© FitForCommerce
eCommerce Strategy
Bernardine WuCEO, FitForCommerce
February 8, 2011
© FitForCommerce
eCommerce Strategy
Bernardine WuCEO, FitForCommerce
February 8, 2011
Multi-channel
© FitForCommerce
eCommerce Strategy
Bernardine WuCEO, FitForCommerce
February 8, 2011
Omni-channel
© FitForCommerce
eCommerce Strategy
Bernardine WuCEO, FitForCommerce
February 8, 2011
Commerce
© FitForCommerce 5
Strategy is only as good as the execution
© FitForCommerce 6
The best intentions don’t always work out
© FitForCommerce 7
Band-aids are a sure sign you need a change
© FitForCommerce 8
“Making things work” doesn’t always mean it’s what’s best
© FitForCommerce 9
Getting from Here to There
© FitForCommerce
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About FitForCommerce• FitForCommerce is a consultancy founded to help online businesses ‘figure out what
they need and how/where to find it’– Team of former multichannel retailers, marketers, technologists and service providers, with
hands-on expertise in eCommerce and mCommerce
• eCommerce Diligence™ is a philosophy and methodology based on diligent preparation and decision-making to ensure success
– Strategic Diligence – eMerchandising, eMarketing, Multichannel, Operations, Technology, Organization, Financial Planning
– Selection Diligence – Requirements, RFP, Selection of eCommerce technologies and providers including: platforms, mCommerce, back-end, all point solutions, 3PL/CS
– eCommerce Marketing Consulting– mCommerce Strategy– Implementation Coaching
• eCommerceKnowHow.com is the first eCommerce knowledge base:– Best practices, feature evaluations, expert advice and info on 100s of features, functions
and topics– 100s of provider and solution comparative info
• FFC mCommerce Benchmark & Buyers Guide is a structure benchmark to assess the market, compare where you stack up, help prioritize improvements (2Q 2011)
© FitForCommerce
Client Sampling
© FitForCommerce
The Obvious
• Evaluate• Competition• Benchmark
Assess where you are
ExecuteDevelop a tactical plan
Develop a full
strategy
• Goals• Approach
• What• Who• How• When• How much $
• Do it• Re-evaluate• Adjust• Re-do
Keep it Simple!
© FitForCommerce
eMer
chan
disi
ng
eMar
ketin
g
Tech
nolo
gy
Ope
ratio
ns
Org
aniz
atio
n
Web
stor
e
P&L / Budgeting
eCommerce Strategy
© FitForCommerce 14
Critical Success Factors
ORGANIZATIONRight skills, right people, doing the right things at the right time – and working together with shared objectives and accountability under clear leadership
FUNCTIONALITYAppropriate features, functions, capabilities for a great customer experience and for efficient management and growth of the business
OPERATIONSProcesses that add value and are efficient; and are not substitutes for sub-optimal organization, functionality, technology
TECHNOLOGYAppropriate tools, technology, integrations to support the business in the most efficient and fail-safe manner
© FitForCommerce
MERCHANDISEThe appropriate assortment for the target audience in line with the brand and showcasing products to sell the most
MARKETINGBeing found when someone is searching and driving qualified traffic that will buy and return to buy from the webstore
BUDGET / P&LInvestment thinking so funds and resources go to the right places and there is room for experimentation
© FitForCommerce
BENCHMARKING
Knowing how you stack up
© FitForCommerce
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Market Comp( Sample )
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IR Top 500• Comparison of sites for conversion rate and average ticket
( Sample )
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Gathering Intel• Consult with an Expert
• Mystery Shopping
• Hoovers, D&B & other financial sources
• IR Top 500 Guide
• Vendors
• Industry news, Blogs, Newsletters
• Attending & Networking at Events
• Recruiting
• Usability Studies, Eye Tracking, Focus Groups
• Other competitive data sources:– Quantcast– Hitwise– Google Trends– Google Insight– Google Adwords– Way Back Machine– The Search Monitor– Comscore– Alexa– BuzzNumbers– Compete.com– ZoomInfo– Statsaholic– nielsen-online.com– Netcraft– Ranking.com– Highbeam
© FitForCommerce
MERCHANDISEThe appropriate assortment for the target audience in line with the brand and showcasing products to sell the most
© FitForCommerce
eMerchandising• What are you selling?
