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Gaining Intelligence and Insights in Home Improvement e-Commerce
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|It’s Kick-Off Time! @eretailersummit|
|Jarvis Consultants @jarvisconsult
15h hours ago
|#Homeimprovement #eRetailerSummit18 – #Day1recap:#WindyCity in the historic #HotelMonacoChicago. #BambooRose #signaturedrink. Great #networking conversations #NHS at @Mortons Trivia winners – @supplyhog Bostwick-Braun @leisterworld @npdgroup and @FedEx! Great Day 1!|
|Jarvis Consultants @jarvisconsult
|Thanks to #BambooRose and @SueWelch for sponsoring the #eretailersummit18 kickoff reception at #HotelMonacoChicago! Look at that #SignatureBambooRose drink! #eretailersummit #ecommerce #homeimprovement|
|STEVEN DENNIS, Founder/President, SageBerry Consulting|
|@StevenPDennis hit the stage for #day2opening at the #eRetailerSummit18 #keynote all about “Really Bad Time to be Boring: Reinventing Retail in the Age of Amazon.”|
|There were an uprecedented number of store closings in 2017—exceeding the number closing in the 2008 financial crisis; record bankruptcies in 2017—21 major US retailers filed in 2017; iconic retailers are struggling; mergers and acquisitions activity is increasing, particularly on the part of mature retailers…and yet we can’t declare a retail apocalypse.
Store openings may be exceeding store closings. Brick and mortar retail is still growing…just at a slower pace than e-commerce.
The bland middle is gasping for air. Brands must differentiate either with value and convenience, or a premium, experiential offering.
Projected e-commerce growth: 15 percent per year. Projected physical retailer growth: 2-3 percent.
Even with the faster pace of e-commerce growth, more than 80 percent of all shopping will be done in physical stores.
Amazon is expected to account for 50 percent of all e-commerce sales within a year or two. In the U.S., the company is bigger than the next nine players combined.
Amazon accounted for 53 percent of online retail growth, outpacing everyone combined.
Eight essentials of remarkable retail: digitally enabled, human centered, harmonized, mobile, personal, connected, memorable and radical.
Digital’s impact on physical stores is expanding dramatically, and mobile is close behind.
Digital’s impact is greatest for electronics; furniture/home furnishings is close—both greater than 60 percent. But it’s not always first or best. Assess how digital enhances.
75 percent of consumers want more human interaction in the future, not less.
Design an empathetic customer journey.
Create a consistent brand experience across channels and focused always on the customer.
Breaking down internal silos is necessary for integrated channel success.
Think about how the physical store serves the relationship and invest in that.
Mobile is retail’s new front door: Be remarkable in those “I want to go,” “I want to know,” “I want to do,” “I want to buy” moments.
Personalize your presentation and, if possible, your products. No customer wants to be average. Leverage data.
Authenticity is impactful; particularly peer-to-peer marketing. The collaborative and connected economy is growing.
If you can’t tell where you are when you’re there without seeing a sign, it’s time to differentiate.
Be intensely relevant and dramatically distinct. Bring the wow. Rethink the experience, and make it frictionless. Go really big or really small…even hyperlocal.
Be willing to experiment. Try, test, measure and risk failure.
|LAURA HELLER, Heller, Director of External Communications|
|Philip Brown @philipdbrown
15h hours ago
|“When thinking about personalization, remember blue dresses and toilets” – @lfheller #eretailersummit18|
|Technology has opened up the marketplace for traditionally “male” products to women in a new way.
Technology is empowering retailers to create their own version of physical and digital commerce. Retailers aren’t just selling technology, but are innovating with and developing technology, and using it better connect to customers.
Online sales of home improvement products are growing double digits year over year. And U.S. online sales of home improvement products increased 34 percent in 2017, reaching nearly $20 billion.
Hardware/home improvement is a product category that is ready for disruption.
Approximately half of consumers are going first to Amazon before shopping elsewhere online.
In the newest iterations, digital mirrors physical and vice versa. Example: Amazon Go, basically a grab-and-go convenience store for the office worker. A marriage of price, convenience and customer service.
The benefits of streamlining checkout:
Mobile scan-and-pay is picking up steam.
Online ordering for in-store pickup eliminates in-store impulse buys, but autonomous checkout using mobile allows add-ons.
A small retail area plus loyalty program plus cameras is an example of an opportunity to take a baby step with autonomous, facilitating the experience and boosting the wow.
Amazon 4-Star is an example of fast revamping and response to consumer trends.
Personalization is priority number one. It allows us to push out recommendations; make use of CRMs; customize email, chat and messaging.
