This is how users perceive search engine ads

According to the OVK online report, last year saw expenditure on keyword marketing in Germany rise by eleven per cent to its current level of some €2 billion. However, according to information from the Bundesverband der Digitalen Wirtschaft (BVDW – German Association for the Digital Economy), the Online-Vermarkterkreis (OVK – Circle of Online Marketers) within the BVDW makes no distinction between expenditure on search engine optimisation (SEO) and that on search engine marketing (SEM).

Yet it would be interesting to know the difference, because if you take seriously an Eye-Tracking study conducted by Search Engine Land, the American SEO/SEM magazine, the question must be raised if search engine marketing is still worthwhile?

The answer is yes – under particular conditions. Those conditions being that the advertisement is displayed directly above the organic search results. Whereas a glance with the eye-tracking camera at the keyword ads in the right-hand sidebar reveals that users just aren’t interested.

Go for the middle

70 to 80 per cent of Internet users ignore the keyword ads listed there. Search Engine Land has returned these findings with both Google and Bing. This insight is not particularly new, but the values are so high that the whole area really needs to be given careful consideration.

By way of contrast, the ads located immediately above the organic search results draw considerably more attention for considerably longer. These are noticed by 90 per cent of users.

Nonetheless, specialists continue to consider SEM a justifiable strategy. By way of example, Fabian Haubner, Head of Marketing, PR and Sales at bloofusion, sees its usefulness as follows:

“As long as you can continue to use Google AdWords to reach customers in a cost-effective manner, I don’t see any reason to stop using it. Moreover, AdWords ads are a good way of generating short-term success, particularly for small online retailers. Because SEO successes, particularly in a highly competitive environment, are often difficult to achieve and take their time to come about.”

At the same time, Haubner also recognises the urgent need to adapt SEM strategies to the usage habits of consumers.

“The intensity of competition and associated complexity has of course increased in the Google AdWords environment, which is why companies should really take care to ensure that their campaigns are optimised for cost effectiveness. If this doesn’t happen they run a serious risk of throwing away a lot of money in a very short space of time. This is why I recommend that all online retailers get professional help from agencies, either in the form of a one-off workshop or a complete support package.”

How to write sales-boosting product texts

In the beginning was the word – and this also applies to online retail. The text which praises or describes a product is just as important for conversion as attractive photographs or user-friendly and well thought-out navigation.

Martin Groß-Albenhausen has summarised the most important rules for writing good copy, thus providing online retailers with access to catalogue copywriter know-how which has been successfully put into practice for several decades.

The benefit/benefit/benefit rule

This three-pronged rule was formulated by the US catalogue guru, Hershell Gordon Lewis.

1st benefit: State a property of the product which makes it superior to others.

Example: “At last, a truly silent washing machine.”

2nd benefit: Place this property in the context of the customer’s leisure time or professional life.

Example: “Whirring and clanking are now a thing of the past.”

3rd benefit: Tell the reader how the product property will improve his/her leisure time or working life.

Example: “For the first time in your life, you can play quiet music in the kitchen…. and enjoy it.”

Seven deadly sins

1. “Sloth” is apparent in lifeless homepages which neither perform a pre-selling function nor provide an introduction to the product range, let alone say anything about the positioning.
2.  “Pride”, i.e. too much “I” copy, too much talk about the company or the entrepreneur and too little about the customer.
3. “Gluttony” means pages which try to do too much, without order or direction.
4. “Lust” means that the fun of the “art direction” overshadows the main objective of all advertising design, i.e. selling based on benefits to the customer.
5. “Greed” manifests itself in saving on sales boosters, which generally involve the mail order retailer giving something back.
6. “Wrath” may be felt by customers if texts are incomplete, the lettering too small or the order information concealed.
7. “Envy” means looking at what others are doing too much instead of developing one’s own language and positioning expressed in images, copy and goods.

Shop design and copy

Of course, product texts sell above the content level. Nevertheless, there are a couple of rules which should be observed when designing and presenting texts in an online shop:

• No red, green or orange headlines. Texts must provide contrast – nothing beats black or dark blue.
• Dominant backgrounds distract from the subject at hand, i.e. the product.
• Text on unstructured or dark backgrounds is difficult to read and reduces the response.
• Inverse lettering is tiring to read and diminishes the response.
• Colourful, shaped bullet points may look nice, but they turn information into a work of art. They appeal to other areas of the brain and reduce information processing.
• Right-justified or centred text hinders reading comprehension.

