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Does e-retail require new merchandising capabilities?

Does e-retail require new merchandising capabilities?
Wednesday May 8 2013

E-commerce experts, Adrian Gordon and Andrew Fowler, argue that segregated, 'best-of-breed' merchandising systems no longer make sense in today’s time-poor retail world

As the subject of the latest homepage poll of Retail Technology online, retailers trading electronically are being urged to look again at their current merchandising systems, as customers increasingly expect a personal, relevant and efficient shopping experience.

Adrian Gordon, independent e-commerce consultant, and Andrew Fowler, UK country manager of specialist software development firm Apptus said the average e-commerce manager has to manage multiple, disparate systems.

"From managing and updating search engines, recommendation engines, content management systems and A/B testing tools, to handling analytics tools, content delivery networks, tag managers and product information managers; each require careful organisation and come with their own problems," said Gordon. 

"But there is a greater concern that arises from managing sites built from these siloed components – merchandising and its effectiveness online."

Get personal and be relevant

Fowler took up the argument. He said: "Retailers need to be intelligent and analyse their buying behaviour before taking a scientific approach to their customer experience; providing them with personal and relevant choices by getting smart with online merchandising."

But both agreed that, by far the biggest challenge facing online merchandisers is the issue of limited product exposure. "In a physical store customers will often see thousands of products during their shopping journey on the numerous instore gondolas, whereas this is more difficult online," continued Gordon. 

"And what does this mean for retailers?" he asked. "Well, if we can’t significantly increase exposure levels, today’s merchandisers have to be very smart about which products they choose to show to customers and tailor it accordingly so it’s relevant to the individual customer using their previous buying behaviour. Retailers have to translate these instore gondolas to the online world and get savvy with their merchandising."

Fowler added: "Pushing the same product over and over again is not going to entice a customer into making a purchase. If anything it is going to ruin the experience and turn the customer off. This usually happens when separate, independent systems are not working together and are choosing the same products to display – unaware of what has previously been displayed in the merchandising ecosystems."
 
Taking a scientific approach

Another concern for e-commerce managers is the under-promotion of new products. "With each disparate system working independently, each system usually biases their choices towards best sellers, whereas new products, some of which with the potential to become best sellers, don’t see the light of day," added Fowler. 

The experts said an integrated system can afford to trial new products as it has a unified view on product exposure and able to balance both best sellers and potential future best sellers.

Gordon said: "We are entering the age of merchandising as a science, and, as any good scientist knows, good science requires good data and good experimental controls. The current, prevalent e-commerce 'best-of-breed' model has its place. But, as retailers, if we are to thrive then the harsh realities of modern merchandising cannot be ignored. Our merchandising systems need to be as joined-up, and co-ordinated, as our thinking."

And Fowler concluded: "With such hectic schedules and an ever increasing workload, e-commerce managers ought to look at a more unified approach to search and merchandising to streamline their daily routine and also give customers what they want to improve retention." 

Tagged as: Online | shopping | e-retail | e-commerce | merchandising | management | integration | personalisation