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Shopping Cart Abandonment – Part II

In the first series of this article here, we found out 10 reasons as to why people abandon the shopping cart. Let's see those reasons in detail.

Why do people abandon shopping carts?

There are many reasons behind cart abandonment, but I feel that the majority of people do so for one of four major reasons, with other issues sprouting from those.

Comparison shopping

It’s not unusual for consumers to go right through the buying process to the checkout stage to get a true indication of what their purchase will cost including tax and shipping. They may repeat this process on many sites before making a purchase.

Confusion

This is a major issue. Consumers may be confused at how the process works, about added costs such as shipping or distracted by other elements on the pages.

Impatience

Too many checkout pages, shopping cart pages that load slowly, sites that require registration before purchase or requests for too much non-purchase related information can send potential customers scurrying away.

Fear

The consumer is about to hand over their credit card details to a complete stranger, and if they have any degree of common sense, they’ll be wary. Anything that seems a little out of the ordinary or order forms that ask for too much personal information may scare them away.

Minimizing shopping cart abandonment

Before putting any of these suggestions into action; you first need to think about the type of clients you cater to.

For example, the “me” generation wants everything now, skimming over information; whereas older shoppers may take the time to read everything on the cart pages and expect to be assured that it’s safe to do business with you.

Shopping cart software

If your cart software is more than a couple of years old, chances are it’s missing a lot of the features that are standard these days that shoppers expect. Like any online technology, carts have come a long way. For example, some shopping carts allow you to grab the email contact details of the customer early on in the checkout process, which then allows you to follow up with the person should he/she abandon the cart.

If your shopping cart is a bit dated, perhaps it’s time to update your current software, or move over to a new product.

Security – SSL

From time to time, I still see carts order forms requesting credit card details without a secure connection. SSL (Secure Sockets Layer) is a crucial element of any ecommerce transaction and is indicated by a https:// address and associated lock icons in browsers.

Also tell your clients about the security measures you have in place, either via a scrolling text box on checkout pages so that it doesn’t take up too much space, or a page dedicated to ecommerce security that is easily accessible from any page on your site.

Security warnings and errors

It’s really important to test your cart and checkout process in Firefox *and* Internet Explorer as they handle security issues differently. On a secure page, i.e. one beginning with https://, Internet Explorer is far more fussier. If one of the elements on the page such as an image isn’t referenced via a https: address; Internet Explorer will throw up an ominous message stating that one or more elements are not secure. Even if it’s just an image that’s causing the problem, it’s enough to scare off wary customers and they are very likely to abandon the shopping cart. Firefox on the other hand just ignores such issues. So if you’re a Firefox users, your site may be experiencing this problem and you wouldn’t be aware of it.

Third party verification seals

Big and small, well known and unknown retailers experience the same issues of jittery shoppers, which contributes to increased shopping cart abandonment rates. It’s been demonstrated that display of a third party verification seal can greatly increase retention and conversion rates.

Request for information

The checkout process might seem like an excellent place to gather demographics through survey-type questions, but it may scare some shoppers away. A “where did you hear about us” question is probably fine, but use a drop-down selection of answers to keep things moving along.

Clear, friendly navigation

Nothing irks me more in a checkout session than a cart that doesn’t allow me to back track to any stage of the process. If your shopping cart checkout process is multi-page, place links to each section top and bottom of the pages. It’s also good practice in a multi-page process to give clients a progress indicator.

Images of products, linking to information.

It doesn’t hurt to have a thumbnail of the product the client is purchasing in the checkout pages; but make it bandwidth friendly. The image should link to a new window with summary information about the product. The use of images can help maintain orientation and ensure the client the product they want is the one they are ordering.

Live help

Consider implementing live chat software. A live help feature on your cart pages may encourage clients who are confused to ask for assistance, thus helping you to close more sales.

Of course, never dive in and offer to assist someone during a checkout process; you may scare them away. Let the client initiate the chat.