– Brand alignment– Merchandise assortment– Merchandise depth– COGS, Pricing, Margin– Multichannel dynamics
• How are you selling?– Robust information on webstore– Emotional connection– Leading her to a sale, making it easy– Guided selling– Cross-channel drivers
© FitForCommerce
Merchandising Analysis
© FitForCommerce
Romancing the Product
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Others:Hero imageLifestyleSwatchingZoom360
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MARKETINGBeing found when someone is searching and driving qualified traffic that will buy and return to buy from the webstore
© FitForCommerce
Marketing Investment
• Creating Marketing Budgets is both an art and a science with more emphasis on individual success of marketing programs. Industry benchmarks are guides rather than rules.
Source: The Econsultancy / ExactTarget Marketing Budgets 2010 Report is based on a survey of more than 1,000 client-side marketers and agency respondents.
© FitForCommerce
Balancing the eMarketing Investment
• Branding, Advertising• Outreach: Email, Social,
Mobile• Get found (80% rule!): SEO,
PPC/SEM, Affiliate, Marketplaces (CSE)
• Offline: print ads, catalog, direct mail
• Cross-channel: store-to-web, web-to-store, catalog-to-web, package inserts programs (PIP), in-store kiosks/endless aisle, POS programs (POP)
• Consistently great experience• Outreach: Email, direct mail• Loyalty programs• Community, social• Content• Cross-channel: PIP
CUSTOMER ACQUISITION CUSTOMER RETENTION
© FitForCommerce
Attribution of Marketing Spend
• Track sources for traffic, quality, conversions• Use matchbacks for catalog or print• Analyze house file for size, age, activity
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Detailed Analysis• Abandonment by Channel - Email-driven traffic is is showing
significant signs of weakness, particularly in View Bag and Order Complete stages of checkout
Aba
ndon
men
t Rat
e
© FitForCommerce
Email Marketing• Performance
– Bounce rate: 11% (first campaigns) 2.5-3.5% (established)– Open Rate: 25-30%– Click Through Rate (CTR): 10-15%
• Key to Execution– Segmentation & Targeting– Messaging (Relevancy) & Frequency– Trigger– Reporting– Think in context of contact strategy– Beware of attrition
• Measuring Success– ROAS = Return on Advertising Spend (a.k.a. ROI)– CPA = Cost Per Acquisition– Are you overpaying for any of your sales?– Cannibalization vs. Lift
• Lift is the net amount of traffic that is added to the mix• Cannibalization is the portion of traffic that comes at the expense of another driver
© FitForCommerce
Source: emarsys eMarketing Systems 2010 Email Report The data for this report was collected between January 1 and December 31, 2009. Results based on analysis of response data from more than 30,000 regular B2B and B2C email campaigns (newsletters, promotional emails) sent by more than 500 companies.
