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While many of us avid shoppers can attest to the immense benefits of shopping online, it may be a surprise that shopping online for furniture is just climbing the crest of its opportunity for retail e-commerce. According to Google/Compete [note: link loads PDF], for shoppers, the path to purchase is all about the right method, products, price and selection that will influence how they buy furniture online. Here’s how furniture retailers can take advantage of the furniture shopper path to purchase.

Online Is a Tool for the Entire Furniture Shopping Pipeline

While furniture shopping is averaging just an increase of 5% unique visits year-over-year, shoppers are behaving all over the map. Furniture retailers have a huge opportunity to capture shoppers at all stages of conversion online. For example, only one in four furniture buyers purchase online but those that do purchase online tend to spend more than those who purchase offline – the average price paid by furniture purchasers who shopped online was $657 versus $600 for those who didn’t. Two-thirds of these buyers who purchase in-store access the internet for furniture information. That’s 66% of shoppers who are just trying to learn more to help their ultimate purchase, whether online or in a retail store!

Omnichannel Is Right On

Marketing to shoppers through omnichannel efforts is not just to satisfy e-commerce buzzwords – omnichannel is a true tenant of what makes furniture retailers reap the benefits of selling furniture online. In-store buyers rely heavily on retail sites while shopping – 76% of them on furniture store sites. These buyers also cast a wide net while shopping online, with 63% of purchasers visiting multiple furniture brand sites prior to purchase.

In addition, shoppers have specific requirements for furniture that influences purchase, among them style (82%), material (81%), durability (81%), and size (80%). With all of these considerations being made by shoppers both online and off, it’s critically important for furniture retailers to engage shoppers wherever they are in their purchase cycle and through multiple channels.

Mobile Continues to Catch Waves

Mobile and tablets are still increasingly important sources for online furniture shoppers. 13% use a tablet to access furniture information, while 12% use their mobile. While these numbers don’t yet represent the majority of those studied, trends still suggest that mobile and tablets are poised for growth in the coming years for e-commerce. In addition, Blueport’s brick and mortar retailers can count themselves as sites that furniture shoppers visit:

• Furniture-only retail sites (39%)
• Home furnishing sites (40%)
• Online-only retail websites (41%)
• Department store websites (44%)

Furniture retailers that can take full advantage of online commerce, while integrating with their brick and mortar stores and mobile, are poised to seize the billion dollar opportunity ahead of them. And Blueport Commerce is riding the wave right along with them, by helping furniture retailers implement a full-service solution that meets the unique, localized needs of selling furniture online.

Recently, eight members of the Blueport Commerce team attended the MITX: What’s Next E-Commerce Summit (Twitter hashtag #MITXECS) to learn about the latest trends and technology in Boston-based e-commerce. Below are seven highlights we took away from this high-energy, informative and inspiring e-commerce experience.

1. Biggest Recurring Theme: Big Data
   The phrase of the day was definitely “big data”. This was a key focus of Wayfair’s panel to kick off the event. Ben Clark, Director of Software Engineering at Wayfair, spoke to the need to structure the data post-capture and being able to create a tailored experience via tactics like clickstream tracking. By creating a record of how people interact with an e-commerce website, such as their products and interests, retailers can create a truly customized experience that is better than any canned solution. We appreciated the focus on consumer behavior pre- and post-purchase and optimized your e-commerce site for maximum revenue generation.
    
2. Most Fascinating Technology Application: Mobile App Segmentation
   One of Blueport’s favorite quotes of the day came from SapientNitro’s Mark Berinato, Associate Creative Director, Experience Design, who said “Your customers aren’t monolithic,” referring to the need for retailers to meet their customers where they are. During the “Building the Next Wave of Great Mobile User Experiences” breakout session, various mobile experts discussed the need to create different levels of apps for different fan bases. For example, designing a full mobile app with each device getting its own platform works for a client like NASCAR, who has some of the most passionate fans on the planet. In contrast, for the casual Indianapolis 500 fan, NASCAR also commissioned a hybrid mobile app which used a combination of an app plus HTML to engaged mobile users who didn’t require the full functionality of a full mobile app. At the end of the session, the panel concluded that designing a mobile app was all about “choreographing the customer journey,” a phrase we at Blueport really loved as it speaks to the heart of the true customer e-commerce experience, not just purchase.
    
3. Best Example of Customization in E-Commerce: Boston Fashion
   One of the most “tailored” presentations was “Boston Fashion Gets Personal with Gemvara, Blank Label, CustomMade, Bow & Drape”. All four companies cater to a more affluent and unique type of customer that wants the highest level of personalization possible in jewelry, furniture, and fashion (men’s and women’s), respectively. Blueport Commerce really enjoyed this panel for its focus on extreme personalization, loyalty tactics and high-end service. For example, Bow & Drape has photorealistic technology which allows a woman shopping for a custom-made dress to virtually “try on” the clothes on a body that mimics her measurements. Bow & Drape also has an at-home-try-on program, where muslins in up to three different sizes will be sent to potential customers, complete with seamstresses’ marks, in order to ensure the best fit possible. These “fit kits” lead to a whopping 60% conversion rate. Also impressive was Bow & Drape’s surprise post-purchase gifts to their loyal customers. We at Blueport Commerce loved the concept of learning to emotionally connect with highly selective consumers pre-purchase to establish trust, something essential for selling big-ticket items such as furniture online.
    
4. Most Interesting Presentation: Karmaloop
   A crowd-favorite presentation was the always-entertaining Greg Selkoe, the founder of Karmaloop, a Boston-based streetwear company. In this fireside chat, Greg touched on multiple topics including the fact he hires passionate people who wear his products as his customer service representatives, knowing that it adds credibility to have people that truly care about the brand representing it. Greg also says he doesn't hire experts anymore regarding his site content because they don't know his audience the way his team does. Greg also spoke passionately against rigid Boston laws that he feels prevent Boston start-ups and businesses from thriving, and encouraged people to check out his project, Future Boston Alliance, which advocates for collective action to improve Boston laws and businesses. 
    
5. Best Vendor Station: STaples
   Thanks to their adorable mini-cupcakes and enormous pastry spread, Staples absolutely killed it in the vendor display department. And who doesn’t love a little conference carbo-loading? Oh, and their panel in the morning on creating an omnichannel experience was delicious as well, touching upon the need for automated metrics around page speed and page performance before even thinking of rolling out new capabilities.
    
6. Most Controversial Statement: Omnichannel
   Speaking of omnichannel, the most controversial statement of the day belonged to Steve Davis, President of Rue La La, who boldly stated his disdain for the phrase “omnichannel”, insisting that it’s overrated and what really matters is the customer experience. Steve also views traditional customer service as reactionary, while by contrast, a great concierge anticipates your needs. Rue La La is extremely focused on NPS (Net Promoter Score) as a mission-critical metric and feels strongly that customer loyalty must be earned. While we at Blueport don’t necessarily agree the need to be omnichannel is overrated, Rue La La is a great example of a truly customer-centric company that prides itself on and strives for great customer service.
    
