The concept isn’t new, see this video by Barry Schwartz in I believe 2006 at TED.

The idea resonates and has been repeated in lots of literature. I wanted to find out if making choices not only makes you less happy, but makes you not want to make future choices. I found a study that demonstrates just that at http://www.csom.umn.edu/assets/113144.pdf. If interested, see experiments 3,6 and 7.
To summarize, the more decisions you have to make, the more you procrastinate/the less you want to make decisions. If you have to choose what to buy, where to buy from and what shipping method, choosing what credit card to use may be the last straw that makes you procrastinate.

So, lets limit choices.

http://tech.fortune.cnn.com/2010/07/24/users-to-net-bosses-we-want-to-pay-you/ is short on real data, but does coin the term “keyboard tax” which I love

Using a default shipping and billing options as Amazon and itunes does is powerful.

Clicktale stalks your users while on your site via javascript, tracking mouse movement, clicks, form inputs and where on the page the customer is.

They use the information to show you click heatmaps (no big deal, google analytics does the same, just less pretty), mouse move heatmaps (more interesting) and lets you watch visitor sessions including mouse movements, clicks and form inputs through an entire session like a movie. That’s cool!

Entry level integration only required adding a javascript snippet to the pages of your site (a few minutes of work). The simple implementation is far from perfect, more on that later.

I watched about 50 user session on the second day.

3 users struggled with tracking orders that had been shipped (a small sample, but 3 out of 50 is a huge). They simply didn’t find the tracking link on the page because due to some CSS changes it didn’t look clickable. One visitor took 10 pages to find it. One took 26 pages, and never found it! The third went to the customer support page and I assume called or emailed. 3 UX failures! It’s an easy fix, and we’ll have it done this week. Think how many customers we provided a poor post-purchase UX because of this dumb bug?

I also found a customer who clicked onto a set of similar pages and saw the same top banner and kept clicking on it, not realizing he was already on the page being advertised in the banner. I tweaked the page slightly. Another easy fix for a problem I didn’t previously know existed.

In case you’re wondering, Clicktale didn’t pay me for this post. Cheap bastards!

You can sign up monthly. A limited trial is free. For the paid version it goes from $100 and up depending on how many session you want to record across how many domains. We’re paying $290 a month. It seems like you can cancel at any time, but I haven’t actually tried cancelling.

About that integration… Entry level implementation doesn’t show javascript or AJAX actions and doesn’t work for pages generated by POSTs, or that vary based on session data. For us that means it doesn’t work most of the time. We’re working on doing a more complete implementation which solves all those problems. Hopefully we’ll learn a lot more when the complete integration is done. Drop me a note if you want to see how that integration goes.

An interviewee today said “Spacious and Clean,” my Mom would have been so happy (and surprised).

I’m also not bringing my laptop. Will I be able to function with just an iPad? I’ll blog about and let you know when I’m back in NY with a real keyboard.

How will I carry it? Will I leave it somewhere (probably) and lose it (we’ll see if people are nice enough to return my pretty toy). I need Stephen Colbert’s jacket with iPad pocket.

Don’t think I’m not passionate about my business. I am. I am passionate about delivering the best user experience for martial arts equipment shoppers. Doesn’t mean I can throw a crescent kick.
Don’t sweat it if you have a business that sells a product that’s not near your heart. Hire a freelancer or employee or two that are passionate about what your business sells. Let them do the writing. Let them be the brand ambassador. Your company is about more than just who you are.
It’s OK if your passion is business. It’s OK if your passion is service. It’s OK if your passion is value. You’ll do just fine.

Ask Gary Vaynerchuk what his real passion is. Ask Tony Hsieh.

Can you measure in near real time the effectiveness of a branding action or campaign? If you can’t, you won’t improve it – we all know that.

I of course recommend hiring Gallup to determine your .com’s Q score, along with using a social media tracker to measure your mentions.
Or not.

See what percentage of revenue you’re generating from searches for your brand name -coupon. Those searchers remembered your brand name or were referred to your brand by name. That figure is my KPI for branding. If it’s increasingly, your brand is improving.
For the last five years Boxing Depot had good search traffic and a poor brand (unlike KD which is strong at both). We changed our product page reviews and Q&A section and added a learning center. Three months later our branding KPI was twice its pre-change level.

One more step down the road to building a brand.

Sounds impressive, right?

If your business is growing at less than 20% a year, you’re stuck in a rut. You probably know that rut very well and have already found the small changes that make a big difference.

Stop your quest to get that extra 5% of incremental improvement. Get back to big picture thinking.

If you think your best idea will need an A/B test to determine if its successful or not, the idea is not good enough.

When you get that idea, stretch yourself and do it. Let the A/B tests slide.

