It’s interesting to note that the top 3 counties are each on a different content – demonstrating that we’re a global company.
  • Average Orbitz customer spends $100 / night for a hotel room. And Apple customers spend an extra $20-$30 / night and are much more likely to choose a 4 or 5 start hotel.
  • Reference blog posting
  • Reference blog posting
  • Reference blog posting
  • Reference blog posting
  • Polling: What do you think is an acceptable CTO rate?Do cleverbridge’s CTO metrics for your company factor into your own CTO measurements?What do you think is an acceptable CTO rate?
  • In the US they say the customer is King.In Japan they say the customer is GOD!
  • The more successful affiliates will have more resources and be able to draw bigger audiences. They will often have ways to monetize their traffic in multiple ways, including advertising. You shouldn’t be overly concerned with trying to prevent your affiliates from working with multiple clients as a good affiliate will always be testing and optimizing their conversions and resources and will adjust their relationships accordingly.

E-commerce Benchmarking Insights – cleverbridge Networking Event (CNE) E-commerce Benchmarking Insights – cleverbridge Networking Event (CNE) Presentation Transcript

  • E-Commerce Benchmarking Insights cleverbridge Client Networking Event, Oct. 3, 2012
  • Introduction • Objectives • Polling and interaction • Brief KPI discussion • General statistics • Insights from data  Browsers  Localization  Payments • Contact to Order (CTO) rates • Affiliate sales
  • Statistics
  • Product Pricing and Conversion Rates • Stable product pricing (2009-2012) • Conversion rates vary widely based on multiple factors Top-Selling Products Conversion Rate High 80.0% Median 20.4% Mean 27.4% Low 0.50% Sources: Pricing and conversion rate data: aggregate data of top selling products
  • Sample Conversion Rate Scenarios ConversionCompany A Rate Freemium product that randomly launches full-screen pop-up cart page <10%Company B Collects email address before cart page >50%Company C Upgrade discount email offer >70% Other database marketing <7%
  • Regional VariationsConversion Rates and Pricing Country Conversion AOV Per Capita Software GDP Piracy Rate Denmark 28.7% 28 € $37.6K 24% Japan 26.6% 30 € $35.2K 21% USA 20.6% 35 € $49K 19% Germany 17.8% 25 € $38.4K 26% Brazil 6.6% 19 € $11.9K 53% Greece 3.5% 26 € $26.6K 61% Russian Fed 3.1% 23 € $17K 63% China 1.2% 32 € $8.5K 82% India 0.6% 27 € $3.7K 63% Sources: Conversion and AOV: sample aggregate data of selected clients GDP: The World Fact Book (pub by The CIA) Software Piracy: NationMaster.com
  • Distribution of Orders on PlatformTop Countries Rank Top Languages %USA 1 English 46.2%Germany 2 German 29.1%Japan 3 French 5.7%UK 4 Japanese 5.3%France 5 Dutch 2.7%Australia 6 Spanish 2.2%Canada 7 Italian 1.8%Netherlands 8 Portuguese (Brazil) 1.6%Italy 9 Russian 1.0%Switzerland 10 Swedish 0.9%Sources:Distribution of orders: aggregate client data
  • Sample of Top Languages Used Brazil % Japan % Portuguese (Brazil) 75.1% Japanese 97.8% Portuguese 12.5% English 1.9% English 11.7% Portuguese (Brazil) 0.1% German 0.3% Spanish 0.1% Spanish 0.2% German 0.1% Sources: Conversion rate: aggregate client data
  • Sample of Top Languages Used Canada % USA % English 82.9% English 99.5% French 16.4% Spanish 0.3% German 0.2% German 0.1% Chinese 0.1% Chinese 0.0% Spanish 0.1% Japanese 0.0% Sources: Language and conversion rate: aggregate client data
  • Internet Browsers
  • Distribution of Orders by Browser Worldwide % AOV Japan % AOVMSIE 47% $44.84 MSIE 80% $42.60Firefox 15% $43.86 Firefox 3% $54.12Chrome 15% $42.99 Chrome 12% $47.92Misc 13% $41.55 Misc 3% $54.72Safari 8% $49.36 Safari 3% $59.62Opera 1% $32.40 Opera 0% $47.10 “Orbitz Worldwide Inc. has found that people who use Apple Inc.s Mac computers spend as much as 30% more a night on hotels, so the online travel agency is starting to show them different, and sometimes costlier, travel options than Windows visitors see.” The Wall Street Journal, Aug. 23, 2012Sources:Browser and AOV: sample aggregate client data
  • Localization
  • Uplift in Orders from LocalizationExample: Konbini launch in Japan Non-Konbini Konbini +14% Pre-Launch Post-Launch Sources: Konbini uplift data: sample aggregate client data
  • Payments
  • Payment Type TrendsPercent of ’07 ’08 ‘09 ‘10 ‘11 ‘12 Last 5-Yrs GrowthSales YTD (% of Sales)Credit Card 68% 70% 72% 72% 72% 71% 4% Stable since ’11PayPal 7% 9% 12% 14% 16% 17% 143% Stable since ’11Wire 15% 13% 9% 7% 6% 5% -67%TransferDirect Debit 10% 7% 5% 4% 4% 4% -60%iDEAL 0% 0% 0% 1% 1% 1%Check 1% 1% 1% 1% 1% 1% Sources: Payment type usage: aggregate client data