The text academy model

This model assumes that the merchant has only limited space and time in catalogues and often also on the shop’s product pages to accommodate benefit arguments, calls-to-action, teasers, all the basic communication concerning the features of the product and obligatory declarations. The model therefore uses a standardised starting point that nevertheless arouses interest. In practice, the model functions as follows:

• Magical mail order lead-in is a word or expression such as “New:”, “Only from [company name]:”, “Exclusive:”, “Bestseller:”, i.e. a teaser with a colon which conditions the further reading of the text.
• Product name: This may be the technical concept, for example, but also (as in the case of Jako-o) a name which in itself is beneficial. “Only from ….: the babygro that grows too”, or “A stroke of luck for children: our mum-friendly, easy-to-wash jeans”.
• Dash and benefit OR “…”: “Only from …: the babygro that grows too – buy it once and your baby can wear it up to the age of two”. In this case, the online retailer has already included the benefit, i.e. the fact that the product has a long lifetime. Of course, you can do it even more elegantly and express the benefit as “going one better”. “ – instead of going through five sizes in 12 months, your baby can wear this babygro until their second birthday. And you can spend the money you save on presents.”
• Descriptive sentence
• Enumeration/facts/data: These include product declarations, information such as “fun motifs sorted into themes for boys and girls” etc.
• Order line: “Only €4.95 until the end of January – it’s enough to have you giggling and drooling yourself! Or save twice as much with a three-pack for €12.95”
• Call-to-action

The most important basics are listed here.

The level of organisation of a mail order warehouse mainly depends on the quantity of stored items. A commercial ebay dealer might make do with a few shelves in his own garage. However, with an expanding range and an increase in shipment volumes, the online retailer may quickly reach his limits.

The storage areas

For many online retailers a simple three-way division of the warehouse should be perfectly adequate.

• Incoming goods:  Here, the delivered goods are checked for completeness and quality. At the same time the supplier can take back empty euro pallets. The incoming goods area can also be used as a temporary supply warehouse, as long as the delivered pallets have not yet been separated.
• Order-picking warehouse: In this warehouse individual merchandise is stored. In most cases simple shelving racks or flow racks are adequate, from which the picker takes the items ordered.
• Dispatch: Here the goods are packed, prepared for shipping and collected for the shipper. FMG – i.e. fast moving goods – can be stored in the dispatch area for a short period of time. This way the goods can be picked directly off the pallet, saving time and shortening walking distances. In large mail order warehouses fast moving goods are stored in pre-picking zones at the front of the dispatch area.

These sub-areas do not need to be separated by walls – when using fork-lifts or pallet trucks this would be more of a hindrance. Rather, these are storage areas which might be identified by floor markings in order to prevent pallets from the incoming goods area from being “just quickly” stored in the dispatch area.

Storage area allocation

A warehouse, in which a picker first has to search for each item, is not very effective. This creates avoidable delays until the goods are ready for shipment; in turn, the maximum logistics capacity of your shop decreases and sales figures may fall due to a larger quota of returns. This is why each item must be allocated to a storage area. Logistics experts call this “marriage to a storage area”. There are two options:

1. Numerical space allocation: Here items are always stored in a fixed area according to the sequence of the item number. This method is suitable for most small and medium-sized online shops with a manageable product range and shipping volumes.
2. Chaotic space allocation: For shops with high shipping volumes the numerical system is not flexible enough to react to changes in the product range. Instead, new items are automatically allocated to the next available storage area. This requires that each item number in a table is allocated a storage area number.

Warehouse planning

When planning a warehouse, technical capacities must be taken into account in addition to economic considerations. The following basic factors should be considered when planning your warehouse.

• Number of items in the product range
• Size of inventory items
• Average and maximum storage quantity of an item depending on disposition cycles and planned clearance sales
• Shipment quantity per day on average and at peak times
• Average number of items per shipment. Multiple item shipments are more efficient for picking
• Quota of returns

You should be aware of these strategies.

There is no such thing as an average return rate in online trading. Returns just depend too much on the type of product to be able to make a general statement. While the return rate is around 15 per cent in the case of technical items, returns can easily exceed the 50 per cent mark in the fashion business, explains Dieter Urbanke, CEO of Hermes Fulfilment GmbH.

Especially in the fashion trade, shop operators have always been up against “selection orders”. These involve the customer deliberately ordering an item in different sizes and colours. The customer keeps the item which fits them or which they like and the other items are sent back to the trader as returns.

Of course the shop operator incurs additional costs for the return shipment and for inspecting, refurbishing and placing the goods back into stock. It may therefore definitely pay to deal with so-called serial returners in a proactive manner and try to exert some positive influence on their returning behaviour.

Obviously, shop operators might also find that the causes of a high return rate are closer to home. For instance when packing errors are made, when product images are unrealistic, or when the staff are inefficient in cleaning up addresses.