When you’ve moved so far outside what you’ve done forever and have known forever, now is the time to A/B test. There is plenty you won’t know about your newly discovered or created business idea and there will be plenty of easy opportunities for incremental improvement. Now A/B test and find them.

This week it was Mercado being unable to get financing and then selling for $6.5M to omniture, which was probably a small fraction of the money sunk into the biz.

The lowest risk strategy is to reduce costs without reducing long term prospects. It’s also quite difficult. I’d like to discuss over the next few weeks some methods that may work for your small-mid online retail company.

In this post, I will focus on identifying and reducing your money losing orders.

For every order you can calculate the profitability. To do so you take Gross Revenue (item and shipping charges) and subtract out all the costs associated with the order. The list of costs are long and complex and to manually calculate profitability for a single order takes way too long to be practical. Fortunately it should be a fairly straightforward algorithm which any decent programmer with access to the necessary data can implement.

So, have a programmer implement it (I’ve listed some notes on the algorithm below).

Then look for the outliers, such as orders where you lost money or had your lowest profit margins. Once you’ve identified those orders, try to figure out why they underperformed. I’ve found shipping inefficiencies such as orders being packed in oversized boxes that weren’t supposed to be, pricing errors due to input costs being underestimated and opportunities for greatly improved profitability.

A simplified example opportunity is a high volume item that sold for $37.95 and had a $1 net profit, was raised to $39.95. Volume dropped by almost 20% but with the adjusted net profit amount it’s a money maker.

And that’s the point of this exercise – Maximize your bottom line today.
Your input costs will vary but don’t forget these:

1. Item cost including after discounts
2. Outbound shipping cost
3. Inbound shipping costs
4. Stocking costs
5. Carrying cost – If your average unit of this item sits on your shelf for 6 months, you’re paying storage space and interest on the cost of that item for 6 months.
6. Picking and packing cost for that order – both the labor and the material. Boxes aren’t cheap!
7. Return costs – It’s important to factor this in at a sku level, don’t just take a round number. I have a lot more judo uniforms returned for size issues than I do boxing gloves.
8. Phone costs – If the order is taken by phone that adds significant costs.
9. Manual processing costs – if someone screens your orders, what’s the cost to screen this order
10. Credit card processing costs

Be specific! Generalizing your costs in this calculations will cost you accuracy and keep you from spotting the outliers that we’re trying to identify.

If you’re there, say hi.

Go to Karate Depot.

Clear your KarateDepot.com cookies, then google MMA Gear and click on the link to the KarateDepot.com front page.

Notice the targeted banners and products. (If you do not see the MMA banners, you probably still have karatedepot.com cookies set).

The different front page being served has resulted in a 69% improvement in conversion rate among those who searched for “MMA Gear” and clicked through to our front page.

Excited, we followed up with a test for terms including “Karate” and “Karate Uniforms” and more than doubled our conversion rate for those searches.
There are thousands of terms that lead to our front page but we don’t want to have thousands of customizations for our front page. Our tech isn’t customizable enough to be able to efficiently manage that many different front pages. I can envision a system that would, but for now we’re grouping those terms and creating customized pages for those groups.

Implementation

We set different front page items and banners for different buyer segment in Mercado.

If the entrance keywords match certain rules, we assign the session to the appropriate buyer segment. If the term doesn’t match any of the rules, or if the visitor wasn’t referred by search, we assign the visitor the default buyer segment or add the visitor to an A/B test that we’re running. To determine whether the user came from a search engine we simply look for certain referring urls and then inspect the term the user searched for. For example, a search for “karate” coming from Google will contain “q=karate” in the referring url.
We pass the selected buyer segment to Mercado.

Mercado gives the visitor their customized front page. That front page remains the customized front page throughout the visitors session, to maintain continuity.

Is this for me?

If you have a high volume of visitors to your front page via organic search and some of the keywords are converting poorly, it’s for you.

But my software?!

There’s e-commerce software that has exactly this functionality built-in. We did it with buyer segments and Mercado made it easy. If your software doesn’t have that functionality, ask if they have or can provide a method for creating custom landing pages.

From Here

We’re showing the customer what he wants more often that we were. Therefore we’re selling more product. We will see if we can do the same for visitors to other pages of the site where the page they’re landing on doesn’t have the exact product selection they may be seeking.

We can also take the buyer segment that the customer is assigned for the session and change other elements of the website – such as our related items and others bought sections – to show items the customer might be interested in. Additionally, we can splash MMA branding across the website for our MMA buyer segment and see if we can convince our visitor that for MMA we’re the place to shop for MMA. While of course showing Karate branding across the website for our Karate buyer segment, because for Karate as well, we are of course the place to shop.

Technorati Tags: Ecommerce, Conversion Rate, Mercado, E-commerce