Posts on Ecommerce



November 30, 2007

UK to Spend €20 billion Online This Christmas

santa
"Ces anglais sont fous" is the comment from one of my partners on seeing the research by Forrester- "these englishmen are mad". The stupendous figure comes to 333 or €500 spent online per capita in the UK.

Such a stream of cash trickles down to everybody in the online sector. Online advertising prices and revenue naturally goes through the roof, as etailers vie for customers. A rough figure is that 10% of this revenue is respent on online advertising.

enclick

The enclick team will shortly unveiling a social shopping experiment, just in time for the Christmas frenzy. It will be interesting to see wheter it attracts a community or not.

All I am saying is that continental etailers dream that mainland Europe fall prey to this dementia too.

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May 1, 2007

Online Shopping To Dominate in the Future

Impressive statistics forecast by the IMRG for the online retail in the next five years. UK shopping has come on in leaps and bounds, the trend continues with the forecast for 2007:
  • €63billion will be spent online by UK shoppers
  • 860 million parcels will be shipped to the UK's 26 million internet shoppers, 33 each on average
  • Online shoppers will each spend €2400 on average
  • 10% of all retail now online, rising to 20% in three years time

Online retail will grow in quality too, becoming an integral part of mainstream consumer's habits

  1. Inclusivity people of all abilities will use online shopping
  2. Normalisation online shopping will become integral to normal everyday life
  3. Diversification online shopping will extend to a wider range of products and services
  4. Shophistication online shopping services to become easier, quicker, safer and more valuable
  5. Exclusivity a rise in specialist boutiques, offering more niche and exclusive products

Cross-border Shopping

Cross border retail is gaining traction, as shoppers look for and find better deals across borders. Shoppers in Europe have forever shopped across borders, specially when located in towns near frontiers. With online shopping and international postal delivery, cross border shopping for better deals is about to take off.

Already, Spanish book purchasing relies heavily on Amazon UK deliveries, as no strong contender exists in Spain. Amazon UK has in the past purchased advertising from hispavista.com, our parent company. Bargain hunting is about to extend across borders; and the bargains are considerable, even in spite of delivery cost across Europe.

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February 1, 2007

Affiliate Marketing on the Rise

Great event for affiliate marketers yesterday by affiliates4u team. Four hundred attendees, merchants, affiliates and networks in Holborn, London.

Merchants are courting affiliates and their ability to attract targeted user traffic. From Kevin Cornil's buy.at presentation; affiliates sold in excess £ 2000m goods online for a fee of £140m. A year-on-year rise of 60%, taking an alleged 10% of total online advertising spend.

Merchants are discovering pay-on-acquisition model. My opinion is that CPA commissions will inevitably rise though, as merchant demand for the model exceeds the volume available through affiliate networks. In the end, buy through ad impressions (CPM), clickthroughs (CPC), and on-purchase-results (CPA) will balance out to give the same value-for-money (ROI).

Yes, what a soup of acronyms.

The word branding came up in conversations increasingly. Paid-search and affiliate marketing have a secondary benefit in addition to the immediate sale; repeat sales. In fact, the repeat sales experts extraordinaires, the email marketers, were also at the event. It is not just about the sale on clickthrough, it is about the repeat visit. The brand and the loyalty. In fact, one expert from UK Media Ltd, who arbitrages £ 12m in volume, says branding is the next natural step for affiliate web sites.

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January 30, 2007

Presenting at the London Search Engine Strategies Conference

Top niche conferences are the best places to start sales cycles. I will be contributing my bit to the Enclick sales effort at the London Search Engine Strategies conference. I will be presenting tips on exploiting European Shopping Search opportunities.

My presentation is derived from the whitepaper Are you Making The Most of Shopping Portals ? (PDF file). The message is

The "search tail" is often under-exploited by merchants. Most merchants own product data that can be turned into a "quick-win" in search marketing terms. My advice is get (1) "your data out" and (2) filter and push your data to the head of the search. Often the most popular and profitable keyword emerges from the tail; all a question of finding it and promoting it to the main page.

A large database of product information is worth its weight in gold in search marketing terms. Learn to exploit it and you will improve both search head and search tail. I have analytics for a shopping site (shopping.enclick.com) that started using dynamic top 10 list of products and categories based on measuring search traffic to the site.

In essence, data feed marketing is the next generation marketing channel. Send me an email, (paul dot elosegui at enclick dot com) if you want to meet up.

