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  November 30 , 2006
THE COLOR OF ONLINE RETAIL
by Andrew K. Burger
Miami, FL (November 30, 2006)—It was as if I was at an off-track betting establishment waiting for the results of a horse race or anxiously scanning a financial ticker for the latest earnings results and stock prices. Only I was waiting for early retail and e-tail sales results for Black Friday, the day after Thanksgiving, and Cyber Monday--the latter a testimony to how fast and deeply retail, B2C e-commerce has embedded itself in our lives and minds.
And come in they did. Like football players and other athletes with games scheduled on Thanksgiving weekend, the folks at QVC, a pioneer in the cable shop-from-home market, that has also grown into one of the country’s largest online retailers, were working this holiday.
Along with a host of e-commerce researchers, they’ve been busy gathering and collating the sales data and producing the forecasts that will give managers and investors their first look at retailers’ and e-tailers’ Thanksgiving weekend sales data, as well as early indications of the all-important holiday sales season to come.
Small and mid-sized e-tailers take heed: There’s much that can be learned by delving into and examining what’s going on at the big and successful e-tail sites this holiday season-- as well as just enjoying some holiday shopping.
Survey Says
Retailers, shoppers, investors and analysts have by now become accustomed to sharp year-over-year increases in online holiday shopping sales and this year’s data is expected to be no different. Forrester Research expects this holiday season’s online retail sales in the U.S. to reach U.S.$27 billion, while Jupiter Research expects a final tally $5 billion higher.
According to a survey conducted by AOL Shopping and Zogby, around 80% U.S. Internet users said they will be going online to buy gifts this holiday season. Moreover, 24% of online shoppers expect to spend most of their budgets buying gifts online, though the numbers vary greatly city by city.
Web users expect to spend U.S.$504.52 online on gifts on average, which amounts to about 40% of their holiday spending, or $1,282.13. The AOL/Zogby researchers also found that online shoppers will spend about the same amount or more than last year buying gifts online.
More than half the respondents (58 percent) said that shopping on the Web saves them time, while nearly a third (32 percent) cited the ease of comparison shopping. Twenty-nine percent responded that the novelty of gifts they found online was what motivated them to shop online this holiday season, while 24% mentioned free shipping as their primary motivating factor. Sales promotions, easier last-minute shopping and gasoline prices were low on the list.
According to a small business survey conducted by Yahoo! Small Business, small businesses may actually have an advantage over their larger counterparts when it comes to attracting holiday shoppers.
Seventy-five percent of holiday shoppers of those surveyed said they plan to shop for holiday gifts online, and 75 percent said they are likely to purchase gifts online from small businesses. Nearly a third said that they would do half or more of their holiday shopping online, while nearly two-thirds said that online specialty “niche” retailers are the best places to shop for unusual or hard-to-find gifts.
Shop, Learn & Earn
Local Search:Online shoppers are becoming more savvy and selective about their online purchases as e-commerce technology has advanced and people have become more familiar with shopping online.
Leading brand name sites, such as Amazon, now have to run promotions to attract new shoppers and hold on to loyal customers. And growing numbers of online shoppers now “shop around’ by regularly making use of comparison shopping engines (CSEs) before they make their purchases.
For the small to mid-sized e-tailer this is an even greater incentive to make good and full use of multiple channels and CSE data feeds. “Comparison engines are a good source of qualified traffic because shoppers can compare products based on detailed descriptions, prices, and consumer reviews before clicking on your listing. These engines typically convert at a higher rate than standard PPC (pay-per-click) engines such as Google AdWords or Overture,” they wrote in a research report to do with comparison engines and data feed management,” researchers at market research firm Marketing Experiments.com wrote in a recent paper.
They have also identified a number of key attributes that in their opinion would make an “ideal” CSE data feed. “The most powerful application that we could envision for advertisers is the development of a single platform to launch, edit and manage a single data feed which may then be syndicated to all CSEs,” says Aaron Rosenthal, Marketing Experiments’ director of channels research.
Also among their ideal feed attribute list is full editing capability for product titles and descriptions for each feed individually. “While I do speak rapidly about the need for a need for a single data feed, it is [also] necessary to maintain the ability to edit a feed for each engine as the optimization for specific CSEs can be important as different verticals do well on different engines.”
Image hosting for non-standard products is another feature that the Marketing Experiments team feels would fill an important need, as are speed and ease of use, and the inclusion of key sales metrics, such as conversion rates and ROI (return on investment), Rosenthal added.