Phone assistance and ordering

This is particularly helpful with big ticket items. No matter how simple your cart is, some folks just won’t get it. No matter what you do to show you’re a legit business, some still won’t trust. This is where offering a phone number for ordering can help and VoIP (Voice Over IP) allows you to set up phone ordering numbers around the world at minimal cost.

Friendly error handling

It’s very frustrating to complete a cart session, all the way through to submitting the order form, only to be told “you moron, your postcode is invalid!” OK, it’s an exaggeration, but developers aren’t known for using subtlety in error messages :).

Ensure the software you are using has friendly, descriptive error messages and that when an error is detected, that the client does not have to start the ordering process all over again. They should be able to fix the error and pick up from where they left off.

Distractions

A cart is not the place to have banners for other sites :). Other distractions such as flashing, whirring, spinning or buzzing elements should be terminated with extreme prejudice, unless they directly relate to the purchase – such as an error message or upsell/cross-sell offer.

Live Chat Software

– Boosts sales, a great marketing tool –
– Helps to reassure your visitors –
– Makes ecommerce more “human” –
– Track visitors on your site in real time –

Added costs

As early as possible in the ordering process, the client should be made aware of *all* costs. Slipping an added fee in at the last moment or having low product prices then a whopping shipping charge is not clever; it’s just bad business. Aside from the sticker shock it will induce, it also smells of trickery the customer may wonder what other nasty surprises may be in store when doing business with you.

Keep it simple

Anything and everything in your cart process should be as simple as possible. If it’s not absolutely necessary to the purchase or doesn’t provide the client with important information that *they* need, turf it.

Currency conversion

It’s important to remember that the US dollar is not the only currency in the world. While it has pretty much global acceptance, converting currency can be a mathematical nightmare for some. Even if you can only accept US funds via your payment gateway arrangements, at least provide a currency converter feature to save your non-US clients the effort of making the calculation.

Transparency and reassurance

So many online businesses try to hide who they are – their about pages do nothing but say “we’re the best”. This does nothing to assuage the fears of online shoppers. A person may be halfway through the checkout process and think “hrm, who are these guys anyway?”. There should be a link to a contact and about/company profile page easily accessible from the cart and the profile page should be more than just puffery – it needs to contain solid information about your company focused on reassuring your visitors.

Get others to test your cart

Once we are familiar with our own software, it’s very hard to be objective as to how easy it is for a first time visitor to use, as we become “store blind”. Enlist the help of colleagues, staff, friends and family – ask them to test your cart and to be brutally honest. Analytics software can also help indicate a common point where consumers are abandoning their purchases.

Like most ecommerce merchants, you’ve put in a lot of blood, sweat, tears and cash in building and promoting your site – I hope some of these tips help you in boosting your profits!

In third article of this series we will see the entire concept in a beautiful infographic.

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Posted by on November 23, 2011 in Product Reviews, UX and Usability

 

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Everything is a Product Management

The basis of the post is this: Everything is a product management problem. Not just the product. Not just features. Not just platforms. Everything you do.

The same techniques and skills you use to manage product development can be applied to your startup, your business plans—and you, yourself.

It’s about compromises and resources and time. It’s about ship dates. It’s about controlling feature creep. It’s about making go/no go decisions. It doesn’t matter whether you’re an engineer, marketing, management, or sales. In the startup world, everything is a product management problem.

With that in mind…

Everything is a product management problem

Now, I’m no expert in product management.

I’ve spent a lot (a lot) of time sitting in product management meetings and listening. My primary contribution to product management meetings?

  • Meeting #1: Me: “When are we scheduled to launch? What’s the date?”
  • Meeting #2-#999999: Me: “Does that affect the launch date? Is the launch date slipping?”

Yes, vital component. That’s me.

But it’s good. Because when I keep my trap shut, I actually listen, so I’ve managed to pick up a few things here and there.

And here’s where the worm begins to turn.

So, the other day, I’m staring off into space, thinking about product management, and this occurs to me: Everything is a product management problem.

How so? Well, let me outline some of the high points of product management.

