The
Online Shopping Environment - How to improve it's impact on consumers and merchants.
IMS vision - there has to be a better
way to shop !
Published Dec. 23
1998
"Online
shopping is rapidly becoming one of the top Internet activities. Forrester Research
predicts that consumer spending online will hit $180 billion by the year 2000, and Jupiter
Communications estimates that U.S. consumer web revenue will grow to a staggering $300
billion by 2002".
The concept, displayed at
Impulse Ads site brings merchant offers directly to consumers. How about
taking it one step further and simplify the shopping experience for those consumers
seeking bargains that aren't featured in the Ads. Great bargains are spread throughout the
vast internet... now how to bring them to a buyer when he's ready to purchase becomes a
daunting project.
The problem
Online shopping today is an
incomplete, fragmented, and often frustrating process. Try seeking specific product
information from a search engine query and you'll know what I mean! There has to be a
better way to leverage Internet technology to assist shoppers in shopping for the right
product at the right price. Only when the requirements for consumer
acceptance-ease-of-use, depth of information, and security-are in place will online
shopping realize its true potential for growth. In order for greater numbers of consumers
to adopt the online shopping model, product information must be distilled, supplemented,
and streamlined to form a seamless experience.
At the same time, merchants need a
way to distinguish themselves from their competitors by factors other than price in order
to flourish in an online environment. More and more consumers are choosing to shop by
going through a destination site and being sent to specific merchants rather than finding
the merchant themselves. As the number of merchants and the amount of information on the
web continues to grow, consumers are embracing the easier alternative of referred
commerce. And as this trend continues, merchants need a cost-effective way to attract
customers and increase sales.
Similarly, destination and
portal web sites are competing more fiercely for users by expanding the range of services
they offer. To increase traffic and grow their community of users, these sites will have
to deliver a shopping experience that addresses the full spectrum of consumer needs and
also offer great pricing.
Check out the Overstock computer -electronics
& sporting goods specials below for the lowest prices on the NET.
IMS helped redesign this site's E-catalog and increased sales 35% in just 2 weeks.
Truly a site worthy of your bookmark!
When consumers decide to shop
online, they approach the process with varying needs and degrees of information. For
example, there are consumers who know exactly what product they want to purchase and need
a complete listing of merchants who carry that product. To fulfill these requirements, a
virtual catalogue and a listing of popular consumer product categories are necessary. How
do we generated such a catalog to pin point the products a shopper seeks? Better yet how
do you address "Impulse Buy" shoppers at the same time?
A consumer who has a general
product need, but is unsure about what features to look for, needs access to editorial
information from online trusted consumer authorities, detailed descriptions of product
features, side-by-side comparisons of those features, and data sheets on each product
being considered to reach an informed buying decision. For another source of information,
consumers should be able to access consumer news group postings and discussion forums for
community feedback.
Finally,
consumers who need more help and information before making a purchasing decision benefit
from transaction oriented content, the idea of wrapping content around commerce. Consumers
will be able to browse through content categories, find products and services that meet
their needs, and purchase them in one seamless process. This marriage of advice, context
and dynamically created E-commerce catalogs represents the future of online shopping.
Looking for specific products should not be a time consuming venture. There has to be a
better way!
For online shopping to continue its
rapid growth, the shopping experience must evolve to seamlessly integrate commerce with
content. This additional product information benefits merchants by providing them with a
way to distinguish themselves from the competition by factors other than price. Those
destination and niche' marketing sites capable of offering a complete, compelling, and
engaging shopping experience for their community of users will have an enormous advantage
over those who wait. But the expense of pulling all these factors together and updating
the web pages with the ever changing product offerings is a daunting task.
The Marketplace -adapting
to shopping habits Along with retail, wholesale (
business to business), and traditional direct sales( mail order), the Internet is
positioned to become the fourth channel of distribution for commerce.
