Join Us in Boston on Monday 6/15 for a Tweetup

Coming to the Internet Retailer conference in Boston? If so, please join me, Forrester Research, and your eCommerce colleagues for a tweet-up Monday evening June 15th. This promises to be a fun, casual evening of conversation and networking around eCommerce, social media, and online marketing. We will be meeting at 7:00pm at City Bar in the Westin Hotel, just blocks from the convention center.

Please register here to receive updates closer to the event. We have no set agenda and there will not be any formal sponsorship of the event. Our goal is simply to have a great time connecting and discussing all-things eCommerce. And don't worry, this tweetup thing is new to us too...

Thanks, and looking forward to meeting you in Boston,

Brian Walker / @bkwalker

Thoughts on ATG's LiveStore Product Launch

by Brian K. Walker

On Monday, ATG announced the relaunch of their on-demand product, now called ATG LiveStore. This marks ATG’s second real focused attempt at an on demand solution. To recap, here are some of the challenges* represented by the earlier product:

• Rocky implementations with missed commitments around time and cost.
• A reliance on ATG professional services, often with middling results.
• Account management and issue resolution challenges, typically identified with poorly prepared or seasoned resources.
• Lack of flexibility in the application.
• Costs, especially when balanced with the on-demand value proposition.

As a result, ATG appropriately took the product back into the garage for some much-needed tuning. With this relaunch there are a number of areas which represent promising opportunities for customers, and challenges to ATG’s competitors in the on-demand solutions space. I was fortunate to receive a briefing on the new product recently, and want to share of the highlights and my thoughts:

• ATG LiveStore represents a “reference application” of the ATG suite, tuned to the needs of a midmarket eCommerce retailer. The aim is to reduce complexity, minimize implementation time, and improve quality of the implementations. This should also improve account management; if indeed the clients remain largely on standardized implementation foundations.
• With ATG LiveStore, ATG is offering flexibility over time to move between hosted software-as-a-service (SaaS) and on-premise licensed models, in addition to flexibility around payment models for use of the software. This flexibility is a great thing for the maturing midmarket online retailer whose needs may change markedly over time. And in a twist, ATG will be offering SaaS credits toward licensing. In a “lease to own” type model, ATG will be offering clients the ability to accumulate credits through the SaaS solution toward a license option later.
• ATG Livestore comes with the BCC module, and by taking advantage of the preconfigured implementation of the management tools clients will simplify what may otherwise be an overly complex and issue-prone implementation process.
• ATG is partnering with AT&T to provide the hosting backbone and scalability. This will largely be transparent to the client on the product, but based on the infrastructure and managed hosting processes, should help to drive stable and scalable environments for their clients.
• ATG is quoting four- to six-month implementation timelines on the ATG LiveStore product. I expect these may end up being shorter once the ATG team is practiced. This will enable more seasonal flexibility for ATG and its clients, and is much more competitive with other midmarket and enterprise on-demand solutions.

This all represents some great progress for ATG and their prospective clients, but here are a few things which I think still need to be ironed out or examined by potential clients:

• I believe that ATG and its key competitors in the on-demand space need to drive down their implementation fees to the $200K range in order to really present an opportunity for midmarket retailers, and to keep eyes from wandering to open source and other marketplace alternatives. ATG is still not there, nor are its key competitors.
• ATG has three different editions of the ATG LiveStore product — which include call center, optimization services, or both. I believe this is a bit too confusing an approach (as in, maybe just a little too Vista-like). I believe a client interested in the product would absolutely want to bundle the optimization services in order to benefit from the automated merchandising features integrated into the product. It is also likely that the customer service modules will be important, and this represents a differentiator with the ATG product in the market.
• Hosting costs remain at a premium for the midmarket online retailer. I expect ATG (and AT&T) to work on managing this down in response to market feedback.
• Timeline expectations around a 4 month implementation project need to be managed carefully. This 4 month timeline assumes requirements and customer experience are already defined, which is typically not the case. It also assumes the retailer is sticking to the basics and not requiring customization. This is an issue not only for ATG to manage - but industry wide – in order to build credible, successful, reference-able client engagements.

Also on Monday, ATG announced a new release of the ATG Recommendations product. While many of the enhancements to the product represent features present in many of the competitive products, I think the key highlight there is its exposing of data through is Adobe Flex/Flash application programming interfaces (APIs) to enable Flash devs; these will integrate dynamic product recommendations and product data into Flash apps and rich content presentations. This is a nice feature we will likely see other recommendations vendors mimic quickly.

