We Are So Not There Yet!

We've been circulating a recent email from The e-tailing Group1 around the office. Bryan started it: "So, guys ... what's wrong with this picture?" Everyone chipped in an observation or two, but the real wrongness lives in these words:

"... the online channel is now truly established .... However, this growth is more measured as with this maturation, it is harder to move the revenue growth needle ..."

Whoa there, Nelly! I've got something to say concerning where you really need to be directing your energies before you can start feeling all warm and fuzzy about how well you are walking just seconds after you made the leap from crawling!

The e-tail detail we were looking at is a synopsis of e-tail Group's first quarter 2006 merchant survey. To be sure, you'll find some interesting information in here. It's well worth a read!

But let's take a hard, big-picture, persuasion-oriented look at a few of this survey's findings.

"The online channel is now truly established"

Followed later by "Use of the online channel for marketing has also reached an established level."

Sorry. It just ain't so. Continuing with my infant analogy, we were all learning to flip over onto our backs only yesterday! We weren't close to crawling even four years ago (then we were still in love with eye candy). Conversion and ROI have only recently become reasonably mainstream concepts!

What's established is the idea that businesses need to have a web presence. However, businesses haven't figured out what that presence really needs to be and how it will successfully integrate their various channels. More to the point, tons of folks are a long, long way from incorporating the critical part of the equation - the customer - into the experience.

If someone tells you we're dealing with maturity out there, don't get too comfy in your armchair. We may be involved in a maturing process, but most folks still have a very long row to hoe before they get there! At the end of the day, no one can really tell you where there is!

"It is harder to move the needle"

Yep, it can be. But only if you don't understand what motivates people to buy and can't create a system that leverages that understanding. These days, little tactical tweaks give us some statistical noise, but they don't lead to dramatic changes. Folks are familiar enough with the online environment to realize businesses aren't meeting customers' real needs.

Frankly, most businesses ignore their customers. They fail to understand what their customers want, so they are unable to provide it. You've been reading me long enough to know better merchandising online is not the key to "speaking to the dog in the language of the dog about what matters to the heart of the dog."

I'm not saying most businesses are consciously withholding. I am saying most businesses still don't get it.

"Merchants are focused on analytics"

Bravo. Analytics are an essential component in optimizing your business's strategies and tactics. But they are only going to be useful if you understand what you are measuring and have created a starting point that is founded on a viable premise.

"Particular emphasis on product pages and the shopping cart"

If you fail to engage your customers early in their buying decision processes, they'll pay minimal attention to your product pages and will use shopping carts purely as buying decision comparison tools. Frankly, this particular emphasis smacks of "cart before the horse," and it's one of the big reasons conversion rates are pitifully low and stagnant. Yes, product pages and shopping carts are important, but not until you've got the right horse lined up.

"The more evolved [are] finally addressing personalization and segmentation"

Certainly a step in the right direction, but personalization alone is never going to cut it. Our forthcoming book, Waiting for Your Cat to Bark?,2 tackles this topic in great detail. The segmentation that is most meaningful to you is "persona"-lization, which requires that you understand and articulate your business from your customers' points of view.

"Focus on integrating catalogs [and] in-store pickup"

In-store pickup is nice, and it provides continuity of experience (I talked about this years ago), but it is not a persuasive panacea for what's ailing online marketing! And the catalog world may have something to teach us about presentation and copywriting, but catalogs aren't interactive.

Before we can truly dream of calling the online world mature, we have to understand the uniqueness of this medium. Folks online are voluntary, task-oriented participants, very often engaged in pulling the information they need from the resources available to them. Once businesses truly acknowledge this important distinction, they'll be able to move beyond the catalog and direct-marketing models that limit their performance.

The Grok's Take

Ebusiness has matured sufficiently that folks are finally starting to make money online. We should all give ourselves a pat on the back, because that's really good news! However, the mere ability to make money doesn't equate with maturity in the industry.

The online world is still floundering, ineffectively trying to adapt traditional marketing techniques to the entirely new environment of emerging media. It hasn't begun to understand its role as the glue that binds multi-channel marketing efforts online and offline. It is only beginning to understand the use and power of consumer-generated media and word of mouth.

Nope. We are neither mature nor established. We're just starting to open our eyes! The question is: What should you really be looking at with those newly opened eyes?

1 "5th Annual Merchant Survey, 1st Q 2006." e-tail detail: the merchants' voice. e-tailing Group, Inc. Get the full executive summary at http://www.e-tailing.com/research/merchantsurvey/index.html.

2Waiting for Your Cat to Bark?: Persuading Customers When They Ignore Marketing. Bryan and Jeffrey Eisenberg, with Lisa T. Davis. Nashville: Thomas Nelson. Forthcoming, June 13, 2006.

Volume 129: 5/1/06

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