What will the e-commerce industry look like in 2015? Honestly, I don’t know, and that’s why I asked the experts. They are the ones involved 100% in this industry and can provide with actionable insights.
Before jumping into the interview content, please allow me to say a few words about this experience. The people I’ve tried to reach are busy as hell. They are marketers or entrepreneurs exactly like you, and their time is precious. After reading their answers, I felt like I own them money for their advice.
Now, I’ll let you analyze their answers and see for yourself the value within their words.
1. The current state
Glen Richardson, CMO at Fruugo and international speaker
Cross-border shopping is now estimated to account for 14% of e-commerce sales in Europe and is expected to grow 20% by 2018 (according to ‘European Multi-Channel and Online Trade Association’). Consumer expectations internationally are ever increasing and one of the biggest struggles for e-commerce marketers is to not only communicating customer centricity but delivering on it too.
Claire Vignon, Conversion Strategist at WiderFunnel
From this past year’s experience, I’ve learned that best practices don’t work. I recently read an article explaining why “first-person” text improves conversions for online shopping (i.e. the CTA “Create My Account” should drive more conversions than “Create Your Account”). When we tested it for a major e-commerce client, the first-person text hurt conversions. The results were confirmed across multiple platforms, including e-newsletters.
Antanas Baksys, CEO at SearchNode
In 2014 I’ve learned one crucial lesson. The whole e-commerce business team must be focused on metrics and analytics to have successful conversion rate optimization outcomes (front-end and back-end). I believe that every change you want to make on the website needs to be based on data. For example, if I observe that on my e-commerce site 32% of visitors are using site search, I need to analyze conversion rate and see how those visitors close the purchase. In case I see that people who use the site search convert at a higher rate than other segments of traffic, I could start thinking about optimizing it. Either I choose to develop it in-house or look for third party solutions like SearchNode that help with increasing conversion rate, I know that I have to do something about it because it will generate revenue.
Site abandonment is a problem many websites have. Let’s say 60% of users leave the website from the checkout page. Well, this is a huge problem, because they’ve already reached the payment. You have to figure why they do it using surveys and then A/B test the changes on the page. Data-driven decisions are crucial to succeed in e-commerce.
Sam Mallikarjunan, Head of Marketing at HubSpot Labs
I’d love to say that the missed opportunities in 2014 are cutting edge tactics like personalization, segmentation, and customer-centric business model innovation. However, most e-commerce marketers are still missing the boat with tactics as simple and fundamental as closed-loop analytics and abandoned cart nurturing. Tactics that are simple to implement and can have a disproportionate impact on revenue. E-commerce (particularly B2C e-commerce) has fallen behind the curve on innovation because innovation hasn’t been necessary to their survival. E-commerce as a whole has grown roughly 20% YOY (year over year growth) for the last 10 years just because selling stuff online is itself a good idea — and many e-commerce businesses are riding that wave right off a cliff. (the 2014 State of eCommerce study has data on this)
2. The opportunities – 2015 is coming
Although the industry has been saying it’s “the year of the mobile” since 2012, Glen thinks that 2014 was finally that year. In 2015 it’s vital that e-commerce businesses have a strong mobile offering. Therefore, Fruugo is launching a new ‘responsive’ site before Christmas to help the global mobile shoppers buy quickly and easily.
Claire from WiderFunnel says that 2015 will be the year of personalization.
“The users don’t have time to figure out what they want, what they need, what new features on the site may be of interest to them. They need to be welcomed with suggestions that fit them and be provided with a personalized experience from the Homepage to the Thank You page. This is easy to do and unfortunately, most of the e-commerce sites have not embraced it yet. They need to track their customers’ preferences, previously viewed items, and latest purchases to better predict what users are most likely to buy in the future. Geolocation will also help personalize the experience based on location, local weather, etc.”
Antanas sees a rapid growth in e-commerece the next year.
“The e-commerce market is growing fast, the economical situation is pretty stable, and the number of users who are buying on the internet is increasing. However, the competition is growing fast too, and the e-commerce merchants should understand that and offer to their users’ something personalized. First of all I would recommend focusing on data-driven decisions. If you successfully identify the problems of your website, the next step is implementing technology solutions to optimize conversion rate based on data analysis and measurement. Personalization goes hand in hand with recommendation engines and email marketing. Companies like Soundest offer amazing opportunities for e-commerce merchants to personalize email newsletters and reach their goals. Mobile-commerce optimization is important too in 2015.”
Sam thinks that the e-commerce companies that are based primarily on price competition will face failure.
“There’s always someone willing to make less money than you — and price competition has become too efficient to remain a viable tactic with the increasing dominance of price aggregators. Companies that are successful will continue to invest in customer acquisition, retention, and lifetime value optimization over short-term profitability. Amazon makes ~$148k during every minute of every day but doesn’t feel comfortable enough to sit back and optimize for profits — we shouldn’t either.
3. Is Conversion Rate Optimization still efficient?
Glen from Fruugo: We ran multiple conversion rate experiments before embarking upon a re-design and without the data from those experiments we wouldn’t have know what to improve and how. Once our new design is live we’ll be running multivariate tests to further optimize the site on a per country level.
Claire says that the first thing every conversion specialists should do to optimize e-commerce websites is to figure out the company’s value proposition. The value proposition is the foundation of a website. Once they find out a high converting value proposition (and they need to test it to find out), the rest of the site should revolve around it.
Antanas From SearchNode: Yes. I believe it will be efficient many years in the future too.
Sam from Hubspot: It’s efficient in that it’s a good use of time with a fairly low barrier to entry. The tools for testing and analytics are readily available. However, make sure you’re measuring the right things and not missing the forest for the trees with your CRO. Challenge your assumptions. For example, we spend a lot of time working to minimize cart abandonment — but data shows that cart abandoners often spend more than those that just buy right away, so are we optimizing for the right thing?
- selling stuff online is itself a good idea, but marketers need to make sure they optimize the website based on data
- innovation has to be embraced only if the basic tactics have given results
- conversion rate optimization is still efficient
- you need to start optimization with the basics: A/B tests and then multivariate tests
- 2015 is the year of personalization and mobile
- price competition has become too efficient to remain a viable tactic
- best practices don’t work, you need to test everything
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