I hope that provides some perspective on the product, from our point of view. Forrester clients, please remember you can ping me through inquiry anytime to discuss these (or other) solutions which you may want to learn more about - or get help with - in the evaluation process.

Thanks, Brian

Follow me on twitter: @bkwalker

* This is based largely on interviews of customers of the earlier ATG on-demand solution.

Preparing to React to Rapidly Emerging Events: Tips for Your Online Business

by Brian K. Walker

If you are like me, you are following the developments with the H1N1 flu closely. Many businesses are seeing a spike in demand for products to help prevent spread of the virus, such as alcohol-based hand sanitizers and face masks - or to treat the pandemic should it be contracted, such as inventory of Tamiflu. Thankfully the severity of the flu appears to be far less than originally feared, though certainly that may change.

But these are certainly not the only large and emerging events that a business must react to. The Web channel offers a unique opportunity to react to emerging events both within the eCommerce channel and in reaching loyal customers. Hopefully there are few situations like the swine-flu – or other natural or man-made disasters – in the future. But by planning and preparing your business may be in a position to help those affected, drive a positive from a negative, and quite possibly experience some strong business as well.

Being prepared for the worst can make you even more responsive for great times, too -- for those profit-making opportunities that pop-up and which depend on quick follow-up and responsiveness.

So what can a business do to prepare for these events? Here are a few things to focus on:

• Resources. Have a team with the right skills and system permissions in place. For example this team may be comprised of a merchant, a copywriter, a marketer, a PR person, and a developer or two — all identified as a rapid-reaction team. Assignment to this team may need to be done on a rotating basis, especially during the holidays. Be sure to have critical resources at your technology vendors and marketing and PR agencies identified too, as well as know-how to reach them at their lake cabin.
• Process. Have a process in place — with clear decision-making and leadership — to react to events, approve plans, content, code, and so on. Have a means of communication with contact information sorted out up-front. Maybe this requires pagers, but more likely will comprise cell numbers, IM, texting, home numbers, and — today — Facebook and Twitter.
• Microsites. Be ready to launch and deploy a microsite quickly. A microsite will serve as a set of pages and products if microsites present a challenge with your current platform, prepare by developing a site with default content with a sample catalog and have your team prepared to modify it. Branding and overall user experiences should be very consistent.
• Landing pages. A cousin to the microsite, but possibly much easier and faster to deploy, a landing page with links to content, categories, and products may meet the needs of your audience. This may be a useful tactic in concert with the microsite to drive traffic between the sites as well.
• Content locations. Have content locations on the site ready to deploy. For example, a thin banner across the top of your pages (right under the global navigation) may be a great slot to use to direct site traffic. Do not overemphasize the homepage, as much of your traffic may never see it. Be sure you have content slots on category and product pages as well.
• Category management. Be sure your team knows the tools well enough to define new categories on the site and react quickly. Category naming may prove very important to customers finding the products.
• On-site search. Tagging, metatags, URL-redirects, binning, and content indexing will be critical to helping customers find the products quickly. A strong on-site search tool is key.
• SEO/SEM. Search engines are a key conduit for audience traffic. Being able to react to the terms and capitalize on the search traffic will be important.
• Marketing. Have a plan in place to review existing marketing plans and efforts, with the ability to react. This can save face, as a key promotion to an area hit by disaster or in the news could be embarrassing. (I will not provide a gruesome example, there are many.) At the same time, have the resources, skills, and authority in place to react to the event proactively through email, display, search marketing, and social media. A well-timed tweet on a timely and needed product may help.
• Establish key relationships upfront. Other key to planning ahead for situations like 9/11, the 2004 Indian Ocean tsunami, or Hurricane Katrina is by having relationships with qualified organizations, charities and service organizations established ahead of time. In some cases you may wish to prepare for a donation to be made through your site. Another means of support may be to link to other companies who have the products in-stock if you happen to run out, or offer free shipping for critical supplies. By having the processes we identified above in place, you may be better able to react to these opportunities in a quick and controlled manner.

I think it goes without saying that another key to reacting to these situations is to be charitable. This will pay long-term benefits in terms of consumer brand loyalty, employee morale, recruiting, and overall PR — and it also goes without saying that it’s the right thing to do.