  • Timeline / Road map / Lifecycle. Every product has one. The really good ones detail the life of the product, from conception through demise. On it, you can see every upgrade, every feature, every release, every date. Everything that will happen to that product. This is the plan. For the entire product. Everything that happens occurs here so that it can be seen in the context of the product life. And every change that is made is reflected here. All the new features, all the slips, all the last minute requests, all the executive force ins. Not only is interesting and vital to managing the process, it’s one hell of a document for the post mortem. And it’s the polar opposite of our next item.
  • Trade offs and compromises. This is the product manager’s preeminent skill. Everything in product management is a series of trade offs. When is that resource available to build that functionality? Regardless of when that functionality is built, when do we release it? What does the market want? What does the company want? What do we do to incorporate this last minute requirement? How do we retool based on the usability tests? Everything is a balancing act for the product manager. You can’t do everything at once. And you can’t do everything before launch. It’s a constant game of ready, fire, aim. What is attainable versus what is necessary.
  • Resource management. Once locked, loaded, and focused on target, how do we manage the resources at our disposal? Are we going to wedge in some additional functionality while we have engineering cycles? Are we going to bring in outside help to get us through this rough patch? Can we rely on a single engineer to bring everything to fruition? What if that person falls ill during QA? How much do I have to spend to get this done? Can I buy more time? Can I buy more resources? Do we have to build? Can we partner? Can we acquire?
  • Translation. The product manager is a Rosetta stone of sorts. Sitting somewhere between the business aspects of having a product and the labor required to bring that product to fruition. In high-tech, as an example, engineers don’t generally want to hear about the business reasons behind feature #479. They want to know the spec and they want to know what technology is at their disposal to create the feature to spec. Conversely, the CEO generally couldn’t really care less if you’ve created an AJAX implementation or used C#. S/he wants to know if the customer will be jumping for joy or throwing up all over it.

So taking those high-level points, shouldn’t we all be product managers for everything we’re doing? Shouldn’t we be product managing our startups? Product managing our investors? Product managing our employees? Product managing our product?

I mean, couldn’t your startup use some product management? A timeline? A life cycle? An attainable list of features and functions to be launched at specific intervals? What does version 3.5 of your startup include? Is it Windows, Mac OS, and Linux compatible? What mobile platforms do you support? Where are your feature/function gaps that could move your startup forward or doom it to inadequacy? What features do you want versus what functions does the business want? What happens when a competitor enters the market?

How’s your startup’s usability?

Think about it. Your startup will be better for it.

 
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Posted by on November 23, 2011 in Product Management, Uncategorized

 

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How to generate word of mouth lead

The Four-Step Plan for Word-of-Mouth Lead Generation

“Here’s the big news,” writes Andy Sernovitz in the book Social BOOM! “It’s not social MEDIA. It’s SOCIAL media. It’s about real people and the conversations they have.” In other words, a presence at online networks like Facebook, Twitter and LinkedIn isn’t enough. To generate word-of-mouth leads, you’ll also need excellent social skills—and here’s how to go on the charm offensive:

Be interesting. Do you tell friends about dull companies, products or advertisements? Do you arrange introductions for people who bore you silly? Of course not. According to Sernovitz, there’s a good way to gauge your word-of-mouth potential. Simply ask: Would anyone tell a friend about this?

Make it easy. Word-of-mouth relies on a simple message—a single, memorable line that people are likely to repeat when describing your product or service. “Anything longer than a sentence is too much,” he says. “It’ll get forgotten or mangled.”

Make people happy. Customers who love your company will enthusiastically share their experiences with friends. “You will get more word of mouth from making people happy than anything else you could possibly do,” he notes.

Earn trust and respect. No one will risk her own reputation by recommending a company with a reputation for iffy business practices. But when you’re known for treating customers, partners and employees with great care, referrals become a no-brainer.

The Po!nt: Like it or not, word-of-mouth marketing is a popularity contest. And you’ll win when you get people can’t resist you, your product or service and your integrity.

SourceSocial BOOM!

