Impressive conversions statistics are beginning to emerge from digital catalogs, for example:

• Significant increases in visitors – some sites report an immediate 30-40 percent jump in website traffic following the launch of their first catalog.
• Catalog referred traffic can make up a significant proportion of traffic – 25 percent of all website traffic is not uncommon.
• Double average time-on-site – visitors that have clicked through from digital catalogs have already researched products offline before arriving at the ecommerce site. Their interest is high.
• Increased AOV – Some merchants have reported increases in average order value of 33 percent.

However, before we get carried away on a wave of digital catalog euphoria, it’s worth noting that measurement of the true effects of having a digital catalog is not straightforward. The tablet is not a conversion device. Tablets are primarily used for entertainment, exploring new things and for social networking.

Consumers feel most secure making ecommerce purchases on traditional desktop computers. Clearly, there is a usability issue as well: Entering in shipping and payment details on a touchscreen can be a pain.

We see this reflected in the shopping cart abandonment rate. In 2011, the average shopping cart abandonment rate for mobile devices was 97 percent, compared with 72 percent across all devices.

What this means in practice is that digital catalogs, just like their paper-based ancestors, provide a great platform for customers to shop and research potential future purchases at their leisure. The future potential purchase will often be in a different session and on a different device.

Getting Started

If you already have a print catalog, then it’s an easy step to take a PDF of your catalog and get it up on one of the digital catalog applications such as Google Catalogs, Catalog Spree or Catalogue by TheFind. There’s even a catalog category now in iTunes. It doesn’t make sense to try and build your own catalog tablet application. Digital catalog applications have aggregated many of the biggest brands into one app, which means millions of app downloads and lots of traffic. It is this traffic stream that you want to tap into. Many smaller brands talk of the ‘halo effect’ of being associated with these mega brands, which brings both credibility and new customers. Many brands, such as Sephora, are on multiple app platforms.

New to Catalogs?

If you don’t have a print catalog, then there is some effort in producing a digital catalog. You need to lay it out in a PDF format and be prepared to update it regularly — four to six times per year. If you are starting from scratch, then it’s well worth thinking about interactive content, video in particular, where it makes sense.

Digital catalog applications regularly promote featured applications, and the apps are more likely to promote catalogs that have rich user experiences. An example of a rich user experience is Williams-Sonoma which has links back to recipes related to the products featured on their catalog.

Getting featured is important in raising your visibility on the app itself. Catalog Spree has more than 100 catalogs; Google more than 200 with 100 more in the pipeline. So getting your brand’s visibility up is important. In addition, to be featured on Google, you’ll need to be on Google Product Search since this is used in the set up process to link your PDF product images to the relevant ecommerce pages on your site.

A good example of a digital-only catalog is Dooney & Bourke. According to Google, approximately 15 percent of their merchants are digital only, and they anticipate this growing as more brands catch on, especially in some of the smaller categories where more of the merchants are niche designers unlikely to be able to afford a printed catalog.

The ability for a consumer to create their own personal ‘lookbook’ of items featured in different catalogs from different brands is important. Bookmarking items and creating a collage ‘Pinterest style’ is an important part of the buying process, as well as enabling customers to socialize and share items or complete lookbooks of items they like or are considering.

The tablet apps all enable customers to variously share on Facebook, Tweet, or Pin on Pinterest, so you need to have your social media act together as well to really leverage these pins, tweets and shares fully.

Summary

If you’ve already got a printed catalog, then the process of going digital is really simple, and you are probably already looking at this. Undoubtedly, digital catalogs will secure you new customers significantly beyond your current subscriber list. The fact that this is essentially a free traffic source makes it all the more attractive.

If you are new to catalogs then you’re going to need some help to pull together a PDF version. However, this is worth the effort to test; having your brand in front of a high-quality traffic stream of buyers and basking in the reflected glory of association with some of the top brands makes this well worth trying out.

While the data is still hard to find, the early conversion and traffic numbers from digital catalogs are really encouraging. In terms of costs, with Google Catalogs there is currently no charge, while others, such as Catalog Spree, charge based on clickthrough traffic.

Sending promotions to customers that have already bought betrays your brand. And the customer will let you, and the world, know just how they feel. It’s just happened to me, so with the benefit of an insider’s knowledge I’ll share how it happens, how it feels to be on the receiving end , and how to prevent it.

