Showing posts with label online sales. Show all posts
Showing posts with label online sales. Show all posts

Tuesday, January 09, 2018

What 2018 Has In Store for Ecommerce Companies

Every year the evolution of ecommerce seems to gain momentum. 2017 was no exception. More and more buying is moving online and total ecommerce sales are expected to top $2.9 trillion worldwide in 2018 – that’s nearly 90% of the GDP of the continent of Africa.
In addition to the shift in buying behavior from retail-space to cyber-space, technology is constantly changing and it’s a challenge for businesses to stay current. The ever-present risk is that falling behind can be costly.
If you’re not quick to adapt to changing consumer preferences and the technologies that meet them, you can quickly lose conversions and revenue to competitors that are able to deliver a more responsive, convenient and personalized online shopping and checkout experience. With this in mind, these will be the top ecommerce trends to track in 2018.

1. Growth Overseas

While ecommerce growth in Europe and North America continues to clip along at around 8% and 9% respectively, the fastest growing markets are in Asia. Ecommerce is simply bigger with a higher adoption rate in rising economies like Chinaand South Korea. While Black Friday and Cyber Monday are the biggest online shopping days in the U.S., they are dwarfed by China’s Single’s Day.
The key takeaway here is that if your payment stack is only equipped to sell to your domestic market, you could be missing out on a huge opportunity. Instead, consider a payments solution that integrates seamlessly with the rest of your revenue stack and that enables global ecommerce by supporting multiple currencies, languages and payment methods delivering localized cart experiences to each of your geo-markets via IP and browser preference detection.

2. Rise of Generation Z

Generation Z, those born after 1995, are fast becoming a demographic with buying clout. With 77% of this cohort saying they spend 5 or more hours a day on their devices, it’s not surprising they’re shopping and buying more online than any other generation. Not only do they have $44 billion in spending power on their own, they are also influential in as much as $600 billion worth of family spending.
Compared to other demographics, Generation Z has high expectations when it comes to online experiences. They’ve grown up with the Internet and are adept at sifting through large amounts of information fast and, with 97% owning a smartphone, they are most likely to be looking for information on their mobile device.
With expectations of getting the information they need quickly, fast loading times and seamless shopping experiences on every device are a must. They like social media but tend to prefer Snapchat, Secret and Whisper over Facebook.
In terms of support, 60% are likely to hang up if their call is not answered in 45 seconds. As Generation Z enters the workforce, they will gain even more buying power and ecommerce businesses are going to have to step it up to compete for and keep their attention.

3. More Personal, More Flexible and More Mobile

It’s not just Generation Z that has high expectations of online experiences. People in general are increasingly expecting shopping and checkout experiences to adapt to their behavior and interests, not the other way around.
Not only do online storefronts need to be fast and easily navigable, they need to adjust to their users’ preferences as well. According to Accenture, over 75% of shoppers say that they are more likely to buy from a website that personalizes their experience, either with their name, or with recommendations based on past purchasing history.
In addition, offering and supporting their preferred online payment methods, local currency and language is key to keeping them engaged and converting their sale, all while ensuring a fully responsive experience at each touch-point. According to RetailDrive.com, nearly 60% of shoppers look up product information and prices while using their mobile phones in stores, making a mobile strategy critical for retailers.

4. Honing the Delicate Security/Convenience Balance

The past year saw many companies big and small fall victim to security breaches and payment fraud.
There are many proven ways to mitigate risk, but if you incorporate too many authentication steps to protect from data breaches and fraud, you can put off many potential customers. As a result of more and bigger breaches, governments are stepping up regulation requirements for companies handling sensitive customer data.
The penalties for contravening regulations vary in different jurisdictions and include stiffer fines, criminal liability and even the suspension of business operations. The most prominent example of increased regulation is the EU’s General Data Protection Regulation (GDPR), which takes effect in 2018.
Unfortunately, there is no uniformity in laws between countries which can pose a challenge to companies operating internationally. Added to this challenge, with massive data breaches like Equifax, it is expected that fraud will be an even bigger problem going forward.
Many are increasingly implementing multi-layer authentication processes with the industry specializing in this service expected to grow 23% annually for the next several years. According to Cyber Source, the top authentication steps that are planned to be added include 3D secure (17%), email verification (12%) and fraud scoring (12%). Other features many are considering include biometrics, geo-location, cryptographic keys, and behavioral analytics.
With current measures, approximately 2.9% of orders are rejected because of suspected fraud. Unfortunately, 10% of these are suspected false positives which can result in angry customers and lost business.