When consumers shop for a product
in the physical world, they must gather information from different sources if they want to
make an informed purchase. Traditionally, consumers research a purchase by talking to
friends or colleagues and getting recommendations from a consumer magazine like Consumers
Digest. Once they have decided on a product, they compare prices at various merchants,
often by making phone calls or physically driving from store to store. Once consumers
choose a merchant, they must verify that the item is actually in stock and available for
purchase.
Online shopping today is only a
slight improvement over this often frustrating and time-consuming process. Rather than
driving from store to store, consumers can visit many merchants from the comfort of their
own homes. However, consumers must still look elsewhere for complete product information
and recommendations. They must navigate through many merchant web sites, clicking rather
than driving, to effectively perform price and product comparisons. To fully realize the
potential of online shopping, the experience must be seamless, easy-to-use, informative,
and secure.
Consumers want a way to
gather product information and recommendations from trusted sources, compare products by
features as well as price, check on availability of products, and complete transactions
securely and privately.
How to create the perfect shopping experience & site
What consumers are looking
for in online shopping is not just price comparisons but also product information.
Since consumers can't actually touch an online product before purchasing, they want the
product information, name recognition, and peace-of-mind that comes from buying an
established brand from a recognized or rated merchant. ( i.e. notice that all Impulse Ads
have merchant ratings by shoppers) The more information consumers were offered, the more
satisfied they were with their purchases-and the more likely they were to keep buying
online. The only cleavet to this shopper behavior is to concentrate a collection of
merchants who guarantee the lowest price on name brand products at that given moment in
time ..so price and quality combine for a "Impulse Purchase".
In a shopping experience
that provides more than just price comparisons, merchants flourish as well. Since most of
today's shopping technologies are little more than glorified search engines, merchants are
able to distinguish their online storefronts from the competition solely by means of price.
This helps the MASS merchants who
enjoy deep manufacturer discounts and are able to keep prices low, but hurts most others
who can't compete with the big guys. In the physical world, merchants have other tools in
their marketing mix, such as quality, service, selection, or delivery time. Similarly, to
achieve success in the online shopping market, merchants need to be able to distinguish
themselves by factors other than price. And with so many merchant sites on the web, they
need an effective way to attract online customers, encourage bookmarks and increase repeat
sales.
Similarly, destination and portal
sites need a way to increase traffic and maintain their community of users in order to
stay profitable. Studies show that Internet users are coalescing around a small number of
sites that offer a full range of services rather than going to different sites for
services like email, chat, Internet searches, informative content, and shopping. To grow
their communities and maintain market share, destination sites need to expand the range of
services they offer. As consumer adoption of online shopping continues to increase, so
does consumer demand for a seamless, fully-integrated shopping platform at their favorite
site. And as the market becomes even more competitive, destination sites will have to find
a way to integrate commerce into all areas of their site, rather than confining it to a
shopping channel.
Growing consumer acceptance of
online shopping is driving both merchants' efforts to capture their share of online
shopping dollars, and web destination sites' efforts to offer compelling, competitive
online shopping to their users. However, online shopping must continue to expand its
services. Consumers aren't looking for a shopping experience that replicates the
often-frustrating process of shopping in the physical world, but instead are
seeking one that enhances the process and removes the obstacles to consumer acceptance and
enjoyment. Consumers, merchants, and destination sites alike want a safe, simple, and
comprehensive online shopping experience that truly realizes the range and power of the
Internet.
Problem:
Shopping Process Online shopping today is an experience marred by incomplete information and
scattered resources.
If consumers are even able to
locate all the product information they need online, they are often forced to sift through
pages of useless information in order to find what they are looking for-and go to several
different sites to find one with the product in stock. The Internet needs a easier way
that traditional searches to assist shoppers. The information may be available, but it is
very difficult to locate; listings are confusing, or not sorted by criteria important to
the consumer. Many times, consumers do product research by talking to friends and looking
up editorial information in consumer magazines. Armed with this information, they use the
Internet for price comparisons and to complete the transaction with an online merchant.
This frustrating process often sends consumers to multiple merchant sites containing
incomplete product information about items that may or may not be available.