© FitForCommerce
Marketing Spend• Paid Search
– Average conversion rate for Paid Search is 3.15% (Source: eConsultancy)– Percentage of site visits via paid search 19.8% (Source: eConsultancy )– Retailers on average spend 40% of their budget on Search (Source: Internet
Retailer)
• Marketplaces/Feeds/Comparison Shopping Engines– Average conversion rate for Comparison Shopping Engines is 3.7% (Source:
Marketing Sherpa)– Shopping Feed demand is mostly driven by consumer looking to comparison
shop for prices– Apparel Retailers are less likely to be successful with shopping feeds
• Banner Ads– CPM = $10 (a typical rate for general, not-very-targeted websites) (Source:
eConsultancy)– CTR = 0.5% (Source: Marketing Sherpa) – Conversion Rate = 2% (Source: Marketing Sherpa)
© FitForCommerce 32
Distribution of Spend (example)Example of Spend/Revenue Scenario• Budget - 61% increase • Revenue - 23% increase • Email - Need aggressive growth in email capture/housefile. Numbers based on more targeted
email strategy and trigger program. • Paid Search - ROAS comes down and revenue increases 30% • Banner - Optimize program on no additional spend• Social - Optimal area to grow• Feeds - no growth planned• Other/Testing - No revenue $’s attached to Program/Bucket
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eMarketing KPIs• These KPIs should be compiled and reviewed to help drive the
business:– Weekly Site Metrics Report– Channel Report– KPI’s
Channel Report • Revenue by Media LY • Orders by Media LY• AOV by Media LY• Items per Order TY & LY• Conversion Rate LY• Visits LY• NTF• CPA• ROAS• Cost
Website Metrics• Buying Sessions• Orders per Session• New Vs. Returning Visitors• Shopping Cart Abandonment
Rate• Days and Visit to Purchase
© FitForCommerce
FUNCTIONALITYAppropriate features, functions, capabilities for a great customer experience and for efficient management and growth of the business
© FitForCommerce
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37
Funnel Analysis
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4.45%convert
Add To Bag 3,256
Bill & Ship1,572
Receipt 937
Sessions: 21,022
Browsers11,975
Ship Meth1,378
Pymt/ Review 1,310
Multi Page Sessions: 17,806
Shopping Bag2,801
Percent Lost Between Each Stage
15%
33%
73%
14%
44%
12%
5%
29%
Checkout
*Monthly averages since 3/07
Optional Offer Code Page
Omitted
Could have abandoned Ship
Meth or Offer Code Page
( Sample )
© FitForCommerce
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Competitive Feature Comparison
Shopping Bag Features of an Site vs Competitors
Retailer
( Sample )
© FitForCommerce
Seek out ‘market data’
• Ask your peers
• Read key reports, blogs– Forrester– Gartner– Getelastic blog
• Benchmarking studies – e-tailing group
EG100 Gauge (“egeg”)
• Knowledge basesThis is real data on the feature: Ratings & Reviews
39
Feature: Ratings & Reviews
Source:
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Eye Tracking / Usability StudyHeatmaps Gaze Plots Cluster Maps
Fixation Count, Observation Time, Participant % Charts
( Sample )
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Top Recommendations: This Year1. Save Bag Longer: tie bags to user cookie, and save longer link
2. Offer Code in Bag: offer code entry in bag and edit payment pg link
3. Edit Items in Bag: edit color, size, qty in bag, remove items in 1-click link
4. Shipping Method Selection: select method/see rates in bag, Mini-bag link
5. Gift Card Balance: show GC and eGC amounts used, balance, check link
6. Add-to-Bag Confirm Page: add ATB overlay w/cross sells & offers link
7. Full Mini-Bag Overlay: show full bag in drop-down from mini bag icon link
8. Mini-Bag Icon: show item count in mini bag icon link
9. Gift Boxing in Bag: select gift boxing options in bag link
10. Calculate Tax in Bag: calculate/show tax in bag link
11. Cross Sells: show cross sells in ATB overlay, Mini-bag and bag link
12. Move Items to Wishlist: move items to/from wishlist, save for later link
13. Error Messaging: improve HazMat, Trademark, etc errors link
14. Address Error Messaging: improve address validation error msgs link
15. Promotion Communication: show promotions differently, deal pricing link
16. Shopping Bag Item Detail: show delivery date, ‘was’ price, color name link
17. Log-in/Registration: login/registration at top of Bill/Ship pg only link
18. Email/Print Bag: email or print bag link
T: XL
Benefit/Impact vs Tech Effort
T: LB:XL
T: LB: L
B: L T: MB: L T: MB: L T: M
T: XLB: M
B:XL
T: LB: L
T: MB: M
B: L T: LT: LB: L
B:XL T: L
B: L T: M
T: MB: MT: MB: M
T: SB: S
T: XLB: L
B: L T: XL
( Sample )
© FitForCommerce 42
Site Workflow Document
© FitForCommerce
TECHNOLOGYAppropriate tools, technology, integrations to support the business in the most efficient and fail- safe manner
© FitForCommerce
ECP OMS
WMS ERPSite Search
Ratings & Reviews
eMerchandising
eMarketing
SEO/SEM
ComparisonEngines
AffiliateEmail
Social
Mobile
Web Analytics
Personalization
MySpaceTwitter
Rich InternetApps (RIA)
Loyalty
Zoom360°
eCatalog
Searchandising
Quick View
Marketplaces
PaymentCMS
Customer CareCall Center
CR MCustomer Satisfaction
Measurement Gifting
Security PCI Fraud
HostingLogistics
Fulfillment Returns
Inventory
Chat
CDN
Performance
Click-Recording
eCommerce Galaxy
MCP
Multichannel
International
© FitForCommerce
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Key Indicators it’s Time for a Change
• Falling Behind the Competition• Missed Benchmarks vs. Best Practices• Cannot Overcome Current Deficiencies• Internal Costs are Too High• Strategic or Future Growth is Dependent
© FitForCommerce
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Key Components & Integrations
Marketing Webstore(ECP)
Order Mgmt(OMS)
FulfillmentWMS
ERP
CustomerService
Customers/ordersInventory
Shipping info
Tracking info
Sales Tracking info
Inventory Price/Stock Qty.