7. Most Engaged Tweeters
   No surprise, but MITX was full of very active social media enthusiasts. Some of our favorite tweets came from the following companies, speakers and audience members:
   @MITX
   @Selkoe
   @drkleiman
   @trishofthetrade
   @bowanddrape
   @karmaloop
   @UsefulArts
   @ScottKirsner
   @sapientnitro
   @compete
   @aubriepagano
   @gemvara
   @blanklabel
   @custommade
   @SteveHaase

Overall, the #MITXECS was a very informative, fun and engaging day that made Blueport Commerce proud to be a part of the fabric of the Boston e-commerce scene. Our hope is that big-ticket retail is an even bigger focus at the next e-commerce event.

Want to read more? Read the MITX Event Recap: Top Tweets from the 2013 "What's Next" e-Commerce Summit (#MITXECS) and listen to Greg Selkoe’s Fireside Chat on Boston.com [may require Boston.com registration].

 

Did you enjoy your New Year’s Eve holiday by spending time with your family? Our big-ticket retail clients did, because they weren’t worried about whether their websites would be live during their blowout New Year’s inventory clearance sales. One of the most critical decisions you’ll ever make as a big-ticket retailer looking to transition to e-commerce is whether to host your own website, or to use a managed solution. Blueport Commerce examines the pros and cons of hosting your e-commerce website yourself, or outsourcing it to a managed solution provider.

In-House Hosting Gives You Total Control – And Sole Responsibility

The benefits of an on-premise e-commerce hardware solution include increased control, budget flexibility, owning the source code and being able to make changes at any pace you desire. Because you are hosting the e-commerce hardware yourself, you are able to exert more control over your e-commerce website, and iterate at any time. And at first glance, hosting yourself will allow for lower initial costs.

That said the drawbacks of an on premise e-commerce solution are that as your business grows, the complexities and hidden costs start to multiply. Hosting your own e-commerce hardware means you need a fully trained technical staff to maintain it, servers to keep the website up and running, licenses for all of the hardware and software associated with the website, a budget to stay compliant with federal rules and regulations, and money to stay current with threat assessments. Inevitably, the maintenance, constant availability and security needs of hosting a first-class e-commerce site become something few companies can afford to handle internally, from a resource, bandwidth and cost perspective. You will spend more time, money and effort trying to manage all the disparate puzzle pieces than you would by working with a managed solution provider.

Managed Solution Means Manageable Cost

Blueport Commerce, the only e-commerce technology and services company that localizes big-ticket retail online, embodies the benefits of a managed e-commerce solution. With a managed e-commerce hardware solution, you’re free to focus on what you do best: selling big-ticket items, instead of worrying about keeping a website running at optimal performance. And because you’re not staffing up when you use a managed solution, your overall costs are actually lower – and those savings can be used to grow the business. Additionally, managed solutions like Blueport Commerce have key partnerships and alliances with vendors that allow for enterprise-grade equipment to be purchased at a cost-savings that is then passed on to the client. Blueport’s business partnerships with established best-in-class technology partners like Cisco, Microsoft, Akamai, Dell and F5 include Tier 1/Priority Support, with dedicated local reps and faster response times when needed.

Because Blueport Commerce is an all-in-one managed e-commerce solution, our clients have all of the formerly disparate puzzle pieces already assembled for them – allowing Blueport and our clients to collaboratively focus on customizing their website for optimal return on investment. By figuring out the best way for each particular client to do business online, Blueport Commerce’s managed e-commerce solution sets each client up for success and allows for the one item you can’t really put a price on: peace of mind.

For big-ticket furniture retailers, it’s important to know who is shopping, where, why and how selling furniture online is part of the equation. This week, we at Blueport Commerce are going to give you insights into all of this, drawing on data from a recent Furniture Today and Apartment Therapy study.

The unlikely pair partnered to complete a 1,600-respondent survey on where, why and how different generations shop for furniture. For this survey, Generation Y includes people age 18-36, Generation X includes ages 37-47 and Baby Boomers are 48-66 years old. While you can read the complete study in Furniture Today’s print publication, we provide some of the highlights and our expert insights.

Where People Are Shopping

It’s rare that in a survey, 100% of one group answers a question the same way, however 100% of Generation X and Y respondents answered that they “frequently shop” at lifestyle furniture stores. These stores are defined as retailers that carry furniture and home accents at full price, such as Ikea, Pottery Barn, West Elm, Restoration Hardware, and Crate & Barrel. Baby Boomers’ preferred furniture shopping source is also lifestyle furniture stores, with 69% saying they regularly shop for furniture there. Ikea is the most popular brand, with 44% of Generation Y and 36% of Generation X saying they regularly shop at Ikea.

Traditional furniture stores, where furniture is the store’s total business or single-largest category, were the next most popular shopping destination for many, but with significant generational differences. Half of Baby Boomers commonly shop at traditional furniture stores, but this number drops to 33% for Gen X and only 23% for Gen Y.

Lagging far behind was the  classic department store (defined as full-line operations carrying a variety of merchandise such as Macy’s, JC Penney and Sears), with less than 10% of any generation shopping there regularly.

Why People Shop at These Stores

We believe consumers of all ages respond well to lifestyle furniture stores because they promote a complete experience. Their showrooms and catalogs tend to focus on the feelings and emotions that the furniture and highly stylized rooms provoke, allowing less visual buyers to benefit from product placement and suggestions. They make the entire furniture decision and purchase process more enjoyable for their customers. Many lifestyle furniture stores also sell a wide range of affordable accessories – letting the aspirational shopper get a taste of the brand without committing to a big-ticket purchase.

Shoppers who liked traditional stores cited the quality product and variety as their reasons for shopping there, as well as being locally owned and having top-notch customer service. Comments such as "the store's customer service and free delivery are great" and "I like to support local, small businesses” are typical reasons as to why shoppers preferred to do business with a traditional store.

Blueport Commerce isn’t surprised by these findings, as the advantage of localized big-ticket retail e-commerce is being able to close the gap between brick-and-mortar showrooms and online shopping. Consumers enjoy the experience of the stores and being able to touch and feel the furniture, while reaping the benefits of easy browsing, knowledgeable furniture sales staff and streamlined checkout.

How Furniture E-Commerce Fits In

One of the biggest surprises in this survey is how “online” was a top choice for furniture shopping across all age groups: 39% of Generation Y, 36% of Generation X and 27% of Baby Boomers regularly shop for furniture on the Internet. Why? Because online shopping is “easy” and “a great resource with a wide range of choices.”

It’s encouraging that each generation is more and more comfortable with shopping online for furniture. The increased comfort level is resulting in a significant likelihood to purchase as well. When asked if they’d be comfortable buying a sofa without sitting on it first, 24% of Generation X, 18% of Generation Y and even 15% of Baby Boomers said they would.

As the only localized big-ticket e-commerce solution company, Blueport Commerce has embraced the trend of the growing number of people who are ready and willing to purchase big-ticket items online. By offering consumers more of a lifestyle furniture shopping experience online – for example, using more complete room images and suggesting accent pieces such as lighting and rugs when looking at larger items – retailers can benefit from increased browsing and conversions online.