I recently purchased a pocket sized Satellite Navigation online at Halfords, a UK motor and bike retailer. Because I travel frequently, I wanted the convenience of having a slim line sat nav to guide me in my travels across the US and Europe.

Online price research found that it was cheaper  at Halfords, available online or for in-store pick up. Pleased with my money saving research, I reserved it online and collected it later the same day. A smooth demonstration of multi-channel retailing?

Not quite. While I’m completely delighted with my Garmin Nuvi (awesome product by the way), Halfords spoiled the experience by sending me a Spend and Save promotion equivalent to a 10% promotion on the sat nav I had just purchased.

This is an example of how to destroy customer trust by getting out of step with a customer. Offering a promotion specific to an item that they’ve just bought is guaranteed to annoy, prompt them to call to your call center, tweet negative things about your brand, and even write a blog about the poor customer experience.

I assumed that this was a browse abandon remarketing program gone wrong, where the trigger was me browsing the satellite navigation category without purchasing online.

I spoke to John Asberry, ecommerce manager at Halfords, and he corrected me: “It wasn’t a sophisticated trigger campaign, but a regular promotion based on having browsed that category in the last 90 days.”

What went wrong

It’s clear that Halfords’ marketing got out of step with my purchase. This was due to the time delay between the selection of the data (browsers of sat navs that haven’t purchased) and the remarketing email going out. Unwittingly, in this gap I had purchased.

There are immediate consequences whenever data is batched together and exported from one system before being loaded into another. Inevitably time passes, and as the minutes become hours and days, the risk that you are out of step with your customers becomes ever greater.

How I felt

My emotions went from the highs at finding a good deal and delight at the new product, to a complete plunge into the depth of despair. I’m the guy that got ripped off. I got the bad deal and everyone else paid less than me. As a buyer, I felt like a jerk. My shiny new purchase, which should be giving pleasure, is now a reminder of how I was ripped off by Halfords.

When I spoke to Asberry at Halfords he apologised for any inconvenience, but I still felt fundamentally wronged.  Maybe in time my view will change, but at this point they are now on my black list, and I will go out of my way never to buy from them again. Ouch.

How to avoid these problems

Asberry told me that “While we do have trigger based campaigns, we specifically don’t put promotions in them precisely because of this problem.” Here is a partial answer: If you are working with batches of data coming from your ecommerce site, do not use them to send promotions. That will at least stop you shooting yourself in the foot most of the time, through it didn’t stop this Halfords blunder.

Secondly, don’t send multi-stage campaigns. Being out of step once is bad enough, but doing it multiple times to the same customer is unforgivable. This is like reloading after you’ve just shot yourself in the foot so that you can shoot yourself again.

Of course, neither of these are particularly attractive ways of avoiding the problem. We know that the primary reasons why customers don’t buy on a website visit are: price objections, including the cost of shipping, and because they are not  ready to buy. And not sending remarketing emails with promotions or multi-stage campaigns isn’t an answer. This is like trying to remarket with both hands tied behind your back. Restrictions which prevent you from addressing the causes of abandonment render your campaigns ineffective.

The answer: don’t use batches of data

Batches of data coming from your ecommerce site have so many inherent limitations that you need to look at alternatives. There are no advantages to batch transfers. The solution is to track customers continually, 24×7, and to automate your follow up activity where the triggering is automatically in step with what customers are doing on the site. This requires real time tracking – and specifically a real time ‘stop’ signal — to terminate multi-stage campaigns as soon as the customer purchases.

You can run multi-stage browse and abandonment campaigns with promotions safely. They work incredibly well, and can be done without alienating customers.

You just can’t do it with out of date data. It’s time to ditch the batch.

For brand marketers, Facebook is a great place to engage directly with consumers, build relationships and drive traffic to their ecommerce sites. But Facebook as a shopping destination? With a few notable exceptions (inherently social businesses such as music, games and entertainment), it just doesn’t make sense to invest in a Facebook storefront. But using Facebook to drive traffic to your ecommerce site is a well proven and very effective method of driving high quality traffic to the site.

A year ago, we stuck our necks out and called the Facebook commerce baby “ugly.” Despite all the hype, we advised steering clear of Facebook storefronts and focusing on ecommerce social integration via plugins (Forget Selling on Facebook (for now) – Think Social Plugins). Since our original post last year, the picture has become more complex since many consumers now have a variety of devices for socializing, researching and shopping. This fascinating infographic from the Internet Advertising Bureau shows how different devices are used for different purposes during the day.