Merchandising
CatalogPricingContentImages
Traffic
Retail(POS)
Mobile store(MCP) Catalog
( Over-simplified! )
© FitForCommerce 47
Mobile adoption• 58% of companies do NOT have mobile marketing OR mCommerce.• Of the 42% that have mobile:
– 39% are using mobile marketing– 81% have a fully optimized mobile site – 42% have a mobile app
• 34% of companies have mCommerce, not just mobile marketing
Source: FitForCommerce M-Commerce Survey Sept 2010
Does your company have a:
Mobile 42%
© FitForCommerce 48
Plans for mCommerce• mCommerce website• Only 17% have no plans• 46% have plans in next 12
months• 35% more than a year from now
• mCommerce application• 37% have no plans• 46% in next 12 months• 17% more than a year from now
Source: FitForCommerce M-Commerce Survey Sept 2010
© FitForCommerce 49
Technical Component Diagram
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OPERATIONSProcesses that add value and are efficient; and are not substitutes for sub- optimal organization, functionality, technology
© FitForCommerce
Functional Component Diagram
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© FitForCommerce 52
Fulfillment Decision Tree
Fulfill in-house
Modify DC(Bldg 4)
Build new warehouse
Fulfill from 3PL
- Not enough space- Too costly- Inefficient configuration
- Higher startup cost than 3PL- Slower time-to-market- New competency risk
+ Leverage real estate+ Leverage pooled inventory
+ Lower cost than 3PL long-term
Inventory Size
SKU count
Sources
+ Leverage outside expertise+ Lower investment cost+ Speed-to-market+ Variable cost base
Vendor drop-ship(as supplement)
+ Leverage top vendors+ Lower MSG inventory
Fill from Store - All stores- Regional stores
Fill from Store(as needed) - Regional stores
- Stores cannot handle volume
+ Increase fill rate
- Increased inventory- More expense over time
- Dependence on others- Lower margin
© FitForCommerce 53
Cross-ChannelIn-StorePickup
• Check item availability in stores• Purchase Item online, pick-up in store• Drives store traffic• Inventory accuracy is crucial
Kiosk• Self service webstore access• Locate inventory in other markets• Find products not offered in stores (vendor drop ship items)
Endless Aisle
• Associate driven order entry for items not in stock• “Ship anywhere” service in stores• Items shipped to guest from
warehouse (no shipping charge)
Store Fulfillment
• Supplement inventory with items not in warehouse• Regional high volume stores• Pick/pack/ship in back stock area• Inventory accuracy crucial
Ship To Store
• Select store as a delivery destination in webstore & endless aisle• Use store inventory when in-store pickup is rolled out• Store to store shipping supported by store fulfillment
© FitForCommerce
ORGANIZATIONRight skills, right people, doing the right things at the right time – and working together with shared objectives and accountability under clear leadership
© FitForCommerce
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eCommerce Org Structure
eCommerceMerchandising
eCommerceMarketing
eCommerce Technology
eCommerce Operations
Creative/Art Direction
Catalog Management
Search Marketing
Email/Retention Marketing
