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Irce 2011   San Diego Final

Irce 2011 San Diego Final



How do top IR500 companies quantify the business impact of their online customers’ experience?

How do top IR500 companies quantify the business impact of their online customers’ experience?
How leading retailers optimize customer conversions by ensuring a quality experience.



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  • Key Messages:Impact of performance beyond RT and Availability Proactive vs. ReactiveHolistic/Correlated/Phased approach
  • Key Messages:Target creating new platform – moving off of Amazon after more than a decadeHome Depot significantly reducing the number of stores they are opening yearly and investing in the online spaceMacy’s focusing on “omnichannel” strategy to engage customers in stores, internet and mobile channelsBest Buy reducing capital expenditures (Stores) and increasing investment in online channel with a goal of hitting $4b in online revenue
  • Key Messages:Belk launched a $150m ecommerce initiative last year because of the growth and margins in that channelWilliams-Sonoma spending $50m on ecommerce and supply chain because it is their fastest growing channelMen’s Wearhouse – recognized they were late to the game in the online and social channels – won’t happen again because George is going to guarantee it!Ann Inc. spending $25m improving ecommerce infrastructure including a redesigned web site, mobile commerce site and more international web stores
  • Key Messages:Even though the online/mobile and social channels are getting a lot of attention, key metrics have not moved that much over the last ten yearsConversion rates have shown some growth but so has cart abandonmentIn addition, repeat customers (Loyalty) trends are indicating that every visit/order has to be earned
  • Key Messages:Dynamic Phase – utilizing customer/previous visit information to customize the visit for the customerOnline is now more than the website accessed from a PCThere are currently 5 devices, 6 channels, and the entire customer lifecycle to consider
  • Key Messages:Navigation/Click Stream Paths can be varied based on the customer, what site they came from and other variables (location)Content can also be varied based on the customer, where they came from and other variables (seasonality)
  • Key Messages:Resorting of site search results to best meet the customers needsProduct Recommendations that can be customized to custom to where they came from, what they have searched for, as well as many other optionsChat sessions customized to customer/website
  • Key Messages:Leveraging all of the data that is collected by Gomez customers key insights can be gleanedPage abandonment varies by page type – visitors are more patient on check out page than home or search results pageOn average abandonment rate increases significantly as page load times increase
  • Key Messages:Mobile users are a little more patient initially but after 2 seconds their abandonment rate mirrors that seen on websites
  • Key Messages;For purposes of consistency across many retailers the conversion just goes through search results“Conversion Rate” begins to drop quickly after 1.5 – 2 seconds of load time
  • Key themes:Gomez helps you prioritize problems based on business impact and rapidly identify the root cause to resolve the issueTalk trackBecause you have this unified view across the entire ADC, when a problem occurs Gomez lets you do two things very quickly:Determine the business impact of the problem so you can prioritize. Gomez dashboards let you rapidly determine how many users are affected, what transactions are affected, etc. so you can determine how urgent and critical the issue is. Once you’ve determined how urgent the problem is, your next question is: what is the root cause of the problem?Gomez also helps you answer this question2. Isolate the root cause. Gomez dashboards allow you to quickly determine if the problem is in one of four major categories, and then drill down into each category to determine the specific root of the problem.Is it in your data center or WAN? Where in your data center? A server? A network segment? A method call? Is it with an ISP or the Internet? Is it a problem that everyone else on the internet is experiencing, or just you?Is it with a third party provider? Is it a cloud provider? A CDN? A third party data feed? Etc.Is it in a browser or device? Is your application incompatible with a browser or particular mobile device? Are your pages too big? Too many objects? Etc.This information lets you quickly prioritize problems and speed resolution.
  • Key Messages:Business expectations of the online channels is highCustomer expectations of online channels always increasingResources are stretchedThere are many ways to look at customer experience
  • Key Messages:If you have a PDP add to cart test all real customer PDP add to cart transactions are trackedMeasures time spent in the data center as well as in the internetQuantifies business impacts by tracking and displaying the real customers impacted by a performance issue
  • Key Messages:Impact of performance beyond RT and Availability - focus IT/Business resources on issues impacting customers the mostProactive vs. Reactive – Move from the “Doing Autopsies” to “Preventative Medicine”Holistic/Correlated/Phased approach – eliminate the time and complexity from a plethora of un-collated tools – single E2E tool

