Online Exclusive: Holiday Shopping Lessons of '05

Here's our online holiday shopping roundup for 2005: more money, more grumpiness and lots of search. But what's it all mean for your Search Engine Marketing? (Skip to the end of this article for the three answers: work in real time; fix your landing pages; advertise competitively.)

First, the numbers. 2005 saw a 24 percent increase in online holiday spending over 2004. It also saw a slight drop in online holiday shopping satisfaction since last year: around 8 percent of shoppers walked away from their computers at least a tad miffed. Meanwhile, more than 60 percent of all 2005 online holiday shoppers got to online stores via search engines. So, in Holiday Shopping 2005, people spent more, searched a lot and were unhappy 8 percent of the time. (All of this information appeared in two recent articles in online industry rag, ClickZ.)

We want to talk about that dissatisfied 8 percent. Eight percent dissatisfaction isn't so bad for e-business overall especially in light of the 24 percent growth in online holiday spend. But it could spell very bad news for any particular site. Why? Because the spend increase and the satisfaction drop are related.

The more people shop online, the bigger their expectations will be of what Internet shopping ought to offer. They've gotten used to what online shopping really can be and have started dreaming about how much better it could get. And when those shoppers' higher expectations aren't met, they walk away dissatisfied. Which means they hit the back button and shop elsewhere. And, by that logic, the more someone shops online, the more likely she'll be to be disappointed by any given less-than-perfect site.

So, on one level, you're looking at around 8 percent of online shoppers hitting back buttons. But that 8 percent of online shoppers is likely to represent a lot more than 8 percent of total online spend. After all, these are the people who are probably most used to shopping online; and so these are the people most ready to buy more things online than the average shopper. Which means that the 8 percent dissatisfaction – the 8 percent of shoppers who are hitting back buttons – might represent a lot more than an 8 percent loss in revenue for the sites those people were unhappy with. Maybe it represents a 10 percent loss. Maybe it's 15 percent. Maybe it's more.

And industry experts seem to agree on why people are unhappy: shoppers just can't find what they're looking to buy. In the words of ForeSee Results director of Marketing, Lee Pavich (also quoted in ClickZ), “Reasons [for dissatisfaction] can range from merchandise that is out of stock online…[to retail sites' not] using the correct description” for their products.

Sixty percent of shoppers came to destination sites via search. So in light of what we've said above, it's worth asking how your SEM might be hurting you with that very powerful 8 percent, and how you can even use online unhappiness to your advantage. We've pinpointed down three things you might want to think about:

1. Work in real time. People get angry when you promise them things you can't deliver. If your search ads imply that you have certain products, but those products are out of stock, people hit the back button. If you need to change your ad messaging right away, can you? If your system doesn't operate in real time, you may not be fast enough to change your ads in time to avoid making promises you can't keep. By the time you've changed ads to meet inventory realities, you might have already offended scores of potential buyers. It's best to have a real-time system from the start.

2. Fix your Landing Pages. Let's look at Reason Number Two that Mr. Pavich gave for all the unhappy shoppers: sites “aren't using the correct description.” Lots of offending sites are offering the products visitors want to buy. They're just doing a poor job of letting shoppers in on the secret. And in search, that kind of error is especially deadly: searchers are looking for specific products; they know there are probably a lot of sites that offer them (because Google has just given them 300,000 results to tell them so); and so if they can't find what they want right away, they'll look elsewhere. Ask yourself: how well do your search landing pages describe what you sell? Do they reflect the way searchers think about and describe your products, or are they written in jargon? If your searchers think of your products in many different ways, which terms will you end up using? And can searchers find what they're looking for? And where, on the landing page itself, is the best location for telling searchers that you've got what they've come to buy? All of these questions require a very deep understanding of keywords analysis and landing page studies; and they both require the right technology to test any theories you might have. Talk to your SEM management about what you're able to do.

3. Advertise competitively. If the market is unhappy with your competition, then you're poised to pick up a whole bunch of very desperate shoppers. Which is wonderful. But to take advantage of that opportunity, you need to watch the competition closely, know which keywords are most likely to represent unhappy searchers, and know how to tailor your ad copy to the shoppers who've spurned your competitors and are searching for an alternative. Again, talk to your SEM management about what you can do to pick those shoppers up.

Doing these three things won't stop the growing trend of unhappy shoppers. That trend is bound to get bigger for as long as the Internet continues to grow. But following these three points of advice might just make you poised to become the go-to site amongst the savvy Internet shopper – and help you hold that position for as online grumpiness expands. It's not a bad goal at all to work towards in 2006.

1 ClickZ, “Satisfaction with Online Shopping Dips” (December 23) and “Most Online Shopping Completed by December 16” (December 27), both by Enid Burns.

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