That’s amazing. How can I get a piece of that pie?
Call it what you will -- V-Tail, vCommerce, or just plain online video -- we are seeing some pretty bold claims around the use of video in eCommerce. Claims from platform vendors, press, and even some case studies and success stories from large retailers who are seeing some significant successes when they integrate video content into the online shopping experience.
But there’s the key. Integrate. Of course it isn’t as simple as sticking a few videos on your existing dot-com site and hey presto, conversion rates skyrocket. Video needs to support the sales process in a way that makes sense to your customers, that supports your brand values, and that enhances the shopping experience.
There are a growing number of ways to source video content, and an increasing number of players in the market who will all tell you that they have the answer. From user-generated content to automatically generated video. From content delivery networks to social media. There are a bewildering number of options out there.
Video absolutely can deliver firm benefits :
It can increase page views by driving traffic to your site.
It can enhance the time people spend lingering on your site, giving you more opportunity to market to them.
Over the past year, we’ve worked together with the forecast team at Forrester to help eBusiness professionals understand the size of different online retail markets around the globe. Last year we published our first look at the online retail markets in some of the major markets in Asia-Pacific — this year, we’ve just published our first forecast for two of the largest online retail markets in Latin America, Brazil and Mexico. Some findings from the report include:
Brazil is — and will remain — the powerhouse in the region. With more than 40% of the online users in the region and a steadily growing economy, it’s not surprising that Brazil’s eCommerce market will outpace all others by a wide margin. Brazil’s projected 2011 sales of almost $10B put it behind other major online retail markets like France and South Korea but ahead of smaller ones such as the Netherlands and Italy.
Mexico’s online retail market is small today —but growing by a CAGR of almost 20%. With less than half of the online users of Brazil and limited online spending, Mexico’s online retail market remains a small fraction of the size of Brazil’s. Average online spending per buyer will not increase significantly over the next five years, but the sheer number of online buyers will.
Are you a product strategist trying to craft an iPad (or general tablet) product strategy? For example, are you thinking about creating an app to extend your product proposition using the iPad or other tablet computer?
At Forrester, we’ve noticed that product strategists in a wide variety of verticals – media, retail, travel, consumer products, financial services, pharmaceuticals, software, and many others – are struggling to make fundamental decisions about how the iPad (and newer tablets based on Android, Windows, webOS, RIM’s QNX, and other platforms) will affect their businesses.
What will retail will look like in 10 years? This is an important question for many CIOs and CEOs, and not just those in the retail sector.
To get a feel for the future of retailing, earlier this month I made my annual pilgrimage to the National Retail Federation (NRF) conference and expo in New York. The most significant difference I noticed between this year and last year was that in 2010 everyone was talking about multichannel retail while keeping an eye on social technologies as a future trend. This year the buzz was around full channel integration/retail-anywhere or what might be called "zero-channel retail."
For many years retailing has been broken out into "channels" based upon how products are put into the hands of the consumer. Channels include: retail stores, outlet stores, Internet, catalog, etc. In the past each channel was managed independently of the others (recall how some retailers actually created separate companies to run their Internet retail business). Last year there was a big focus on how to integrate online and physical retail into one, seamless channel.
As retailers approach the homestretch of the 2010 holiday shopping season, we thought it would be useful to share some insights from consumers about their Web buying activity. Forrester and Bizrate Insights teamed up in late November/early December to survey online customers, and here are a few of the findings:
Free shipping with a threshold is most popular (though people would, naturally, prefer to have no threshold). One interesting fact is that the threshold (in addition to adding units to transactions) attracts higher-income shoppers. Households with incomes over $150k are nearly twice as likely to use “free shipping with a threshold” than households with incomes less than $40k.
9% of shoppers say they belong to some shipping club (e.g. Amazon Prime, ShopRunner) and participation skews up with income. 13% of households with incomes over $150k say they have this type of membership.
Email still rules. From our Cyber Monday research with Bizrate Insights, 43% of consumers who shopped online on that day found out about deals through email. This was by far the most popular way that people found out about deals, greater than search, Facebook, or even word of mouth. The second biggest source of finding out about deals was a retailer’s own site.
It’s about women and gifts during the online shopping season. Again from our Cyber Monday research with Bizrate Insights, 69% of online shoppers were women. Only about half of men purchased gifts for others that day, but 78% of women purchased gifts that day.
Enough with the Groupon madness this week. Let’s talk about things that actually impact our businesses. Like holidays sales to date, and in particular, a quick post-mortem on Cyber Monday now that the week is over. Forrester fielded some questions to consumers in conjunction with Bizrate Insights (the findings will be available in full to clients in a few weeks) and here are some quick takeaways as teasers:
Most people don’t buy on Cyber Monday (though many would like to), so the Cyberweek deals like Amazon has are always a good idea. 62% of the 3,200 shoppers we surveyed said that they didn’t shop on Cyber Monday.