BUT. Don’t equate personalization with stalking customers. Intent doesn’t always mean they’re ready to purchase. Sometimes they simply want to do research.
Abstract language in search is an opportunity to do brand marketing in the explorer phase. Features and benefits are relevant mid-cycle. Concrete language in search is an opportunity to close the deal, when offers are more welcome.
Voice assistants represent a new way for brands to engage. Twenty percent of searches are now by voice, according to Google: Siri, in-home speakers, phone searches. By 2020, 50 percent of all searches will be voice.
The way we’re searching is conversational.
Voice-enabled devices deliver reach and impact.
Digital voice assistants: 42 percent of U.S. users say they’re essential to life; 75 percent of owners use them daily or weekly. YOY growth is 50 percent; one-third in U.S. own a DVA.
Voice-enabled smartphones: consumer reach estimated at 5 billion globally by 2022; 69 percent of owners use voice search daily or weekly.
Information and research intents are core to voice behavior. 32 percent search for something they’d normally type on a daily basis. 10 percent buy or order something. Alexa is delivering product reviews and consumable goods and adding to lists. But percentages will change quickly.
Voice assistants are asking questions back and delivering video content. Direct line to customer: give them a phone number or chat message on the device to let them take action.
Product categories that virtual assistant users are interested in purchasing include household items (19 percent) and electronics (11 percent).
Mine data from virtual assistant queries for insights. Capitalize on locational information. Create useful, informational content to build trust.
Augmented reality is particularly relevant for home improvement e-commerce.
Retail-as-a-service is creating turnkey solutions to help retailers bring new brands into stores, integrated into the technology and ready to go.
5G will speed up the e-commerce transition, providing better data streams.
Customers still want a curated experience. Don’t make online an endless aisle. More is not better.
Cutting-edge retail trends are often happening first in Asia in retail. Pay attention and learn from the people who’ve come first.
|JOE DEROCHOWSKI, Executive Director and Home Industry Analyst for The NPD Group|
|Laura Heller @lfheller
14h hours ago
|Strong message from @JoeDerochowski at @eretailersummit. New perspective to think about when ecommerce growth might top out. #eretailersummit18|
|We need to act now in e-retail and particularly in the hardware and home improvement industry. It’s time for urgency.
The home industry remains hot; it’s a great time for the Industry to invest for growth. In dollar sales in the past year, kitchen electrics are up 9%, home improvement is up 5%, home environment is up 9%, housewares are up 2%.
Population changes are favorable for the home industry, with more people hitting key life moments as well as changing consumer needs that make the home more important.
Home improvement is still in the early stages of ecommerce. Lags behind most industries for online conversion, but is one of the online growth leaders: 17% of dollars spent online last year, but dollar growth vs. year ago is 26%.
Segments growing more quickly online include storage, air filters, area rugs and blinds. Items with less urgency are more likely to be purchased online.
Décor, hardware, major domestic appliances, outdoor living and plumbing are the next home categories that might be ready to ride the digital curve.
While most purchases are still in-store, as industries mature online, most become more of a mix of both in-store and online.
If home improvement follows commercial technology, all age groups leverage online more. But prime targets for home improvement online are consumers hitting key life moments or who’ve been in the home long enough that they are ready for changes (ages 25-44).
All six of the top online home improvement retailers are seeing growth: Amazon, The Home Depot, Wayfair, Lowes, Target and Walmart.
The home improvement industry can ask, Are there innovation-in-marketing opportunities to better meet life moments? Look at how consumers explore over six months.
The technology is there to innovate around logistics. How can we use it, in particular to address returns and the last mile?
Augmented reality, virtual reality and 360-degree photography can help consumers connect the dots to their needs and have confidence in their purchases.
A consultative experience can help differentiate you among competitors online.
Subscriptions can remove friction for regular purchases.
Insert yourself earlier into the process. How do you break through the noise and become the go-to, winning the hearts and minds of the consumer?
Everything we do has an I hate, an I wish and an I love. How can you address that for consumers online?
|@joederochowski talking about all the triggered purchases that happen at predictable intervals after a major event. Kitchen remodel: small appliances 30 days later, houseware purchased 60 days later at #eretailersummit18|
|BAMBOO ROSE, Jim Laverty, VP of Sales|
|How to make a manual process more efficient and collaborative? Email for sourcing purposes doesn’t work. It’s not collaborative or visual and includes too many people/too much data without a clear thread.
