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04 May 09 Sheep Theory: E-commerce Product Placement

sheeptheory

Soy milk does not need to be refrigerated until opened, so it never used to sit in the supermarket fridge next to the regular milk.  Not surprisingly, it didn’t sell very well.  Milk that’s not in the fridge?  That’s just too weird for most of us used to buying fresh milk.  Soy milk eventually got repackaged and put on a shelf next to all the other milk and hey presto, it started selling.  And now on to product placement in the virtual world:

How do you decide what people see on your homepage? You let your customers decide.

Majority rules in the world of e-commerce.  If a lot of people are buying a particular product, then it’s very likely that others will also want that product on the basis of what is effectively a very powerful recommendation from their peers. Roger’s Innovation Adoption Curve, while not created for this purpose, is still a clear illustration on how a little known product can be catapulted to stardom and it teaches a valuable lesson:  Speak to a narrowly targeted audience of people who will want your product.

EcommerceProductPopularityCurve

So, it makes sense to identify potential products that could fit the bill as early as possible and then give them some homepage real-estate.  To do this, mine your data and display what other people are buying through visualizations of:

  • Your daily / weekly sales stats. (Bestsellers)
  • Things people desire (Wishlists)
  • If Customer A buys product X, then display products Y and Z that Customer B,C,D bought who also bought Product X. (Keep up now :-) )

A note on product pages:  The primary objective of the product page is to get the prospect to add the featured item to their shopping cart and then easily complete the order and pay you. However, the product page also offers ample opportunity to cross-promote and up-sell your prospect by enticing them with related products, thereby increasing your Average Sales Value. The classic example is Amazon’s Better Together feature which recommends the top 1 or 2 other titles that are commonly bought with the item in question and offers the entire bundle to you at a slightly discounted price. (A dollar today is worth more than a dollar tomorrow.)  This is made possible by analytics driven decision making.

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17 Apr 09 Satisfying a Desire

desire

“Consumers spend time and money satisfying a desire for authenticity”
Joseph Pine@TED, 2004

In his presentation at TED, Joesph Pine used coffee to illustrate what consumers want.  Coffee starts life as a bean:

Commodity: (Coffee Beans) Command a meagre $0.02 per cup
Product:(Bag of beans on Supermarket shelf after roasting / refinement / instantisation) $0.15 per cup
Service: (Coffee made for you at a kiosk) $0.50 per cup
Experience: (Buying a cup of coffee so you can satisfy a desire for an authentic experience) $4.00 per cup

I see this as the same reason we choose to visit the movie theatre or shop at Borders.  Both supply commodity products, but they have been packaged into an experience that you can’t get anywhere else.  You might have also noticed how you tropical island holiday ads always feature idyllic white sand beaches and clear blue skies, with a happy couple or family playing on the beach…this could be you. (Ofcourse, being a tropical island, it does tend to rain every so often.)

Another example from my recent Facebook Social Ad Experiments is in selling books.  Another commodity, but a particular genre, author or title delivers emotional value to the fan.  She doesn’t buy a book, she buys the experience that it delivers, and that is exactly how I write my ads, not selling books, but selling the immersive experience that she will have once the book is in her hands.  This works because people using Facebook are not looking to make a purchase.  They are in what I like to call ‘Escapism Mode’ where they seek opportunities to ‘take the red pill’ and go further down the rabbit hole.

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16 Apr 09 Analytics Driven Decision Making

What do the numbers say?  The beauty of e-commerce is that everything can be tracked and measured to your benefit.

  • Track where the buyer came from, what they bought, at what time, on what day and in combination with which other products.
  • Understand what page layout converts best by conducting A/B and multivariate tests.
  • Use IP addresses to know what geographic location your traffic is coming from and customize what is shown on your landing page accordingly.  More customization can be done for repeat visitors by using cookies.  For example:  Recommend new items based on their previous purchases.

With access to timely, accurate and actionable data, there is no reason to do things ‘on a hunch’

Read more:
Vanity Metrics vs. Actionable Metrics

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13 Apr 09 Skycity Cinemas – You’ve Failed!