Of those who shopped but did not buy (45% of shoppers who were trolling eCommerce sites on Cyber Monday!), 28% wanted to buy but didn’t see any products that they wanted. Product selection is king.
Social, schmocial. Not such a big deal yet. Only 7% of people who found deals on Cyber Monday found them through social networks or Twitter, versus 51% who found them from emails from the retailer.
Some people live under rocks. Kidding. But one-fifth of the people who didn’t shop on Cyber Monday said “They didn’t know there was anything special about that day.” How that is possible I have no idea, but I’ll give them the benefit of the doubt and assume they don’t have time in their lives to squander away time online like the rest of us. But for anyone really wondering what this “special day” is about, check out this link (see the full slideshow here) — these are screen shots of the top 50 merchants’ home pages from this past Monday.
Microsoft began opening its own retail stores in 2009 and recently began a push into more US cities. A recent post by George Anderson on Forbes.com about Microsoft's new store format prompted me into some late-night analysis. It appears Microsoft's store format strategy is to ride in the draft of Apple by building larger-format stores very near, if not adjacent to, Apple's own stores. As a retail analyst and both an Apple and Microsoft customer for over 25 years, I feel compelled to weigh Microsoft's retail strategy against Apple's (and since I cover retail strategy from a CIO perspective, it feels appropriate to publish here).
Comparing eight success factors
Location: I'll start here, as it was the subject of the original post. Across from Apple may be the only sensible choice for MS, but the challenge MS has is that Apple is a destination store, i.e. people plan to go there for the experience. This makes it less likely they will decide to browse the MS store because it is close. On the other hand, assuming MS does some promotions to attract traffic to its stores, they are likely to also drive additional traffic to Apple. Predicted winner = Apple.
Store architecture: Size isn't everything! Sure Microsoft can copy Apple and go for outstanding store designs and even build them bigger, but Apple architecture is designed to reinforce a consistent brand image: minimalist, clean lines, designer. Microsoft's designs can reinforce many things about its brand, but it's hard to see the consistency in a way that's possible with Apple. Predicted winner = Apple.
After years of looking at how the online markets of Asia Pacific are emerging from an online shopping perspective, we are thrilled to announce our first online retail forecast for China, Japan, South Korea, India and Australia.* Some findings from the forecast:
Japan still takes the top spot in the region. Japan retains its dominance in the region with some $45 billion in online retail sales this year. Indeed, while China’s combined B2C and C2C spending surpasses B2C spending in Japan, Japan is still the leader in traditional online retail sales. And despite the fact that online consumers in Japan are purchasing across a wide variety of categories, some category purchases like beauty have shifted online in Japan in a way they have not in the US or Europe.
China’s growth rates will propel it ahead of Japan in the very near future. China’s combined B2C and C2C sales — the two are nearly impossible to separate** — are poised to reach $49 billion in 2010. China’s CAGR will be double that of the US, Western Europe and Japan, and it’s clear that China will be the eCommerce market most likely to rival that of the US.
Australia’s robust growth will be driven by an increasingly vibrant online retail sector. The online marketplace in Australia is marked today by a large number of cross-border transactions, but there is growing momentum among local players. Though less than half the size of the online retail markets in Japan and China, Australia’s growth rates are slightly higher than those of Japan and its US and Western European counterparts.
The past couple of months have seen a number of new initiatives and shifts on the global online retail front: Zara went live with a series of eCommerce sites (in five languages in Spain alone) while Gap started selling to an international online audience. At the same time, eBay conceded the market in China and looked to partner with market leader Alibaba. More companies have started coming to us asking about eCommerce in less traditional markets, with markets like Russia and Saudi Arabia being brought up with increasing frequency in our calls with clients.
Rollin Ford has one of the toughest CIO jobs on the planet. He leads a global IT team in one of the world’s largest companies by revenue and employees, a company that has earned a reputation for leadership in supply chain that has allowed it to dominate its markets. Yet Wal-Mart is constantly under pressure to maintain its leadership position. In the US, Target has become a fierce competitor, while in the UK, Tesco may have overtaken Wal-Mart in supply-chain leadership, with Tesco's move into the US watched closely by Wal-Mart.
Earlier this year, Ford sat on a CIO panel discussing IT’s role in innovation. His thoughts on innovation also touched on strategy and alignment. He suggested that innovation starts with the customer, then leads into a business strategy, and then it gets enabled by technology. However, he acknowledges, “there are very few secrets out there.” Ford suggests that the only competitive advantage over time is the speed at which your organization can implement and leverage innovative ideas: “Your organization has to embrace change and new technologies, and that becomes your model. It’s about getting from A to B and doing it quicker than everybody else.”