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QVC Grows Online
Liberty Media-owned electronic shopping pioneer QVC reaches approximately 96% of all U.S. cable homes, as well as nearly 25.3 million satellite-equipped homes, which equates to over 160 million homes worldwide. It is the second-largest network behind CBS in terms of revenue.
The company hasn’t been a slouch when it comes to e-commerce, either. The company’s e-tail site, QVC.com, has established itself as a valuable sales channel in its own right and has been ranked the No. 5 Internet retailer on the Web.
In April, QVC’s parent company Liberty Media acquired Provide Commerce for $477 million in cash. Provide's expertise in supply chain management and order execution built online businesses that specialized in the sale of perishable goods via brand name e-commerce Web sites such as Proflowers.com, CherryMoonFarms.com, UptownPrime.com and SecretSpoon.com.
"At the end of the day, customers want order hubs that address order capture, order fulfillment, order completion and cash," said Forrester Research Principal Analyst Ray Wang, noting that there are very few independent software vendors remaining in the partner relationship management/customer relationship management e-commerce space.
While QVC’s tremendous success and its deep pockets enable it to do what most could not even entertain doing, small and medium-sized e-tailers can certainly derive a number of benefits from delving into the company’s website and perhaps even apply to become a QVC vendor.
Entrepreneurial may be the one word that best describes the company. And encouraging and supporting new and smaller retailers is part and parcel of QVC’s own business strategy. Its Product Search gatherings at its West Chester, PA corporate headquarters are now regular annual events.
Dozens of new products have been introduced and added to QVC’s product line-up through the event. A number of QVC vendors, including Ron and Margie Kauffman, founders of Chesapeake Bay Gourmet; Alan Rosen of Junior’s Cheesecake fame; and most recently, 92-year-old Bea Toms, author of Recipes from a Country Cook have been discovered during these gatherings, according to the company.
This year’s product search event, which took place April 21, also recognized the significance of women entrepreneurs through the “Make Mine a Million $ Business” program. QVC joined with non-profit organization Count Me In and OPEN from American Express, to launch the program, which aims to help women entrepreneurs accelerate the growth of their businesses to $1 million in annual sales. QVC held special educational seminars for women entrepreneurs and small business owners as well as product search sessions with QVC representatives on April 21.
“QVC honors the spirit of the American entrepreneur and is pleased to be able to introduce their products to our national audience,” said Marilyn Montross, QVC’s director of vendor relations. “We’re always looking for new and innovative products to bring to our discerning customers. With the inclusion of the Make Mine a Million $ Business program, we may be able to assist even more women entrepreneurs in the achievement of their overall business goals.”
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Back to School
But even successful bricks-and-mortar and cable television retailers are learning as they go when it comes to successfully building their online e-tail channels. Smaller e-tailers can ‘go to school’ and pick up some critical ‘do’s and dont's by keeping a close eye on what’s happening on their e-tail sites.
“One thing that you will notice [on QVC’s e-tail site] is that there is a lot of overlapping that goes on, you go to the kids clothing section and aren’t just tossed into a myriad of selections-- you are shown other sections that are also available like toys, accessories, furniture and jewelry. This is a great way for them to market themselves and keep people at the site instead of going elsewhere to find other items,” wrote a reviewer on Epinion.com’s Online Stores Reviews section.
“This is a great idea to keep people at the site but for those that are new to the site, it is a little confusing. When you go to a specific section and are shown other items of interest the actual section/sections you are looking for are shown on the left-hand side of the screen. It took me a while to get used to this type of search result and I really wish they would minimize the amount of alternative purchases that they display or at the very least, make the links on the left side easier to navigate through.”
On the plus side, the reviewer noted the high-quality and importance of QVC’s support service. “QVC ranks up there with Amazon, Target and eBay when you are talking about the overall size and amount of traffic that the site gets. Even so, customer service is great and the fact that they have 24-hour live Internet support is a real perk for me – especially when some other sites take days to get back to you and most of the time it’s a canned response or something that does nothing but frustrate you.”
Promising Start to the Holiday Season:
QVC Case study a Good Barometer for Online Holiday retail sales
Pronto.com - More Products. Lower Prices. QVC’s retail analysts and management are closely tracking product and unit sales for Black Friday and Cyber Monday, as no doubt are their counterparts across the retail and e-tail marketplace.
On Black Friday, QVC.com experienced a more than a 60% year-over-year increase in traffic, fueled by the company’s 20th anniversary on-air celebration.
On Cyber Monday, QVC’s website registered its highest ever one-day tally of unique visitors and its second-highest total number of visits for one day. Cyber Monday online sales were 20% greater than last year’s, which lead management to forecast that the company’s Web business will bring in $1 billion in revenue this year.
Management pointed out that QVC.com has one of the highest click-to-sales conversion rates on the Web, according to Nielsen Net Ratings. The early figures for Black Friday and Cyber Monday holiday sales are in line with the overall double digit growth in Web traffic QVC.com has experienced consistently throughout this year, they added.
Beauty, jewelry and electronics products top QVC’s list of best-selling gift categories. Among the best selling products this past weekend, both on-air and online included: the Philosophy kit in the Beauty Products category, Judith Ripka necklace in Jewelry and the Cobra GPS system in electronics.
Online sales of high-end women’s accessories and beauty products continue to grow, while online sales of beauty items “are doing incredibly well. High-end electronics have been booming all year [and] name brand items have done extremely well,” a spokesperson told eTail dTail.
The company also provided the following hourly breakdown of its Black Friday sales:
Between midnight and 6 a.m., these were the top selling items:
  1. Dennis Basso Faux Mink Throw with more than 10,000 projected shipped
  2. 180s Ear Warmers
  3. Set of 3 indoor/outdoor automatic on/off light sensors
  4. Cybersonic Advance Oral Care System
  5. Precious Fibers 2-Ply Cashmere Turtle Neck
  6. Flip-out leather jewelry case with compartments
  7. Norcent Digital Camera
From 6 a.m. - 10 a.m. this Black Friday, shoppers were eager to snap up gifts for the difficult-to-buy-for male. Here are some examples of what QVC sold on the morning of its 20th birthday (see release below):
  1. Jeep 9-function multi-tool with matching knife & carry pouch - 4,000 units sold-out in six minutes.
  2. Panasonic double blade pro-curve wet/dry shaver – more than 12,600 units sold-out in ten minutes.
  3. Lee Sands Man's eelskin bi-fold wallet – more than 7,000 units sold-out in eight minutes.

