Ruth P. Stevens Articles and Columns: IM Press (Interactive Marketing Press)

August 2007 — Article 1 — New Ways For Online Marketers To Present Merchandise

Introduction to the new 13-article series, "What's New in e-Commerce in the U.S."

E-commerce is finally mainstream now in the U.S., after a decade of being a niche player in the world of retail. In traditional bricks-and-mortar retailing, the most important day of the year was Black Friday, the day after Thanksgiving in November, when Americans began their Christmas shopping in earnest. But in the holiday season of 2006, everyone was talking about Cyber Monday, the Monday after Thanksgiving, when Americans spent $608 million doing the Christmas shopping online, growing the holiday online spending 24% versus 2005.

This series explores some of the new marketing methods that are driving the explosion in online commerce. We will look at new techniques in online merchandising, marketing, customer service and operations.

The online shopping experience will always have limitations. When shopping for apparel, you can't try on the jacket to see if it really fits. In kitchenware, you can't pick up the bowl and get a feel for its heft.

Online merchants are always looking for ways to overcome these disadvantages, and to increase the shopper's ability to evaluate products and make a purchase decision. Companies are experimenting with new technologies designed to present merchandise in a more attractive, informative way.

3D Presentation of Products

One way shoppers can get a better feel for the product is by viewing it top, bottom and sides using 3D technology. According to the E-tailing Group's 2006 Mystery Shopping Study, 14% of online merchants are using 3D, compared with only 4% in 2005.

A leading supplier of 3D services to online catalogs is Kaon Interactive, whose technology can be applied to everything in the catalog or to a limited set of featured products. Kaon prices begin at $25 per product per month.

Kaon's 3D Catalog technology is used by such leading brands as Texas Instruments and Home Depot Direct, where it is appears not only at the website but also at kiosks in their brick-and-mortar stores.

Rob Cohen, president of the Kaon client Display Supply & Lighting Group (dslgroup.com), says that the Kaon 3D Catalog technology has tripled the length of time visitors spend on his site, from 30 seconds to more than 1.5 minutes on average. Year on year sales were up 26%. "Kaon's technology sets us light years apart from our competition, and delivers an experience that compels customers to come back for repeat businesses, while providing them with 24/7 access to valuable product information," said Cohen.

3D Within the Second Life Virtual World

3D presentation of merchandise can be applied in other Internet environments, too. Circuit City recently opened up a prototype consumer electronics store in the IBM area of Second Life's virtual world, where visitors' avatars can stroll along the virtual aisles, pick up and examine virtual electronics products, and take then to the virtual checkout counter. The real product later arrives via real mail.

Videocasting Brings Merchandise to Life

The E-tailing Group study reported that 38% of sites are experimenting with streaming video to enhance the buyer experience. The jewelry category is a big user of this method, to showcase high-ticket items like diamond rings, pearl necklaces and jeweled bracelets. Ross-Simons Inc. (ross-simons.com) has used TV-like videocasts, showing the company president Daniel Ross talking about new trends in jewelry design with a well-known soap-opera actress. As a particular piece of jewelry is discussed in the video, viewers can click through to buy it on the spot.

Bodybuilding.com is also a big user of video at its site, which is bifurcated into an area for training info and another for products. Bodybuilding enthusiasts contribute their own videos, as well as articles, to the site's message board, to explain what training techniques are working for them. And the site itself produces original programming, Bodybuilding Fit Show, with over 50 episodes on archive.

Not all e-commerce video is about product enhancement, however. The high-end re-tailer Neiman Marcus, is getting into the e-commerce video act, as an entertainment and brand-building strategy. Neiman is famous for its annual holiday catalog, the Christmas Book, which offers beautiful, often exclusive, merchandise, some of it priced in the stratosphere. In response to customer suggestion Neiman developed an online video to show how the catalog is produced. The video is placed next to the holiday catalog on the site, and visitors who want to delve into the production back story can click to activate it.

User-Generated Videos

In keeping with the spirit of Web 2.0, it's not surprising that user-generated video is beginning to enter the e-commerce world. The $782 million florist 1-800-Flowers launched a Valentine's Day service that allows users to create a 60-second video-like message of music, photos, graphics and words that can then be sent as animated Valentine messages to loved ones.

1-800-Flowers also operates a service within YouTube called Reconnections, wherein users can make their own videos recalling some flower-related incident important to their lives. In one case, a man who had lost touch with his high-school sweetheart recreated the prom corsage he had given her 50 years earlier — and 1-800-Flowers later provided the bouquets for the couple's wedding.

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