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Search and research made easy (IRUK 2016)

The importance of showing the right products to the right people at the right time:

The Merchandising Performance Dimension recognises the RetailCraft involved in presenting relevant and timely products to the consumer. Researchers have looked to find the most visually appealing ecommerce websites that make it easy and convenient to search for, and find, the right product.

Disney Store tops the list in the Merchandising Dimension of the IRUK Top500 2016 for a trading approach that makes it easy for customers to find and research products. Strong images and a clear design make the site visually appealing, while detailed product information keeps shoppers informed. Clear filtering, search suggestions and the skilful use of banners as signposts make navigation straightforward. Combining these factors, Disney Store performs strongly. “This is a diverse store, selling everything from Star Wars to Minnie Mouse merchandise, but it’s easy to find things you might be interested in,” says Martin Shaw , InternetRetailing’s senior researcher.

Amazon is close behind, an achievement that recognises, among other factors, its expertise in cross-selling and upselling, and the way it offers personalised recommendations. Even though Amazon offers an enormous range, shoppers can easily find a specific item, filtering by brand and other attributes. Reviews add to a depth of product information, while social validation enables browsers to share their finds and purchases easily.

Austin Reed , Watch Shop and Littlewoods complete the Top5 in this Dimension. John Lewis , which headed last year’s ranking, comes in at number seven. This reflects a typically strong performance in this area of RetailCraft.

This changing list reflects the continuous development of the InternetRetailing research team’s approach to measuring merchandising. Evermore focused metrics have emerged from a process of evaluation and refinement, with the advice of industry experts. What’s measured is the range of achievement, from strong foundations through to best practice and cutting-edge innovation in areas that affect the relevance of search results offered to the consumer.

Through these measurements, researchers have uncovered not only individual performances, but the way the industry as a whole is refining its approach to trading online. Thus, by examining what happens when a search enquiry meets with no findings, researchers were able to say that a little more than a third (34%) of the IRUK Top500 offer alternative product suggestions through a ‘no results’ page. “It’s one of those key areas where it’s hard to imagine a case when it wouldn’t be advantageous to do that,” says Shaw.

Turning to social sharing from the product page, this has fallen by 15% in relation to the 150 retailers analysed last year. Some 17% more retail websites, however, now offer dropdown product suggestions when shoppers search for an item on a website. In all, 51% of the IRUK Top500 companies now have this functionality.

Even more widely used is the ability to recommend similar products to items that a shopper has in an online basket through the use of cross-selling and upselling, now adopted by 74% of the IRUK Top500.

Researchers also considered whether retailers required shoppers to register on a website before they checked out – and found that 58% did. “This is almost a trade off,” says Shaw. “By introducing the barrier of registration, retailers are sacrificing the ability to sell immediately in order to potentially add a customer to the database with their email address.”

Insights into the fashion trade

InternetRetailing worked with Knowledge Partner and analytics specialist Edited to analyse how fashion retailers handle stock availability – contrasting newness of products with how much retailers needed to discount in order to clear stock. The 21 retailers studied were the largest apparel retailers in the IRUK 500. The study places Marks & Spencer in first place, suggesting the retailer is making good buying decisions.

“The troubled retailer is working tirelessly to get apparel back on track and retail metrics hint that it’s working,” said Katie Smith, senior retail analyst at Edited. “M&S is able to replenish 22% of their offering, which is no mean feat. They’ve also got a healthy approach to discounting – very few larger price slashes but a healthy amount of lower-level reductions to entice spend.”

Next followed M&S in the findings of this research, with “an exceptionally small proportion of its offering reduced by 60% or more.” But while Next rates highly for stock newness and the speed of sell-through, at an average of 59 days, “lower replenishments rates see Next fall behind M&S,” says Smith, who adds: “Next could be missing out on optimising consumer demand with their fast sell through and high rate of newness.”

Retailers that scored less well in this area included Sports Direct, ranked in 21st place, and Mothercare, just above in 20th place. The study found that it took Sports Direct an average of 303 days to sell through product, while 12% of its offering was discounted at the time of the analysis. Mothercare took an average of 107 days to sell through, but a relatively small proportion of 6% of stock was new in last month.

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