Retailers wanted to talk to all players in the supply chain. They also want to source digitally ahead of time; in a single place; that allows chatting within the virtual showroom and crafting dynamic purchase orders that can be amended and finalized in one spot.
You can’t bring great products together quickly if everybody isn’t moving at the same speed at which you’re moving.
Bring together retailers, suppliers, designers, inspection companies, mills, factories, carriers, freight forwards, financial institutions—everybody involved in going to market—on one platform.
Retailers can comment on, ask for, modify and seek samples of exactly what they want to see, without having to travel overseas. Just specificity of sampling can save dramatically on costs and time.
Suppliers find value as well—they applied the savings toward marketing for retailers and still came out ahead.
A single platform where suppliers can share their showrooms with retailers results in greater collaboration on product ideas, decreased sampling costs, and faster time to market. Virtual showrooms make products available to buyers 24/7.
|JASON GOLDBERG, SVP Commerce, SapientRazorfish|
|Jarvis Consultants @jarvisconsult
13 hours ago
|OMG! Jason Goldberg, @retailgeek, provided a very funny historical overview of #technologychanges and shared #bestpractices for selecting tools and crafting strategies to implement #Omnichannel plans. #eRetailerSummit18|
|Not everything is a disruption. If you drop someone into a system and it’s so unfamiliar that they don’t know what to do…that’s a disruption.
In 2006, brick and mortar retail was 97.7 percent of sales. Just 2.3 percent of all sales were online vs. 9 percent today. And 25 percent of that e-commerce happened on one day: Cyber Monday.
Since 1898, when the traditional sales funnel was developed—awareness, familiarity, consideration, purchase, loyalty—we’ve assumed this is how people shop.
E-commerce and in-store, online price-shopping revolutionized the traditional customer journey and created any number of paths.
Not letting customers do what they want to do is not a long-term sustainable strategy. Amazon Price Check forced a response from physical stores.
Today the online team is often in a silo elsewhere and seen as a competitor for the in-store team. But the notion of channels is irrelevant to the customer. It’s just commerce.
Currently in North America, 53 percent of all retail sales are digitally influenced. In the near future, 100 percent likely will be.
90 percent of REI customers have visited the website before entering the store. And Target stores ship more than 50 percent of the company’s e-commerce orders.
Today, the shopper no longer goes shopping; she is always shopping. She can have a micro-moment of consideration at a virtually unlimited number of touchpoints.
A principle of persuasion: People want to follow the lead of individuals around/like us and know they’ve had a good experience.
No. 1 consideration today is social proof, outweighing brand.
Early volume growth has an immediate impact on conversion.
More reviews lead to more purchases, Fifty reviews can provide a 30 percent lift. If you want to be good at e-commerce, you have to get reviews.
Q&A is one means of social proof online, as is user-generated content (photos of products posted by consumers, for example).
Other ways to use social proof integrating technology and physical stores: shelf talkers noting most popular products on Pinterest and identifying items rated highly elsewhere; posting blown-up Instagram photos in visible places; giving salespeople tools so they can see reviews on the spot; in-store mobile assistants; electronic price tags on shelves (fact tags) with reviews; product information on consumer’s phone via augmented reality; sales associates (facilitators) enabled with a headset so audio goes to search, which provide recommendations; products that self-order in auto-fulfillment.
Forty percent of consumer spending will be auto-replenishment. This will create a challenge for retailers who have a chunk of physical space devoted to frequently reordered goods. It can create a reverse auction where cheap is important but speed is not, because ordering is pre-emptive. This has the potential to disrupt.
It’s about addressing the last mile: means include ship from store, deliver from store (curbside), deliver to refrigerator.
Porch piracy is a huge problem. Lockers are too popular, so staffed locker rooms inside buildings are solving a problem. Backed by a warehouse, they fill lockers upon your entry.
Pickup at curbside can drive down impulse purchases, but greater customer satisfaction may prove more valuable.
A new trend in delivery: standalone pickup depots in places other than stores.
Shipping orders from stores makes delivery faster than from distribution center. Use stores as fulfillment. Leverages fixed assets. Maximizes inventory. Is cheaper to ship with U.S. Post Office.
Pilot programs deliver to refrigerators with cameras to monitor delivery.
And there’s even digital delivery—make it while you wait—customized and unique to you.
First movers have a 47 percent failure rate. Fast followers have an 8 percent failure rate. Don’t just try to be first with these tools. Try to be the one to best solve the underlying problems that these tools address. Understand the customer priorities changed by digital.
|BRIAN FRICANO, Founder and CEO of Sustainable Supply|
|South Dakota vs. Wayfair changed the game to establish economic nexus thresholds in states. Since June 21, 2018, 22 states have enacted economic nexus laws.