Traders have tested various strategies to reduce the return rate. It is up to each shop operator to test whether and to what degree any such measure is effective. There are a great number of measures for preventing returns that a shop operator should be aware of. We have put together a list of the most important strategies based amongst other things on the book “Versandhandelsmanagement” (Distance Selling Management) by Dr Jan Thieme:

Customer-focused measures

• Addressing “serial returners” by telephone or in writing with comments on return behaviour (e.g. reference to size charts, virtual fitting room or body scanner).
• As a follow-up measure, if required, refusal to deliver or selective deliveries to serial returners with a negative profit margin.
• Deactivation of serial returners with a negative profit margin, no more newsletters, no more catalogues, etc.

Product-focused measures

• Improvement of quality control regarding efficiency, fit, etc.
• Inspection of suppliers or of specific delivery batches
• Removal of items from product range
• Provision of replacement items to avoid further returns

Communication-focused measures

• Check whether displayed images of goods are too unrealistic
• Improvement of operating instructions
• Use of size charts, fitting guidelines, virtual dummies or body scanners
• Review of returns information (are the options for cancellation/return highlighted too strongly?)
• Monitoring of agent behaviour in the call centre

Fulfilment-focused measures

• Quality management and research into error causes in the picking & packing department in the case of packing errors
• Optimisation of packaging
• Selection of a delivery service provider who offers flexible delivery scheduling with multiple delivery attempts
• Review of processes involved in address cleanup
• Complete deliveries
• Prompt deliveries (the later the delivery, the higher the likelihood of returns)

Measures focused on material requirements planning

• Better goods availability reduces returns

Confidence-boosting measures

Their purpose is to evoke a positive emotion in the customer when he or she takes hold of the goods:

• Welcome gifts for new customers
• Surprise gifts
• Renewed confirmation of reliability through use of a seal of approval logo on a parcel insert, the exterior of the packaging or the paperwork (invoice, delivery note, etc.)

Why Google wants to become a logistics provider.

According to media reports, the strategists at Google are considering offering a same-day delivery service for Google Shopping. The Wall Street Journal reports that the search engine giant is looking for a strong retailer with whom it can create a delivery service similar to Amazon Prime. The publication claims that discussions have already been held with GAP, Macy’s and OfficeMax.

For Google, this step is logical and necessary. There are two main reasons for this:

1. Google’s influence on the e-commerce value creation chain ends at the retailers. Despite its Checkout, Google does not yet have its foot in the door in one of the central business areas of e-commerce: logistics and shipping. Amazon is well-equipped here thanks to its fulfilment services.
2. When looking for products, Internet users tend to turn to Amazon rather than Google as a search engine. It’s argued that, as a result, many retailers generate more traffic via Amazon than via Google.

Google is said to have been inspired by Amazon’s Prime service. For an one-off annual fee of £49 in the UKor $79 in the USA, the customer gets fast delivery from Amazon Prime with no minimum order value.

The pilot is due to be launched soon in the San Francisco region.

Google must react

For Martin Groß-Albenhausen, head of e-commerce at the German E-Commerce and Distance Selling Trade Association (bvh), Google’s approach comes as no surprise:

It is because Amazon has become the one-stop shop and that is particularly due to its expensive Prime service. As Amazon has secured itself the best price advantage and offers excellent service – and so has perfected the dirty day-to-day distance selling work -, many Internet users now search for products on Amazon first. Google loses out on these searches, precisely because it is no longer enough to just compare prices if it makes placing the order too tedious.

What’s more, Groß-Albenhausen believes Google will be faced with a further major challenge in future: the increasing omission of display screens for searches. This is being caused by virtual agents who react to speech, such as Siri.

Google will be forced to develop its own Android product to compete with Apple’s Siri. This means some things will have to change, as Google will need to move its sources of revenue away from ads. Siri does not read aloud any advertising texts that the user then activates. The user also no longer goes back and forth in the search, which would produce multiple views and clicks.

The alternative to Amazon

Not all retailers are happy to get more turnover traffic via Amazon than via Google, as the commission at Amazon is considerable. What’s more, many online sellers must always fear the online shop giant as a potential competitor.

However, a partnership with Google within the new project would only be possible if Google takes over more and more of the customer contact work itself as part of the transaction, i.e. addresses, credit checks, handling payments, etc. This would mean the retailers no longer gain new customers, but instead become “upstream suppliers”, unless Google then passes on the information to the retailers for subsequent use, which is certain to have its price. Otherwise, there will be further distance between retailers and customers.

Google will have to combine a high level of availability with a consistent level of service if the scheme is to be a success. Google is really only strong at the front-end, whereas Amazon is strong in every area.