  • Order non-Completion Rates 80% 70% 70% 59% 60% 52% 54% 50% 44% 40% 33% 30% 19% 20% 12% 14% 10% 6% 0%Sources:Order non-completion rates: aggregate client data
  • Evolution to Subscription Creates Conflictwith Offline Payments • Monthly billing creates challenges for customers who use offline payments • Enhanced recurring billing capabilities:  Direct Debit -- already implemented  PayPal -- pilot project (Oct’12) • Consider providing customers incentives to pay for subscriptions quarterly or annually Example:
  • Payment Types Usedwith Monthly Subscriptions - Germany Payment % of All % of Mthly Comments Type Orders Subscr. Orders Direct 21% 41% Recurrent billing already in Debit place PayPal 35% 28% Recurrent billing pilot Oct’12 Credit Card 25% 22% Authorization recycling in Place Wire 17% 7% Transfer Sofortüber- 2% 3% This provider is working on a weisung.de subscription billing solution Sources: Payment type usage: aggregate client data
  • Payment Types Usedwith Monthly Subscriptions - USA Payment Type % of Monthly Subscription Orders Credit Card 82% PayPal 18% Sources: Payment type usage: aggregate client data
  • Contact to Order Rates
  • Contact to Order Rate (CTO) • What is Contact to Order Rate and why does it matter?  Refunds  Customer satisfaction  Potentially requires work of client • CTO rates on cleverbridge platform:  Highest: 15.5%  Median: 8.0%  Lowest: 2.6% Sources: CTO: sample of leading clients
  • Top 5 Sources Drive 65% of CTO Refunds Redelivery/Extend 31% download link 35% (Other) Tech support (referred to client) Installation issue Delivery missing 12% 6% 7% Other 10%Sources:CTO: sample of leading clients
  • CTO Rates by Country USA 8.3% Japan 6.7% Germany 6.6% Canada 6.3% Netherlands 5.7% Italy 5.4% UK 5.1% Switzerland 5.0% France 4.7% Australia 4.1% Sources: CTO: aggregate client data
  • Refund Rates by Country Japan 7.7% USA 4.3% Canada 4.1% Sweden 3.8% UK 3.6% France 2.9% Netherlands 2.4% Australia 2.1% Italy 2.0% Germany 1.5% Sources: Refund rates: aggregate client data
  • Some Best Practices to Reduce CTO 1. Refund Authorization 68% of clients authorize cleverbridge to decide on refund request Benefits: • Increases customer satisfaction • Reduces risk of chargebacks • Reduces client’s processing work Refund Rates High Median LowPre-authorized 5.5% 1.9% 0.6%Authorization required 5.2% 1.9% 0.2% Sources: Refund authorization: sample of leading clients
  • Best Practices to Reduce CTO (continued) 2. License Keys and Download Links • Download links valid for more than 14 days (perhaps 60 days+) • Integrate license key generator with cleverbridge platform to reduce the risk of running out of keys or having to send keys via a separate process Benefits: • Increases customer satisfaction • Reduces CTO
  • Best Practices to Reduce CTO (continued) 3. Instructions Effective and localized instructions for order confirmation pages and confirmation emails • Installation • Registration Benefits: • Increased customer satisfaction • Reduced CTO
  • Best Practice ExampleAvast Confirmation Page Extract for confirmation page for Firefox users Extract for confirmation page for MSIE users
  • For Your Consideration… Advertise Money Back Guarantee 20 out of 25 clients now advertise money back guarantees Potential Benefits: • Higher conversion rates (commonly mentioned in the industry) • Higher customer satisfaction Sources: Money Back Guarantee: sample of leading clients
  • Affiliate SalesLarge potential upside for many B2C clients
  • Portion of B2C Gross Sales from Affiliates Category % of Gross Sales Utilities 30% to 40% Anti-Virus and Malware 10% to 25% Baseline with Affiliate manager 10% Baseline without Affiliate manager 5% (or less) Sources: Affiliate data: aggregate client data
  • Gain from Hiring Affiliate ManagerSample ScenarioCurrent gross sales $1,000,000 / mo(includes 5% from unmanaged affiliate sales)5% lift in gross sales with Affiliate Manager $50,000 / moCost of Affiliate Manager $6,000 / moIncremental gross sales less cost ofAffiliate Manager $44,000 / mo $528,000 / yr
  • Affiliate Program Statistics • Total Affiliates: 26,000 in cleverbridge program • Percent of gross revenues generated by cleverbridge-managed Affiliates:  80% by the top 2% of Affiliates  85% by Affiliates with multiple clients Sources: Affiliate data: aggregate client data
  • Profile of Successful Affiliate • Has multiple clients • Larger and has more resources to draw bigger audiences • Multiple ways to monetize their traffic (advertising, etc.) • Continually tests and optimizes conversions and investments across their clients
  • Thank you