5. Longer Online Events for Traditional One Day Holidays

Online shoppers have a lot of information and a lot of offers at their fingertips. The fight for attention during the lucrative holiday periods when more people are actively shopping online becomes even more fierce. Accordingly, many stores are adapting with longer periods of deals. For example, many Boxing Day sales started as early as Christmas Eve and extend well into January. Black Friday now often starts before Thanksgiving and extends all weekend.

6. Integrated Revenue Stacks

With consumer preferences, technology and security threats changing so rapidly, it will be imperative to continue to invest in a revenue stack that can keep up with your chosen strategy. An optimized ecommerce experience is no longer confined to one department or technology solution. It takes an entire company and ecosystem of solutions working together to provide a truly great online experience for your customers.
Not only do you need basic payment processing, you need top security, a variety of payment methods, chargeback management, fraud mitigation, localization features, conversion optimization, billing support, pricing flexibility, international tax calculations, partner payouts, transaction emails, subscription management, a CRM, analytics tools and more. All of these individual solutions need to be plugged together to provide real-time data to power business decisions and deliver solutions that satisfy increasingly online and expectant customers.

A Year Full of Opportunity

While the challenges this year promise to be formidable, the ways to connect with customers and earn their loyalty is also increasing. The technology is available. If you can capitalize on the trends affecting ecommerce now, you will see your conversions, customer base and revenue continue to grow into and beyond 2018.

If you liked this article, check out our Ebook, “The Ultimate Guide to Ecommerce KPIs”.

The Curious Case of Ecommerce Buttons: A Best Practices Guide

Ideally, all aspects of your ecommerce experience drive shoppers towards a conversion. Depending on your business and the point in the sales funnel your prospect is, your conversion goal could be to get individuals to enter contact information, finalize a sale or share a promotion.
Whatever your goal is, the final hurdle to get a conversion is getting a user to hit a button to actually take some sort of action. And when it comes to helping nudge your customers to finally click that button, I’ve put together a few best practices to follow.

Find the Right Call-To-Action

Your call-to-action needs to clearly state the action that customers are about to take. Use unambiguous, active language on and around your button that reinforces the value to expect. If you leave anything open to interpretation or use words that imply extra work or more commitment on the part of the shopper, they’ll have more hesitation and are less likely to convert.
So, do use words like “see”, “give”, “get” or “reserve” as they demonstrate momentum and will encourage individuals to continue. A study from HubSpot showed that from a list of action words, “Click here” and “Go” actually had the highest conversion rates. Alternatively, words that can have the opposite effect include “download”, “submit” or “register.”
Additionally, shifting from second person to first person can also have a considerable effect. A study by Michael Aagaard, Unbounce’s Senior Conversion Optimizer, demonstrated how changing a call-to-action button from “Get your free template” to “Get my free template” resulted in a 90% increase in conversions.

Colors Matter

With online shopping being so visual, it makes sense that color can have a huge impact on conversions. For starters, certain colors can have drastically different connotations from country to country. For example, while yellow signifies jealously in France, it can mean bravery or wealth in Japan. Purple is considered a color of mourning in Thailand, while the Western cultures tend to view it as a symbol of royalty. So, it’s important to pick colors that carries positive sentiments, keeping in mind that you may have to use different colors for different countries. It’s also important to keep colors consistent in your ecommerce experience and on brand.
Unfortunately, there is no one-size-fits-all when it comes to button color. Every customer segment is different so experiment to see which colors create the highest conversion rates for your business. As UX Dilemma points out, the best way to bypass the different associations that can occur with each color and each culture is to emphasize the button with a color that contrasts the other colors on your page.
color-wheel
Image source: Bright Hub

Pay Attention to Your Fonts and Button Shape

In addition to being a contrasting color to the rest of your page, UserTesting Blog says that buy buttons should appear large enough on your page so that customers can easily pick it out, but not so large that it appears obnoxious on the webpage.
You also need to avoid hard-to-read fonts and all-caps. The lack of letter variation in all-caps actually makes reading it more difficult. Follow these simple guidelines of formatting a call-to-action button by using a rectangle shape, having clear boundaries and borders and using white space around the buy button. Vitally, make sure all of your spelling and grammar is correct! These can cause a great deal of hesitation in shoppers and cause them to not hit that button.

Create Urgency

Creating a sense of urgency can have a huge impact on the effectiveness of your ecommerce buttons. One case studyfound that creating a sense of urgency helped increase sales by 332%.
There are lots of ways to create a sense of urgency including limited-time discounts, communicating that only a limited amount of stock is available or adding countdown clocks to the end of a sale. Use words such as “now” and “today” to reinforce this sense of urgency.

