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IRUK Top500 The Customer Report: 2018

IRUK Top500 The Customer Report: 2018

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Data-powered merchandising

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Search results and recommendations are key to selling online, reports Chloe Rigby

SHOWING THE RIGHT product to the right person at just the right time can make the sale. At the cutting edge of the UK industry, merchandisers are working on ways to achieve this by developing their understanding of customers and the factors that influence consumers as they move through their shopping journeys. The aspiration is to use these insights to show shoppers the most relevant items at the point when they are most likely to buy.

While the sophisticated personalisation that this implies is in reality still a way off for many IRUK Top500 retailers, this Dimension Report shows how traders are nonetheless developing websites in order to ensure that shoppers can search effectively for the items that they are looking for, as well as browse with the aid of high-quality images and product information.

Showing relevant items

Internet users searching for a specific product are potential shoppers who are already predisposed to buy. But buying online is about making an emotional decision, and consumers need to be well informed before they make it. Leading retailers in this Dimension stand out because they ensure shoppers have plenty of facts to hand. Disney Store, for example, has an easy-to-navigate website that helps shoppers find just the right item, with filters that help to narrow down their searches. Clear product images show exactly how a product looks.

Amazon, meanwhile, guides shoppers through the millions of items available on its website by showing them recommendations that are based on past purchase history and past behaviour.

Like Disney Store and Amazon , many IRUK Top500 retailers work hard to ensure their ecommerce websites are packed with information about the products and services that they sell. On average, Top500 retailers show 3.5 product images. When it comes to search and navigation, 78% enable shoppers to filter by product type, and 65% by price. Such approaches are particularly important when a retailer has a wide range: surfacing the most relevant items is crucial if the shopper is to stay with the process.

This is important, says Chris Dunn, operations director at website optimisation technology provider and InternetRetailing Knowledge Partner One Hydra, because analysis of exit surveys shows that shoppers often struggle to find what they want to buy – and will go elsewhere when they hit problems. “We hear that message all the time,” says Dunn. “These are people who are already on your site – all they want is a better consumer experience.”

Key to that better consumer experience is search. Gareth Rees-John, global digital director at Topman, who spoke to InternetRetailing at the InternetRetailing Europe Summit in Berlin, says it’s unsurprising that search converts on that website at a higher rate than navigation since people who search already have a definite product in mind.

That’s why, he says, it’s vital to get landing pages for search right. More than half of all searches that take consumers to the Topman website don’t go to the home page. Indeed, the jeans listing page is most often viewed, thanks to the retailer’s reputation for skinny jeans.

Rees-John suggests it’s important first to ensure that searches land on a page that has relevant results, and then to add relevant content, such as a style or trend guide.

Making it as easy as possible to search a website makes commercial sense. Most Top500 retailers recognise this. When InternetRetailing researchers measured whether sites offered dropdown search suggestions that help to guide the shoppers through the website, they found that a little more than half (52%) did.

That may seem like a detail – but getting site search right is an important part of the customer experience, says Ian Scarr, regional vice-president, EMEA at SLI Systems. “Site search should give you the opportunity to provide contextually relevant results for the keywords that people are searching for,” he says. “People come to your site with an intention to buy and know exactly what they’re looking for. If your site search doesn’t provide that for you in one or two clicks, they will go back to Google.”

Learning from search

The latest learning search platforms, says Scarr, can learn from information such as customer behaviour on the website to provide the most relevant results. Using this, he says, “Your users are merchandising your site for your other users. It’s their buying, clicking and their interaction with your keywords that’s re-ranking the most popular products to the top – and making you more money.”

This kind of information can also potentially help to improve the product range. “We have lots of examples of customers who have identified poor results for searches,” says Scarr. “Buyers have gone out, bought a product and it’s been one of their best-selling items in the months ahead, but identified early. Then the merchandisers go to work and promote it. Analysing the data is really key to spotting those trends, what’s working well, or not.”

Topman’s Rees-John says that his team learns a great deal from the analysis of searches that don’t produce results. “We look at failed search in a lot of detail,” he says. “We use search as an indicator that leads buying cycles and helps us understand what our visitors want to buy.”

Data-driven merchandising

Such information is just one part of the wide range of information – or big data – that retailers can use in creative ways in site merchandising.

OneHydra’s Dunn argues that retailers can use this data to organise online shops based on what customers are searching for. “Just because you have loads of apples do you put them at the front of a supermarket? Clearly not,” says Dunn. “You display your products based on what consumers demand. In the store, merchandisers spend vast resources working out where to put each aisle, unit, shelf and product so that each next step flows effortlessly for the customer. It pays instant dividends. But in online most of the merchandisers we speak to say they’re either caught up in trading meetings or agonising over promotions, as opposed to optimising the experience. There just isn’t the time in the day.”

An advantage of demand-driven merchandising is that retailers get search engine optimisation [SEO] for free. “You get SEO if you promote and surface the search for categories, styles or areas,” says Dunn. “Google will see them and give them more prominence in your rankings so that you rank better. For most retailers at the moment, the number one piece of advice is to look at the data.”

He adds: “The goal is a self-optimising website based on the consumer and their ever-changing demand. Categories, colours and trends come and go, and it’s about staying on top of that. That’s challenging when you have thousands of products – but the data and the technologies are there to help you do that.”

Merchandising across channels

Beyond the site, data can be used to present products to shoppers wherever they are, or whatever they are doing. That ranges from targeting them in store to sending them marketing emails. Saima Alibhai, practice manager, professional services at Bronto Software, says its software can integrate apps that predict which in-stock products will be relevant – and show relevant images alongside email content. “Personalising content is what is happening right now,” she says. “It’s all about continuing the conversation across relevant channels.” She says this should be a relatively straightforward step, and cites Bronto figures that suggest 97% of UK retailers show product images at checkout, and 81% include them in emails.

Rajesh Kumar, vice president, merchandising, concept to consumer at adidas, says data drawn from hindsight (in the form of historical sales information, insight); from current sales patterns; and foresight (from social media and a range of digital touchpoints, including the store) can help traders to make better merchandising decisions in stores as well as on the internet. The sports brand retailer is currently trialling a solution in 10 stores, including one in London, that draws on these types of data in order to inform the local range.

But, he said, speaking ahead of the recent InternetRetailing Europe Summit in Berlin: “It’s important not to over-rely on data. Merchandising is a science and an art. Data is the science part, but the art part is what the team thinks, along with a range of other factors. It has to be a combination of both.”

Data, he acknowledges, can be overwhelming, which means it’s important to identify or focus on what’s most important. Knowing exactly what to look for is key. Describing social media as an “ocean” of information, he says: “When you’re diving into it you have to be very clear that you’re searching for this pearl exactly at the bottom, rather than swimming the entire ocean.”

Mastering this challenge, he says, will mean in the future that retailers trading across regions can centralise marketing efforts. Rather than having local teams, he says, “[Merchandisers will be able to] sit anywhere in the world and know everything and anything about the consumer as long as they have the data. This will be a big paradigm shift.”

These challenges will continue to resonate in the future. As yet, it seems that many retailers have yet to get fully to grips with understanding and analysing the large amounts of data that businesses are now producing. That’s true whether data comes from the website, mobile activity or from stores. In turn, retailers have not yet cracked how to use that data to show products on their websites and on mobile. But that, no doubt, will come.

But it is in the interests not only of retailers but of their customers that businesses do start to learn from the data as they merchandise sites to show shoppers the most relevant images possible. At the same time, as adidas’ Kumar makes it clear, the data in itself is not enough.

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