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For e-Tailers, It's a Wide, Wide Web

As the e-commerce train keeps a-rolling, the most successful online retailers will be those that take a multi-channel approach in their Web strategies, according to a recent study from JupiterResearch. [cob:Related_Articles]

According to Jupiter's analysis, the most successful e-commerce campaigns are nuanced, mindful of the interrelated skein of affiliate networks, search engine marketing, ad networks and social sites that can drive sales.

"Today's consumers have become increasingly savvy in their approach to online shopping, discovering new sources of product, pricing and information, said LinkShare CEO Steve Denton in a statement. LinkShare, which operates an e-commerce marketing network, commissioned the research.

"Marketers must respond to this new world by deepening their customer engagements, broadening their online marketing portfolio and creating a richer shopping experience," Denton said.

The number of sites where consumers can shop online is proliferating, a trend which is reflected in shopping behavior.

Among U.S. online shoppers polled in JupiterResearch's study, 87 percent visit multiple sites before making a purchase. Looking just at heavy shoppers -- defined as those who reported spending an average of $2,203 online in the last year -- 95 percent comparison shop before making a purchase online.

Predictably, social networks have the strongest impact on the shopping habits of younger consumers. Of consumers between the ages of 18 and 24, 51 percent said social and community sites influence their purchasing decisions; among older shoppers, that figure dropped to less than 26 percent.

Of the consumers who said they did consult online communities and social networks, 36 percent said they still made their purchases in bricks-and-mortar stores. Much of the value of the social sites relates to satisfaction and consumer confidence -- they make shoppers feel better about their purchases because they can see what their friends have said about a product.

Of course, marketers trying to leverage the power of trusted referrals by inserting their brands into a conversation among friends need to tread carefully. Facebook tried to do just that with its advertising "revolution" last November. The result was Beacon, a public-relations nightmare that drew fire from privacy watchdogs, security experts, legal scholars and, worst of all, the site's own members.

A month after the Beacon rollout, Facebook CEO Mark Zuckerberg apologized for the tracking behavioral tracking mechanism, and offered members a way to permanently opt-out of the program.

The Facebook episode serves as a cautionary tale to online communities and merchants looking to cash in on the phenomenon of the social Web, but the cross-promotional monetization possibilities are too great for retailers to ignore, the JupiterResearch study found.

Respondents indicated that they want social sites to provide more shopping resources. Forty-two percent said that adding consumer product reviews would make online communities more useful destinations to research products and services, and 24 percent said they would like to see "top 10" lists added to social/community sites.

At around 7 percent of all retail spending, e-commerce is still a small portion of the retail economy, but its reach is much larger than the numbers indicate, according to Patti Freeman Evans, an analyst at JupiterResearch. The number of customers who make purchases online is dwarfed by the number of shoppers who use the Internet to research products, a finding that underscores the linkage of the off- and online channels.