 
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Posted by on November 17, 2011 in Social Media, Social Media Marketing

 

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Increase your Productivity….16 easy ways…

If you ever wanted to know what it is about to be as productive as possible, here are few of the brilliant tips from 16 Tips to Simplify Your Life (and Increase Your Productivity) and here is my list after customization.

1. ……I have no idea what to write here

2. ……I have no idea what to write here

3. Start your day with exercise. (Hmmm, I have not been doing this…)

4. Plan your day ahead. Spend at least 10 minutes on planning the day and 10 more minutes on reviewing the previous day. Make your notes and observations. ( 10 minutes, this is too much for me to even spend..thinking is such a waste of time…)

5. Make sure to plan a decent holiday break once a year. (I find it should be at least 10 days for it to become truly regenerative.) (Ah ha…this is what Priya has been telling me…but…

6. Learn to protect your time. The data says workers are interrupted every 11 minutes. Distractions destroy productivity and complicate your life.

7. Make a list of ever growing quotes that have the power to change the way you think. Hang a few of these at your desk. Change them regularly…(Isn’t it a waste of time…lolzzz)

8. Start and track Projects(small and big) that fuel thinking. Share them with the team and be an example. (Hunh)

9. Capture the knowledge you gain and share it with the team. Take Feedback. Collaboration can make wonders. (Hmmm, this is what I have been doing learning from others…I don’t know how much people learn from me…)

10. Build the team spirit with the help of the team and help them in becoming more productive by sharing the knowledge.

11. Have your visions clearly defined.Have more focus! (Now what is this VISION?)

12. Post Everyday. (Ask me 🙂 )

I will get back to you guys after one month…to give you s hindsight as to where I am…

Related articles
 
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Posted by on October 19, 2011 in Productivity

 

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Product Launch Learnings – SPRITE

Let’s see how Sprite launch in 2001 can help us in understanding various Market fundamentals and Research followed by launch principles.

A market segment is a part of a larger market with similar features. In effect these smaller segments contain a set of products that can be substituted for one another. For example, someone who wishes to purchase a Lemon-Lime flavoured soft drink may prefer Sprite, but if that brand is unavailable they can readily substitute it with another similar soft drink.

With the strength of other brands in the Lemon-Lime segment of the soft drinks market it was easy for everyone to guess that new entrants would find it very difficult to gain a significant market share. However, preliminary research conducted by Sprite found that the current lemon-lime brands in the market did not have deep appeal to teenagers, or ‘teens’, as they tended to target families. However, teens represented a large percentage of the Irish population, with increased spending power, created by a strong economy that saw many young consumers with part time jobs.

Sprite’s global positioning is that of a soft drink for teens. Therefore, it was identified that both a volume opportunity for sales existed and that a profitable market niche within the lemon-lime segment could be created. If Sprite could target their soft drink at this sector, a profitable market niche within this segment could be created. A market niche is a sub-section of a market in which a small number of products very closely match the needs of consumers. As a result of this, Sprite initiated a process of market research in order to better understand Irish teens and their needs.

1. Market Research

Market research is a process that links consumers to a company through information and data gathering. The market research process consists of four steps:

1. Defining the Research Objectives

Defining the objective is often the most difficult step in the research process. A poorly defined objective can lead to inappropriate research and a waste of valuable time and money. Exploratory or preliminary research is often required to help define the issue to be investigated. In the case of Sprite, sales figures from other markets indicated that their brand would appeal to young people if the right marketing messages are created.

2. Developing the Research Plan

Having defined the objective, Sprite then created a research plan to help gather the information management needed. Market research information comes in the forms of Primary and Secondary Data.

Primary Data is new information collected by a researcher specifically for the project in hand. This data is often very expensive to gather and may vary in terms of quality.

Secondary Data is information that already exists somewhere else, whether that is inside the company or in an external source e.g.newspapers, magazines, the internet etc. Secondary data is very useful for providing background knowledge to a problem and is used by most companies as a starting point in a research process.

Innovative Focus Groups

For the purposes of Sprite, management decided that the information required about Irish teens could best be gathered by conducting new primary research.