Unless this process is streamlined
and simplified, online shopping will never realize its potential as a superior alternative
to shopping in the physical world. IMS is looking for a way to leverage the high consumer
acceptance rates fueling E-commerce's rapid growth. By overcome obstacles to ease-of-use,
depth of information, and merchant selection we can put all the pieces together into build
a dynamically generated universal shopping site. The process must be transformed to
fulfill the needs and wants of consumers, merchants, and be private labeled for
destination or smaller sites. A short cut to this monumental task is to create a desktop
shoppingg application with the "PUSH" technology pioneered by Pointcast News in
1996 and broadcast the merchants hot sellers right to the desktop with an instant buy
feature. One click purchasing or a browser linked request for more details direct from
merchant site.
The ideal mix
An optimal online shopping process
would take into account these varying needs and degrees of information. For example,
consumers who know exactly what product they want to purchase, such as a specialized
exercise bike. They should be able to enter the product name, model, manufacturer, or
description into a search engine to get a complete listing of merchants who carry the
bike, both online and local. This listing should also inform consumers about product
availability and whether the bike is in stock through a subscribing trusted merchant.
Delivery, warranty, and return information should be provided as well. Consumers may also
wish to explore alternate methods of shopping such as the opportunity to buy the bike at
an online auction. Or, they may wish to check online classified ads for the chance to
purchase a used one. A complete shopping platform needs to address all these
sources of merchandise to provide a satisfying shopping experience.
In another example, a consumer may
want to buy a mountain bike but be unsure about what features to look for. These consumers
need a search engine with information organized into relevant categories that match the
products most requested and sought by consumers. In addition to merchant listings, these
consumers seek editorial information from a impartial respected consumer authority,
detailed descriptions of product features, and side-by-side comparisons of those features
to help them reach an informed buying decision. To address this need, a complete shopping
platform needs to provide both editorial content and a way to compare features and learn
more about each product.
Finally, there are consumers who
are seeking even more context before making a purchasing decision. These consumers benefit
needs identification, advice from familiar, respected subject-matter experts, product
recommendations and comparison data, merchant selection, and transaction completion. They
should be able to read articles on mountain biking that link to specific products, or
maybe have an online fitness expert design a workout for them that includes biking and
makes product recommendations. This content should address the same familiar market
segment and universal product categories for a convenient, comprehensive, and seamless
purchase process.
Only a shopping platform
that incorporates all of these services and resources-commerce, comparison, community, and
context-is a complete, integrated, easy-to-use online shopping experience. This platform
indicates how online shopping must evolve by going beyond traditional methods to truly
harness the power of the Internet.
Requirements for ideal
shopping system We propose to successfully create a
completely integrated online shopping process, with the following requirements:
First, a virtual
catalogue of merchants and product information must be compiled into a virtual shopping
site. To work well, it must be organized into universal product categories using a simple
structure and common shopper's language. Otherwise, the same product would be listed under
several different categories, making it difficult for shoppers to locate. It must
build a database by using specialized merchant drivers to search merchant e-commerce
databases daily, update product information and availability, and combine this information
into a universal listing of categories consumers can browse. Consumers can choose from a
growing list of popular categories, including automotive, consumer electronics,
entertainment, computers and technology, home electronics, fitness, and home and garden,
health and beauty products etc....
Second, the
shopping engine has to power consumer searches that potentially encompass thousands of
merchants and millions of products, then provide a functional way of serving up the search
results. To be effective, the data must be well-organized and easy-to-use. It should also
search the full range of locations where the product may be found, such as online
merchants, auction sites, online classifieds and local yellow pages listings. When a
consumers requests a search, the results should be presented in an easily understood
manner with the added functionality of providing detailed merchant information upon
request, including product descriptions, availability, shipping policies, return policies,
and maps and driving directions to local offline merchants too.
To achieve success in the
online shopping market, merchants need to be able to distinguish themselves by a factor
other than price. When consumers were able to get product information and compare quality,
value added services as well as price, they were willing to pay a higher average price.