Note how desktops are considered more secure (68%) and great for storing important information (72%).  By comparison, the benefits of smartphones are ‘Keeping in touch on the move’ (95%) and ‘Socializing with others’ (78%).

While consumers will undoubtedly use a variety of devices, their preferred device for shopping is a desktop/laptop and an ecommerce site. And a mobile ecommerce site is preferred over a smartphone app.

This data suggests that brand marketers should focus on optimizing their ecommerce sites for purchases on desktop/notebooks and tablets, and their mobile sites for researching future purchases. It also suggests that mobile shopping apps are a distraction for both merchants and consumers and will fail for many of the same reasons why Facebook stores have failed.

Here’s why consumers don’t want to shop on Facebook:

Purpose

Currently, consumers aren’t going to social networks to shop, but instead to socialize, have fun and share. This shows a disconnect between the way some brand marketers view social networking sites (as a channel to sell more) and the way that consumers view them (as a way of interacting and having fun).

Cannibalizing, not additive

Of the limited number of success stories for Facebook stores, a common theme emerges: promotions. Promotions are effective in driving traffic to the Facebook store and securing a conversion. But our issue with these promotions is that they can be used to drive traffic to the ecommerce store just as effectively, where the buyer will most likely spend more than they would on Facebook. Until evidence emerges that Facebook storefronts are additive and create incremental sales, they are doomed to failure. What we should be thinking more about is how we can make shopping inherently more social, rather than cannibalizing ecommerce sales with promotions just to promote a different storefront.

Trust

Facebook, in particular, has a troubled relationship with its users when it comes to privacy. And several studies have shown that the majority of social network users are unwilling to shop on a social network due to security and privacy fears. What will Facebook do with my information if I do shop there?

Limited range

Facebook stores have a more limited range than the full store, so it’s inevitable that serious shoppers will navigate to the main ecommerce store. Limited ranges also lead to lower average order values.

Another negative impact of a Facebook store is that there is a reduced screen width in which to display merchandise. This leads to a practical limitation of a three or four column grid for displaying products, smaller images, and the right hand column being reserved for advertisements.

This is also a major limitation when considering mobile sites and apps where the screen size limits the images, download speeds limit the quality, and for apps, limited ranges typically apply.

There are, of course, always exceptions where there is an inherently social aspect to the business, and Facebook commerce can thrive. But for the majority of brands and merchandisers, it just doesn’t make sense. In the end, the focus should remain on making ecommerce more social and accessible for different device types.

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• The Connected Customer
• The Discount Seeker
• The Social Butterfly

Each of these behavior types don’t describe a unique segment of customers, but more a behavioral trend. The point here is that many customers will exhibit one or more of these three behavioral characteristics. For example, Connected Customers and inherently social, and Discount Seekers often use multiple devices to research purchases, just as Connected Customers will.

These three behaviour types are useful because it allows us to think about the types of marketing tactics we should be deploying in 2012 to address the new buyer behavior.

To make things simple, I’ve made a short Prezi (as sort of dynamic infographic) which highlights each of the personas, their characteristics, and what ecommerce teams should be thinking about in relation to each group.

If you’d like to understand more about online buyer behaviour in 2012, then we recently recorded a Conversion Academy webcast which you may enjoy:

Let us know what you think about these three different types, and what you are seeing in your ecommerce world! Are there any other new behaviour types that you’ve spotted?

Everything is more exaggerated over the holiday period: Retailers offer a dazzling array of new products, coupled with equally dazzling promotions, while trying to manage the constant problem of out-of-stocks. And customers make an abnormal number of purchases in a very short period and abandon their shopping carts in droves as they search for the best deals.

The 2011 holiday season was no exception. It was a bumper year again for ecommerce, with more than $37 billion in online spending in November-December, up 15% from 2010, according to comScore. And more than half of all online orders over the period had free shipping. While the volume was up, the average order value was down, reflecting widespread promotional offers.

Studying the shopping cart abandonment rate reveals interesting patterns in the run up to the holiday season.

As in previous years, many customers anticipated promotional offers and deferred purchases, causing the abandonment rate to shoot up, averaging 85% in the weeks running up to Cyber Monday.

Compare this with the average for 2011 of 72%, up slightly over 2010. The highest abandonment day of 2011 was at 89.2% on November 23, the Wednesday before Black Friday.