Richard Rosens “Velocity” concept for advertisements is surely known to quite a few online sellers. For those who do not know this: customer-specific transaction patterns are filtered out within defined periods in the “Velocity approach”. For your online store this means:

How many obstacles do you place between the customer and the order button?

A few years ago I met Kelly Mooney from the American agency Resource Interactive at a conference. She spoke about O.P.E.N. Framework for sale in the Web 2.0: on-demand, personal, engaged, and networked.

Elsewhere, Mooney points out that all “touch points” of customers and dealers must be designed considering two main aspects: they must either contain immediate motivation for purchase or meaningful added value. You can achieve immediate motivation e.g. through limited-time offers or particularly good use-oriented copy. Consulting tools, for example, are meaningful added values.

Additionally, for an increased shopping experience, there are three core elements:

• Triggered: A touch point must recognise the customer’s requirement – e.g. the use of social plug-ins. IKEA in England launched a YouTube app, which connects certain additional information to the Facebook profile and thus creates the “ideal” bedroom. Further trigger elements can be designed based on a specific environment of use (mobile vs. stationary) or these could also be connected (e.g. through Google Local Search).
• Shareable: In future, it will become increasingly important to offer customers the option to share concrete product content. This could be the simple “like” button or a sophisticated style concept which has already been implemented at Frankonia. Sears in the USA has placed Skype terminals next to the changing rooms in ten of their branches to allow customers to quickly, and free-of-charge, discuss choices with their friends.
• Shoppable:Every touch point must suggest a direct path to purchase. Just the way Weltbild managed to do this with their posters in Hamburg: book title + QR code offer a reading sample with option to order. Of course you can place a different “call to action” – but action as preparation for the next sales step.

Really quite logical. But have you considered your shop pages or other promotional activities, your store or your market stall from this point of view yet?

About the author:

Martin Groß-Albenhausen is the chief editor and publisher of the renowned mail order industry journal “Der Versandhausberater” and a leading expert on mail order, direct marketing and e-commerce. “Der Versandhausberater” has been reporting on current trends and developments in the mail order business in Germany on a weekly basis since 1961.

Read why here.

With the increasing acceptance and establishment of the iPad, the question is being asked whether the tablet PC will lead to a renaissance of the catalogue. This issue is also gaining weight because the design of double pages and the ability to leaf through pages is not far away.

Nevertheless, it is simply wrong to approach tablet PCs in this way. Most of all it shows that the makers have simply misunderstood or forgotten how the mechanism works. After all, the emotionality and sales potential of a catalogue is generated by more than just well-designed double-sided sales pages and “series”. Here are a few (really just a small selection) of the drivers of a good catalogue that are still effective today:

• The catalogue comes as a package, that is to say it is delivered to the customer in an envelope, shrink-wrapped or open. In any case, it is also a physical carrier medium for other, separate elements which therefore also generate extra attention. They belong to the so-called “Environment“. Intelligent environments are part of the fine art of mail order marketing because they also often further activate the catalogue. An app is not a carrier and does not have an environment.
• A catalogue has a front and back title page as well as a U2 and U3. That is a total of four hotspot pages that increase frequency and sales. Good catalogues maximise their appeal by designing those four pages strategically.
• Catalogues not only have a back title page but also an opposing leaf page, whether left or right-handed. Catalogues are also read from back to front, and that must not be disregarded in the sales-oriented placement of products.
• In addition, catalogues in their role as a “technical product” also often have special insert pages. They have a different format or a different paper thickness with a different feel. They do not only attract more attention per se, they also act as a physical stopper when the catalogue is leafed through quickly. Stoppers can also be used as eye-catchers in the catalogue to maintain interest and increase sales.
• Catalogues are thick. What is more, if a catalogue is too thin it will not be taken seriously. It has been proven that thinner catalogues attract a “thinner customer budget”, and that by experimenting with thicker pages, mail order retailers were often able to give the impression of having more content even though in practice they had less content.
• A catalogue with a particular volume and a strong title retains its place and even without extra triggers (but especially with them) can achieve recurring “appeal”.
• The variation of formats enables additional differentiation on the customer’s desk or living room table.
• Creativity with regards printing, ranging from lamination and finish to press-cutting and embossing, gains noticeable customer “involvement” and can achieve so-called “pre-conditioning” solely with such finishing. High-quality catalogues justify high prices, at least in the customer’s perception (proven again and again in surveys).