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January 11, 2007

One in Ten Pizzas Ordered Online at Domino Pizzas

domino pizza
Domino Pizza's sold 20.1 million (&euro 30 million) online during 2006. Its e-commerce orders were the fastest growing channel to market and attracted record numbers of new customers as well as delivering an average ticket value that is typically 25% higher than orders placed by phone. E-commerce sales grew by 43.8% in 2006 in the UK

Domino is also preparing its mobile ecommerce platform. It expects text message orders will also drive sales growth in the future, as the coming teenage demographic use always-on broadband and text rather than voice phones.

Domino pizza media center.

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January 8, 2007

Ecommerce Risk Reduced to Zero with PayPal Virtual Credit Card

paypal
Though security and risk worries are becoming a thing of the past for online shoppers, Paypal has just introduced the ultimate security solution; a debit card for your paypal account.

Hundreds of millions of shoppers using their paypal account to ensure security on their ebay purchases can now use their paypal accounts for all purchases. With the new debit card number associated ot their paypal accounts, shoppers can use this new "paypal credit card" to shop safely on all retailers accepting credit cards.

Paypal accounts are designed with online fraud protection, since they can only be used online. Paypal guarantees fraud protection and polices its account transaction proactively. Online security is heightened by technical encryption and authentication technologies, over and above the standard secure transaction page.

Paypal's new innitiative to improve consumer confidence online should have higher impact in countries where confidence is still low. The value is limited in the UK and US where credit card companies and major banks have dedicated online fraud units, and confidence is high.

PayPal Virtual Debit Card FAQs - PayPal

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January 6, 2007

Bricks and Mortars Retailers Turning to Online Sales to Save their Business

A quarter of all electrical goods sold over Christmas were bought online, according to Interactive Media in Retail Group (IMRG). IMRG also said that online now accounts for 10% of total retail sales in the UK, compared to just 0.5% in 2000.

"From talking to our members, my guess is consumers will have spent 3.7bn (€5.55bn) online just in December ... This has definitely been an online Christmas. We think 25 million people are now shopping online and the spike that we see at Christmas is huge. Everything combines to push people to internet shopping over the period - bad weather, bulk buying, the inconvenience of transport ...", James Roper, chief executive for IMRG

Wrapped gifts was another category of massive growth this year, up 150 percent year-on-year. On commodity products that have little differentiation, shoppers search for best prices using price comparison engines like Enclick best price search.

Statistics released by online shoppers are impressive:

  1. John Lewis saw its online sales soar 60% in December
  2. Online sales at Tesco soared by more than 30%
  3. 1.3 million shoppers ordered groceries and Christmas gifts through Tesco.com
  4. Tesco Wine Club delivered 80,000 orders in time for Christmas, up 50% since last year
  5. Amazon, the number one etailer in the UK, sold 4 million orders on its busiest day, December 11.
  6. Next Directory's sales (50% of which are estimated to be online) rose by 9.3

Offline, high-street sales are loosing market share. HMV and Woolworths both issued profit warnings at the beginning of December, and Mr Ratner of the Retail Consortium, said their Christmas trading updates were likely to be bad. Next's retail division, saw underlying sales in the 308 stores slump by 6.9 per cent from 31 July to 24 December.

The solution is online; Marks & Spencers is making a concerted effort to increase its online sales. Stuart Rose, M&S's chief executive, wants to increase internet sales from 100m to 500m by overhauling its website.

Marks & Spencers datafeed has improved in quantity and quality recently, as it distributes its products among shopping portals. Retailers are embracing internet shopping portals as distribution partners. For the high-street retailers, the Enclick shopping compares prices on the following number of products:

  • Woolworths: 273,000 products
  • John Lewis: 19,000 products
  • Marks & Spencers 9300 products
  • Littlewoods: 10,500 products

The enclick data feed marketing team is in high demand, helping retailers market their inventories online.

Many bricks and mortars high-street retailers are all turning to Online Sales to save their businesses. Who would have said ?

[Disclosure: we are invested in Enclick Ltd]

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October 31, 2006

Lycos Acquires German Online Shopping Technology

Lycos Europe, european online portal has acquired Mentasys, shopping software provider, for €30m and an additional performance related €14m. Mentasys software connects sales networks with intelligent product advisors. The software facilitates the sales process. Mentasys' 60 staff doubles Lycos' shopping technology development team. According to Antoine Boulin, MD of Pangora HQ in France.