Irce 2011   San Diego Final Irce 2011 San Diego Final Presentation Transcript

  • Quantifying and Proactively Reducing Negative Business Impact due to Performance Issues
    Steve Trimbo
  • Topics
    Online Channels Increasing in Business Strategic Importance
    Increasing Complexities in Capabilities being Delivered
    Impact of Performance on Business
    Taking a Proactive Approach
    Q & A Time
  • Online Channels Increasing in Business Strategic Importance
  • The retailer is taking control of, and overhauling its website, which has been run by Amazon.com Inc. for the last decade.
    Traditional retailers making strategic bets in the online channels
    Typically opens up to 200 stores worldwide per year, this year expects to add fewer than 10. Meanwhile, the big home improvement chain has embarked on a three-year plan to invest $1.1 billion in its supply chain and in technology, with much of that budget earmarked for the web.
    Macy's, Inc. continued to develop and expand its online capabilities in 2010 to accommodate future growth. This investment is part of the company's omnichannel strategy, which integrates the offerings in stores, the Internet and mobile technologies
    Plans to shave off $70 million to $80 million in capital expenditures over the next three to five years by reducing its bricks-and-mortar square footage by 10%. Meanwhile, it expects to double its web sales to $4 billion in the next 5 years.
  • Traditional retailers making strategic bets in the online channels
    Launched last year a $150 million e-commerce investment initiative. "Our margins are so much higher online, that's why it's such a growth area for us," says Ivy Chin, head of e-commerce
    Projects $135 million to $150 million in capital expenditures in 2011—one-third of that for e-commerce and the supply chain that supports it. "The Internet is our fastest-growing channel and a key component of our future strategy," CEO Laura Alber says
    In 2011 Ann will spend $25 million on improving its information technology and e-commerce infrastructure with a redesigned web site, a mobile commerce site and more international web stores, says CEO Kay Krill
    "Our e-commerce site traffic and business is surging," Zimmer told Wall Street analysts at the time. "As a technology Luddite, I accept responsibility for the lateness in aggressively entering into Internet marketing and social networking. It will not happen again."
  • But - Site metrics continue to be challenged
    Source: Forrester and Shop.Org State of Retailing Online Studies
  • Increasing Complexity in Capabilities Being Delivered
  • Delivering complex capabilities
    According to Forrester we’re in the “Dynamic Phase” of site optimization
    • Not only are we optimizing the site – we have other online channels to grow and optimize as well:
  • Tactics Varied and Complex
    Varied Navigation and Click Stream Paths
    Optimized Content
  • Tactics Varied and Complex
    Resorting of Site Search
    Different looks of Chat
    Product Recommendations
  • Impact of Performance on Business
  • Website performance impacts visitor behavior
    Abandonment Rate Across 200+ Sites / 177+ Million Page Views over 1 week / All Browsers
    Source: Gomez real user monitoring
  • Web & Mobile Performance Impacts Visitor Behavior
    Abandonment Rate Across 200+ Sites / 177+ Million Page Views over 1 week / All Browsers vs. iPhone Safari
    Source: Gomez real user monitoring
  • Website Performance Impacts Business Results
    Transaction Conversion* Rate Over Load Time Across 33 Major North American Retailers
    * Conversion rate computed from home page through search results
    Source: Gomez real user monitoring
  • Why Web Performance Matters
    Average impact of 1 second delay in response time for Web users
    Customer Satisfaction
    Page Views
    • Lost revenues*
    • Brand damage
    • More support calls
    • Increase costs
    • LOB dissatisfaction with IT
    *Online business doing $100K/day = $2.5M/year in lost revenue
    Source: Aberdeen Group - 2009
  • Why Web Performance Matters: Impact of Poor Performance
    second slowdown
    reductionin revenue/user*
    found that a
    determined that a
    fewer searches/user*
    Source: Steve Souders @ VelocityConference 2009
  • Why Web Performance Matters: Benefits of Good Performance
    reduced page load times from ~7 seconds to ~2 seconds
    increase in revenue
    reduction in hardware costs*
    Reduced landing page load time by 2.2 seconds
    60 M
    increase in conversions
    More downloads/year
    users that visit the fastest pages
    more pages/visit than users visiting the slowest page*
    Source: Steve Souders @ VelocityConference 2009
  • Taking a Proactive Approach
  • Challenge 1:Pinpointing Problems and Optimizing Performance
    2. Where is the root cause?
    1. What is the business impact?
    Private Public
    Data Center
    Virtual/Physical Environment
    3rd Party/Cloud Services
    Web Servers
    App Servers
    DB Servers
    Load Balancers
    Content Delivery Networks
    Web Services
    Mobile Components
    Mobile Carrier
  • Challenge 2:The Application Performance Delivery Chain
    The Application Delivery Chain:
    Customer Experience
    More and Diverse
    More Customers
    Data Center
    Virtual/Physical Environment
    App Tier
    DB Tier
    Web Tier
    Load Balancer
    Home Grown/Freeware
    Point Solutions
    Web Services
    Tool Mgt.
  • Business Challenges
    • Web Platform more important to the business
    • Customer expectations increasing
    • Complexity becoming more challenging
    • Resources stretched further
    • IT budgets stretched Further
    • Customer Experience Increasing in Importance
    Home Page
    Funnel Reports
    Search Result
    Product Page
    Fault Isolation
    Visual Replay
    Application Performance Management
    Customer Experience Management
    Web Analytics
  • What Gomez First Mile Does
    Evaluates all website traffic
    • Sees every transaction related to a Gomez test
    • Unifies Real-user and Active Monitoring
    Active Tests
    End-user RT
    Characterizes end-user response time
    • Measures total end-user response time
    • Measures the time spent with the data center
    Data center RT
    Real User
    Data center RT
    Quantifies business impact
    • Measures pages views and users impacted by a performance problem
  • Summary
  • To quantify and proactively reduce business impact due to performance issues in the customer experience delivery chain
    Quantify business impact of Web performance problems
    Automatically prioritizes performance problems by number of page views and users affected
    Create A Proactive Monitoring Framework
    Identify and resolve issues before they lead to a degraded customer experience
    Take a holistic – correlated approach
    Build on a set of integrated tools providing correlated data with end to end visibility
  • Q&A Time
  • Thank You