Additionally, an e-commerce store can offer a targeted experience to consumers, increasing the likelihood of closing a sale. Targeting consumers by generation, for example, makes sense: members of Generation Y may live in smaller-sized apartments and condos, so furniture specifically selected for them, as opposed to Generation X or Baby Boomers in larger homes, can make all the difference. With 46% of respondents claiming they continuously shop for new furniture, providing an engaging online experience could be one of the best investments any furniture store could make.

2013 is a year – when you were a kid, picking dates unimaginably far away – that might have been the founding year of your Lego moon colony, the birthday of a future hero or the expiration date of a seemingly permanent galactic treaty.

When I Uber, use Nike+ or email from 34,378 feet, it feels a bit like the future. Things once cumbersome have become easy – they feel clean, simple and efficient, like the future we imagined in the ‘70s and ‘80s. Is an iPad so different from a Tricorder? I think much of Apple’s market cap comes from the fact that it’s one of the few companies that looks and feels like the future. Forget that (Maps, Lighting) and watch out below.

Retail’s challenge – make the messy elegant

While experiences like hailing a cab have been transformed, the messiness that is retail has a way to go. In many ways, it’s messier now than ever. Shopper interactions with stores continue to expand in scope, channels and expectation. 

Morgan’s 3 Key E-Commerce Trends to Watch in 2012 were dead on – highlighting new devices and channels, as well as the need to maintain an experience across these multiplying mediums. Brick and mortar retailers, only a few decades ago able to count on the ritual of “shopping” to drive their traffic, are challenged to adapt. Their real challenge is to streamline this complexity into a modern, clean, relevant experience. Can Ron Johnson bring the future from Apple to JCP? It will be fascinating to watch.
 

2013 – Trees > Forest

2013 feels like the year that the factionalized retail trends of the past few years will start to harmonize. Chasing the latest widget, device or channel will evolve to a holistic view of brand delivery, understanding consumers’ needs and meeting those needs consistently across mediums. 

Three specific trends to keep an eye on in 2013 and beyond:

Ubiquity – Can we count (and scrap) the terms used to describe the ways shoppers and retailers interact? Distinctions between e-, multi-, omni-, digital and physical commerce will collapse, as former pure plays like Amazon build massive physical infrastructure and retailers like Williams-Sonoma consolidate stores in favor of online. 

2013 may be the year we finally start to treat stores as just another brand delivery method. The question for retailers in the past has been “do I need an online/mobile/social presence for my stores?” The question of the future is “do I need stores to deliver my brand?” Some categories (like furniture) will continue find stores useful. Other categories won’t. In either case, the days of stores being the default, requisite method of delivering a brand feel long gone.  

Back to Brands – Just as ubiquity will replace channel focus, a holistic approach to brand will replace digitally limited ideas like “user experience”. Where retailers have been looking at online and social as a way to express their store brands online, they are starting to look at what their brand means – regardless of channel – and how that can best be delivered. New entrants start with brand, and only embrace the channels that can deliver it. 

It’s those retailers that have a strong sense of brand and brand delivery that are winning in retail today. That clarity of purpose drives efficiency in their decisions online and off, and is a beacon to consumers looking for simple, cohesive solutions in a messy landscape.

All Aboard – Laggard industries will continue to be transformed, either by upstart entrants or forward-looking incumbents. If Uber can transform messy municipal markets like taxis, is there any market that “can’t” go online? 

Winners and losers in these markets will be determined by who has the assets to deliver the brand experiences people want. In some cases, those assets will be digital, others physical. Particularly interesting will be markets like furniture, where incumbents have massive advantages in brand delivery, and are finally bringing them to bear in a $70B market.

*          *          *

2012 was an unimaginably great year at Blueport. 2013 looks to be even more so as we continue to work with our retailers to deliver their brands online and recreate our own brand, Furniture.com. We’re looking forward to looking back with you on what will be a fascinating, fantastic year.

Did you know Canadians lead the world in online engagement, with users spending an average of 45 hours online a month? Consumers in Canada are heavily engaged in social media channels, as well as online search and banking. In 2010, 8 out of 10 Canadian households (79%) had access to the internet, and over one-half of connected households used more than one type of device to go online.

Yet in contrast, Canada's internet economy is expected to grow by 7.4% a year through 2016, better than the country's overall GDP, but still lagging many global peers. And shockingly, only 1% of retail expenditures in Canada are from online transactions, compared to 8% in the United States. Compared to similarly connected nations, eMarketer notes that product assortment, payment paths and the number of online operators still lag in Canada’s e-commerce ecosystem.

So with all of these connected Canadians, one would think the consumer demand for e-commerce is there, yet the retailers aren’t. Why the disconnect? Blueport Commerce, the only e-commerce technology and services company that localizes big-ticket retail online, examines some of the reasons for e-commerce’s failure to thrive in Canada.

Lack of Government Support

The federal government could do a lot more to create incentives for the internet economy to take off, said Tawfik Hammoud, partner and managing director at BCG who worked with Google on a study on Canadian e-commerce. Hammoud points to the governments of South Korea and Australia as examples of countries that worked to get e-commerce up and running.

“Canada needs a bit of a shot in the arm to get its e-economy growing going forward and if we don't do that we'll probably lose even more in terms of the ranking,” said Hammoud.

Canadian businesses are investing 40% less in information and communications technologies, or about $2,400 less per worker, than American businesses, according to Canadian Business. This means potential vendors struggle to justify the expense of building out a channel and lack the tools to overcome the challenges.

Selection, Payment & Technology Options Lag Behind

Canada is currently lacking the large presence of small online retailers that the US has. Although 71% of small businesses purchase products online, only 18% actually sell products online. And in order for a consumer to get the selection they want, they are often forced to shop for products from other countries, such as the US or the UK. There are hefty import and tax fees involved for Canadians that choose to purchase from other countries online using a credit card. For example, a $30 shirt imported from the United States could cost as much as $58 after taxes and fees. The inflated price makes many Canadian consumers decide to visit their local brick-and-mortar retailer rather than order it online, even if they can locate the product for less online (before fees and taxes).

Even in-country Canadian credit card transaction costs are prohibitively high for Canadian merchants. Per CBC News, merchants pay two to four percent of the sale price in various transaction fees whenever they accept a credit card for payment. Money first goes to the credit card network (Visa or MasterCard in the vast majority of cases), the company that processes the payments and the merchant's bank. A Bank of Canada survey looked at the estimated cost of processing a $36.50 transaction, which was the median cash transaction in its survey. Costs broke down like this:

• Debit card: 19 cents
• Cash: 25 cents
• Credit card: 82 cents

Additionally the provincial tax system has been cited as an obstacle – in Canada, different provinces have different retail taxes and it is an onerous compliance burden for businesses to attempt to follow all of the rules, leading to less interest in e-commerce. 

And finally, with Canada being a smaller country, there is a lack of capital for funding the necessary expenditures on new technologies needed to drive e-commerce. With telecommunications, for example, this problem is further exacerbated by foreign ownership restrictions. The cost of implementing an e-commerce platform is high and many retailers are unable to currently accept online payments.

Shipping Challenges

Canada’s low population density makes shipping difficult and highly expensive for retailers – and that gets passed down to the consumers. The result is Canadians tend to research products online, but not actually make purchases via the internet, unlike Americans. Additionally, the poor showing of e-commerce as only 1% of Canada’s annual retail expenditures may also be affected by Canadians who shop online but from US retailers who ship north of the border, thus their e-commerce spending is reflected in the US’s annual retail expenditures, rather than Canada’s.

