Special Report: E-Commerce & Catalog Technology: A Gift for All Seasons

It may be hot outside, but savvy merchants are already contemplating sleighs and snowflakes. With the holiday season comprising fully a third of all online sales, according to Forrester Research, now’s the time to begin building the strategies that will propel year-end success.

But we’re not only talking holiday season here. Half of all online buying is for other people at any time of the year, according to Forrester. So multichannel merchants should adapt successful holiday gifting tactics for year-round use during seasonal peaks and special events.

To be successful, your gifting strategy must be carefully planned and woven into the fabric of your site, rather than appearing as merely an afterthought to capture more business.

The gift registry from environmental health-related products cataloger Gaiam (www.gaiam.com) is a great example of a thought-out approach. Gaiam's Web site allows shoppers to create registries (see graphic on pg. 29) for any occasion and easily add any product on its site to the list. These registries can then be searched, sent to others and added to by other visitors.

“Our customers often shop for gifts on our site within a special area of interest, like yoga, fitness, apparel or even media,” says Gaiam's Vice President of Direct and Internet Jason Marshall. “Often people will register for a special occasion and request gifts within a category or area of interest. The gift registry is an important part of our site and can provide another way for shoppers to engage with us through the year.”

Chocolate-dipped fruit gifts cataloger Shari’s Berries mails three catalog editions a year and drives its remaining revenue through its Web site. Shari’s offers several price points, categories, occasion or holiday focuses, and other gifting options that align with merchandise it offers for a browsing customer.

President/CEO Kevin Beresford says Shari’s studies why people give gifts and who they give them to. “Then we use that information to help bring them back again,” by reminding them of gifts they’ve given in the past.

Holiday ’07: Key Drivers
Here are three gifting tactics that worked for catalogers in fourth quarter of 2007 and can be adapted for year-round use.

1. Gift guides: Merchants who provided deeper gift guides with more recipient categories gained substantially better results.

2. Gift cards: Last year, overall gift card sales grew by 25 percent. Multichannel merchants who enjoyed the strongest results offered more than just a link to purchase them. They allowed online redemption and clearly communicated redemption policies.

3. Gift sets: Marketers who offered gift sets and gift packs — preselected and prewrapped combinations of products based on personality or theme — enjoyed sales gains averaging 3.75 percent of their total sales and ran as high as 10 percent for the fourth quarter.

Guides: Go Beyond the Basics
Robust gift guides provide any merchant selling direct-to-consumer wares an opportunity to help shoppers browse products in a whole new way. During the 2007 holiday season, 56 percent of the merchants profiled in one of MarketLive’s performance indexes offered some kind of gift-buying guide.

Results show that doing so is well worth the effort. Merchants offering gift guides had stronger performance across the board than those who didn’t:

● They averaged 38 percent visits to shopping carts and 68 percent-plus greater conversion, along with 70 percent additional revenue per visit.

● Their one-and-out rates, in which they gauge the percentage of visitors that see a single page and then leave the site, were lower by more than 8 percent.

● The percentage of single-page visits specifically to the homepage was more than 23 percent lower, as shoppers were instantly able to locate gift products through prominent links to gift guide categories.

It’s not enough to offer a gift guide link on the homepage. Go beyond “his” and “hers.” From MarketLive’s research, we’ve found that the most successful gift guides offer packages for an average of four types of recipients — 66 percent more options than those with gift guides reporting lower response.

Depending on their product offerings, merchants should devise a range of potential recipients. This shouldn’t just be by gender and age, but also by interest. For example, “Bakers” and “Grill Masters” work well for a kitchen goods online catalog. You can even have categories for pet gifts.

Marketers also should offer a range of options for filtering by price. While our surveys show that most gift guides had at least one category for shopping gifts by price (usually for bargain gifts), the top sites went the extra mile, offering a wide range of price points. They averaged 3.75 price-based categories, which is 212 percent more than the bottom five sites.

Merchants should consider the pricing of their entire product offerings and offer several categories to cater to bargain hunters and top-of-the-line buyers alike.

In its gift guide, one outdoor apparel and gear cataloger from our studies offered several price points. It also offered unique recipient categories such as “for the gadget freak.” The gift subset of “stocking stuffers” highlighted smaller items, while “green gifts” put the emphasis on eco-friendly wares that appealed to its environmentally conscious core customers.

The same merchant devised a “top 10” category that drew on the behavior of other customers. This allowed shoppers to see what others were buying while serving the needs of those who trust “others like them” to help steer purchasing decisions. The top gift guide subcategories were displayed prominently on the homepage as well as within the gift guide environment, giving shoppers instant access to relevant product displays.

Based on the gifting strategies that drove success during the holiday season in 2007, merchants should start now to plan for the 2008 holiday season and beyond. Doing so will help you outperform retailers by using successful, event-driven holiday strategies to maximize peak seasons year-round and sustain customer relationships over time.

Ken Burke is the founder and chairman of MarketLive, a provider of e-commerce technology and services. You can reach him at (877) 341-5729 or ken.burke@marketlive.com.