Discount Seeking Behavior

An e-tailing group study conducted at the end of 2011 found that 47% of online buyers would only buy discounted products, except under exceptional circumstances. The same study shows that 73% of consumers rate unconditional free shipping as a critical feature when making an online purchase.

What we can conclude from this is that customers are demonstrating ‘deal seeking’ behavior. Given a difficult economic outlook in 2012, it seems likely that this will continue.

Abandonment Rates Keep Rising

The shopping cart abandonment rate rose steadily through 2011, as it has for the last three years.  During this time, online marketers have not stood still: checkout processes have been simplified, security seals added, more payment methods, and a host of other conversion rate optimization tweaks.

To answer why, you have to look at the different characteristics of abandoners and those that have never abandoned a shopping cart. In a consumer survey published at the beginning of last year, Forrester Research showed that 89% of online shoppers have abandoned their shopping carts. Abandoners have more experience online, make more purchases, and spend more time on the internet than those that have never abandoned a shopping cart.

More and more consumers are becoming sophisticated internet shoppers, aware of simple techniques to seek out the best deal and of TV-advertised price comparison websites.

This explains why, despite the significant improvements in conversion techniques on the majority of sites, shopping cart abandonment rates continue to climb.

One thing is clear: Customers are becoming increasingly savvy, looking online for information to make more informed choices, especially around price.

What Will the 2012 Consumer Be Like?

Using this data as a starting point, the SeeWhy Conversion Academy research team considered what this means for online buyer behavior in 2012. We concluded that there are three major consumer trends that ecommerce sites need to take into account in their understanding of the consumer in 2012. We’ll cover these in a future blog, but if you can’t wait, then we’re hosting a webcast titled “Introducing the Online Buyer of 2012,” on Thursday, January 19. You can register for the complimentary webinar at http://ow.ly/8vI6p.

And yes, this is correct.

But this “single track” view of conversion is overly simplistic.

In this column, let’s explore why, and how it’s important to consider all of your available conversion paths.

Why Customers Don’t Buy

Only 3 percent of visitors buy within one session on an e-commerce site. And once they get as far as the shopping cart, 71 percent will abandon. To understand why, Forrester Research asked 3,000 people why they abandon.

Source: Forrester Research, May 2010; “Understanding Shopping Cart Abandonment”
Note: Respondents were able to give multiple answers

As it has been for years, the cost of shipping is still the number one reason why people abandon their online shopping carts. What’s interesting to note is that none of the top reasons have anything to do with the actual checkout process. They’re all behavioral and related to lack of readiness or willingness to pay the final purchase price.

So, making the checkout process easier for the first-time buyer is only part of the answer when addressing cart abandonment. In fact, many have learned that once changes are made, abandonment rates are still high.

Multiple Paths to Conversion

Visitors will make multiple visits to your site before finishing a sale. And on their journey, there are many different purchase paths they may follow.

After analyzing the online buying behavior of over 600,000 consumers across numerous e-commerce sites, I learned that surprisingly 75 percent of shopping cart abandoners would actually return to the site they abandoned within a 28-day period. This defies conventional wisdom: we polled online marketers and 81 percent believed that the majority of abandoners never return.

Additionally, these returning visitors are more likely to finish their purchase, as well as make future purchases. In fact, they are 2.3 times more likely to do so than new visitors making first-time purchases.

So keep in mind that your visitors will not buy immediately, and will require a series of visits and abandoned carts over time whileconsidering their final purchase.

Optimizing the Checkout Process for Repeat Purchases

While an average e-commerce site converts 3 percent of visitors to buyers in each session, this isn’t true for all sites.

The top 10 converting websites are able to convert 23 percent of visitors to buyers each session. These sites convert more because of their business model, the loyalty of their customers, and a focus on driving repeat purchases.

Amazon is a case in point. At number 11 in the top converting sites rankings, Amazon converts 18 percent of all visits into a sale.

Amazon does not offer a guest checkout, but forces new visitors to register on the site. While this creates friction for new visitors, it means that Amazon is able to identify a high proportion of traffic, and, when they don’t buy, engage them using email marketing.

Amazon.com has also revealed that 66 percent of its sales are repeat purchases (compared with my analysis showing an average of 7 percent for the e-commerce industry). Amazon.com does not optimize for the first-time visitor, but rather for the returning customer.

