Market Live Performance Index V9 110409

The MarketLive Performance Index TM

Key Holiday Success Factors

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The MarketLive Performance Index - Volume 9
>> www.marketlive.com 9

The MarketLive Performance Index Vol. 9

The MarketLive Performance Index - Vol. 9

The MarketLive Performance Index represents the pulse of e-retailing. In it,
aggregate data from a robust range of merchants is tied to actionable tactics to
drive eCommerce success. Using previously undervalued performance metrics, the
MarketLive Performance Index provides a holistic view of consumer behavior.

Ken Burke
Chairman, Founder, & Chief Evangelist, MarketLive, Inc.
Jaye Sullivan
Senior eCommerce Strategist, MarketLive, Inc.
Catherine Thorpe
Research Specialist, MarketLive, Inc.

For more information about this report, contact MarketLive, Inc.

www.marketlive.com
877.341.5729

The MarketLive Performance Index Vol. 9: Key Holiday Success Factors © MarketLive, Inc. 2009
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As November arrives, many merchants are poised to launch the MarketLive/eTailing group survey. Even better, they’re not solely
marketing and merchandising strategies for stoking sales during looking for bargains; fully 88% of survey participants reported they’re
the holiday gifting season – the crucial period that often makes or willing to pay full price for unique products, excellent service and
breaks overall performance for the year. convenience.

In 2009, the stakes are even higher than usual. With the eCommerce
industry reporting mixed results for the year to date, merchants are What will it take for you to pay full price for gigfts this
keeping their fingers crossed that the pivotal fourth quarter will tip holiday season? Check all that apply.
the scales in favor of sales growth. But the outlook is uncertain:
According to a recent consumer survey from MarketLive and the
eTailing group, 46% of shoppers plan to keep spending flat for the
coming season while Forrester Research forecasts fourth quarter
holiday sales will be up 8% over 2008.

88%
Quarter Over Quarter
Q2 Q3 %
Metric 2009 2009 Difference
Overall Conversion Rate 3.64% 3.40% -6.59%
Overall Cart Abandonment Rate 60.91% 63.01% 3.45%
"1-and-out" - % of all visits 32.24% 30.88% -4.22% In short, the 2009 holiday season has the potential to reap significant
Engagement Rate (Visits to Carts) 9.51% 9.66% 1.58% rewards for merchants, despite the challenging economic
environment. But the key is converting attention into action.
Year Over Year
Shoppers may not be looking for rock-bottom prices, but it’s still
Q3 Q3 %
Metric 2008 2009 Difference essential to deliver value – in the form of judicious promotions and
Visits 1.16% stepped-up service. With the holidays fast approaching, fine-tuning
Revenue 1.95% sites with the following strategies in mind will be crucial to maximize
Overall Conversion Rate 3.72% 3.40% -8.60% holiday sales and improve the bottom line.
"1-and-out" - % of all visits 38.31% 30.88% -19.39%
Engagement Rate (Visits to Carts) 8.12% 9.66% 18.97%
Strategy #1:
Data from the MarketLive Performance Index indicates that
Targeted free shipping that won’t break
eCommerce conversion rates dropped by 6.59% from Q2 of this year
the bank
to Q3, while cart abandonment rose 3.45%. Year over year, conversion
slid even further, dropping by 8.6%, while abandonment jumped Without a doubt, free shipping offers are crucial to holiday success.
4.36%. Shipping charges remain the number one barrier to buying online
for the holidays, with 62% of consumers saying costs are too high,
But there are glimmers of hope. Visits edged upward year over according to the Marketlive/eTailing Group survey. Similarly, 91%
year – and overall sales increased at a higher rate, by 1.95%. Both of consumers say free shipping tops the list of promotions that
quarter over quarter and year over year, the “1-and-out” rate dropped influence them to make purchases online.
while the engagement rate (or add-to-cart rate) increased – with
improvements on both counts of almost 20% year over year. The But offering free shipping too liberally can destroy margins and set
numbers signal that shoppers haven’t abandoned the online channel. false expectations with consumers that it will always be available,
If anything, they’re more attentive than ever; they’re digging deep whatever the circumstance. Instead, merchants should tailor free
into sites, studiously using the shopping cart for research – and shipping offers to the purchase period and target them further by
rewarding sites that deliver relevant products, compelling incentives customer type – thereby delivering relevant offers and customer
and strong customer service. . value.

