Do you think retailers are really embracing the digital channels and making them work?
If converting a browser into a customer is any indication, the general answer is "no." Granted, we're basing this solely on the fact that the average conversion rate for e-commerce websites still sits at around 2%.
Imagine that: 98% of the people who come to your e-commerce site do not buy.
This week, Shop.org (which is the largest association for merchants who sell online) is holding it's annual summit in Las Vegas. Over 3000 people attend to learn what worked, what's working and where this all might be going. It's heavy Digital Marketing immersion. It has to be. Retailers fight for commerce in a way only few of us can understand. A retailer's business model is based off of how they can best maximize every square foot of their retail footprint. This is, fundamentally, why we've seen slow adoption of digital signage and a lack of really deep diving into the digital channels. Not everyone falls into that categorization, but the industry as a whole is looking to better understand how to be more effective and build revenues online while at the same time maintaining their dollars per square foot.
Social Media and the Reluctant Retailer.
That's the title of my presentation tomorrow. The spirit is to help people who sell online to better embrace the Social Media and Web 2.0 opportunities, but there's a major problem with my presentation and the concept: if people are hanging out and connecting to one another, they're not shopping. If they are reading peer reviews and watching online videos, they're not shopping. If they're not pumping the 1-click-to-buy button, they're not shopping.
Why would any e-commerce website owner want to give a potential customer anything that distracts them from shopping?
Because shopping isn't just shopping. The very nature of it is community-driven. Think about your local shopping center or any major downtown strip that hosts the latest and biggest retailers. They're not just places to ring a cash register, they are places to go, to be seen, to hear things, to see things... the new town hall.
The online experience needs to be more social. If it is, people will spend more.
I recently saw a quote that stuck with me:
"Experiences satisfy the soul."
We got out, we shop, we meet our fellow community members and we live and breathe these experiences. All of which provide some level of self-actualization and satisfaction. Further more, the online channels do provide a chance to engage in a similar experience. Let's not debate online communities versus real-world communities, let's just accept the fact that people do feel as strongly about their Facebook community as they do about anything else.
Social tools enable you to get your consumers excited about your products and services. It enables them to connect and freely talk about what you do to make their lives easier. The strategy and tactics behind pulling it all together is the challenge. Getting buy-in from your senior management while they keep trying to increase revenue per square foot will be a challenge, but - in the end - bringing people together to connect is going to change everything you know about selling online (in the best possible way).
I just noticed that the H&M Fan Page on Facebook has over 250,000 fans. There's some great communication going on there between customers. There's also some great communication going on between H&M and their clients.
Last thought: imagine how all of this will shift again once mobile devices like the iPhone and BlackBerry Bold really take hold. Just watch and see how the social, mobile and real-world collide in a brand new opportunity.
What do you think the online shopping experience could use (beyond better pricing, free shipping, etc...)?