A Brighter Future

However, there is hope on the horizon. Large Canada-based retailers have begun to compete with US-based Canadian operators such as Amazon, online offerings have begun to expand, and creative solutions to supply chain difficulties have been implemented. One of Blueport Commerce's success stories, Leon's Furniture, has worked for five years to bring their furniture, electronics and appliance sales online. Their e-commerce revenue now holds its own against their physical store locations. And Canadians’ noted preference for going to brick-and-mortar stores to shopping online could work to big-ticket retailers’ advantage. Because of the consumer’s need to oftentimes see the furniture in a physical showroom, Blueport Commerce is able to localize the big-ticket retailer experience, creating an integrated shopping experience. This also applies to shipping, with consumers entering their Canadian postal code to allow for their local supply and local delivery, cutting down on shipping costs. With eMarketer predicting $35 billion in e-commerce spending by Canadians in 2016, it’s in Canada’s best interest to incentivize Canadian retailers to get their big-ticket retail items online.

Related posts:

• Move Over Omni-Channel Retailing, It’s Time for a Little Soul
• E-Commerce Leads to Smarter Brick and Mortar Retail
• Canadian Consumers Are Waiting for You Online

In the mid-1990s, it was inconceivable that people would want to buy shoes online. Yet in 1999, Zappos was born, became a giant in the e-commerce industry and now brings in a cool $1 billion in revenue just 13 years later. Blueport Commerce saw a similar opportunity in 2001 around selling big-ticket items online such as furniture and appliances, and launched the industry's only e-commerce technology and services company that localizes big-ticket retail online. With higher price points and slower buying cycles, big-ticket retail can take longer to reap rewards. However when a world-renowned company like BMW decides to sell cars online, it makes us feel like we're onto something big.

On June 13 in London, Ian Robertson, head of global sales at BMW, spoke with Bloomberg about online retailing and sales strategy for the new BMW i electric car. Two topics Robertson touched on are particularly relevant to big-ticket retail: pricing for big-ticket items and channel optimization.

Pricing for Big-Ticket Retail

Ian Robertson revealed that BMW will be selling the new electric icars over the internet, in addition to their traditional physical dealerships around the world. "It's clear in my mind that the actual experience that a customer has with a dealer, with a point of sale, is still the backbone of what we're going to do."

When asked if the price of the cars would be discounted online, Robertson responded, "Absolutely not. We have a very clear policy – our dealers ultimately will do the deals for vehicles. What we are not going to do is have different channels offering different price points. Our dealers are responsible for this around the world - this is not new, this is our normal business."

Although deep discounting has come to be associated with e-commerce, for example in the world of online marketplaces such as Amazon, BMW recognizes that price-slashing is not an effective technique for big-ticket retail. Or, in the words of Robertson, "This is not something that people are likely to just look on the internet...and say 'yes, that's for me....this is expensive product, and in many cases, is the most expensive product people buy. And that experience of the product, both in the physical sense and the driving sense, is a fundamental part of that actual decision."

With this insight, it is clear BMW agrees with Blueport's assessment that having two disparate buying channels, with physical stores and a branded e-commerce website competing with each other on price, is not a model for success. Blueport firmly believes that BMW is on the right track by keeping the dealers in control of setting the prices of the cars and the website being a connected and cohesive channel for optimized buying. Blueport frequently advises our big-ticket retail clients to think of their e-commerce website as a branded hub, while also being a tool to help their showrooms compete in local markets. By keeping prices consistent, bi-directional web and physical traffic allows for greater lead generation, as well as increased sales.

From Channel Conflict to Omnichannel Optimization

On the topic of potential channel conflict, between traditional dealers and online stores, Robertson stated, "It's no secret today that a very large percentage of all the customers that buy BMW have done research on the internet so when they arrive at a dealership they've almost made their decision. And we want to actually make sure that the customers have the option to do whatever they so desire."

"The worldwide dealer body remains the backbone of what we're doing with all the products for BMW....the actual availability to experience the car, to sit behind the wheel, to drive it, is a very important part. But we will have multichannel approaches which will be useable for the i products and, in time, other products as well."

Robertson mentioned the dealers in this equation as the equivalent of local heroes, with higher knowledge than any website could provide, able to interface in real time with the customer as needed and close the deal with their rapport and experience. This sets up the online and physical stores to combine for greater total sales, appealing to consumers who do internet research before arriving at a dealership, as well as those willing to pull the trigger without setting foot in a physical showroom.

Like BMW, Blueport recognizes the need for brick-and-mortar stores to work in harmony with an e-commerce presence. Blueport long ago realized that physical stores were the heart and soul of the big-ticket retail experience, with the online stores acting as an additional channel that allowed for both research, comparison shopping and added purchasing convenience. By coordinating both prices and discounting online and offline, the stores benefit from increased foot traffic of people who have researched online, but want to touch and feel the furniture or appliances in store. The web benefits from being available as a channel for people who are confident in their internet research and are ready to buy immediately, without needing to travel to a physical location or talk to a salesperson. And while it may be awhile before all cars are available online for immediate purchase, it's nice to see a world leader in the automotive industry like BMW taking that step into big-ticket e-commerce retail. 

Related posts:

• Omni-Channel Retailing 2012: Marrying the Best of the Digital and Physical Channels
• E-Commerce Leads to Smarter Brick and Mortar Retail
• With E-Commerce, How Many Physical Stores Do Retailers Really Need?
• Demandware: A Cloud E-Commerce Solution for a Category That ‘Will Never Go Online’ -- Sound Familiar?

A common problem for potential consumers of big-ticket retail items such as furniture and appliances is that it's almost impossible to know how a certain piece will look once it is in their home or office. Measurements can be taken, and photographs can be scrutinized, but it's more often than not a guessing game as to how everything will fit together on delivery day. In fact, one of the biggest e-commerce challenges is that the consumer is often uncomfortable pulling the trigger on big-ticket retail items that cannot be visualized in their own personal space.

At Blueport Commerce we combine the industry's only big-ticket retail e-commerce solution with dedicated e-commerce integration services and personalized service packages to build the right solution for your business. Part of providing all of the components required for a successful e-commerce site is ensuring retailers have the technology necessary to help consumers solve the age-old dilemma of how furniture or appliances will look in their rooms. Here are two hot new furniture retail technologies currently on the market that attempt to do just that.

1. 3D Room Designer by Crate & Barrel

Crate & Barrel has introduced 3D Room Designer, an in-store tool which allows a customer to drop a digital photo of a room in their home or office into a 3D room model – without recreating a floor plan. The customer makes an appointment online and either emails or brings a photo on a USB stick to a nearby Crate & Barrel location. The height of the room is the only measurement the customer needs to know. From there, the customer can work with a store associate to transform their space with 3D models of Crate & Barrel merchandise, swapping out products, materials and colors. More than 2,000 Crate & Barrel products are incorporated into the 3D Room Designer, with all combinations of materials and fabrics together. Store associates are then able to print and email photos of the redesigned rooms to the customer, along with a list of all the items chosen.