Key Tips for E-Commerce Marketers

1. Understand why your customers don’t buy. Every site is different. While industry studies are insightful, it’s important to collect data on your unique visitors to understand why they’re abandoning. Use survey tools, such as an exit survey. Start with data from industry research to help you design the questions and be sure to set up triggering rules carefully, so that you don’t pester.

2. Understand what it takes to get the sale. Recognize also that customers probably follow their own unique path to purchase – a path that looks something like this:

Browse – Abandon – Consider – Research – Consult Friends – Browse – Purchase

Digging into your analytics will give you a good idea of what this looks like for your site, as well as the length of the cycle. Calculate: the time from first visit to first purchase, the average number of visits, and cart abandons per purchase. This data will help you consider what changes need to be made on your site to accommodate the unique buying patterns of your customers.

3. Reengage visitors who don’t buy on the first visit. If your visitors take multiple paths to conversion, you must think about how you can gently nudge these visitors into returning and becoming buyers. This should span the different stages of the sales funnel with different approaches for browse abandonment, cart abandonment, and new customers, all of which need nurturing.

Understanding more about your customers – why they buy, when, and how – is a journey rich with rewards. The more you can step out of your shoes and become the customer, understanding her needs and concerns, the more you will be able to convert browsers into buyers. Sometimes, surrounded by myriad of tools and analytics, we forget this most basic tenet of marketing.

Online Buyer Behavior 101 and the Many Paths to Conversion was originally featured on ClickZ.

This fascinating insight into buyer motivations has contributed to on a major new piece of research into online buyer behaviour, which I’ve been working on over the last few months. It will be published on December 13th as an ebook titled ‘The Science of Shopping Cart Abandonment.’

To mark Black Friday, I’ve drawn from some of this research to look at the effects of holiday promotions, and how different price points impact buyer behavior. In particular, I’ll look at the relationship between the cart value and the shopping cart abandonment rate.

What are key price points that trigger abandonment? And can different pricing tactics lead to more conversions without eroding margin? I began my research analyzing a random sample of 264,631 abandoned shopping carts in August 2011, from a cross section of B2C e-commerce sites.

What we already know is that the value of the shopping cart has a disproportionate impact on whether an e-commerce purchaser will buy or abandon. What we have discovered is that it’s not a linear relationship and too simplistic to assume this as a general rule. This leads us to conclude that there are three promotional tactics that merchants should test this holiday season to improve conversions:

1. Offer discounted shipping for low cost shopping carts.
2. Set a $99 minimum order for free shipping.
3. Consider specific promotions for individual products with varying abandonment rates.

1. Offer discounted shipping for low cost shopping carts. As might be expected, higher value shopping carts are abandoned more frequently, and as a broad rule, this holds true. Surprisingly though, as you can see in the chart, lower value shopping carts are abandoned often, as well.

What appears to be happening is that customers abandon when the ratio of shipping cost to the value of the cart approaches 100 percent. Many people face an “emotional block” as the shipping costs approaches the cost of the item(s) in the cart. Would you buy a $19.99 item if it costs an additional $14.95 to ship? In this case, the shipping cost is 75 percent of the item value.

Online retailers should review the ratio of shipping-cost-to-cart-value for some of its lower value abandoned carts and then consider adjusting shipping policies to achieve a ratio below the acceptable threshold of 50 percent.

2. Set a $99 minimum order for free shipping. Retailers know that customers are sensitive to perceived price points. For example, a $19.99 item seems to be cheaper than a $20 one, at least by more than 1 cent. We perceive the $20 item to be significantly more expensive, even though we know it is not. As you can see in the chart, online shoppers have the same emotional response. When we analyze the shopping cart abandonment rate curve by smaller price breaks for carts up to $200, we find there’s an emotional hurdle close to $100.

What this means for e-commerce sites is that the abandonment rate spikes at key price points. At $100, the spike is the most significant and has the highest volume, but at $250, $400, and $500, you will most likely see similar spikes. These are great break points for offering minimum order free shipping, which will help with the low value cart/high shipping cost problem by encouraging customers to add more items to their carts to reach the free shipping minimum.

We’ve asked retailers that offer $99 minimum order free shipping how they arrived at that particular threshold. Their answer is that, through trial and error, $99 is the best balance between changing customer behavior and maintaining margin. This data suggests that, from a customer perspective, free shipping just below the critical $100 threshold is well worth testing.