Repeat business also means a higher average purchase amount, according to a 1998 Binary
Compass Enterprises study of over 32,000 online shoppers. Researchers reported that the
average purchase amount for a repeat customer who has made six or more purchases from the
same merchant is $208, compared to $109 for first-time shoppers. -Pointcast News
Nov.1998
Therefore, a complete shopping
solution must provide merchants the opportunity to further distinguish themselves by
methods such as placing targeted ads on relevant pages or offering incentives to purchase
from their particular store. In addition, if the aggregate transaction data were collected
and reported to merchants, they could improve and increase their targeted marketing,
upselling, and cross-selling efforts, just like with Impulse Ads merchant reporting
system.
Dilemma for traditional
sites:
With the continued increase in referred
(affiliate) commerce, like the Amazon.com plan, comes a corresponding decline in
consumers going directly to non aleigned merchant sites. More and more consumers are
choosing to go through destination sites to reach merchants instead of spending the time
to locate and visit individual online storefronts via search engines. Merchants who don't
benefit from referred commerce are seeing shrinking market share as consumers continue to
flock to destination sites for all their Internet activities. And with the
proliferation of merchant sites on the web, merchants need an effective way to attract
online customers and increase sales.
Third, consumers
may require assistance identifying their needs and finding products that meet those needs.
A successful shopping system must be able to provide not only pricing and availability
information, but also editorial and community-based information to allow consumers to make
informed purchasing decisions. A " Comparison Guide" is one example, with
editorial content from recognized, respected sources such as Consumers Digest for product
feature comparisons and Best Buy recommendations in several product categories, PC Order
for computer hardware information with online knowledge base for incompatability alerts,
or DejaNews and Delphi for community-based information on thousands of products and
services.
Currently, sites offering online
shopping are forced to hand their visitors over to merchant sites to complete transactions
( redirect hard to get traffic). Since web sites are dependent on traffic, this
practice runs counter to their ultimate business objectives. Stickiness, or being able to
keep consumers on one particular site, encourages user loyalty and helps destination sites
maintain their communities. To grow their community of users, destination and
portal sites need to deploy a seamless, integrated shopping platform that fulfills the
needs of consumers by providing product, editorial, and price information in an
easy-to-use format and build revenue from repeat sales.
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The Solution can
we find it ?
To address the needs of
consumers, merchants, and site owners, IMS will propose to industry giants to design a
modular, scalable, and flexible infrastructure that integrates all aspects of the purchase
process into a single technology suite.This complete shopping solution
will consist of a Merchant Selector, Comparison Guide, and Shopping Assistant. It
must be able to be private labeled and customized to each site owners preferences.
Each component will work together seamlessly to support the online shopping experience,
from complete merchant listings to editorial information to comparative shopping by
feature. The resulting technology will be built to be private-labeled and integrated into
both high-traffic web sites such as search engines, online communities, and destination
sites and benefit the smaller online retailer as well.
The Comparison Guide will be
designed to enable consumers to read detailed information on available features for a
particular type of product, decide which features are important to them, and enter any
other preferences such as size and price. The Comparison Guide will then display
all the searchable or featured merchandise that matches the shopper's criteria in an
easy-to-understand format. The consumer should be able to view comparisons of the closest
matches, or click on a product for a printable data sheet with product specifications.
When consumers decide on a product, the "Merchant Selector" kicks in and
will generate a complete listing of trusted merchants.
All sites that implement
this "Universal Shopping Engine" can benefit both by attracting new visitors to
grow their communities and by retaining their persistent traffic. With affiliate coding
and tracking linking directly to subscriber merchant E-catalogs, transactions can be
executed from the host site without passing the consumer to the merchant site. The
infrastructure should be a seamless solution that is architected to let consumers conduct
multiple transactions with multiple merchants all in one execution. The Virtual
shopping site generated should hundreds of sites, thousands of merchants, millions of
products, and multi-millions of transactions.