While this technology certainly aims to solve the issue of visualization, the problem is that the final image can often look cartoonish and not realistic enough for the consumer to want to purchase. And while the goal of this 3D Room Designer is to drive traffic to brick-and-mortar stores, some customers will not want to make an in-store appointment and then go to the physical store. Additionally, by having the product only available in stores, it turns away those customers who may be in the research stage and want to simply “play around” with the tool online, and make a purchase decision weeks or months down the road.

By ignoring the needs of customers who live in rural areas, far from a store, as well as those who simply prefer to do all of their research and shopping online, Crate & Barrel is losing potential customers. In the spirit of true omnichannel retailing, Blueport Commerce recommends that Crate & Barrel creates a web version of 3D Room Designer that allows customers to do the manipulations themselves, as well as purchase the items online, rather than only going to the physical store.

2. Mydeco 3D

Mydeco.com, a UK-based online home store that sells furniture and home accessories from multiple retailers, boasts 3D, an online floor planner that lets customers visualize their home in 3D when buying new furniture. From the comfort of their home, a customer can upload up to 2 floor plans for free and move the walls and manipulate furniture from any of Mydeco’s retailers to their liking. After the customer is satisfied, they will receive back a 3D rendering in one business day. Additionally, the site has a community feel in that customers can connect with Mydeco’s collection of interior design enthusiasts, students, and professionals.

Mydeco.com also has another tool, Moodboard Creator, which is a Pinterest-like tool that lets consumers use furniture and home accessories from Mydeco.com (or any image they like) to get inspired to redecorate their homes. Pictures can be rotated and mixed, along with background and frames.

Blueport Commerce recognizes the value of Mydeco.com’s 3D tool, as the output is more realistic than Create & Barrel’s 3D Room Planner, and it allows users to get more creative, with furnishings from multiple retailers. Additionally, consumers can use the tool from their homes or offices, and not have to make an appointment or drive to a physical store location. The community and social feel of Mydeco’s 3D planner and Moodboard Creator allow for a greater viral reach, encouraging users to share their designs within the Mydeco community, as well as social sites such as Google+, Twitter, Facebook, StumbleUpon and Pinterest. The only negative is that it’s not as fully visually compelling as it could be yet – it has not achieved the next step of augmented reality.
 

Augmented Reality – The Next Dimension

Imagine in the near future a customer being able to walk into a brick-and-mortar store and, with their mobile device or a device supplied by the store, scan and have elements of the display room pop out with information such as pricing, reviews, dimensions, availability and description. Or imagine being able to scan a room in your home or office you wish to redecorate with your mobile device, and have a retailer’s furniture placed into your home, in varying colors and at scale. Hidden Creative has a video depiction that suggests such a possibility here (at the 2:00 minute mark) through the next step of Augmented Reality, called Articulated Naturality Web. As the drive to capture the increasingly-connected consumer continues, retailers will need to stay attuned to technology advancements that can aid them in reaching and capturing tech-savvy consumers.

Blueport Commerce is currently developing exciting new technology that includes augmented reality. Our goal is to help solve the e-commerce challenge of allowing consumers to envision their desired big-ticket retail item in their own space. Let us know if we can help you develop technology to enhance your brick-and-mortar store or e-commerce website presence – we would welcome the opportunity to enrich the consumer experience and increase e-commerce transactions for your business.

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• Making Sense of Mobile Payments & More
• How Will Facebook’s Acquisition of Instagram Impact the Social Network for Retail Brands?

In some ways, the Olympics is just like any business, including your e-commerce website. This year for the 2012 London games, the Olympics and NBC, the network airing the event on TV and the Internet, have social media to navigate.

And the solution for both of them is the same: If you can’t beat them (which you can’t), join them. The reality today is that social media is a part of people’s lives, and the best a marketer of any breed can do is harness its word-of-mouth power.
 
Social Media & the Olympics

Unlike during previous Olympic games, the use of sites like Twitter and Facebook has grown significantly. According to a recent Wall Street Journal article, “Social media usage has surged since the last summer games. In 2008, Twitter had about 300,000 tweets per day. Now it has 400 million. Facebook had about 100 million active users in the summer of 2008. As of April 2012, it had 900 million.” It’s so prevalent that visitors were asked to refrain from tweeting and texting during specific events after the data network was too clogged to send bike GPS data to broadcasters during a men’s cycling race, reports dailywireless.org.

And beyond the personal user, media outlets covering the Olympics are present on these social networks. Contrary to many people’s intuition, the real-time streaming of winners, losers and other Olympic news  as actually led to an increase in viewership at prime time. “In its first three nights of the London Olympics, an average of 35.8 million viewers have tuned in, the biggest first weekend for any summer games on record, according to NBC,” reports the WSJ article. “Average viewership has been 1.4 million more than the 1996 Atlanta Olympics and five million more viewers than the 2008 Beijing Olympics, which was mainly live.”

It appears these “spoilers” and all the buzz  may be getting people more excited to see the games.

Social Media & Your E-Commerce Business

E-commerce marketers can learn from NBC and the Olympics that while a true social media strategy includes relinquishing control, the payoff for that trust is an impassioned community that can powerfully extend your brand.

We know it’s hard to let go, but here are some strategies to help you get started:

• With social media, it’s always best to start with the reigns the tightest you want them and then let them loose as you become more comfortable. Doing the reverse will upset your brand followers. For example, if you think you might want to approve comments on your blog at some point, launch it that way. But also consider letting this control go, especially once you see the nature of the comments. In most cases, you can easily delete a comment that goes against your terms.
• You need to really invite the conversation and show your customers you want the back and forth. Ask them to post images and reviews of items they’ve purchased, or allow them to weigh in on merchandise you plan to sell in the future. Show your fans they are a priority by quickly responding and commenting on their posts about your brand. To really put this on hyperdrive, be sure you have a good listening process and reach out to those talking about you beyond your own social network pages. Keep an eye on blogs and review sites.
• Allow critics to voice their negativity. I know it’s hard to believe, but there will always be haters out there. Don’t close them out. Allow them to say their piece, and openly help them if necessary. If you don’t let them interact in this way on your brand pages where you have the control to interact with them, they will find other public places online to do it. And you’ll be surprised: As you grow your social media brand, when someone posts something invalid, your other fans will come to your aid.

A great social media strategy can equal gold for an e-commerce company. Are you and your e-commerce company ready to embrace and champion this medium to move your business forward?

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New York may be the city that never sleeps, but perhaps if its tech workers got a little more rest, then the Big Apple would be declaring itself home to the most IPOs in the East over the last 18 months. Instead that title goes to the city Blueport Commerce calls home, Boston.

Flybridge Capital general partner Jeff Bussgang recently wrote a piece comparing the two cities’ scorecards for IPOS as a follow-up to a two-part blog he had done a year earlier on the state of East Coast IPOs. At the time, he believed NYC had a stronger pipeline of pre-IPO companies. But now, 18 months later, he sees Boston has had nine IPOs compared to New York’s, um, zero. None. Zip. Bupkis.

First, I’d like to take a moment to congratulate my Boston brethren; here is the list of Boston-based tech IPOs: Brightcove, Carbonite, Demandware, EXA, Kayak, Tesaro, TripAdvisor, Verastem and Zipcar. I don’t care what you doing for a living, you’ve heard of at least four of those.