Find What Works for Your Ecommerce Store

There’s obviously a lot more that goes into optimizing your checkout than just the button. But it is the final barrier, so you need to do everything you can to eliminate any risk of hesitation. Be mindful of the particular needs and desires of your target market to help your buttons convert. And be prepared to test different combinations to see what works best for your ecommerce business.

Tuesday, November 14, 2017

Getting your Ecommerce Store Ready for the Holidays



The holiday season is an extremely hectic time for ecommerce companies which is why it’s essential to get an early start on planning well before the pandemonium starts.
A 2014 study by Statista showed that nearly 20% of annual retail sales can be attributed to the holiday season and as much as 30% of an individual retailer’s total revenue. With consumers consistently spending more money every year, you’ll want to ensure that your company is well-prepared to capitalize on as much of that market share as possible.


From Black Friday until Christmas, ecommerce revenue can increase anywhere from 50% to 100% above normal, with peak earnings usually occurring near the end of November. While Thanksgiving, Black Friday, Cyber Monday and Green Monday (the second Monday in December) are the most profitable dates in North America, there are other notable dates you’ll want to be mindful of as well, like Singles Day or Diwali, if you sell globally.
So with that in mind, here’s how you can maximize on holiday conversions this year.

1. Speed Wins the Race

The first thing you’ll need to be prepared for is a higher volume of traffic on your website. More people visiting your website or product pages can cause server latency, slowing load times. While a few extra seconds might not seem like a big deal, it makes a big difference in ecommerce. If a website takes longer than 3 seconds to load, you could lose up to 40% of your potential buyers.
Use Google Analytics to see what your holiday traffic looked like a year ago and make the necessary adjustments with your IT team to ensure your digital infrastructure is durable enough to withstand the pressure.


2. Go Mobile or Go Home

Chances are, this isn’t the first time you’ve heard about the importance of providing a great mobile experience. But there’s a good reason why it’s being talked about so much. In 2015, mobile commerce was responsible for nearly $13B of holiday ecommerce revenue. Year-over-year, the growth of desktop purchases has been slowing down while mobile has been accelerating. Plus, consumers are using mobile devices to research products and services, and it won’t take long for them to bounce to one of your competitors if their experience isn’t quick and easy.

3. Tell Them a Fireside Story

If you haven’t added content marketing to your bag-of-tricks, the holidays are a great time to do so. Content marketing costs 62% less than traditional ads, and it generates triple the amount of leads.
Though a broad term, content marketing involves videos, images or written-text to reach, engage and provide value to customers. The more of these elements you can leverage, the better — it can give your SEO rankings and social engagement a boost which, in turn, enhances your brand awareness and social proof.
There are a variety of ways you can put a holiday spin on your blog, social channels and email campaigns. Gift guides, last-minute shopping ideas, winter tips, year-in-reviews or even a holiday message from your CEO or founder can spark positive emotions with your audience, compelling more people to choose your brand over the competition.
The more styles and channels you can leverage, the higher your reach will be. If you need additional inspiration, here are 100 content ideas courtesy of Social Media Today.

4. Reward & Profit

Ecommerce is competitive, so you shouldn’t be pulling any punches. If you don’t have a loyalty program, now is a good time to implement one. The chances of selling to a new customer is between 5% — 20% whereas the probability of selling to a previous one is 60% — 70%. Not to mention the fact that 87% of your shoppers want you to have one.

5. Unleash the Emails

Don’t be shy with email marketing this holiday season to keep your products top of mind. Depending on your customers, use your content marketing pieces or let your offers do the talking.
Cart abandonment emails are critical too. Seventy-five percent of the peoplewho abandon their purchases initially had the intent to buy, so a follow-up email might be exactly the nudge they need to finish what they started. If that’s not enough to convince you to ramp up the emails, consider this: a third of your customers will complete their purchase if prompted by an email.

6. Take it Personally

Personalization has been a major ecommerce trend over the past couple years, to the point where consumers are now expecting it.
Ecommerce companies need to make every effort to ensure that relevant product recommendations are being made based on the previous buying habits of each individual customer, especially during the holidays!

7. Embrace the Chatter

When the holiday blitz begins, customers are going reach out to you for information in their preferred way. Expect more phone calls, email inquiries, messages on your social channels and chat requests.
Monitoring as many of these channels as possible can make a huge difference. If you can’t allocate the resources to provide a quick response 24/7, clearly state the hours or the response time in which customers can expect to hear back from you. An eConsultancy report revealed that 83% of customers required some kind of support while buying online, so don’t let your inquiries fall on deaf ears.

