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Whether selling products in a department store or digital downloads online, the principles of merchandising are the same: Companies must make it easy for customers to discover, consider, and ultimately purchase their products and services.

When it comes to online merchandising, however, marketers have traditionally lagged behind their brick-and-mortar counterparts, the latter having the advantage of real-time interaction with a customer in order to best guide their purchasing decisions.

The challenge for online marketers is to figure out how to seamlessly deliver the same personal experiences to online customers.

Here are three tips for delivering a rich, targeted, and more relevant shopping experience to drive online sales: 

1. Improve search capabilities 

The first step towards mastering your merchandising strategy is to make sure your products are easily discoverable. In the bricks-and-mortar world, merchandise is not only tangible, but merchants can anticipate the need for a specific item and make sure that it is easy to find (think positioning umbrellas at the front of the store on a rainy day).

Discoverability starts with useful and effective search that anticipates the shopper’s needs. To create a more intuitive experience for your customers, consider incorporating the following best practices into your website:

  • Use predictive, type-ahead search so that if a shopper misspells a search query, they will still get the results they want.
  • Include visual elements such as thumbnails and product names/descriptions in your predictive search suggestions; remember that many people search for products visually.
  • Utilize weather targeting in your search results. For example, a search for “coats” should promote waterproof coats for customers visiting from a location where it’s raining.
  • Present search results based on common preferences by featuring new or popular products first and demoting search results of items that are out of stock or have low ratings.
  • Test the location and size of your search box, and adjust positioning based on results.

2. Drive relevance through recommendation endcaps

In physical retail stores, endcaps–or displays at the end of each aisle–are the most valuable real estate in the store. The same is true online, where endcaps–page elements that display featured products–have proven to drive revenue and boost shopper awareness and engagement.

The key to success with endcaps is to target them to to specific customer segments in order to make the shopping experience more relevant for the visitor. For example, target new customers with an endcap that features your most popular items, while returning visitors who are familiar with your merchandise see the newest arrivals.  

This can be taken a step further by incorporating the visitor’s geographic data and serving them with the top selling products in a specific region. On a clothing retailer’s website, for instance, top sellers in a cold climate are likely very different from top sellers in a warm climate.

3. Make product recommendations more relevant 

Product recommendations are essential to meeting the aggressive performance goals of online merchandisers. However they can be difficult to deploy and their impact on the business can be hard measure.

To get optimal value from your recommendations, consider these best practices:  

  • Practice intelligent segmentation: Target product recommendations to key audience segments, like featuring “New Items” to returning visitors and “Top Sellers” to first-time visitors.
  • Match recommendations to stages of the buying process:  “Top Sellers” is an excellent choice for visitors in the browsing stage. “People who viewed ultimately bought” is a better choice in the evaluating and deciding stage. Meanwhile, showcasing manually merchandised accessories or matching outfits are good alternatives for the checkout and buying phase.
  • Create decisive testing and reporting:  Results should be based on data, not intuition.  Measure recommendation against a control group to accurately calculate results.
  • Deliver recommendations at the browser level: Launch recommendations at the browser level with no page real estate limitations to avoid lengthy and invasive integration processes.

Smart merchandising drives results

By optimizing your merchandising strategy, you can achieve significant gains in conversions, average order value, and the overall bottom line.

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Published 26 June, 2012 by Bruce Ernst

Bruce Ernst is VP of Product Management at Monetate and a contributor to Econsultancy. 

3 more posts from this author

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