Second, as someone who has had the pleasure to live in both of these cities, I believe they both have a lot to offer on personal and professional levels. But note which one I chose as my home, the one I chose to use before it used me. While I have my reasons for that decision, Bussgang theorized a few of his own as to why Boston has been better for technology IPOs as of late. They include:

• New York City doesn’t have the IPO culture. One Tweeter seemed to agree with this sentiment, posting: “Hipsters don’t build companies…operators do. NY is full of Hipsters.”
• New York’s strong sectors aren’t in favor right now. Although, Bussgang disproves this one himself as some of Boston’s IPOs were consumer-focused.
• New York gets more media play, making it seem like those companies being mentioned may have progressed their businesses more than they really have. This is the theory that seems to have the most meat. New York has more presence from TechCrunch and Business Insider than Boston does, so the stories do not hit the mainstream in the same way.

“E-commerce companies like Etsy, Gilt Group and Rent the Runway get a lot of ink compared to, say, Boston-based Wayfair and RueLaLa,” he writes. “But if you objectively examined their financials in terms of actual revenue and scale and profitability, who is really closer to being ready to file their S-1?”

Of course, we at Blueport have a few additional theories as to why Boston is attractive to these emerging technology companies:

• Boston is a fantastic city with a deep history in innovation and sparking change.
• Relative affordability -- Boston doesn’t even appear as one of the top 10 most expensive US cities, which surprises me, but it is a hard fact.
• With centers of innovation and all the area colleges producing top-notch folks who stay in the area, Boston has a very attractive talent pool and new ideas to match.
• And of course, the Red Sox, Pats, B’s and Celts.

Yes, we definitely feel in good company here in Boston, especially as we see some bigger players, like Amazon and Paypal, increasing their own footprints in the area. If Boston sounds like a great place to work to you, or you are already here and ready for a change, let me know, because we’re always looking for the best talent to help move Blueport forward.

Related posts:

• Demandware: A Cloud E-Commerce Solution for a Category That 'Will Never Go Online' -- Sound Familiar?
• Making Sense of Mobile Payments & More
• Blueport Commerce to TJX: How to Bring Your Local Stores Online
• 3 Key E-Commerce Trends to Watch in 2012

Once upon a time, it was believed that site load speed depended on the size of your website. So for e-commerce businesses, that meant the more products you featured on the home page, the more images you displayed for each product and the more advanced widgets consumers could interact with would all lead to a longer site download time and the risk of losing your customers. But technology has advanced and things have changed.

There are some new truths in the world of e-commerce:

• While a 3-second download time is the target, it’s not as important to consumers as it used to be.
• The size of a website does not directly correlate to its download speed.
• Metrics now have a major impact on how long it takes for an e-commerce site to load.

RetailWeek recently wrote an article that examined a Pingdom study comparing the performance of the top 100 e-commerce websites. It found that site size and the number of files requested do not seem to have much of an impact on speed. For example, “two of the fastest sites (REI.com and Kohls.com) are also among the most bloated – they’re more than twice the size of an average site in the study…. CVS, at just over half the average size, is simply slow compared to almost all the other retailers.”

Then what dictates site speed? “Ironically, what’s slowing down some of the big-chain sites are services that rely on third parties – such as web metrics and tracking services – that drag down site load times but are outside the control of retailers. What’s slowing down some of the big-chain sites may not be problems that retail IT shops can easily fix.”

As a business, e-commerce fuels itself with its data, and in some cases, slower load times are the price to pay for it. Here at Blueport, we put a premium on the data the e-commerce channel can provide in targeting consumers as well as informing local business decisions. Of course, much of this data collection and monitoring requires third-party partners. We work with our big-ticket retail clients to determine which services make the most sense and then help them analyze the impact each cookie might have on site speed versus the value it provides. We continuously monitor how the third-party calls affect performance and proactively work with the vendors should any issues arise.

If you are working with third parties of your own, here are some things to keep in mind. Ask the vendors what systems they use – this will give you an idea as to where the files are hosted. You can also monitor your site’s performance with a free tool like Pingdom or Firebug that will help you see which files are coming from your own site and which are coming from someplace else and how long it all takes to load.

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This month, Retail Systems Research (RSR), released its report “Omni-Channel 2012: Cross-Channel Comes of Age.” This benchmark report has a number of interesting findings, including:

• Retailers now understand that consumers use multiple channels to complete a single purchase.
• All the retailers surveyed believe a single brand identity across all channels is important.
• Retailers believe consolidating customer data all channels is the most important requirement and biggest hurdle to creating a seamless customer experience.
• RSR recommends retailers focus on understanding their customers, and then a singular cross-channel strategy will come out of that.

It’s Not Just E-Commerce, It’s Digital

At Blueport Commerce, we help our big-ticket retail clients not just with e-commerce, but with their entire digital channel, which has evolved to encompass social media and mobile commerce as well. And with these clients, our ultimate goal is to help them provide customers with the best of both the digital and physical shopping experiences (or the closest approximation of the physical experience online).

The RSR report credits physical stores’ biggest advantage as being able to provide instant fulfillment. But with big-ticket items like furniture, that is often not the case. For sofas, dinettes and similar items, consumers like to be able to see and feel their items. We work with our clients to offer rich, detailed information and spectacular imagery to make the customer feel as close as they can to shopping in the store. And this in-depth content is available to shoppers using their mobile devices in-store and even to salespeople, arming them with the information they need to close sales.

We also have solutions for our retail clients that struggle with legacy systems, allowing them to offer customers up-to-date inventory and delivery information – the same they would get in-store.  We plug right into their own inventory and pricing systems, so we can display real-time local information to customers for pricing, inventory and delivery.

The Future of Retail – Online and Offline

The RSR report addresses the current shift going on in retail today. Retailing today is not just about selling the right products at the right price, but it’s about selling solutions. This requires understanding customers and their paths to purchase so you can deliver the information and product when they need it, while also allowing customers to access the information and items when and where they would like to.

At Blueport, we believe the only way to meet customers’ expectations is to complete a seamless cross-channel experience that leverages the best of each channel.

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• Consistency Is Key in This Multichannel Retail World

A recent Forbes piece takes a look at the future of e-commerce and how curated retail sites, like AHAlife are just the beginning of what is to come.

To date, there is no doubt that e-commerce is a force for quick retail transactions. From toothpaste and books to diapers and concert tickers. You know what you want, go to the website and in a few clicks these goods are on their way to your door. But these are the items that don’t require tons of research and thought.

For big-ticket items, like furniture, consumers want a more intimate experience with what they are buying. They want an emotional connection with the sofa before they pay a larger sum and welcome the piece into their home. As Shauna Mei, AHAlife’s founder says, “the next 10 years [for e-commerce] will be about leveraging digital technology to enhance and create real, emotional experiences.” And we here at Blueport Commerce, with our solutions and services for big-ticket retailers, believe we are on the forefront of this movement.