Now, I do not want to be all doom-and-gloom, so I want to end on a positive note. These same tactics can be used to in context of a positive event too. For example, we have had clients who have had a product featured on Oprah, and the resulting traffic and sales opportunities are like an earthquake — but a positive one. Your team may only have hours or a day to react to the news that Oprah is featuring a product or destination, or the NBC Nightly News is featuring a story on a key product or category. These positive events may leverage much the same processes as above, and be good rehearsals as well for similar events down the road.

Bottom line, days and weeks are not sufficient when dealing with these events. By planning ahead, you and your team will know how to react swiftly and effectively.

Thanks, Brian

(If you have other ideas or examples I missed, please comment below.)

Travel Companies Should Look To ideeli.com As A Way To Invigorate Web Sales

 [Posted by Henry Harteveldt]

 

OK, the fact that I’m writing this blog post, and the fact I’m on Twitter (hharteveldt) is proof that an old dog can learn new tricks.

 

What inspired me to write this piece was when I received an email from an industry friend telling me he’d taken a job as a VP with ideeli.com. ideeli describes itself as an invitation only shopping Web site, offering “privileged access to sought-after products in fashion, home and beauty, as well as luxury lifestyle experiences.”

 

You can’t just join ideeli willy-nilly – you need to be invited. I think this is both practical and brilliant. It’s practical in that it allows ideeli to control the size of its customer base, which hopefully means that its members will have reasonably good chances of obtaining items of interest available on the site. And it’s brilliant because it creates the aura of exclusivity – we all want what we can’t have. Plus, ideeli sells a premium category – they call it 1st Row – which offers earlier access to all the goodies ideeli sells.

 

In a sense, ideeli isn’t a new idea. It, and its competitors, owe at least a teeny, tiny nod to the airline industry. In 1986, Eastern Airlines pioneered its “Weekender Club,” a fee-based membership program that extended weekly unpublished special fares out of key Eastern markets such as Baltimore, Boston, New York, Atlanta, and Miami where the airline had excess inventory. Other airlines, including TWA, implemented similar programs. In that pre-Internet era, the special offers were delivered by – get this – Western Union telegrams.

 

OK, so back to the 21st century. I think ideeli as a concept has some value to the travel industry and offers a way to invigorate travel eBusiness, especially in this tough commercial environment. Why? I’m so glad you asked.

 

Travel eBusiness is mature. Forrester’s 2008-2013 Online Travel Forecast estimates that by year-end 2009, we’ll have 68 million US leisure or unmanaged business travel Bookers (Bookers are travelers who go online at least once and month and both research and buy travel online). That’s an increase of only 2 million more people from year-end 2008. OK, yes, getting two million more online customers is great, but it’s a sliver of the net new number of online customers compared to even three years ago.

 

So anything that can be done to increase online travelers’ engagement with the channel is, as Martha Stewart would say, a good thing. Forward-thinking travel firms can adapt ideeli’s model for themselves, using it to:

• Drive traffic and volume to and through preferred channels. Travel sellers can use this type of a program offer to drive traffic through whatever channel they choose. This is particularly relevant for travel suppliers, such as airlines, hotels, and cruise lines, which can use a program like this to “right channel” customers through their own Web sites, versus those of third-party intermediaries (TPIs). Multi-channel TPIs can play this game as well, using it to drive traffic to Web sites and away from call centers.
• Develop or strengthen business partnerships. Travel suppliers can reach out to partners – for example, an airline, a hotel, and an entertainment company – to create distinctive experiences. TPIs could partner with their preferred suppliers to create distinct promotions or packages as well.
• Force behavior in a defined timeframe – AKA you snooze, you lose. Ideeli’s offers are limited – items are available for only a set time frame or until they sell out, whichever comes first. Members receive email alerts that alert them to when items will go on sale. Travel companies can send similar email or SMS text messages to program subscribers. Either they act, or someone else gets that fantastic deal.
• Test pricing. Ideeli operates in private: only its members know what’s for sale, and at what price (some items are even giveaways). Travel firms can use a program like this to experiment with destinations, products, and price points in a relatively private setting. Sure, a member can tweet or publish on her Facebook page about the great deal she just found, but that will be after the fact – and the offer may be over by then. It may also be possible to test slightly higher price points compared to what you’d have to advertise in a public promotion.

