1. Mgt 240 Lecture E-commerce: Successful Retailing on the Web November 18, 2004

2. Miscellaneous Lecture homework 5 due tomorrow by 5pm Lecture homework 5 due tomorrow by 5pm If you have picture files, you have to upload them to your dropbox folder too If you have picture files, you have to upload them to your dropbox folder too Second lecture exam on December 2 nd in class Second lecture exam on December 2 nd in class Exam review and MIS career session on Tuesday, Nov 30 th at regular class times Exam review and MIS career session on Tuesday, Nov 30 th at regular class times

3. Retail on the Web E-tail sales figures keep rising at a very healthy rate More potential customers on the web Further along the learning curve about what works Consolidation in retail categories Entrance of brick and mortar retailers

4. The State of Retailing Online What key indicators seem to be improving for online retailers? What key indicators seem to be improving for online retailers? Sales up Sales up Revenues up Revenues up Percentage of all retail sales up Percentage of all retail sales up Important in certain categories Important in certain categories Cost of customer acquisition down Cost of customer acquisition down Marketing costs down Marketing costs down Conversion rates have improved Conversion rates have improved Highly profitable multi-channel customers Highly profitable multi-channel customers

5. Retailing on the Web Examples Amazon Amazon Amazon Overstock Overstock Overstock REI REI REI Land’s End Land’s End Land’s End Land’s End

6. Retailing on the Web Best Practices Home page Home page

7. Retailing on the Web Best Practices Navigation Navigation

8. Retailing on the Web Best Practices Product pages Product pages

9. Retailing on the Web Best Practices Checkout process Checkout process

10. Converting Browsers to Customers How can online stores improve their conversion rates? How can online stores improve their conversion rates? Site ease of use Site ease of use Improve navigation Improve navigation Simplify checkout process Simplify checkout process Opt-in emails Opt-in emails Community Community Recommendations Recommendations

11. What Causes Customers to Buy on Impulse? What site design features influence impulse buying? Why? What site design features influence impulse buying? Why? Not price! Not price! Search capabilities Search capabilities Category structure and links Category structure and links Navigational ease Navigational ease Cluster recommendations Cluster recommendations Personalized recommendations Personalized recommendations

12. Are You Driving Your Visitors Away? What are some common online store design flaws? What are some common online store design flaws? Lack of quick orientation for first-time visitors Lack of quick orientation for first-time visitors Hard to follow processes Hard to follow processes Missing prices or shipping charges Missing prices or shipping charges Poor graphic design Poor graphic design Poor navigational structure Poor navigational structure

13. Online Retailing: More than a Web Site What do customers expect from online stores? What do customers expect from online stores? Trusted brand Trusted brand Attractive surroundings Attractive surroundings Easy-to-find and always available merchandise Easy-to-find and always available merchandise Competitive quality and price Competitive quality and price Good customer service Good customer service Rewards for loyalty Rewards for loyalty Links between online and physical stores Links between online and physical stores

14. Convenience is Key Online stores must strive for Online stores must strive for Ease-of-use Ease-of-use Product availability Product availability Site availability Site availability Multiple access devices Multiple access devices Price not as important Price not as important Personalization, community important for emotional connection Personalization, community important for emotional connection Opt-in email Opt-in email

15. Important E-Retail Store Features Clarity and ease of navigation Clarity and ease of navigation Fast loading pages Fast loading pages Shopper privacy Shopper privacy Technical support Technical support Return and exchange policies Return and exchange policies Right look and feel Right look and feel

16. How Can Retail Web Sites be Designed for Ease of Use? Fewer and simpler screens Fewer and simpler screens Multiple search options Multiple search options Appropriate category hierarchies Appropriate category hierarchies Well thought out navigational structure Well thought out navigational structure Good product information Good product information Support for ordering process Support for ordering process Real-time inventory checks Real-time inventory checks Personalization opportunities Personalization opportunities

17. Acquiring More of the Customer’s Business How can cross or up-selling be achieved in an online environment? How can cross or up-selling be achieved in an online environment? Complementary or step-up item recommended on product page Complementary or step-up item recommended on product page Recommendations during product configuration Recommendations during product configuration Others? Others?

18. Fostering Customer Loyalty How can customer loyalty be fostered by online stores? How can customer loyalty be fostered by online stores? Personalization Personalization Customer service Customer service Loyalty programs Loyalty programs Convenience applications Convenience applications Wish lists Wish lists Personalized help Personalized help Education Education

19. Determining Retail Web Site Success Old measures Old measures Hits Hits Page views Page views Session length Session length New methods New methods Surveys Surveys Interviews Interviews Usability testing Usability testing Click stream analysis – data mining Click stream analysis – data mining

20. Obtaining Customer Intelligence Customer intelligence opportunities Customer intelligence opportunities Web site interaction data Web site interaction data Purchase history Purchase history Registration provides demographic details Registration provides demographic details IP address provides information about customer IP address provides information about customer

21. Using Customer Intelligence Customer Intelligence Uses Customer Intelligence Uses Use web-based customer knowledge in other channels Use web-based customer knowledge in other channels Personalization Personalization Targeted marketing Targeted marketing Site design Site design Product variety Product variety Customer segmentation Customer segmentation

22. Retail on the Web Back end processes important too! Back end processes important too! Order processing Order processing Customer accounts Customer accounts Communication with suppliers Communication with suppliers Inventory Inventory Fulfillment Fulfillment Customer service Customer service Returns Returns

23. Advantages of Brick and Click Retailers Back-end infrastructure already in place Back-end infrastructure already in place Warehouses Warehouses Customer service Customer service Existing supply chains Existing supply chains Order processing and shipping Order processing and shipping Brand recognition Brand recognition Synergies between online and physical stores Synergies between online and physical stores