8. Lock it Up

Last, but certainly not least, there’s the matter of your website’s security. An increase in sales likely won’t be the only thing you encounter over the holidays. In 2015, one out of every 67 digital transactions was fraudulent. Moreover, from Thanksgiving to December 31st, that activity increases by 8%with significantly large spikes taking place on Christmas Eve, Thanksgiving and Black Friday.
To mitigate charge backs resulting from “friendly fraud,” ensure that your company’s contact information is clear and concise, especially on invoices. The easier it is for your customer to contact you, the less likely they’ll be to call their payment provider to have their payment reversed.
Additionally, contacting your customers to confirm larger purchases (or any purchases that may be raising red flags) and consulting with your compliance team to make sure prevention techniques are optimal will keep your naughty list to a minimum.

Don’t Make It a Stressful Time of Year

The holidays should be a joyous time for both ecommerce customers and merchants. With nearly $70 billion in sales in 2015 in the U.S. alone, online sales are only expected to grow as consumers become more comfortable shopping online and digital experiences continue to improve. By planning early and leveraging some of these tactics, you’ll be in a strong position to drive home as many conversions as possible and grow revenue, giving you more reason to celebrate and be merry!
originally posted AUGUST 29, 2016 on paymotion

Friday, May 15, 2015

SaaS Metrics: How to Calculate Your Quick Ratio


Investors have been embracing SaaS businesses in a big way in recent years. One of the biggest reasons is the promise of stable, recurring revenue over an indefinite period. This is in addition to the huge opportunity presented by a rapidly growing appetite by businesses and consumers for cloud-based software solutions. If done right, a subscription model can increase the total amount of revenue earned by software companies and, by extension, investors while also providing users with ongoing value.
But with this increased attention from investors, SaaS companies now find themselves needing to be fluent in a number of KPIs not normally used in non-subscription software businesses. In addition to customer lifetime value, monthly recurring revenue and churn, another indicator has emerged to gauge the long-term viability of SaaS companies: the quick ratio.
Described by venture capitalist Mamoom Hamid at this year’s annual SaaStr conference, the SaaS quick ratio compiles data in a way that helps to determine if a company is likely to be a profitable investment. As an example, Hamid used this metric to help make a decision about investing in Slack, which had a high quick ratio and then proceeded to grow to over $10 million in annual recurring revenue (ARR) in just 11 months.

Determining Your SaaS Quick Ratio

The SaaS quick ratio stems from an accounting concept which measures a company’s short-term liquidity by comparing assets and liabilities. For the quick ratio, however, the “good” SaaS metrics that indicate recurring revenue growth are measured against “bad” metrics that eat away at recurring revenue. Specifically, the sum of upgrades (expansions) and new acquisitions are measured against the sum of cancelled contracts and downgrades (contractions):

Quick Ratio Formula

Unlike measuring churn or MRR alone, this ratio can be telling for SaaS businesses who may post strong MRR growth or low churn but have significant underlying weaknesses. In one example Hamid presented, a company looked like a viable investment based on its expansion MRR. However, when churn was taken into account like the quick ratio does, it was clear that while expansion MRR was high, it was merely keeping the company afloat and net MRR was quite low.

Quick Ratio Graph


Things to Consider

For a SaaS company to be considered a viable investment, investors tend to set a benchmark ratio of 4. In other words, the company must average over 4 times as much MRR added in a given period than MRR lost. Above that rate, companies have relatively good prospects for continued recurring revenue growth and are likely to be good investments.
For the best results, the ratio should be examined over different time periods to account for periodic variations. While in one month businesses may fall below the benchmark, a quarterly comparison may indicate substantial growth. However, if your SaaS business is consistently failing to achieve a ratio equal to or above the 4 benchmark, you may want to consider looking into product fit or better facilitating customer success.
Companies must also consider which stage of their lifecycle they are in before calculating their SaaS quick ratio for investors. Similar to churn, the ratio is irrelevant for start-ups in their first year of business who have many new customer acquisitions locked into contracts. This will only lead to an inflated ratio and subsequently, an inaccurate evaluation of your company.
The quick ratio ensures SaaS companies looking for investment can’t hide behind good churn or customer acquisition numbers alone. To achieve a SaaS quick ratio of 4 or above, companies need to make sure they are applying strategies that acquire, retain and upsell customers. Of course, there’s more that goes into an investment decision than just one metric. But a good quick ratio is a good indication to investors that your service is in demand and you have a solid process in place to successfully scale.