States have ignored pleas from online retailers about the complexities of collection and remittance.
Some states began to collect within 10 days.
Brian met with Congress in May, but they wanted to wait till after midterms to address the issue. States have hurriedly put together a patchwork of legislation.
Main Street brick-and-mortar retailers now face new complexities when trying to expand online.
Ways states are establishing economic nexus: monetary thresholds ($100k in sales), order-based (22 plus), either/or, or both.
It requires looking at sales for past year, current year and future year.
Economic nexus, affiliate/click-through nexus, streamlined sales tax state (uniformed reporting).
Colorado as home rule state requires reporting to every district. It’s extremely complex. With filing fees, it’s expensive too.
Managing tax exemptions in all states is a new challenge and administration nightmare; including knowing what’s taxable and not in different states.
There’s not enough time on the clock to develop a strategy; it switches on in January.
But concurrent audits in multiple states is a direct headwind to expansion.
There’s hope that Congress will identify a better solution. However, software companies are telling Congress that collection is easy, cheap and non-burdensome for the retailer.
Avalara partnered with SST states to provide free services, but requires collection and remittance in all SST states…even if you don’t have a liability.
Current ways to address the challenge:
Software: TaxJar, Avalara and Vertex are three leading providers of software.
Software often integrates easily into e-commerce and accounting software packages, but usage-based pricing is not always transparent. There are often connector fees, support fees and implementation fees. Overages can be a killer.
https://www.avalara.com/us/en/learn/sales-tax/south-dakota-wayfair.html has online resources.
http://www.streamlinedsalestax.org/ is another resource.
This is the biggest headwind coming at e-commerce expansion plans right now. This really stuck a cog in the wheels, focusing energy on sales tax remittance instead of executing sales plans.
|Lunch included a fun and interactive networking exercise facilated by Denola Burton, @dm_burton, for the #eretailersummit18 at the #hotelmonaco – “If You Really Knew My Company” which gave insight and knowledge of participants company. Lots of fun and great #networking!|
|PAUL MATKER, CEO, Thanx Media|
|After lunch at the #eretailersummit18 began with Paul Matker, #thanxmedia, providing help for participants to properly document strategies and requirements to choose the right #ecommerce solutions and ensure successful projects. #digitaljourneymarketing|
|Making the wrong choice in an e-commerce platform can be very costly in: the time devoted to implementation; the cost of the platform; and the cost of lost shoppers that they now have to win back.
Choosing an e-commerce platform is a roughly three-month timeline from interviews with stakeholders through defining requirements, RFPs, evaluation and selection.
Include stakeholders from IT and business in evaluating e-commerce software.
As you interview stakeholders, review existing documentation and consolidate it.
As you define the requirements to be included in the RFP, benchmark your website’s current state and craft a future-state analysis.
Build a score sheet based on your defined requirements to send to invited vendors. Evaluate vendor submissions against that score sheet.
Require vendors to prove the concept when selecting e-commerce software.
The product experience and returns are some of the places where e-commerce software can fall short.
Bolt-on software for machine learning and tools to further personalization are biggest drivers in updating systems.
Moderating an Influencer panel at the @eretailersummit in Chicago this week. On the panel: @takeDeChance of @TheGrommet, #LaurenKelp and Bridget + Casey of #TheDIYPlaybook!
|What an awesome panel at the #eretailersummit18! Moderator Deborah Shearer, @tableanddine, facilitated excellent questions with panelists and #keyinfluencers Bridget and Casey, @DIYPlaybook, Ryan DeChance @TheGrommet, and Lauren Kelp #StudioAlcott.|
|An influencer is someone whose voice is authentic and represents your niche. They’re the embodiment of the word of mouth that you’re looking for–third-party validation.
A reason to invest: Influencers can and do increase conversion rates. (You might need a small army of influencers to get to that point.)
Social media pages should be dedicated to brand awareness and developing your personality—not one big ad. Influencers provide that social proof.
According to studies, influencer marketing drives eight times more online engagement than branded content.
Look for potential influencers with not just followers, but engaged followers.
Start looking for influencers for your company among those who are already engaged with your products. (Use hashtags or Google Alerts to find them.)
Bloggers should know who their readership is and be able to tell you.
Start with a phone call before signing on to make sure there’s a good fit.
A 5 percent engagement rate is a good goal when selecting an influencer—make sure their followers are commenting, sharing, etc.
Set clear expectations and goals for your influencer campaign.
People trust people, so offer relatable content.