And looking ahead to the holidays, shoppers are even more bullish
about the Web, with 55% of consumers saying they plan to shop
online during the season – a 12% increase from 2008, according to

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aTargeting by purchase period. Research from the MarketLive
Performance Index shows that consumers shop their way
Strategy #2
through the holidays in distinct buying patterns. Tailoring free Using customer service to drive sales
shipping accordingly makes the offers more relevant and timely,
making it easy for shoppers to complete sales in synch with their Consumers attach real value to customer service. More than one
holiday purchasing schedules. in four shoppers – 28% – are willing to pay full price for the right
products coupled with excellent customer service. And responsive
merchants whose sites smooth the purchase process are more likely
Dec. 25th
Dec. 25 to win powerful word-of-mouth recommendations.
Nov 1 - 22 Nov. 22 – Dec. 12 Dec. 12-24
But what aspects of customer service are most important? The
o In the peak order period, shoppers aren’t looking for deep MarketLive/eTailing Group survey found that three elements are
discounts; they’re buying full price for unique finds or crucial for converting holiday browsers into buyers.
exclusive items as well as hard to find products on their
gift list that might be out of stock later. Limit free shipping aFree returns. After free shipping, free returns are the most
offers to new and exclusive products at full price, gift sets potent offer a site can make for holiday shoppers, with fully 81%
and other featured products. of the MarketLive/eTailing Group survey participants saying
it strongly influenced their purchase decisions. In addition to
o After Thanksgiving and in early December, by contrast, offering returns at no cost:
consumer expectations are high for free shipping offers; o Clearly state any deadlines or timeframes for returning
they know there’s still time for gifts to be delivered and goods.
expect to be rewarded for shopping early. Now is the time o Specify whether items purchased on-line can be returned
to offer site-wide free shipping tied to a dollar threshold; in-store.
lower or eliminate the threshold on key shopping dates, o For online returns, outline the procedure for shipping
such as Black Friday or Cyber Monday. returns back for exchange or refund.

o During the “last minute frenzy,” shoppers are rushing to
find items for the last names on their gift lists. Consider aUbiquitous information. Consumers rate the ease of finding
shipping promotions tied to items that are in-stock with contact information on eCommerce sites a top concern, with
guaranteed delivery by Dec. 25, and offer free upgraded 70% saying its prominence is the top customer service feature
shipping with a higher threshold. they expect. Another 65% of consumers give importance to the
availability of a toll-free number; it should reside in the global
aTargeting by customer segment. In addition to using the header of your site’s navigation.
calendar to determine what type of free shipping offer to deliver,
study customers’ past purchases to deliver even more targeted In general, don’t force shoppers to dig deep into the site to
shipping offers. find key information. For the holidays, make sure the following
o For buyers who frequently purchase full-price products, information is never more than a click away throughout the path
keep free shipping thresholds high, or offer it tied only to to purchase:
exclusive or new items or gift packs. o Contact information
o Delivery deadlines for each shipping method on offer
o To reward loyal customers with high lifetime value, offer o Shipping costs, including current free shipping promotions
free shipping without restrictions – but limit the offer o In-store pickup options – a service 60% of shoppers will use
to those who’ve bought repeatedly within a reasonable or are considering, according to the MarketLive/eTailing
timeframe. Group survey.
o Product guarantees
o Fulfill the expectations of bargain-hunters with shipping o Return policies
discounts above a moderate threshold. Consider offering o In-stock status
free shipping without restrictions – but restrict the
promotion to specific dates, such as a peak buying day like
Black Friday (the Friday after Thanksgiving). Alternatively,
try offering unrestricted free shipping on a specific day or
time of day that has traditionally been a low performer, in
an effort to encourage purchasing off-peak.