A catalogue app doesn’t have any of that. It is one of a potentially infinite number of thumbnails on the iPad which does indeed provide attractive image worlds but which lacks the overall power of a complete catalogue concept. Only because catalogue know-how has already lost so much importance that hardly any mail order retailers can master all aspects of catalogue design these days, a two-dimensional and therefore flatter representation of a catalogue on the tablet PC is perceived as “magic”. They cannot work. There is no way that they can achieve the productivity of a catalogue.

“Crutches for crutches”

All of the above points are part of the “emotion” of a catalogue, not only the attractive images. That is why catalogue apps on tablet PCs are currently just “crutches for crutches”. Catalogue distributors should stop hoping that a future media will prolong the past.

The iPad and other tablets will see the dawn of completely new type of catalogue. Different navigation, different scopes, maybe even a different way of controlling the view. However, certain rules remain that are independent of the media. For instance gaze motion, that is to say that the viewer’s eyes are guided by the models’ posture and gaze. Or the structure of text and image in order to provide as much information as possible.

However, completely different options present themselves even in the navigation. I can navigate from left to right as well as from top to bottom. Why is that relevant? Research has shown that users generally expect to find further information beneath an image. Catalogue pages very quickly got to the stage where pagination conveyed its own very important messages (orientation + ordering via hotline number, to name but two elements). That can be experimented with.

Or take the virtual but photo-realistic scenery first implemented by Otto. It is the first example to include true depths insofar as the user can move within the photo location (in the future “rendered in real time”) and can rotate products on the page for instance. Not a pop-up with 360 degree photography but interaction.

Different approach

Due to the fact that the approach is completely different than in a physical catalogue, thought will have to be given to the scope and the frequency of tablet catalogues. That is why Cortez’s theory is especially applicable to tablets – in order to conquer new territory you must first burn your own ships. It is time to change the way we think.

Those who have let the catalogue department die out over the last few years and have not authorised budget for experimental print advertising will have no more success with their extremely paired down catalogues on the iPad. Anyone who is in control of their business, and many specialist distributors with excellent print catalogues are, is also in a position to unlock the creative potential of new media.

That means that print media is as dead or alive as the creativity of the advertising department (print). Online shops are as exciting or boring as the innovation and agility of the advertising department (online). Tablet applications are as sterile or “infectious” as the willingness to experiment of – ah yes, of who exactly?

About the Author:

Martin Groß-Albenhausen is editor in chief of the renowned trade magazine “Der Versandhausberater” and is a leading expert for mail order retail, direct marketing and e-commerce. Since 1961, “Der Versandhausberater” has been providing information about the latest trends and developments in the German mail order retail sector on a weekly basis.

That even works in catalogues.

A white paper that I co-published reports on the use of customer reviews in multi-channel selling. If you use customer reviews in an online shop you have one great advantage: unlimited space. However, as soon as you limit space and time, that is to say print media or TV adverts, other rules apply.

1. Reviews should provide added value.

Let’s look at the following review of a technical device: “Clearly one of the coolest devices …”. This review doesn’t say anything new – the product description and the photo already show how cool the device is. However, if you present the product in a gift catalogue, the following review is more suited: “My thirteen year-old son loves it!” Reviews are convincing, so be sure to use them to entice interested buyers to purchase something.

2. Reviews have to read well and match the products.

The contents of a catalogue are sometimes unclearly structured, but reviews should stand out. Use short text passages (snippets) to attract more attention and ensure that they are clearly allocated to the product that they are referring to. Do not leave it up to the reader to work out whether a particular review on the page refers to product A or B.

3. Reviews absolutely have to be genuine.

That is not only called for by legal advertising regulations but if ignored could also lead to a nasty boomerang effect. If an interested customer first reads the catalogue and then visits the website, it is essential that they find the genuine review from the catalogue there too.

You should never “invent” reviews or place reviews in the catalogue that are not on the website. Many consumers may indeed not check up on that, but it is still recommended to always remain authentic. And what is more, your customers’ genuine comments are far more effective than any texts that your marketing department would produce.

4. Combine your best rated products in one section.

Interested buyers who do not have much time primarily want to find out about the most popular products, especially if they are only interested in certain categories such as gifts or clothing. Therefore, you should combine all those products that always have positive customer reviews in a special section. That makes it easier for interested customers to make their selection from your best products.

It is worth displaying them on the opening pages of the catalogue. You then certainly draw attention to the products and show from the very beginning that you take your customers seriously.

5. Show that your brand is trustworthy.

Think about the fact that publishing reviews creates trust in your brand, just as printing reviews in your catalogue, or any other marketing materials for that matter, says a lot more than simply “Our customer like our products.”

Published reviews prove that your brand is open to feedback, that you believe in your products and that you listen to what your customers have to say. This is much more than simply selling products; it shows that your brand is trustworthy.