When choosing a research method, Sprite marketing management was aware that an inappropriate choice of research setting would dissuade some teenagers from getting involved.

The target group might feel intimidated or uncooperative if invited to a formal research setting such as an office or hotel conference room. As a result it was decided to create a new and innovative research environment. The aim was to design an informal atmosphere where teens would feel comfortable, speak honestly and have fun.

The setting also had to enable the researchers to gather all the opinions and data they needed through both observations and contact research.

The advantage of this approach was that it allowed great flexibility in interviewing technique. It would also allow a very large amount of
information to be collected at one go. The main disadvantage was the cost of hosting these sessions and the fact that the sample groups had to remain small to be manageable.

3. Implementing the Research Plan

Having decided on an approach, the researchers then invited a number of teens to come and talk with them.This sample of teens had to be chosen in such a way as to represent the wider Irish teen population. In particular, the Sprite researchers were eager to understand the attitude of ‘Leading Edge Teens’. ‘Leading Edge Teens’ are young people who are regarded as trend setters by their peers. These individuals are innovators and are among the first to adopt new fashions and styles. As such, it was important that Sprite understood how to target this group.

The teenagers were asked to bring along some of their personal items, for example, CDs, books or videos, and to talk about them. They were also encouraged to chat about life as a teenager in Ireland. The purpose of these sessions was to allow these young people to ‘get deep’ and to reveal the values most important to them. In this way the researchers attained a very revealing insight into what makes Irish teenagers tick.

4. Reporting on the Results

Reporting is a standard business practice and can cover many areas, for example, financial reporting, health and safety reporting and production reporting.The aim when reporting research results is to identify the most important findings that have arisen. The research conducted by Sprite proved extremely important for isolating the attributes and values of young Irish people. These results, together with findings from other research, could then be used in the creation of an innovative new marketing strategy for the re-launch of Sprite.

We will talk about Marketing Mix in our next article…

*’Sprite’ is a registered trademark of the Coca-Cola Company.

 
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Posted by on October 19, 2011 in Product Reviews

 

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Marketing and New Product Development

Marketing management plays a key role in the new-product-development process along with the research and development department and other related departments.

New Products

The consulting firm Booz, Allen & Hamilton has identified six categories of new products in terms of their newness to the company and the marketplace.

New-to-the-world products (Product new to the company and the market)

New product lines: New products that allow a company to enter an established market for the first time (the product is new to the company not the market)

Additions to existing product lines: New products that supplement a company’s established products lines (package sizes, flavors, and so on)

Improvements and revisions of existing products: New products that provide improve performance or greater perceived value and replace existing product (Improvements in features and benefits of a product)

Repositionings: Existing products that are targeted to new markets or market segments (to be called a new product there must be some changes in the existing product to suit the new segments targeted).

Cost reductions: New products that provide similar performance at lower cost to the company.

Kotler says only 10% of all new products are truly innovative and new to the world.

New product development in various categories mentioned above is very important for any organization because existing products are vulnerable to changing consumer needs and tastes, new technologies, shortened product life cycles, and increased domestic and foreign competition.  Organizations have to be on the lookout for new products.

Factors That Contribute to Success in New Product Marketing

Madique and Zirger found the following factors:

1. Deep understanding of the customer needs.

2. High performance to cost ratio of the product

3. Being the early entrant into the market

4. Higher contribution margin

5. Larger amount of marketing expenditure

6. Strong top management support

7. Greater cross-functional teamwork among R&D, Engineering, Manufacturing, Purchasing, Marketing and Finance from the beginning

Effective Organizational Arrangements for New Product Development

An effective new product development organization starts with top management. The amount of money spent on R & D is an important top management decision related to new product development. Companies give the responsibility for new product development to product mangers, or new-product managers, or new-product committee, or new-product department, or new-product venture teams. In general product managers may not be able to devote adequate time to new products as they have to take care of existing products’ marketing and selling issues.

Managing the New Product Development Process

Eight stages are involved in the new product development process.