For years, we have been working with our clients to help them use the best of the web and technology to bring their product catalog to life. Through detailed imagery and rich product descriptions that go far beyond manufacturers’ details, we help our clients create romance and a story behind each item. We create an emotional connection between shoppers and the items they browse, giving them reason to take action, whether it’s using their online research to go in-store or choosing to buy the big-ticket item right there online.

We at Blueport are excited about this next step in the evolution of e-commerce and know that we and our clients are poised for continued success.

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As exciting a time this is for e-commerce, this is also an extraordinary time for the business of paying for goods. From Square, which converts smartphones into credit card-processors, to mobile payment regulations, there’s a lot going on in payments.

When it comes to mobile payments, do you have a pulse on customers’ needs, retailers’ goals and the big technology players? We’ve gathered a roundup of some of the hottest headlines to help you keep up with this fast-moving field:

NFCNews – Survey Shows 66% of Retailers Want Mobile POS

A new survey from Motorola Solutions shows there is increasing interest from retail, hospitality and field service industries for mobile Point of Sale (mPOS) solutions, such as NFC payments and mobile loyalty programs, as a core strategy for improving customer service. According to the survey, which was comprised of 541 retail, hospitality and field service employees from North America, UK, France and Germany, 66% of respondents are interested in mPOS, while 42% of respondents are currently piloting or starting trials within the next 36 months.

U.S. News & World Report – How Safe Are Mobile Payments?

For some consumers, paying at the checkout line becomes a lot simpler when they can forgo the plastic card and pay with their phone. Mobile payment applications like the Isis Mobile Wallet, Google Wallet, Square, and LevelUp turn your cell phone into a payment source: Just store your debit card or credit card information on the phone and scan the device at checkout. "Consumers like the convenience factor," says Sarah Jane Hughes, a commercial law professor at Indiana University. But is this new form of payment safe?

Mobile Payments Today – PayNearMe Gives Unbanked a New Mobile Payment Option

One of the problems for "cash-preferred" consumers is that some transactions, for instance, airline tickets or online purchases, require an electronic payment method. Now U.S. consumers who choose to use cash have another mobile option to make electronic payments. PayNearMe, a cash transaction network that markets to the under- and unbanked, announced its new mobile cash payment system, a product that lets those without credit or debit cards use their cash to make loan payments, pay bills or buy tickets.

Seeking Alpha – Apple: Sleeping Giant Within the Mobile Payment Industry

The mobile payment industry is still in its infancy. I believe the mobile payment industry is a multi-billion dollar, multi-year secular growth market which will have a huge impact to the bottom line of key mobile payment players. Aite Group states the volume of mobile payments will grow to over $200 billion by 2015. In 2010 mobile payment revenue was approximately $16 billion. That is an over 12-fold increase in just five years. Apple is a dominant leader in the smart phone market with over 35 million in smartphone sales last quarter alone. They have not entered the mobile payment market yet, but I expect them to arrive on the scene very soon and disrupt the current mobile payment landscape.

Wall Street Daily – Google Could “Wrapp” Up the Mobile Wallet Race for Good

Wall Street Daily readers know that point-of-sale Near-Field Communication (NFC) technology is one of my top trends to watch this year. And although a recent study by Pew Research found that the technology likely won’t be a dominant form of payment until at least 2020, that’s not stopping players from jockeying for position now. After all, whoever lays claim to the biggest share of the NFC market should have an easier go of dominating the industry as the technology gains popularity down the road.

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Blueport Commerce would like to offer a hearty congratulations to Demandware, which priced 5.5 million IPO shares at $16. They closed at $23.59 making the company’s value $530 million. Demandware joins the likes of other cloud computing-based software companies, including Brightcove and Bazaarvoice, that have joined the IPO wave since December.

There are a number of reasons why we here at Blueport are happy for Demandware’s success. Above all, it shows how more and more retailers are looking to the cloud for e-commerce solutions, rather than trying to build and run their own e-commerce software.

Retailers who use Software as a Service (or SaaS) e-commerce solutions like Blueport or Demandware leverage the cloud, cutting-edge technology and the expertise of companies that live and breathe e-commerce to bring their brands online efficiently and effectively.

This IPO is also a good reminder of how far e-commerce has come. Demandware’s e-commerce solution focuses on apparel. There was a time when no one believed anyone would buy clothes or shoes online. Now, buying clothing online is as commonplace as buying as anything else.

Just as Demandware has done for its apparel clients, Blueport takes the hard work out of e-commerce for challenging categories like furniture, flooring and appliances. We provide a robust SaaS e-commerce platform that solves the unique, local challenges our customers face, so they can focus on their businesses, rather than attempting to reinvent e-commerce technology.

We’ve seen our customers have great success selling big-ticket items online. Demandware’s IPO reminds us this is only the beginning.

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Copyright 2010, Official Blog of Blueport Commerce

In February, when TJX announced its plan to nearly double its annual sales, we here at Blueport took notice, especially since e-commerce is a crucial part of the plan to get there.

For the fiscal year ending January 28, 2012, TJX, parent company of T.J. Maxx, Marshalls and HomeGoods in the US, had $23.3 billion in net sales. The goal is to reach $40 billion by investing in technology and e-commerce. While the company has a web presence with a combined 4 million visitors per month for all of its properties, they do not sell merchandise online in the US and have not since their last attempt at e-commerce in 2006.

“E-commerce is clearly in our future,” said TJX CEO Carol Meyrowitz in a recent conference call as reported by RIS News, Internet Retailer and others. “We believe e-commerce will open up a greater landscape for categories. Just think about the potential for us to carry categories online that we wouldn’t carry in our stores.”

At this point, TJX is building a team of e-commerce experts with a focus on developing the new initiative.
 
My Advice for TJX

Working at a company with more than 10 years of e-commerce experience, I have some thoughts on the possible tact TJX could take in growing its online retail business.

As I understand the retailer’s overall business, much of the merchandise it sells comes from opportunistic buys, like when a distributor liquidates 900 name-brand sweaters or 500 sofas in a discontinued upholstery pattern, or from program buys, when items are manufactured specifically to be sold by discount chains. Most, shall we say, Maxxinistas, go to the stores to land the opportunistic merchandise, which is harder to find because of the limited supply. So not every store carries the same merchandise, and much of the more sought-after stock moves very quickly. How does this translate to an online retail business?

Option 1: The Gilt Model

TJX and all of its properties could follow in the paths of Gilt Groupe, Fab.com and the like, selling the best stuff online, perhaps even following the invite-only model. Then, items could be shipped from a central location, which tends to work best for smaller items that can be packed in a Fed Ex box.

The challenge here is that their retail websites would directly compete with their stores rather than creating a beneficial and seamless multichannel retail experience for consumers. (Hint: Don’t do this.)

Option 2: Localized Cross-Channel Commerce

TJX could go for a truly localized e-commerce solution that ties into real-time inventory data would provide the best results for their overall bottom line. Customers would be able to get their purchases inexpensively and quickly or even see items in a nearby store. The web presence would continue to improve the overall bottom line without jeopardizing any individual location’s own fiscal health. (Hint: Do this!)

Based on the e-commerce solution we’ve created for our own clients, we think the second option and offering customers a localized cross-channel e-commerce experience would be the best for any retailers’ long-term growth. After all, we’ve already proven this model in the home furnishing industry for stores just like HomeGoods.