Affiliate Marketing
Front-end Development
QA
Site Support
Fulfillment
Customer Service
Web Design
Content / AssetManagement
Tech Project/ Program Mgmt
Direct-to-Consumer
Corporate Functions (Finance, HR, Legal)
Business Units
Merchants Marketing IT Operations
Graphics Design
PhotographyMobile
M-Commerce
Analytics / Reporting
Social Media MktgStrategic Partner
Strategic Partnership Mgmt
“A” Merchandising/ Business Unit
“B” Merchandising/ Business Unit
“C” Merchandising/Business Unit
Mobile Marketing
Back-end Development
( Sample )
© FitForCommerce
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Organizational Growth(Oversimplified) Growth Patterns
LEVEL 1
1-2 Person Shop
< $1mm
LEVEL 2
Handful ofPeople Team
(<5 FTE)
<$10mm
LEVEL 3
Full TeamCovering
AllDisciplinesPoised for
Growth(~15 FTE)
$10-20mm
LEVEL 4
Full TeamCovering
AllDisciplineswith Scale
&Some
Outsourc’g(~20 FTE)
$20-50
LEVEL 5
Full TeamCovering
AllDisciplineswith Scale
& Balanced
Outsourc’g & In-house3rd Party
Vendors &Integration
s(~30 FTE)
$50-150
LEVEL 6
Full TeamCovering AllDisciplines
with Deeper
expertise,Scale
Heavy MktgMulti-channel
Bringing it back in-house
Some 3rd
Party/OS
(~40 FTE)
$150m+
5 6
LEVEL 7
Full TeamCovering AllDisciplines
with Deep
in-house expertise,
Scale, Heavy Mktg
Cross- channelSome 3rd
Party/OS
(~60 FTE)
$250m+
Note: includes tech, but not fulfillment/customer service
( Over-simplified! )
© FitForCommerce 57
Why not mobile?• Technical obstacles, resource constraints and skills, but not that they should not be.• Many need to focus on eCommerce before mCommerce - “One thing at a time”• Need to support the upside potential with hard data to make mobile commitment.
Why are you not yet Mobile?
Source: FitForCommerce M-Commerce Survey Sept 2010
© FitForCommerce
BUDGET / P&LInvestment thinking so funds and resources go to the right places and there is room for experimentation
© FitForCommerce 59
$15M Revenue P&LOption 1 Option 2 Option 3 Option 4
FF in-house FF in-house FF outsrc (3PL) FF outsrc (3PL)Status Rate Best Pr CS in-house CS outsourced CS in-house CS outsourced Notes
Gross Sales 15,000,000 15,000,000 15,000,000 15,000,000 Orders (Demand) $85.00 176,471 176,471 176,471 176,471 Based on GSI 2010 AOV Cancelled 3.5% (525,000) (525,000) (525,000) (525,000)
Shipped Sales $ 14,475,000 $ 14,475,000 $ 14,475,000 $ 14,475,000 Orders (Shipped) 170,294 170,294 170,294 170,294
Returns 11.0% (1,592,250) (1,592,250) (1,592,250) (1,592,250)Adjustments 1.0% (144,750) (144,750) (144,750) (144,750) Cost of MVP Points
Net Sales $ 12,738,000 $ 12,738,000 $ 12,738,000 $ 12,738,000
Cost of Goods SoldInitial COGS 45.0% 5,732,100 5,732,100 5,732,100 5,732,100 Freight In 1.0% 127,380 127,380 127,380 127,380 Markdowns 8.0% 1,019,040 1,019,040 1,019,040 1,019,040 Other/Shrink/Damages 1.0% 127,380 127,380 127,380 127,380
Total Cost of Goods Sold $ 7,005,900 $ 7,005,900 $ 7,005,900 $ 7,005,900 % of Net Sales 55% 55% 55% 55%
Gross Revenue $ 5,732,100 $ 5,732,100 $ 5,732,100 $ 5,732,100
