Online Investment

In the most recent issue of Internet Retailer (July 2008), the Publisher’s Letter (written by Kurt Peters) talks about Moody’s Investor Services recent move to more heavily weigh a retailer’s online revenues when rating their debt. “A Strong online presence is considered a ratings positive more frequently than in the past because it represents such an important channel of distribution and can mitigate declining comparable-store sales trends,” according to Moody’s.

There were a couple points driven home in this article that new and existing multi-channel retailers should keep in mind as they assess their own online investments. But first, take these numbers into account:

Moody’s has a 40% share of the worldwide credit ratings market

First quarter 2008 online sales grew 13.6% year over year versus retail sales growth of 2.8% for the same period

Online sales growth has been very strong for several years as the shift of consumer spending from bricks and mortar to online continues. As this growth continues the percentage increase will decline because the revenue base continues to grow. Taking the news from Moody’s, you can bet companies are taking this seriously and looking very hard at how they invest resources into their online business.

For smaller retailers this is an opportunity to carve out niches and leverage growth to compete effectively and take market share over time. If you don’t have a large budget, carefully spend your money in those areas that will grow your business and areas that will support that growth. There are a lot of great tools out there that generate incremental revenue, but, that increase may not be worth the investment of your limited resources.

Focus on areas that grow your build your brand, generate sustainable revenue and increase market share. Look at your customer service. Are you taking care of customers to the fullest and increasing the profitability of the relationship? Look at your fulfillment…are you cutting unnecessary costs and finding ways to encourage sales conversions? Look at your site…is it efficiently converting visitors into customers?

As mobile commerce becomes more of a reality with devices such as the iPhone and Blackberry its up to the retailer to step up and take their piece of the pie. As a consumer, I have a web app loaded on my iPhone to compare prices when I go shopping at stores. On several occasions, I have gone into a store (i.e. Target, Barnes and Noble) and used this app to find better prices online and even completed the transaction before leaving the store. This is going to happen more and more as people have better mobile devices and want more convenience in their hectic lives.

Mobile commerce is going to quickly become a reality for some of our retailers in the coming weeks and we’re excited to see the growth. For these partners, they will be the first in their respective industries to have a mobile optimized site. These sites will be mentioned after going live.

I suggest you take a few moments to assess your online investments and determine where you’re headed. If you’re in a rut, you need to quickly rejuvenate as the holiday season approaches. Speaking of holiday, you should be acquiring more new customers than at any other time of the year and you need to groom that relationship. Every order that leaves your door is an opportunity to create or nurture a relationship. Do simple things over the holiday to make your customers feel appreciated. Include a simple holiday card in a box thanking the customer and wishing them a great holiday season. If the order is a gift for someone else, make sure that package contains everything it needs to and everything looks perfect because it’s about to go to a potential new customer. Start early and you’ll be thankful later.

Woopra Website Analytics

I can't recall what search query I did, but, on Thursday I stumbled across Woopra website analytics. It's free and in beta mode and Woopra makes the claim of being the "world's most comprehensve, information rich, easy to use real-time web tracking and analysis package.' That's a pretty bold statement to make especially when you think of other analytics packages out there (i.e. Omniture) that take web analytics to the next level, but, I guess they qualify the claim by saying 'real-time web tracking and analysis package.'

I was interested enough to implement Woopra on this blog and give it a test run. Set up was simple, but, not quick because I had to wait for approval which came the next day. So yesterday I had my approval code and I quickly set up Woopra by inserting a short snippet of code. Then, I had to download an application which wouldn't work on my Mac so I put it on my PC.

Now that I inserted the tracking code and the application was installed and running I could instantly see who was on the E-Facts blog. The application interface has a nice look to it and is very informative right off the bat. There's a ticker at the bottom showing 5 visitor metrics and the dashoard shows you what pages are being/have been viewed, referrers, search queries and visitor countries.