Last night I was out with a friend and decided we wanted to check out the movie Watchmen. We were at dinner, so I did not have access to a computer.  To cut a long story short, I spent 10 minutes trying to find show times, but to no avail. Skycity Cinemas have struggled to make ends meet in New Zealand last night was a taste of why that is:

  • Their website is too heavy and takes too long to load
  • There is no mobile WAP site / Iphone site etc.
  • The Movie times service on Vodafone Live! does not work
  • A phone number was difficult to find and when dialled, I got no answer!

Details of each of these issues and solutions are described below:

Skycitycinemas.co.nz is image and flash heavy, but most people still have a dial-up connection in.
Of the 1,504,000 internet users in New Zealand (March 2008, Statistics New Zealand)

  • Broadband: 891,000
  • Dialup: 613,000

Download Times for Skycitycinemas.co.nz*

Connection Rate Download Time
14.4K 315.90 seconds
28.8K 163.65 seconds
33.6K 141.90 seconds
56K 89.70 seconds
ISDN 128K 35.38 seconds
T1 1.44Mbps 13.48 seconds

One and a half minutes is far too long for a website to load, but as the saying goes, you don’t have to outrun the tiger, just the guy standing next to you:

Download Times for Hoyts.co.nz*

Connection Rate Download Time
14.4K 515.06 seconds
28.8K 266.73 seconds
33.6K 231.26 seconds
56K 146.11 seconds
ISDN 128K 57.51 seconds
T1 1.44Mbps 21.80 seconds

For more about Hoyts, check out Mathew Sanders post:
Dear Hoyts: here’s 5 tips on showing movie times on your website

With over 90% of New Zealand’s population owning a mobile phone, the cinema has failed by not making it easy for people to access them via this medium. I was forced to chew through my meagre 10MB Vodafone daily data allowance

Vodafone’s Movies feature in its Sim Lifestyle section is absolutely worthless. It hasn’t worked once in the 2 years i’ve tried to use it. (Atleast they didn’t charge me for the txt requests, oh those angels)

Solutions:

  1. Functionality is more important than form.  The flash and heavy imagery needs to be stripped down. Removing the flash module would be a good start, followed by caching the css and images.  Also lighter image formats (PNG rather than JPEG) would make sense.  View a full checklist here.
  2. With a larger mobile audience than pc-internet audience, a WAP site is essential, as well as iphone / Blackberry optimised versions that are light,fast and functional.  A good design would consist of just 2 search boxes, one for the movie name and the other for location.  A list of movie times should follow on the next page.  Added bonus: Txt a shortcode to buy tickets!
  3. Sort out the Movie times feature on Vodafone Live! or get rid of it.  Skycity Cinemas should have their own shortcode that people can simply text QUEEN ST WATCHMEN to and get a list of movie times returned. Again, “a reply with TIME QUANTITY (3.15pm X2) to buy would be a powerful call to action. This service should be promoted on all of their marketing collatoral, including their website, emails, movie money booklets, tickets and receipts. Ideally, Skycity should provide this themselves, but theres no reason a service like Flicks.co.nz couldn’t do this either.
  4. An easy to find phone number and good IVR system that tells you movie times. (Don’t switch it of after hours! What if I want to by tickets for another day?)

Looking back, this is in fact my second post about the flaws of Skycity Cinemas.  The first was with regard to the launch of their ‘Film Squad’ product.  My gripe was that they issued actual plastic cards rather than use someone’s mobile phone number as their membership ID, a much more convenient and less archaic solution.

Functionality is more important than style.

Site speed tests conducted using: Websiteoptimization.com, www.webpagetest.org.nz

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13 Apr 09 Good Friday is bad for E-commerce

Weekends are notoriously weaker for e-commerce than weekdays and when it comes to long-weekends like Easter.  Good Friday is in fact, Very Bad Friday.  While not being restricted by archaic no-trading laws like physical retailers are, online retailers tend to struggle on account of people being away on holiday and therefore, away from their computers during the day at work and also away from their home computers while they relax in vacation spots.

While there is an obvious short term sales slump, I wonder if clickthroughs over the holiday convert later on.  With a 30 day cookie, standard with most e-commerce sites, this is easy to track by setting up a campaign with a tracking cookie separate to your regular campaigns.  Try this:

  1. Pause your regular campaign.
  2. Copy the exact same ads over to a new campaign, but change your URLs to include a new tracking cookie.
  3. Now you can accurately measure your holiday advertising ROI vs. the norm.
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