And one more bonus tip: two little-used moments for customer testimonials are “lift letters” and “shopping basket mails”. Lift letters (printed in individual mailings or near the order form in catalogues/in the shopping basket at the checkout) further encourage customers to make a purchase. At this stage, the testimonial should refer to the service experienced in the shop.

You have to be prepared for that.

As soon as next year, over 40 million US Americans will own an iPad or similar product. That equates to 12.8 percent of the entire population. Market researchers eMarketer estimate a percentage of 7.6 percent (24 million US citizens) for the current year. Last year, 9.7 million US Americans owned a tablet PC (3.1 percent).

Why a tablet PC?

It is especially intriguing for online sellers to look at the reasons why American consumers are so interested in the iPad. Surfing the internet is right at the top of the list with 64 percent. That is followed by using photos, videos and music (58 percent) and the use of apps (54 percent). For 41 percent of Americans, the iPad shopping experience was the reason for buying the tablet PC.

However, the number of people willing to make purchases using an iPad is surely much higher. After all, most e-commerce experts agree that iPad-shopping will establish itself via apps.

Successful shopping apps give added value

Thomas Lang has two important tips for online sellers who are considering selling via iPad apps:

1. The functions of the mobile end device have to be adequately used in the app (GPS, camera, tilt sensor, access to contacts etc.)
2. The sales concept on the various mobile sales channels has to be distinctive, otherwise a separate app for tablet PCs is not worthwhile.

Pay attention to them!

Catalogue and online marketing advisor Kevin Hillstrom, whose name I have mentioned in my blog many times, has compiled a list of “signs of trouble” via Twitter. Those that he has observed and those that others have made him aware of. Here is a summary – from #obvious to #ohmygod:

• You are gaining less customers with the same advertising budget.
• Your best customers are spending less on average per year than they used to.
• The returning customer rate is constant, but turnover per customer is decreasing.
• The number of items per order is increasing but the average item price is decreasing (that means higher logistical and shipping costs per order).
• The number of discounted items bought increases each year.
• The number of marketing channels and advertisements is increasing significantly, but increase in turnover is only slightly more than the inflation rate.
• CPA (cost per action, whether an order or a newsletter subscription) is increasing, but average turnover per user is decreasing.
• One or more important employees are contacts with recruitment consultants on Xing, or worse, your boss is.
• You achieve a 15 percent increase in conversion, but turnover remains the same.
• Customers go from one order channel to another and your average sales decrease.
• The response from your advertising increases by 15 percent but the returning buyer rate remains the same.
• Turnover is increasing but gross earnings decrease due to more overheads or a different range. (Is your profit and loss plan still correct?)
• Demand is increasing, but so is negative feedback in social media. (And the next thing to increase will be the return rate?)
• You have 250,000 customers of which 250 account for 80 percent of your social media feedback.
• 18 percent of turnover is generated by discounted products; 55 percent of turnover from email campaigns is also generated by discounted items.

If you want to follow Kevin Hillstrom on Twitter (very much recommended): http://twitter.com/#!/minethatdata

About the Author:

Martin Groß-Albenhausen is editor in chief of the renowned trade magazine “Der Versandhausberater” and is a leading expert for mail order retail, direct marketing and e-commerce.

Since 1961, “Der Versandhausberater” has been providing information about the latest trends and developments in the German mail order retail sector on a weekly basis.

Learn more about newsletters in the following article.

1. Individualisation and timing

Newsletters should be personalised as best they can. This can be achieved by analysing the group of recipients and breaking it down into segments and target groups. Consumer behaviour seems to be changing insofar as today’s customers expect to receive only offerings tailored to their interests and needs.

It is thus essential to communicate with newsletters sent at the right time with the right content, and to individualise these more and more.

2. Relevance and added value

The relevance and the value of the contents is another important component of a successful newsletter campaign. The aim here is to offer recipients added value through the newsletter, and to communicate this fact as well. Only if the recipient is informed of what he or she is being offered will click on the related links in the newsletter.

Added value can be a special offer, but it can also be helpful, interesting content. But the entertainment value should not be overlooked.

Here, you should try to determine what interests the recipients and then provide them with offerings and interesting content that takes this into account. With a little creativity, use can be made of the social media to learn more about the interests of one’s target group.

3. Frequency and performance measurement

Finding out the right frequency for sending out your own newsletters is a must – but it as at the same time probably one of the greatest challenges you will face in planning a good campaign. Unfortunately, performance measurement and the task of determining the ‘right’ frequency are growing more and more difficult.