1. Idea generation

2. Idea screening

3. Concept development and testing

4. Marketing strategy development

5. Business analysis

6. Product development

7. Market testing

8. Commercialization

Idea Generation

A number of creative idea generating techniques can help individuals and groups generate idea. Some of them are:

  • Attribute listing
  • Forced relationships
  • Morphological analysis
  • Need/Problem identification
  • Brain storming
  • Synectics

Idea Screening

The purpose of screening is to drop poor ideas as early as possible and allow only promising ideas for further stage in the new product development process.

There is likelihood of two opposite types of errors occurring in this process. One, the drop error, results in dismissing a good idea. The other, the go-error, results in moving a poor idea forward.

Poor ideas result in product failures. Three types of product-marketing failures can be categorized: Absolute product failure loses money even on variable cost. Partial product failure recovers variable cost and some fixed cost. Relative product failure yields a profit, means it recovers variable cost and fixed cost, but the profitability is less than the company’s target rate of return.

Concept Development and Testing

A product concept is an elaborated version of the product idea and it is expressed in meaningful consumer terms so that consumer can visualize the product.

Concept testing involves an appropriate group of target consumers giving their reactions to the concept.

Will it Sell?

New Product Marketing Strategy Development

After the concept is finalized, marketing strategy needs to crystallized. At this stage the marketing strategy is expressed in three parts.

The first part: It describes the target market’s size, structure, and behavior. Product positioning is defined. The sales size, market share and profit goals are expressed.

The second part: The price and distribution strategy and the required marketing budget  for the first year are specified.

The third part: It describes marketing-mix strategy over time and evolution of sales and profit.

Business Analysis

At this stage, marketing department has finalized its market understanding and converted it into sales revenues and related marketing costs. The next stage is analysis of operating costs and profit analysis.

Product Development

If the business analysis clears the product, actual product development work is given to the research and development department

Test Marketing or Market Testing

High investment/high-risk products, where the chance of failure is high must be market tested. The cost of the market tests will be an insignificant percentage of the total project cost. Various types of market testing are:

Sales-wave research

Simulated test marketing

Controlled test marketing

Test Markets

 Commercialization

Based on marketing, if the company decides  to go for the manufacture and sale of the product, capacity decisions are to be made. The timing of the launch, the geography of the initial launch, the niche market within the target market and how to launch the product become important decisions.

Consumer Adoption Process

Marketers need to understand the new product adoption process to build an effective strategy for developing market for the product. Adoption is an individual’s decision to become a regular user of a product. The adoption process is followed by loyalty process.

Stages in the adoption process

Rogers defines the innovation diffusion process as “the spread of a new idea from its source of invention or creation to its ultimate users or adopters.”

Adopters go through the following five stages:

Awareness

Interest

Evaluation

Trial

Adoption

New product marketer has to aim his effort at facilitating the movement of consumer who is an adopter of new product  through the five stages.

References

 

Philip Kotler, Marketing Management (Main text for revision and article)

Modesto A. Maidique and Billie JO Zirger, ” A Study of Success and Failure in Product Innovation: the Case of the U.S. Electronics Industry,” IEEE Transactions on Engineering Management, November 1984, pp. 192-203

See Bibliography also

Bibliography

Determinants of New Industrial Product Performance: A Strategic Reexamination of the Empirical Literature by GARY L. LILIEN AND EUNSANG, 1989

http://www.garylilien.info/publications/47%20-%20Determinants%20of%20new%20industrial….pdf

New Product Successes in Japanese Consumer Goods Market,

Hotaka Katahira, Makoto Mizuno, and Yoram Wind, 1994, Wharton School Working Paper

http://marketing.wharton.upenn.edu/documents/research/9402_New_Product_Success_in_the.pdf

New Product Diffusion Models in Marketing: An Assessment of Two Approaches by Malcolm Wright and Don Charlett, Marketing Bulletin, 1995

http://marketing-bulletin.massey.ac.nz/V6/MB_V6_A4_Wright.pdf

 
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Posted by on October 18, 2011 in Product Innovations

 

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