The 'Live' tab shows me details of the current visitors including geographic location, browser, operating system, navigation path, and visitor history. Other tabs include 'Search'(search for visitors), 'Analytics' (includes 5 sub-tabs) and 'Manage' (create custom event notifications).

The features that I really liked were 'Start a Conversation' (live chat) and 'Tag This Visitor.' Clicking on 'Start a Conversation' opens a live chat window allowing you to communicate with a specific visitor. Its cool, but, also creepy at the same time. This is all facilitated through the tracking snippet I inserted into the HTML. 'Tag This Visitor' allows you to give a name to a specific visitor. To test this, I tagged myself and I see what pages I've visited, browser I'm using, country, etc.

Woopra certainly won't replace the analytics packages I use (Omniture and Google Analytics), however, I'm going to keep it on this blog and consider it as a supplement on other sites. It's going to be an excellent tool to provide me with instant gratification especially when a new campaign is implemented. Nothing like seeing the fruits of your labor in real-time!

From a customer service and marketing perspective, the customer tagging and live chat presents some unique opportunities. We use Magento for our ecommerce platform and the reporting provides insight on a visitor's current location on the site. So, when a customer calls in and mentions a specific page they're on the CS agent can look into Magento to verify the location of the visitor then go into Woopra and tag the customer. As an extra verification, you can instruct the customer to visit another page and you should see that page appear in their Woopra profile. Now, you can see where this customer goes and what they do in future visits! That's a marketing goldmine. The live chat feature should be used carefully. There's the potential of spooking visitors and causing them to never return. Be cautious with this one.

Check out Woopra and let us know what you think.

Enhance Customer Service, Marketing and Online Reputation Management: Part 1

This post is a mash up of two previous posts with some new information. This is about using all the information resources available on the web to enhance your brand and customer service, but, the emphasis will be on social networks. Why social networks? Well, consider that the basis of social networks is building communities of friends and other like-minded individuals. And, there's not enough time to get into all the other informational resources!

Let's focus on Twitter as a tool to enhance your customer service, marketing and online reputation management. From a customer service standpoint, you can use Twitter to monitor all the mentions of your brand and get a pulse on how people interact with your brand. To make this easy on yourself, use Summize to quickly search all the mentions of your brand. Type in your brand and see if any conversations pop-up. If Summize returns results for your brand then you should be flattered (if all positive) that people talk about the brand. If you don't get any returns, then its a marketing opportunity which will be discussed in the next post.

Assuming you see conversations about your brand, quickly go over the conversations and get a feel for what people are saying and how they interact with the brand. There's nothing like an unmoderated and candid forum to gauge how much people like what you do or offer. Its inevitable people will have some negative comment to make and that should be an opportunity for you to make good. After all, customers remember you most when you make a bad situation a positive one. If you find a negative comment, reach out to that individual and let him/her know you want to make good on the negative experience they had and invite them to email/call you at their convenience to hash out the issue. After you take care of the situation and the person is happy, ask them to mention it on Twitter and give them an incentive to move quickly (i.e. free shipping on next order).

Roll this out slowly and build on your experiences. Create a plan of action that addresses who is responsible for checking Twitter/Summize, how often it will be done, customer follow up and reporting. Its important that an individual is assigned this task and they are given guidelines for customer follow ups, empowered to act quickly and have the ability to report on resolution (i.e. SugarCRM).

This is an opportunity to engage customers in another medium and show the importance you place on their ongoing experiences with your brand.

Customer Service (part 2)

Part 2 of this series focuses more on actual phone systems, metrics and tools to close sales.

Many times a business owner will run out to Staples, pick up a few business phones and desks and call it a customer service operation. While this works if you're just starting out or don't field many calls, you should research getting the right equipment and making the investment for the long run. Why you ask? Getting the proper phone system in place will allow you to make your customer service operations more effective and efficient because you're giving employees the proper tools. Its akin to giving a web designer a 10 year old computer with an old version of PhotoShop. Sure, you may get the job done, but its going to take longer and the end product may not be as nice.