3. Consider special promotions for individual products with varying abandonment rates. Different products get abandoned at different rates, and it’s amazing to see the huge difference. For example: two items at the same online retailer both cost $199. You might not be surprised to learn that an item costing $199 is abandoned frequently, at 95 percent of the time. That means that when this item is added to the cart, the item is purchased only one in 20 times.

But figure this. On the same site at a different item, also costing $199, the item is abandoned only 32 percent of the time, and gets bought two out of every three times. While it is worth evaluating the difference between the product specifics between these two items, online retailers should consider special promotions for the item abandoned more frequently.

If both of these products at $199 are frequently abandoned, we highly recommend further examination. Start by building a spreadsheet of frequently carted items and calculate an abandonment ratio for each product. This will help you identify frequently abandoned items and opportunities for specific product promotions, as well as zero in on other opportunities to optimize the copy on the product detail page to secure the conversion.

These three techniques will help to drive conversions this holiday season. If you are able to offer site wide free shipping as part of your peak promotion package, then this will be universally popular. If you cannot, then minimum order free shipping, together with specific incentives for high abandon or lower value carts should prove a successful formula.

A version of this article was originally published in ClickZ. If you’d like to learn more about the research behind this article, then Charles Nicholls, the chief researcher and author of ‘The Science of Shopping Cart Abandonment’ will be presenting the findings on December 13th. You can register to attend the live launch here.

As we have written about before, customers have become trained to wait for holiday offers prior to making purchases. A tighter economy suggests that this holiday season should see good growth for ecommerce sites as consumers look online for the best prices. However, there is evidence that the 2012 consumer is also moving online to save money across a spectrum of goods, including luxury items.

New research by the e-tailing group shows that 73% of consumers rate unconditional free shipping as a

critical feature when making an online purchase.

The October 2011 study, “The Connected Consumer,” also shows that free returns are a critical feature for 70% of consumers, followed by discounts, coupons and rebates.

We shouldn’t be surprised that free shipping is so important. After all, the number one reason why consumers say they abandon shopping carts is the cost of shipping and handling.

Many customers don’t understand why they should pay shipping charges at all. They don’t see the hidden costs for distribution built into the product in-store, and they consider an online purchase to be an alternative to going to the mall when they can afford to wait for delivery. The inconvenience of waiting is offset against the inconvenience of driving to the mall.

The e-tailing group’s research also shows that price is the most critical factor when considering a purchase, whether online or in-store (79%). The convenience of having a home delivery is number two (63%), but this is offset by impatience to get the product quickly (55%) or the ability to purchase from a local store (45%).

Noteworthy, 47% of consumers say that they will never, or hardly ever, buy products at full price.

Research also shows that 40% of consumers do a quarter or more of their online shopping at Amazon. Amazon’s site-wide free shipping, ‘Prime’ next-day free shipping, and hassle-free returns have set the benchmark to beat.

Moreover, an astonishing 60% of consumers surveyed go first to Amazon to establish a target price for the item as part of their shopping process.

What this Means for Ecommerce Merchants

Site-wide free shipping is difficult for many merchants to offer, yet this should be a strategic goal for any brand. This is not from a point of view of competing with Amazon, but price-sensitive consumers are demanding great value, free shipping and easy (preferably free) returns.

If you can’t offer site-wide free shipping, then offer free shipping on select products. You may have some products that are shipped differently, and therefore, you can offer category-based free shipping. It’s also worth doing some analysis to understand which product categories are most frequently abandoned and targeting free shipping for those.

Equally, there are some individual products that are much more likely to be abandoned. Build a spreadsheet ranking your frequently-carted items by an abandon-to-purchase ratio calculation, and you’ll see immediately where there are issues. Some products are abandoned because of their physical size and prompt delivery/damage concerns. With each of these high abandonment products, check the product detail page, and see if there are enhancements that need to be made, either to the photography or to the product description.

Minimum-Order Free Shipping

Another alternative to site-wide free shipping is minimum-order free shipping. This gives those customers that won’t buy without a promotional offer a reason to buy and to add more items to their cart in order to qualify. It often results in an increase in the average order value.

If you haven’t already done so, you should calculate your free shipping breakeven point. You can do this simply on a site-wide basis, or if you sell some categories at very different margins, then at a category level. This will help you determine where to set the minimum order threshold and will give you a basis for a sensible discussion with the chief financial officer.