Operating ExpensesCredit Card Fees 3.0% 434,250 434,250 434,250 434,250 Estimated fees based on industry average Bad Debt/Chargebacks 0.5% 72,375 72,375 72,375 72,375 Estimated fees based on industry average Shipping 15.0% 2,171,250 2,171,250 - - Estimated actual cost of shipping Shipping Revenue 17.0% (2,460,750) (2,460,750) - - Shipping & Handling charge to online customer
Total Operating Expenses $ 217,125 $ 217,125 $ 506,625 $ 506,625 % of Net Sales 2% 2% 4% 4%
Marketing Expenses 10.0% 1,273,800 1,273,800 1,273,800 1,273,800 Agency Fee 15.0% 161,070 161,070 161,069 161,070
Content (copy & images) 30,000 30,000 30,001 30,000 Ongoing catalog maintenance(item copy; attributes/tagging;
images)
SEM/PPC 25.0% 270,683 270,683 270,683 270,683 Pay for performance (search engines, network buys) Affiliates 15.0% 162,410 162,410 162,410 162,410 Third party costs & support email Marketing 5.0% 54,137 54,137 54,137 54,137
Cross Channel (DM, store adv.) 20.0% 216,546 216,546 216,546 216,546 Compare Shop Sites 5.0% 54,137 54,137 54,137 54,137
Promotions 10.0% 108,273 108,273 108,273 108,273 Free ship, Free gift w/ purchase, Channel Partner exclusive SEO 5.0% 54,137 54,137 54,137 54,137
Total Marketing Expenses $ 1,111,391 $ 1,111,391 $ 1,111,391 $ 1,111,391 % of Net Sales 9% 9% 9% 9%
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Summary of OptionsSUMMARY
Current Scenario 1 Scenario 2 Scenario 3 Scenario 4 Scenario 5 5-Year2010 Year 1 Year 2 Year 3 Year 4 Year 5 Cumulative
%incr %inc r
%incr %inc r
Gross Sales $ 9,000,000 $10,000,000 $15,000,000 33 %
$20,000,000 25% $25,000,000 20% $30,000,000 17% $ 100,000,000
$10m is baseline "min" and basically equals current site .$15m is "par" and should be achievable with additions and improved site. $20m is "max" or stretch goal for 2 yrs, but achievable in 3 yrs. Growth to $30m in 5 yrs is aggressive but achievable.
Net Sales $ 8,492,000 $12,738,000 $17,174,729 Gross Revenue $ 3,821,400 $ 5,732,100 $ 7,728,628 $ 9,650,000 $11,580,000 $ 38,512,128
ExpensesOption 1FF & CS in-house $ 4,711,841 $ 4,822,816 2% $ 4,871,347 1% $ 5,358,481 10% $ 5,805,021 8% $ 25,569,505 Includes investment in
new/multichannel capabilitiesOption 2FF in-house / CS outsourced $ 4,794,341 $ 5,074,191 6% $ 5,243,347 3% $ 5,767,681 10% $ 6,248,321 8% $ 27,127,880 "Option 3FF outsourced / CS in-house $ 4,533,141 $ 5,063,891 10
%$ 5,483,947 8% $ 6,032,341 10% $ 6,535,036 8% $ 27,648,355 "
Option 4FF & CS outsourced $ 4,615,641 $ 5,315,266 13 %
$ 5,855,947 9% $ 6,441,541 10% $ 6,978,336 8% $ 29,206,730 "
Gross Rev minus ExpensesOption 1FF & CS in-house $ (890,441) $ 909,285 $ 2,857,282 68% $ 4,291,519 33% $ 5,774,979 26% $ 12,942,624 See details for Expenses in yrs1-3
Option 2FF in-house / CS outsourced $ (972,941) $ 657,910 $ 2,485,282 74% $ 3,882,319 36% $ 5,331,679 27% $ 11,384,249 "
Option 3FF outsourced / CS in-house $ (711,741) $ 668,210 $ 2,244,682 70% $ 3,617,659 38% $ 5,044,964 28% $ 10,863,774 "
Option 4FF & CS outsourced $ (794,241) $ 416,835 $ 1,872,682 78% $ 3,208,459 42% $ 4,601,664 30% $ 9,305,399 "
9% 15% % of Gross Rev. FYI, $10m store: 10- 15% profit
CapEx (36 mth depr)Option 1FF & CS in-house $ 1,874,667 $ 1,874,667 $ 1,874,667 $ 100,000 $ 100,000 $ 5,824,000 See details for CapEx; $100k in yr4&5
