Merchandising is power
Written by: Peter Messana - CEO
In a prior post on why I run a search company, I mentioned that if I were to invest in one thing as an ecommerce retailer, it would be search and merchandising. I wanted to dive in further and, as promised, this is not a marketing piece – even if our software is mentioned and is pretty great.
To back up slightly, you have to understand that our company’s mission is to “Give Merchandisers Superpowers”. We landed on this as most mission statements are horrible (this is a great video on why most are bad). Typically, no one can actually tie it to what they do at the company. Our mission is based on the premise that ecommerce today requires a high level of merchandising. The evolution of ecommerce went from the simple “list it and it will sell”, to the current situation where you have to make sure you get the right product, in front of the person, at the right time.
Ecommerce is not really any different than a physical retailer. In physical stores, you have visual merchandisers who lay out things like bays, wing stacks, end caps, clip strips, racks, window boxes, etc. Online, you have the same things, they are just called different names. Instead of merchandising the window box, you are merchandising the hero image on the homepage. When someone views “dresses”, you are now merchandising a rack of dresses. You have a few you want to highlight (those typically on a mannequin) and then you have the rack of dresses behind it. In a physical store, they are typically ordered by size. Online, you have a default order, but customers also have the ability to pick how they want to shop. This is where ecommerce gets so powerful.
You can’t walk through a store and quickly see all the blue dresses (because you want a new blue dress). Instead, you walk through each section looking at the different dresses and looking for the blue ones. The downside of this is that browsing in stores leads to much more impulse buying, which is where product recommendations come into play. In a store, you walk around, see things you like, and pick and choose. You also have store associates bringing you items and helping you along the way. Online, we try to mimic this with product recommendations, to encourage you to make a complementary or impulse purchase of something you maybe didn’t come to buy. In a perfect world, we are so intelligent that you buy that blue dress and get a pair of earrings and some shoes to match.
The real key to ecommerce is that it requires human intervention. Many solution providers tout machine learning and AI – we use machine learning, but we don’t believe that we can replace humans. Instead, we want to augment humans and give them more information to make informed decisions. We call it “No Black Box AI”. My personal belief is that it is impossible to auto-merchandise a website, you need a human making informed decisions. These decisions need to be made by real humans using their product knowledge.
Merchandisers can do this by digging into site reports and reviewing things like the top 1,000 searches. Yes, 1,000. So many stop at the top 100 searches but the deeper you go, the more long-tail searches are captured and these searches are high intent. Of course, you can’t overlook the high volume ones, you should be reviewing all searches and adding redirects for things like “gift card” or “returns”, but the product searches need to reveal the proper grid of products that will display the best products to the person searching.
In addition to top searches, you really need to pay attention to your landing pages. They can be PLP/category pages or even just promotional landing pages. The top landing pages are obviously very important; you want to make sure that they are converting at the highest rate possible. Don’t ignore high-converting pages, make them even higher. So many people will look and focus on high traffic/low converting pages. Sure, these are important, but just because you are getting 6% conversion on one page doesn’t mean you can’t get 8%. Maybe the product set is just that much better and aligns better with the person landing on that page. If you go from 6% to 8%, it could be far better than slightly improving a low conversion page. The point is, don’t focus on the bad, look at the good ones, and make them even better.
Merchandising is power. Online merchandising is difficult but it isn’t earth-shattering and new, it just requires you to focus on things you wouldn’t have otherwise focused on. In the physical world, you don’t (easily) get to know how many eyeballs looked at the product and didn’t buy. In the online world, you have a mountain of data. Use it and get the right product, in front of the right person, at the right time.