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Ecommerce Solution - Harvard Business Review

Great stores draw you in, make you want to return often (even when you don't have a particular purchase in mind), and create significant impulse purchases. In contrast, most online stores reflect the assumption that shopping online is mainly an efficient destination purchase. A consumer knows what they want to buy, does research online and finds the best price. This has led most online stores to follow the same strategy - make it as easy as possible for consumers to a find a product, place it in a cart and checkout.

It turns out that this strategy is wrong. As outlined in a recent Harvard Business Review article, two researches have completed an exhaustive study of 1,700 ecommerce sites and have shown that adding compelling content to directly engage customers is correlated with stronger financial performance. In fact, the companies that engaged customers the most outperformed the S&P 500 by more than 12% on an annual basis from 2003-2006. That is dramatic outperformance.

How can this be? In our ecommerce practice we have found that the dominant web storefront strategy to provide an efficient, destination purchase fails to generate significant return visits and impulse purchases. As a result, ecommerce retailers are forced to spend significant sums emailing price reduction offers to lure customers back to the store - which further reinforces the lack of a compelling store experience.

The principles of retail still apply on the web. Great stores should draw you in, make you want to return to be part of the experience and create significant impulse purchases. There are new ways to do this online with the creation of online customer communities.

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