Most ecommerce sites are offering some element of free shipping this holiday season. What this new research shows is that consumers want it all: great value, free shipping and free returns year round, not just during the holiday season.

Charles Nicholls is hosting an upcoming Conversion Academy webcast,”5 Shipping Promotions Guaranteed to Increase Conversions,” on December 6, 2011 at 9am PT/12pm ET. Register at http://ow.ly/7w4SZ.

For many website visitors, the Online checkout user experience is far from intuitive. I just came across this great viral video from the Google Analytics marketing team on the online buying process. Taking the simple idea of what it would be like to have to go through an online shopping process in a physical store, there are many painful home truths exposed here in an amusing way.

The video follows a man trying to buy a loaf of bread in a British supermarket, but being forced to go through an online checkout process. What fun – it  should resonate well with all ecommerce teams and user experience experts alike. It’ll also make you chuckle and cringe as well. What’s amazing is that it takes him so long before he abandons his shopping cart.
Enjoy!

“Not doing usability testing? Are you nuts?” said web usability expert Steve Krug at the Conversion Conference in New York last week. According to Krug, “All sites have serious usability problems. Tuning a website without fixing the problems is like painting over potholes.”

Krug is arguably the man who put website usability testing on the map with his seminal book ‘Don’t Make Me Think.’ If you haven’t read it, this is the one book on website design that everyone that has anything to do with websites should read.

Krug is an incredibly likable character. He has a self-depreciating style and dry humor that makes him an engaging and entertaining speaker. As a usability consultant for 20 years, he is naturally an advocate for testing. “My solution for everything is usability testing. Admittedly, I’m a guy with a hammer…” he says, but he is the first to acknowledge that website usability testing is not hard. His mission is to teach the skills to all ecommerce teams, because usability testing should be a continuous process, and “Who can afford to hire a usability consultant all the time?” he asks.

Usability Testing Defined

Krug defines a usability test as “watching people try to use what you create, while thinking out loud. You’re really trying to get the person to verbalize what’s going through their head.”

He’s at pains to point out that usability testing is not a focus group. Focus groups solicit opinions. Usability is about watching people try to do things. The insights come thick and fast in a usability test, when visitors struggle to complete the simplest and seemingly obvious (to the designer) website tasks.

The advantages of usability testing are that you can make a real difference in the way that visitors are able to interact with your website:

• Moves you away from designing by personal biases
• Creates a shared experience for the team, which helps build consensus
• Gives you an ‘ah ha’ moment when the designers realize that their users are ‘not like us’

A/B tests give you different insights from usability tests, because A/B tests are quantifying differences. Usability tests give you qualified insights — there’s no substitute for watching and hearing users describe how they are struggling with your beautifully designed site. It helps you realize that you’ve missed the mark. Krug advises: “Make it a spectator sport for the entire web design team. The act of actually watching people trying to use your stuff makes you a better designer.”

Most websites don’t get tested in this way for two key reasons:

• Money
• Time

Usability testing doesn’t get done because building a website is such a painful process in the first place; it takes too long and costs too much already. There’s an understandable fear that testing will inevitably slow the process down, cost more, and find a whole host of new problems that need fixing.

And it’s true. It will.

Usability testing always produces a huge laundry list of problems. Fixing problems is no fun; it takes far less resources to find problems than fix them. Krug’s advice is to get consensus on the top five problems, not in terms of how hard they are to fix, but in terms of the impact on the site.

Some problems will be harder to fix than others, and some will be easy. Most web development teams will naturally want to check off the easy to fix items. Krug maintains that this is a flawed approach because of the assumption that the bigger problems will be fixed in the next redesign. “The next redesign is like the messiah; when the messiah comes, everything will be fine.” The net results are that the bigger problems often do not get fixed.

Krug’s advice is to work from the top of the list, starting with the most serious problem, irrespective of how hard it is to fix. Then focus on what’s the smallest fix that would solve the problem observed in the usability tests. This is effectively tweaking, painting over the cracks to make the site more usable without any re-architecting. “Tweaking has a bad reputation, kind of associated with duct tape,” Krug maintains, “but tweaking will fix the problem fastest, whereas a redesign will be complex, involve lots of people, and may never happen.”

It’s worth reiterating that the benefits of usability testing significantly outweigh the challenges: making your website more intuitive will have a significant impact on conversions.

*Photo credit: Tim Ash, SiteTuners