Talk about your product online as if you were talking about it at the dinner table. People are over being sold to. Use a voice consistent with your brand, but be flexible on social media.
People don’t go on social media to shop. They’re passing time or being entertained. Seek to capture attention.
Provide the influencer with briefs identifying specific language to work into posts, or mood boards with images to communicate a company’s vibe.
The biggest challenges most marketers face?
Steps to influencer marketing:
Influencer marketing is not a one-time thing. It’s not a one-month thing. It can take time. Seek to build a relationship with influencers.
Can start by offering just free products for small campaigns and new influencers/bloggers. Or, your offering could be just payment instead. Or, it could be both product and payment; depends on scale and scope and expectations.
Have a budget in mind for an influencer campaign and investigate options: a monthly retainer, varied fees by channel or payment per response.
|RETAIL PERSPECTIVES PANEL||Retail Perspectives moderated by Peter Giannetti, @homeworldnews with panelists Kurt Vitale @fireflybuys, Brian Fricano @SustainableSply and Scott Benedict @GrouponMerchant – a diverse panel of #retailers discussing complex challenges in retail. #eRetailerSummit18|
|Curt Vitale: The tax issue and getting/verifying reviews are the biggest challenges now.
Brian Fricano: Focusing on differentiating with expertise. Technical products that require an assist are their jam. White papers, DIY guides and people answering the phone all address this issue.
Scott Benedict: Many companies’ e-commerce strategy is only selling on Amazon.
The endless shelf sounds great, but in fact it can be quite confusing to a consumer.
Not everything should be out there. You have 3.5 seconds to grab someone. You need to put the right things out there.
View the endless shelf through the customer’s lens: know whether they want you to help them discover products and have a deep enough selection that they can find what they need vs. curating a selection so that they don’t have to dig around.
Curation can happen specifically on a product page—choosing the copy and image and other elements that convert.
Conversion also can mean including the full range of accessories and parts that could go along with a product.
Sometimes more is better and sometimes less is better.
The way you do things in physical retail, where the shelf experience and packaging is important, is different from the way you do things in an e-commerce space, where it needs more context and can have a lifestyle content element.
The product detail page is often the new home page. Search leads consumers to the website. Those important pages where people land are ones that are optimized with photography, short video, offers for expertise, the opportunity to get a quantity quote, etc.,
Google Product Listing Ads can be a cheaper way to get in front of a customer than text ads.
How to handle the expectation of free shipping: Larger products might provide room to incorporate shipping costs, but smaller commodities don’t have that space. Strategies:
A risk with speed in changing prices (like Amazon): it can engender suspicion about whether I got the best price as a consumer.
Third-party marketplace is a friend if you control it. It’s a pay-to-play game. Amazon as friend is a short-term strategy. Amazon re-pricers can create a pricing war for your own website. Start with a marketplace that isn’t going to compete with you such as eBay, where home improvement is a growing segment. It’s a viable marketing channel where businesses shop.
As a catalog growth engine, a marketplace (not Amazon) is great. But be careful about cannibalizing products on your site. Instead, include complimentary items that won’t compete with core items on your site.
Keeping things live on a third-party marketplace all the time is tricky for manufacturers selling direct. They’re good at manufacturing, but underestimate dealing with customers and aren’t equipped to work with end users.
If manufacturers are going direct, they’re not seeing the value of distribution. Distributors need to establish that.
Apple is the exception at spanning that gap. But digital enables more of those exceptions than before.
|RYAN DeCHANCE, Director of Discovery, The Grommet|
|CLOSING KEYNOTE ADDRESS||Ryan DeChance @takeDeChance, revealed how @TheGrommet discovers and helps their best products succeed while celebrating the makers, maintaining their #corevalues and their #commitment to launch at least one new product a day! #eRetailerSummit18|
|Storytelling works; it’s a fundamental human experience. It’s relatable.
Stories stimulate the brain. It’s more wired for stories than for data. We spend about a third of our lives daydreaming.
Use words, photos and videos to create a life around products.
Provide real insight with testing, and teach the community something every day.
In 2017 Ace Hardware acquired a majority stake in the Grommet, helping makers to reach Ace’s 5,000 plus stores with new and unique products.
Small makers plus small retailers will equal next big brand.
Invite people to take part in citizen commerce.
|NETWORKING||Lots of networking at the #eRetailerSummit18 reception and #PubGrub dinner at #EmeraldLoop Bar and Grill after an intensive and engaging day with A-list speakers on #retail and #eCommerce, specifically as it related to #HomeImprovement. Time for a little fun!|