Nortel offers a great call center package that includes well-featured phones and software to track phone metrics. With their system, you can make your business look bigger than it actually is by having enterprise level functionality. For example, you can implement a phone tree (menu) and group employees according to skillset. For example, you can divide your employees into one group of order takers and another group for order follow up. The entire system can be managed through a web interface.

Measurement is the key to effective management. You need to know how many calls are coming in, call reason, how many hang up, how long it takes to answer, how long the calls last and how many calls convert into sales. Knowing these numbers allows you to hold employees accountable, take steps to improve, create promotions and set up contests to reward performance.

Here's a scenario of how all this ties in to effective customer service:

Your current operation brings in 100 calls per day. 30 calls are for order follow up, 20 calls are for order placement and 50 calls are general product inquiries. Only 5 orders are placed (5% total conversion) for 10 total products (UPT =2) for total revenue of $200 (AOV=$40).

Keep in mind every phone call is an opportunity to sell.

After reviewing concrete data, taking steps to improve processes and creating a bank of promotions you devise the following contest. Employees will qualify for the contest if the group generates $300 in revenue. From there, you calculate which employee contributed most to the revenue total and you award him/her.

This is a simplistic take on the situation, but, you can't argue the results when you have a motivated group of employees who are working toward realistic goals set forth after reviewing concrete data. Making the investment in proper equipment will pay off in spades in the near and long-term.

If you have a call center operation and need help maximizing your operation, contact MJM for information that will get you moving in the right direction. Email us at info@mjmecommerce.com or visit us at http://www.mjmecommerce.com/.

Customer Service (part 1)

An issue that sometimes is overlooked or not given adequate resources is customer service. I'm going to write a series of posts addressing this important marketing and business function. Its important because for many of your website visitors, a phone call to your customer service is the only human interaction they'll ever have with your company. This first post will address a basic component of customer service which is having all customer data at the drop of a dime.

Occasionally, I'll buy a product from a small business because they had the best price. It hits me how small they are when I call their customer service phone number to follow up on an order. I'm left on the phone waiting while the agent digs through paper to find my order or has to call me because all the knowledge resides in the mind of an individual who is at lunch. As a customer, I expect to get answers to basic questions when I contact customer service because that's what I've come to expect when dealing with more well known companies. Its not out of line to expect the same from a small business becasue at the end of the day that business took my money for a product or service I expect to receive. A negative customer service experience can drive away a new customer or a long time customer. One bad call is all it takes.

One way to streamline your customer service operations is to implement and integrate a CRM tool with your ecommerce platform. At many small businesses, the staff wears many hats and its not uncommon to have a designer or other person fielding customer service calls. How much more productive can your staff be if they had the proper tools?

I use SugarCRM because it works, its open source and its comparable to other expensive solutions. At a previous position, I implemented SugarCRM for my customer service team and the results were incredible.

First, my costs went down. My phone bills went down because customers weren't sitting on the 800# while my staff went looking for information. It drove down cost on outbound calls becasue we addressed customer needs immediately. It also improved my revenue contribution per employee ratio because my staff could immediately address customer issues while spending more time on revenue generating activities (i.e. home page refreshes, paid search placements, etc.).

Second, it improved the customer's perception of my brand and turned potentially negative situations into positive ones. Customers will always recognize you when you do the right thing. Part of doing the right thing is having all the information at hand to make a good decision. It also allowed any one of my staffers to properly address a customer issue by having all the customers notes at hand. It didn't matter if one person initially took the call because that person put all the notes into the CRM tool.

Third, it housed all my customer data in one easy to access application. I could access Sugar CRM and segment my customer list based on any number of parameters I chose and market to those folks with relevant email blasts, mailers or package inserts.

Finally, contrary to popular belief, it's not expensive to have an enterprise level CRM tool or to integrate. Contact us at info@mjmecommerce.com or visit http://www.mjmecommerce.com/ and I'll tell you how to make this solution work for you. Check back soon for Part Two!