-Jason
Jason Kiwaluk
Director of Ideation

Monday, August 08, 2011

Video Game Consoles Top Internet-Connected TV Device


Online video is enjoying explosive growth. eMarketer projects the US online video audience will reach 158.1 million users this year and US online video ad spending will jump 52.1% to $2.2 billion. As more video content becomes available online and more devices facilitate access to that content, users are broadening their viewing habits to incorporate multiple platforms—diversifying the video advertising landscape.
Although the vast majority of US consumers (89%) still use PCs and laptops to view online video, research from Frank N. Magid Associatesshowed a sizable percentage of consumers watching online video on additional devices, such as mobile phones and TV sets, connected to the internet.

Devices that US Online Video Viewers Use to Watch Online Video, April 2011 (% of respondents)

Data from Leichtman Research Group (LRG) showed that as of February 2011, 30% of US households had at least one internet-enabled device connected to their TV, a percentage that has grown slowly but steadily over the past few years.

Internet-Connected Devices US Adults Use to Watch Online Video, Feb 2011 (% of respondents)

More specifically, LGR found that while only 10% of US households had an internet-connected TV, almost a quarter (23%) had an internet-enabled game console they used to watch online video.
The Frank N. Magid Associates study found a slightly higher share of US internet users with internet-connected TVs, a percentage expected to increase further as newer TV models are sold with built-in internet connectivity.
But for now, the majority of users appear to be accessing the internet through other connected devices—specifically gaming consoles. In fact, 19% of viewers who have accessed the internet through their TV have used a PlayStation 3, and 13% an Xbox 360.

Devices Used by US Internet Users to Access the Internet Through Their TV Set, April 2011 (% of respondents)

With video game consoles capable of streaming services like Netflix and Hulu to a TV, many of these devices—once considered just a source of video game entertainment—can now be leveraged for multiple media consumption purposes.
Perhaps this is why more respondents cited video game consoles as their primary entertainment medium than popular devices like mobile phones or smartphones, putting them ahead of all devices but PCs and TVs.

Attitudes of US Internet Users Toward Select Devices, April 2011 (% of respondents)

As online video continues to gain in popularity and consumers continue to broaden their consumption habits across platforms, brands that have already capitalized on some digital video advertising opportunities should consider non-computer-based platforms like smartphones, tablets and video game consoles for additional brand messaging integration.

Friday, July 08, 2011

Shoppers Willing to Connect With Retailers on Facebook


Social commerce may be on the minds of retailers everywhere, but buying through Facebook is still far from mainstream. But it is hard to say whether shoppers are being restricted by the lack of “f-commerce” opportunities on Facebook, or whether retailers are hesitant to experiment before seeing a strong level of interest.
Software provider Ability Commerce found that 79% of the Internet Retail Top 500 retailers have Facebook pages, yet only 12% offer apps or widgets that enable ecommerce transactions on the social network. Meanwhile, according to a joint study by Shop.orgcomScore and Social Shopping Labs, more than half (53%) of Facebook users have reached a retailer’s website from its Facebook page, and 35% of online shoppers said they would be likely to make a purchase through Facebook.
Facebook has become the social media venue of choice among online buyers. Compete discovered that the number of online buyers using retailers’ Facebook pages increased 3 percentage points over the previous year, bumping blogs, forums and review sites to second place. Additionally, a third of respondents “like” six or more retailers or consumer products companies on Facebook.

The prospect of finding out about sales and promotions is a big lure. Over 56% of those surveyed by Compete visited retailers’ Facebook pages for this purpose, while 58% in the Shop.org study, which included Twitter and a company’s blog in the figure, cited deals as a primary motivation. Learning more about a retailer and keeping up to date on products were also important.
According to Compete, more than 20% of online buyers found Facebook pages “influential” or “extremely influential,” regardless of the channel where the transaction is completed. The numbers show promise for a less established retail offering.

PowerReviews and e-tailing group survey discovered that more familiar online tools, such as customer reviews, Q&As and forums, beat Facebook for their effect on buying behavior, yet the popular site still fared better than mobile or Twitter.

Community/Social Tools that Have an Impact on Their Buying Behavior According to US Online Buyers, April 2011 (% of respondents)

Taken with Compete’s findings, this implies that Facebook is being used by online shoppers more than ever and is continuing to grow in popularity, but has yet to surpass more ubiquitous online community tools in direct influence on purchasing.
Retailers and consumer products companies could give the small but eager group currently connecting with them on Facebook what they are looking for: access to sales. Even if these online shoppers are not yet able to make purchases directly through Facebook, exclusive offers can engender goodwill, loyalty, sharing and increase the likelihood of taking the “f-commerce” leap when it is offered.

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