is nominalOption 2FF in-house / CS outsourced $ 1,874,667 $ 1,874,667 $ 1,874,667 $ 100,000 $ 100,000 $ 5,824,000 "Option 3FF outsourced / CS in-house $ 708,000 $ 708,000 $ 708,000 $ 100,000 $ 100,000 $ 2,324,000 "Option 4FF & CS outsourced $ 708,000 $ 708,000 $ 708,000 $ 100,000 $ 100,000 $ 2,324,000 "
Gross Rev minus Expenses minus CapEx (36 mth depr)
% of rev % of rev % of rev
% of rev % of rev
Option 1FF & CS in-house $ (2,765,107) - 28%
$ (965,382) - 6%
$ 982,615 5% $ 4,191,519 17% $ 5,674,979 19% $ 7,118,623 7%
Option 2FF in-house / CS outsourced $ (2,847,607) - 28%
$ (1,216,757) - 8%
$ 610,615 3% $ 3,782,319 15% $ 5,231,679 17% $ 5,560,248 6%
Option 3FF outsourced / CS in-house $ (1,419,741) - 14%
$ (39,791) 0% $ 1,536,682 8% $ 3,517,659 14% $ 4,944,964 16% $ 8,539,773 9%
Option 4FF & CS outsourced $ (1,502,241) - 15%
$ (291,166) - 2%
$ 1,164,682 6% $ 3,108,459 12% $ 4,501,664 15% $ 6,981,398 7%
Retail Store Revenue $ 568,000,000 $ 600,000,000 $ 618,000,000 3% $ 636,540,000 3% $ 655,636,200 3% $ 675,305,286 3% $ 3,185,481,486 Assumes 3% growth across 5 yearsOnline as % of Retail Store Revenue 1.58% 1.67% 2.43% 3.14% 3.81% 4.44% 3.10% Average over 5 yrs
'Profit' - Same growth as MSG $ 700,000 $ 1,050,000 33 %
$ 1,400,000 25% $ 1,750,000 20% $ 2,100,000 17% $ 7,000,000 However, this assumes can grow MSG significantly even though they haven't been able to in past years
'Profit' - Same growth as past perf $ 630,000 $ 700,000 $ 791,000 6% $ 893,830 6% $ 1,010,028 6% $ 1,141,332 6% $ 4,536,190 More moderate growth
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People / Overhead
OutsourcedFF/CS
In-houseFF/CS
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Capital Investments
OutsourcedFF/CS
In-houseFF/CS
© FitForCommerce
Can you leapfrog the competition?Fu
nctio
nalit
y / C
usto
mer
Val
ue
eCommerce Evolution
FEATURES• Catalog• Shopping cart• Payments
HomegrownManual updatingScaling issues
ADDED FEATURES• Search• Promotions• Merchandising• Order Status• Cross Sells• Bolt-on approach
(3rd party systems)
Product-centricSingle-channelLimited features
BEST-IN-CLASS• Personalized experience• Continuity/Subscription• MicroSites• Integrated OMS• Integrated call center• Integrated POS• Dynamic content mgmt• Micro-targeted
content/offers• Guided navigation• Rich media• Web analytics• Customer intelligenceCustomer-centricMerchandiser controlMulti-channel
1st Generation
MarketingOnly
2nd Generation
3rd Generation
4th Generation
63
© FitForCommerce
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Resources• There are many great resources out there for you –
some are literally at your fingertips; others require more time and effort!
• To name a few:– Tradeshows: IRCE, Shop.org, eTail– User Conferences Omniture & many others– Associations: MGA/DGA, NR F/Shop.org, DMA– Consultancies: FitForCommerce ☺– Informational websites: eCommerceKnowHow.com,
InternetRetailer.com, GetElastic.com
– Industry papers/magazines: Internet Retailer, Stores, Multichannel Merchant
– Networking Groups: Women in Ecommerce
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eCommerceKnowHow.com
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