Even simple parameters such as ‘opening and reading of the email’ are becoming more difficult to measure as a result of blocked image files and increased use of mobile devices. Of course newsletters can also be designed to make them legible even with the image files blocked. At times, though, the result is that the recipient reads the content without opening or downloading the image files, rendering the event impossible for the sender to measure. This makes analysis and performance measurement difficult.

The emphasis on good branding should be just as pronounced as it is on determining the right sending frequency for achieving the goals you have set without straining or even annoying the customer. But this is very much a function of the palette of products in the shop, and of the target group in question.

4. Service

The area of service in particular is where the wheat is separated from the chaff. The aim here is to offer the customer the most comprehensive ‘all-inclusive service package’. Email notifications or status reports and satisfaction surveys are examples of service-oriented emails. You can learn more about the topic of emails in the following article: ‘The Power of Triggered e-Mails; 6 Examples’.

5. Mobile shopping

Heavy growth in the use of mobile devices also has a profound influence on consumer behaviour on the internet. As a consequence, shop operators should tailor their newsletters and emails so that they can be read on the various mobile devices.

6. Social media:

What direct consequences social media will have for sales in online shops remains to be seen. Still, you should not ignore developments in this area. For maximum success, you should try to dovetail social media and newsletters with one another. Be creative and try to combine the two channels to improve your performance.

A Facebook fan page alone is no longer enough. What matters, rather, is actively to engage with one’s fan community and to maintain customer relations as a way of distinguishing yourself from the masses.

7. Canvassing and reactivation

Attracting new customers and reactivating customer relations can contribute to increased sales. Here, too, the topic of the newsletter plays an important role. When it comes to attracting new customers effectively, though, a multi-channel strategy is better suited.

Send newsletters with relevant content to customers who have long since ceased placing orders. Sometimes, reactivating customer relations is easier than you might first suspect.

These are four things you will want to make a note of.

1. Too much is left to the imagination

One of the most important findings in catalogue marketing was that product photography should give an idea of an object’s actual size. And that while photography using models may cost more, it is also more effective.

That didn’t seem to apply on the internet: there, models are relegated to the background (often with the head partially severed – a no-go in catalogues!), or else the fashion items are laid out or photographed on a bust. Cut-out images are dominant in hardware and fashion mail order. Showing a product on a model or in a particular setting as an alternative view gives the customer points of reference that eliminate uncertainty before the choice.

2. Too much ‘featuritis’

When I give my introductory courses on internet retail, I like to refer to the ‘Benefit-Benefit-Benefit’ rule by Herschel Gordon Lewis. With Palmer, though, I can also apply the theory to a practical case in point: while the MP3 player by Creative advertised its ‘5 GB of storage’, the iPod promised ‘1000 songs in your pocket’ (or something to that effect). Every product needs a benefit that is the result of the features.

3. Not enough story

In the Google age, what matters is not the story but the words. A story links a product with the world in which the customers live. In the internet age, this milieu-oriented approach has been overtaken: No customer searches with terms of his or her social location.

And yet: if the issue is not the brand and the technical details, then it is often the product history (the origins à la Manufactum or Land’s End) or the promise behind the product range (Hess Natur) that can influence the decision. So: catalogue texts are not necessarily well-suited to online shop settings. Without a background, though, the products do not carry far enough.

4. Too much focus on logic, too little emotion

This is the result of the previous points, but it also goes beyond that. I am a fan of customer reviews and letters to the editor. If a shop lets customers rate products, the reviews are often very ‘feature’-oriented. If a customer describes his or her experiences with the product instead, the result is emotional. Naturally, I can classify a product’s appearance with the buzzword ‘eye-catcher’. But a mini-story is more powerful (for better or for worse) and as a result increases customers’ satisfaction and certainty of decision.

Too basic? Then stop thinking for a moment about why so many 2.0 instruments are precisely designed to bring the human touch back to the sales experience. And how you can get yourself a little slice of that potential.

About the author:

Martin Groß-Albenhausen is the editor-in-chief and publisher of the acclaimed industry magazine “Der Versandhausberater” and one of the leading experts for internet retail, direct marketing and e-commerce. “Der Versandhausberater” has been reporting on the latest trends and developments in the mail-order business in Germany, week for week, since 1961.

Read more here about how online retailers should deal with negative customer comments.

Active complaint management costs online retailers a lot of time and money. That is why so many retailers hope to be able to pacify their unsatisfied customers with small monetary gifts such as vouchers.

Economists from the universities of Bonn and Nottingham found out in a study: whoever wants to motivate a customer to revoke their negative rating has to invest around 40 euro. But there are easier and cheaper ways.