Pangora and Mentasys competencies are very complementary. Pangora brings its expertise in front-end technologies, sales and international distribution. With this new partnership, Mentasys brings know-how in back-end technology, product data and reviews... [Free translation]

Lycos, european online portal, is investing in its white brand shopping portal Pangora. Christoph Mohn, CEO de Lycos Europe declares

We are convinced that more and more purchasing will be done online. European online shopping sector has double digit growth every year. Lycos Europe has a strong position in the sector and is constantly improving its performace thanks notably by its Mentasys acquisition. It's strong expertise, specially in B to B, and its white brand shopping solutions will help us in more than our German market. We forecast these sales figures in other markets like UK, France and Italy. [Free translation]

Pangora's own brand shopping site is evita.de, which has a small market share in Germany; the site is yet to top 500,000 unique users a month. Lycos is pushing the eVita brand to France and UK. Though not part of the top 10 shopping sites in UK, Europe's top market, the eVita is expected to contribute significantly to Lycos' struggle for positive cash-flow.

[Via euro adhoc: The European Investor Relations Service]

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October 30, 2006

Comparison Shopping Engines Contributing More to Online Retail Shopping

Moneysupermarket.com, leading loans and insurance comparator, received 13.55% of total traffic from organic search, and 20% from paid search (PPC) campaigns. Hitwise's Bill Tancer reports that 4.2% of traffic to retail sites are now being sent by comparison shopping engines. For certain products, 90% of online shoppers use comparison shopping engines to research a purchase.

.....read more

[Disclosure: EUCAP is invested in Enclick Comparison Shopping and data feed marketing service.

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October 21, 2006

Shopping Feeds Standards Fight is On

association for retail technology standards

The Association of Retail Technology Standards (ARTS) has issued its first proposal for a data feeds standards. The standard is aimed squarely at Comparison Shopping Engines, like shopping.com, kelkoo.com and enclick.com. The goal of the standard is to allow ecommerce merchants to generate a single data feed valid for all affiliate networks and shopping sites, instead of the dozen odd data feeds which are necessary at present.

Jay Heavilon of MARS, who chairs the committee for the standard states

"The current situation is a digital tower-of-Babel, where different online shopping search and shopping engines take SKU [Stock Keeping Unit] data in different formats. These specs allow advertisers, engines, and agencies to exchange product data more efficiently,

[National Retail Federation Press Release]

Google, w3c.org (world wide web consortium) and ARTs have competing standards for ecommece data feeds. Google has published the GData API which is a simple focused standard, concentrating exclusively on getting merchant's products into Google Base. With Google Checkout interface adding the transaction backend interface.

The ARTS standards is a more comprehensive definition of vocabulary which ties into ART's other standards for the communication along entire retail value chain. The W3C's RDF schema is also comprehensive, but the retail category XML schema is still not complete.

There Can be Only One

The three data feed standards clearly overlap in scope. Which one attains critical mass first is still very much an open question. Each standard has pros and cons.

ARTS has buy-in from Yahoo, AOL and Microsoft, and other major players in the online retail sector.

Google Data is now the way for merchants to get their products into Google Search Results. Since Google dominates the retail clickthrough market, its search is typically the origin of 25% of all ecommerce related clickthrough. If Google keeps this lock on retail related traffic, Google Data will be an obligatory data feed for all online shops.

The W3C's XML standards have the advantage of having public domain licences. W3C waives the right to demand fees for the use of its schemas. Contrary to ARTS and Google, who reserve all rights on the use of their standard; either organization has a right to demand fees and royalties on the use of their standard in the future. All W3C's standards use forms of creative commons licences, and are therefore truely for the benefit of the retail community.

Public Licence Standards

The public licence issue over the standard is central here. Viral marketing tenets for mass adoption recommend zero fees and minimum friction on use of the schemas. But Already Google has attracted strong criticism from internet leaders over their commercial lock-in tactics of the Google Data standard. Similarly, ARTS already levies fees for use of some of their standard; a disaster in viral marketing terms.

Meanwhile retail merchants observe in hope, as they are forced to produce half a dozen data feeds for submitting their product list to price comparison engines.

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September 30, 2006

Google to Phase Out Froogle

froogle

Froogle is being elbowed out of the online price comparison sector. Like or not, the essence of a good price comparator is the quality and depth of its database, and the quality of its search. In my opinion, the google search and google base combination will inevitably see froogle out of the the door.

Meanwhile Google is circumspect about Froogle's future, stating

G: Froogle is alive and well. We are continuing to integrate shopping and product search features into Google.com to make it as easy as possible for users to find product information through Google. We don't have any more specifics to share publicly on how this will look down the line but we will make sure to let you know about any developments. [Via John Battelle's Searchblog: News:

Google is no stranger to failed projects. In fact it thrives on them, using the darwinian approach of beta testing a huge number of potentials and only picking the best and fittest projects.

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