• Get around “full content” distribution requirements. Most airlines are contractually required to sell all publicly available fares, including so called “Web fares,” through global distribution systems (GDS) and travel agencies. GDSs can be valuable distribution partners, but not necessarily when low-margin distressed inventory is being sold. A private, membership-based program like this may be exempt from full-content requirements.

• Create, increase and sustain loyalty. Travel organizations constantly bemoan the lack of customer loyalty. In an industry that’s awash in a glut of choices and product, travelers – especially infrequent travelers – have little need to be loyal. A program like this may be able to engender loyalty to the company. And, while this can of course be linked to a travel seller’s loyalty program, it doesn’t have to be.

• Create artificial demand. ideeli’s “1st Row” premium access program is similar to having access to a “priority screening line” at an airport. 1st Row members get first crack at ideeli’s offers. 1st Row membership costs between $83.88 a year and $93.88 a year, depending on the subscription payment option the member chooses. Not only can travel sellers limit the number of memberships they sell to their club – thereby creating the desire to have something that another person can’t – but they can stimulate this further by offering a premium, fee-based tier which would also have a limited number of slots.

Travel companies – mostly airlines – have experimented with bits and pieces of what ideeli offers, but no one currently offers anything quite like ideeli. In 2000, Northwest Airlines introduced its NWA.com Club, an online-only fee-based club that offered access to unpublished offers. It was an idea ahead of its time, and the 9/11 terrorist attacks and following recession didn’t help. Continental Airlines has The Continental.com Club, which includes a soft-dollar “cash back” component and access to travel and merchandise offers. Southwest Airlines’ highly successful DING! downloadable desktop application provides free access to limited-time special Southwest fares. And of course we have two travel agencies operating in the US specializing in helping suppliers move excess inventory: Priceline.com, with its unique “name your own price” model, and Hotwire.com.

What do you think? I’d enjoy learning your perspectives – and, if you’ve been trying something like this, whether it’s met your expectations.

Thanks for your time.

Henry

Perspectives on Demandware’s Summer Release

By Brian K. Walker

eCommerce platform provider Demandware recently released updates to their product, dubbed the “Summer Release”. For one thing this is a refreshing departure from a version number in that it makes me think of a mix-tape I made as a teenager instead of an operating system. (More on that in a later blog post – or maybe not). This release is notable in that it does address some shortcomings we discovered in our “Forrester Wave: B2C eCommerce Platforms, Q1 2009” we published in January. Here are some highlights on the product from a briefing and discussion with Scott and Jamus at Demandware recently, along with some thoughts:

• Addition of “Active Merchandising” to allow for automated product sequencing and display on category pages, landing pages, in cross-sell/up-sell slots, and on-site search results ordering. While not tied to web-analytics at this point, the active merchandising feature does pull from the transaction logs and store merchandising data. This will be useful for improved automated merchandising, particularly in largely ignored categories.
• Improved business—user experience with the tools focused on site-management and layout, with key improvements to targeted/segment-driven content and offer targeting. While useful, and on-target for what most clients will be able to functionally use, this targeting capability needs to integrate to external web-analytics, campaign management, and CRM to enable multi-channel marketers to target across channels.
• A new reference application – loosely translated from softwarese as “starter store” – which incorporates the 80/20 rule of required standard eCommerce features to get clients up and running more cost and time efficiently. This should also improve quality and enable Demandware’s partners to deliver more consistently as well.
• Many incremental improvements to the bundled on-site search capabilities. These range from term-entry completion to binning to additional user filters and sorts. This was an important area for Demandware to improve in.

What it means for Demandware clients and those considering it:
It is very good to see that Demandware is focused on the merchants and marketers. With their Summer 2009 release we can see evidence that Demandware is making significant headway in modernizing the back-end tools and management capabilities they originally leveraged from Intershop. These features are meaningful improvements, though there are still gaps or deficits in other critical areas such as product content management, promotions management, micro-sites, and site optimization. See our Wave report or earlier blog post for more details. I look forward to seeing future releases from Demandware as well as others as these solutions mature to meet the needs of today and tomorrow's online retailers.

Others have been making progress and updates to their products as well, and I get the beneift of talkign with many of the other vendors serving clients in this space. Look for thoughts on those in the next few weeks and months, as well as an update to our Wave report later in the year.

Thanks, Brian

follow me on twitter @bkwalker