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In particular, don’t overlook the product page for conveying this
crucial information. Shoppers viewing a single item are on the
Conclusion
verge of deciding whether to commit to a potential purchase; Delivering value, winning sales
give them all the information they need right on that page to
convince them to proceed to checkout. The 2009 holiday season presents both an opportunity and a
challenge. With relevant promotions and stellar service, eCommerce
merchants can deliver meaningful value to customers – and end the
year with strong sales.

This MarketLive Index merchant uses tabs to link to extensive
product details, including a size, fit and care guide, above the
fold on the product page. The “Ask an Expert” tab lists customer
service contact information, including online chat – an options
shoppers increasingly use. According to the MarketLive/
eTailing Group study, 45% of shoppers rate click-to-chat an
important customer service feature, while 41% deem click-to-call
technology important.

Finally, when it comes to ubiquitous customer service
information, think beyond the site to mobile devices, which one
in three shoppers say they’ll use as a holiday shopping resource.
Provide a store locator for mobile users that includes links to in-
store and online promotions and ship-to-store options.

aPerpetual shopping cart. The ability to view and add to the
cart without leaving the current page is key to a smooth browsing
and buying experience, with 66% of shoppers saying it’s a top
customer service feature.

While it’s probably too late to re-engineer your shopping cart
process for the holidays, you can still tweak your site design to
give more prominence to the cart link. If a link to the shopping
cart isn’t already in your global header, add one there, and
consider jazzing up your cart icon with a holiday graphic to catch
shoppers’ attention

Sites with a perpetual cart already in place can go one step
further, using drop-down displays of cart contents to showcase
promotions and alert shoppers who are approaching the free
shipping threshold.

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MarketLive Performance Index
Overall (Average All Sites) - Q3 2009

a. Comparison Data

Metric Q2 2009 Q3 2009 % Difference

Year Over Year


b. Detailed Data

Conversion Average
Overall Conversion Rate 3.40%

Abandonment Average
Overall Cart Abandonment Rate 63.01%
Checkout Abandonment Rate 50.46%

Revenue Average
Average Order Size $140.73
Revenue Per Visit $4.55

Engagement Average
Engagement Rate (Visits to Carts) 9.66%
"1-and-out" - % of all visits * 30.88%
Home page "1-and-out" -
% of all visits 7.26%
Pages Per Visit 11.77
Time Per Visit (Minutes) 7.6
% of Sites with Reviews 58%

Average
Customer Acquisition Traffic
All Search Engines 40.83%
Bookmarked/Typed 29.50%
Other 29.67%

Availability Average
Average Uptime 99.91%
Average Response Time (Sec.) 2.53

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Catalogers - Q3 2009

a. Comparison Data

"1-and-out" - % of all visits 30.47% 31.00% 1.74%
Engagement Rate (Visits to Carts) 12.89% 11.97% -7.14%

Year Over Year


b. Detailed Data

Conversion Average

Abandonment Average

Revenue Average

Engagement Average

Average
Other 31.00%


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Apparel, Footwear, Accesssories - Q3 2009

a. Comparison Data


Year Over Year

Overall Conversion Rate 4.19% 4.43% 5.73%

b. Detailed Data

Conversion Average

Abandonment Average

Revenue Average

Engagement Average

Average
Other 31.24%


The “1-and-out” measures the number of single-page visits©to the site
* MarketLive Performance Index Vol. 9: Key Holiday Success Factors MarketLive, Inc. 2009
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Brand Manufacturers - Q3 2009

a. Comparison Data


Year Over Year


b. Detailed Data

Conversion Average

Abandonment Average

Revenue Average

Engagement Average

Average
Other 28.59%


* “1-and-out” measures the number of single-page visits to the site

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Brick-and-Mortar Retailers - Q3 2009

a. Comparison Data


Year Over Year

Engagement Rate (Visits to Carts) 5.47% 5.34% -2.38%

b. Detailed Data

Conversion Average

Abandonment Average

Revenue Average

Engagement Average

Average
Other 21.46%


10


Housewares & Furniture - Q3 2009

a. Comparison Data


Year Over Year

Overall Cart Abandonment Rate 62.24% 58.98% -5.24%

b. Detailed Data

Conversion Average

Abandonment Average

Revenue Average

Engagement Average

Average
Other 30.04%


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