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• Consistency Is Key in This Multichannel Retail World

Copyright 2010, Official Blog of Blueport Commerce

Would you spend $300 on shipping an item you’re buying online for $100? If you’re like many of today’s consumers, you might think that’s just not fair. But that is the type of shipping charge Ikea customers are facing.

According to this Stylelist Home blog post, Ikea has established a flat shipping rate for customers further from their store locations. This likely lowers the cost for customers buying roomfuls of furniture, but the customer who is buying a single item appears to lose out. Statistics show that people who purchase furniture on the web are, in fact, often buying single pieces -- it's the guy who’s jumping online at lunch to snag that $899 leather couch he has in his cart that is now on sale for $629 (you know, the one with the brushed stainless legs).  But what is the abandonment rate when a customer sees the shipping rate is higher than the money he’s saving?  I'll save you the thinking on this one: The abandonment rate is huge, and that's a problem for billion-dollar retailers like Ikea.

Shipping is an expensive part of the retail business, especially for big-ticket retailers. But not getting this part of the pricing right can be detrimental to the bottom line. Implementing a local e-commerce strategy can keep shipping costs down for your customers.

Our e-commerce solution here at Blueport takes the customer’s location into account. We tie into our retail clients’ real-time inventory data and display the merchandise that is available in the physical stores closest to the customer. This allows customers to get the merchandise they want as quickly and inexpensively as possible. After all, happy customers equal happy retailers!

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Copyright 2010, Official Blog of Blueport Commerce

Looking at last week’s post, it seems marketing and IT have switched personalities for this discussion, as marketing is usually the promoter of the bright and shiny future while IT proceeds with caution seeing dangers around every corner.

After years of working with in-house tools and best-in-class SaaS solutions, Blueport’s marketing department has a few words of caution for our kin who are working to gain control over their own technologies.

Know What the SaaS Will Really Offer Your E-Commerce Website

There is an ever-increasing number of technologies being pitched to marketing as being the key to higher conversions, with easy-to-use interfaces and “little IT involvement” required. But beware of false promises and flashy demos. For every app that really makes your life better (like social media posting apps), there are apps that will only add to your workflow, not your bottom line. Many seemingly promising apps turn out to be so limited and inflexible that in a month your ideas will have exceeded their capabilities.  Even worse are the apps that make website pages grind to a halt as they call numerous third parties to display data in a fancy new interface.

Technical Resources Required

One of the benefits of your internal development team is their ability to help identify your needs and find a real solution. While the solution may be found outside your company, marketing will still need business analysts and vendor managers to help evaluate and maintain these new services. These professionals, which typically sit in the IT part of the organization, will have insights and questions that are not evident to all in the organization. These same talents are needed to ensure these services are implemented correctly and doing what you expect them to do on the client side – many of these SaaS provides offer little handholding around the backend of things. I would caution marketing to be too willing to take over their own IT projects without first having these resources in place.

Tracking All Your Systems

Lastly, be aware that tying these systems together with other marketing efforts and internal systems to gain a complete view of your customer becomes more and more difficult with each new service. Each service will come with its own usage data, which may or may not conflict with other information you have. Make sure this new information really adds value, and not just inactionable data.

When IT and Marketing Collaborate, There’s Some Letting Go

For e-commerce companies and the like to truly advance and be competitive in a world where the latest technology consumers want to experience may come from anywhere, marketing and development leaders should sit down and set some ground rules as to who makes the calls – with input from the other – on what functionality. In other words, they should draw the lines between core (IT’s domain) and subject area (marketing) expertise. On an e-commerce site, the key shopping cart workflow would be ultimately owned by development but product reviews would be marketing’s domain. While it is necessary for each side to provide input and support on changes and technology, clear owners will help keep projects and advancements moving along.

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• What You Should Know About E-Commerce Hosting
  

Copyright 2010, Official Blog of Blueport Commerce

Here at Blueport, we’ve been passing around last week’s StorefrontBackTalk blog post “Should CIOs Now Surrender to Marketing?,” and it has sparked some discourse between our own marketing and technology functions. As Director of Integration, do I think CIOs should surrender to marketing? They already have!

Some don’t know it yet and some have walled themselves up in time capsules, and for both those groups, the battle has passed them by. Those CIOs who don’t know it yet lead organizations that just can’t seem to make up lost ground chasing the most profitable new technologies. Those who have walled themselves off behind pretexts of the need for conformity and centralized control have done nothing but stifle and stratify the process of business evolution critical to ongoing competitiveness. IT organizations that encourage and support peer business unit management of specialized, cost effective, outsourced applications have won the day.

When CIOs Let Go, Bigger Opportunities Result

By foregoing complete control of all that has become the technology function, the CIO also realizes benefits and reveals opportunities. No IT organization has excess resources to spend making specialized applications that compete with today’s best-in-class cloud and SaaS solutions. Spinning off responsibility for tools that cater to subject area expertise allows CIOs to focus resources against core projects where their resources thrive as opposed to working a potentially complicated solution in an unfamiliar discipline.

A Real-Life E-Commerce Example

The real opportunities result when, through a collaborative approach to enabling specialized applications, a vision develops of the next generation corporate infrastructure, an infrastructure that enables and supports snap-in specialized solutions and opens the door to the same type of quick, cost-effective solutions for all business units. Collaboration between the company’s business functions leading to a common enabling infrastructure gives the CIO the benefit of steering decisions on critical issues central to modern IT, such as compliance and security. Finally, the specialized applications researched and implemented by business units act like a research and development IT skunk works, exposing the organization to the newest technologies and solution patterns.

A real world example of this is your typical big-ticket retail e-commerce website.  Assuming the CIO chooses to develop the e-commerce solution in house, the company first needs to decide on a technology for catalog, order tunnel, fulfillment, and reporting. Then the CIO must hire a development team or train existing staff. While the staff is either hiring or training, none of them are advancing the IT organization’s other core solutions. And, as the new e-commerce team is building the website against the initial technology chosen, they are already falling behind technically. When the in-house solution finally launches, it is already underwhelming to consumers and, more often than not, the effort needs to be set aside immediately to resume work against the ever-present backlog of requests for changes to core business solutions.

All the while, the CIO could have used one of the SaaS solutions that are evolving quickly and constantly setting new user experience paradigms.

Alternately, if the CIO chooses to embrace an SaaS e-commerce solution advanced by the marketing team, the CIO’s team would have input on integration and security, as well as an easy case with management for building enhancements to core infrastructure and systems. The enhancements to the core infrastructure, quickened and focused by working against the new SaaS e-commerce solution, open the door to additional SaaS or cloud solutions as well as new technology core solutions by the in-house team. And don’t forget the finished product: SaaS solutions evolve very quickly and constantly set new user experience paradigms – customers love the new website. The next SaaS integration is very cost-effective, and the CIO is the hero. Best of all, nothing of true importance was actually surrendered to marketing.  

Next week: Marketing responds!

Related posts:

• HTML5 Moves to the Head of the Line for E-Commerce Web Development
  
• When It Comes to the Newest Technology, Set Objectives First
  
• The Next Big Thing in Big-Ticket E-Commerce
  
• What You Should Know About E-Commerce Hosting
  

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