Future of Online
Shopping
As online shopping continues to
evolve, merchant relationships and consumer patterns will be established rapidly. Any site
capable of offering a complete, compelling, and engaging shopping experience for their
community of users will have an enormous advantage over those not willing to leverage new
technologies into their marketing mix. Since consumers control the whole Web experience
they are seeking ways of managing the enormous volume of available information on
the Internet. Sites that are able to distill this consumer information and present it in
an easily understandable format will become the preferred online shopping venues. The
platform adopted by these sites must be modular, flexible, and scalable in order to be
compatible with sites that grow rapidly and change frequently.
With the proliferation of
online merchandise, consumers will demand a more varied selection of products that are at
the same time tailored to their specific needs. They will turn to online shopping for an
experience that seamlessly leads the shopper through every step of the purchase process to
deliver a product that precisely meets the user's needs. This "personal shopper"
concept is the model for the next level of online shopping and we propose to incorporate
this " vision into a reality".
Terminology:
Affinity sites
Sometimes called destination sites, these sites have a loyal community of users who seek
out a particular site for its specific content. Affinity sites are growing their user
communities by increasing their range of services to include offerings such as online
shopping.
Destination sites
These sites have a loyal community of users who seek out a particular site for its
specific content. Destination sites are growing their user communities by increasing their
range of services to include offerings such as online shopping. They are comprised of a
range of sites including portal, affinity, community, sports, news, and sites specializing
in other content areas.
Affiliate Site
A private labeled version of the "Universal Shopping Engine" is displayed at:
High-Traffic Sites (such as search engines, AOL, Netscape, MSN etc.); Vertical Sites
(targeted at specific vertical market segments); Yellow Page Providers (online directory
services); and Consumer Internet Service Providers (ISPs) and Cybermalls or free hosting
sites like Geocity's.
Portal sites
These sites provide a full-service environment where consumers can send email, read news,
access stock quotes, search the Internet, and shop online. Portal sites are becoming
increasingly popular as consumers seek one site to use as a home base for all their
Internet activities.
Referred
"Affiliate" commerce
A rapidly growing part of overall web commerce, referred commerce describes consumers who
shop by going through banner Ads and catagory listings at destination or portal sites
rather then directly to a merchant through a search engine. Referred commerce is driving
the coalescence of consumers around a few portal sites, which contributes to the
difficulty individual merchants are having in attracting shoppers to their sites.
Shopping Assistants
Built-in Shopping Assistants
are capable of stepping the consumer through any stage of the purchase process, from needs
identification to transaction completion. The integrated shopping infrastructure
will consist of the Merchant Brand Selector, Comparison Guide, and the intelligent
Shopping Agent. The Impulse Ads concept will suppliment this as a additional
means of displaying product specials at the same sites for impulse shoppers.
New wave in advertising -
"rich media" or transactional Ads that combine revolving real time offers and
instant purchasing to provide a way for small sites as well as destination sites to deploy
online shopping in all areas of their web, not just within single stores. Consumers will
be able to reach out beyond their chosen portal to product information, availability,
pricing, and merchants where they can purchase the right product while surfing the net.
Impact of the above IMS
vision is born out by similar strategies just announced in March 99 by Microsoft as their
ecommerce innitiative. Amazing how the big guys eventually adopt some of IMS visions into
their business plans.
Get-in2 is being remodeled into a more visitor friendly
format. New sections are being added to this shopping community which will offer Java
Chat, forums, FREE web sites and POP3 E-mail accounts. Our Outlet and FleaMarket sections
will allow the smaller merchant a chance to get their "Feet Wet" on a limited
budget. More information in our Outlet area.
Always look to Get-in2.com for showcasing the best
merchants who discount name brand merchandise daily.
Ecommerce NewsFlashes
Finally,
consumers who need more help and information before making a purchasing decision benefit
from transaction oriented content, the idea of wrapping content around commerce. Consumers
will be able to browse through content categories, find products and services that meet
their needs, and purchase them in one seamless process. This marriage of advice, context
and dynamically created E-commerce catalogs represents the future of online shopping.
Looking for specific products should not be a time consuming venture. There has to be a
better way!
Problem:
Shopping Process
The editor for 