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• Holiday Season Best Practices
Recent studies suggest that best practices during the holiday season should be initiated way before the season begins. By analyzing data from previous months, a merchant should be able to determine the best strategy during the November and December months. Merchants are advised to increase their budgets to reel in shoppers, but with a close eye on ROI (return on investment) as PPC (pay per click) charges can pile up rapidly.

• Black Friday Sales
New studies also point to a huge surge in online shopping during the Thanksgiving weekend. Black Friday, November 24th, was particularly good for merchants this year. Online retailers saw an average 42% increase in sales compared to the same Friday last year. Total retail sales are predicted to have been over $434 million on this day alone.

• Holiday Shopping Peak
While Cyber Monday, the Monday following the Thanksgiving weekend, is predicted to have been huge as well, it is only the beginning of the holiday trend. The peak in online holiday shopping is predicted to occur this year during December 11th – 13th.



SEO with MerchantAdvantage
by Marifer Vergara, Certified Merchant Advantage VAR Partner

Articles and reviews are a great way to create relevant content and relevant content is one of the key factors Google takes into consideration when ranking your pages in their index.

Creating this relevant content on online stores is not difficult. Most shopping cart platforms like Yahoo! Store, Zen Cart and OSCommerce allow customers to rate and submit reviews of their purchases and you can use this content to create back links to your site.

Creating Back Links with MerchantAdvantage:

  1. Export all your reviews and articles
  2. Use same mapping for articles used for products using “caption” as the body of the article and make sure you include links to your website in the article.
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  4. Use Text2 or any other black field to add your main page URL or department pages URL
  5. Login to Google Base or register if you do not have an account.
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Voila! You just got your content into Google base creating several back links to your pages and increasing your relevancy.



For information on how MerchantAdvantage may help your business grow, please contact us:
Chip Arndt
Executive Vice President
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305.895.9466 x113
partnerships@merchantadvantage.com