“It is a waste of time and expensive and online retailers would prefer to be able to get rid of these problems in an automated, digital way or to buy themselves out with vouchers. Seen from a business point of view, a 5 euro leave-me-in-peace voucher seems to be more cost effective than an expensive telephone call with the customer,” Matthias Henrici from the German blog konversionsKRAFT said about the situation.

Apologise for your mistakes

The economists examined the trade platform eBay to determine when customers who have rated a retailer negatively are willing to revoke their rating. Around 45 percent of customers were prepared to do that if the retailer apologised for the mistake.

Only 20 percent of customers withdrew their rating if they were given a voucher for €2.50, for 23 percent of customers the voucher had to worth be five euro.

The evaluation of the test is carried out two weeks later. In the first few days, the version with the red button actually did do better, but then the conversion rate slowly but surely started to drop. In the end, the original version was indeed more effective. By making small adjustments, the sales performance of the landing page could however be improved by about 11 percent.

What had happened?

Often, the truly effective levers for conversion optimisation are not noticed. The comparison of stationary retail and online shops demonstrates the problem: good sales figures for retailers are the result of several factors. A good location ensures more visitors, comparable with a good online marketing campaign. Attractive window displays and a positive first impression attract passers-by into the shop, similar to a good landing page.

However, factors such as product ranges, advice competency, staff friendliness, welcoming furnishings and optimum product presentation are however the key factors in purchase decisions. A good till system is of course taken as read. So what are the true decisive factors for conversion optimisation?

Optimise in the right places

Shopkeepers do not look into the depths of their till system to find the causes for poor sales. They also don’t make the mistake of thinking that customers cannot find the door handle when entering their shop. Similarly, web analysis and usability are rarely the factors that can lead to a doubling of sales figures in online retail. Other levers have to be activated to achieve more conversion in an online shop.

Tip 1: Ensure trust and credibility

You know that from your own experience: nobody goes into a “dubious” shop or an empty restaurant. People have a “good nose” for the reliability of a service provider. Various factors, even of the exterior appearance, can tell us whether we are taking too high a risk. In online shops, the mechanisms are similar. A positive first impression can be achieved through professional, slick design or with customer ratings and a seal of approval.

Customers check within the first few seconds to see whether an online shop is a “questionable outfit” or a trustworthy retailer. But be careful: closeness and personal contact are often strengths of smaller retailers in particular. Be sure not to lose those positive aspects when redesigning, for example by changing your landline hotline to a 0900 number.

Tip 2: Selling is like seduction

Do not try to lure customers in with lots of vouchers or price drop offers right away on start or landing pages. Consumers are becoming more and more sensitive and very quickly clock canvassing attempts. In the first few seconds, customers particularly check to see if you have what they want in stock. Therefore, make access to your product range easy for them via the search or navigation functions.

Studies have shown that customers’ willingness to look more closely at a product range is at its highest during the first eight seconds. It is therefore worthwhile increasing the relevance of your product range by presenting your product range in a mega drop-down format for example.

Tip 3: Get your customers into buying mood

Once customers have found their way into their shops, shopkeepers then employ a number of refined sales tactics. They know that customers buy more if they go round a shop in a clockwise direction. They use aromas and present products in the correct light. The emotional triggers of an online shop are however generally less noticeable.

It has now been proved that people do not make rational or “sensible” decisions in online shops. Most triggers for our decisions to make a purchase have to do with emotions, attitudes and belief patterns. We trust instincts and interpretations when we analyse product ranges whilst searching for the perfect buy.

In only the rarest cases is the price the decisive factor, the right feeling is much more significant. Therefore, you should ensure that you present your products carefully and suitably. Analyse your customers’ motivations for buying and put the advantage of your product in the foreground.

Take special care to use the right tone in texts and consciously implement emotional sales triggers. Make sure that you provide extensive product information. If it makes sense, additional emotional impulses, for example shortage (“Only three more in stock”) or urgency (“Order in the next 23 minutes for next day delivery”) can be the final clincher for you.

Tip 4: Surprise your customers

The 10 euro voucher for newsletter subscription on the start page is superfluous. Everyone knows it is “bait”. However, small surprises later on in the purchasing process are generally worth the money.

You should positively surprise your customers upon delivery at the latest. When opening the package, the most exciting moment, customers are mostly first confronted with an invoice and sheaves of promotional flyers. A simple “Thank you very much for your order” together with a small reminder of your other products is a much better investment for a good and long-term customer relationship.

Tip 5: Take care of your customers

Depending on what it is that you sell, it can’t do any harm to contact customers a few days after delivery to ask if everything was alright with the order. Often complaints that were satisfactorily resolved can lead to a particularly loyal customer relationship.

It is important that the initiative comes from you and that you resolve any problems in a pro-active manner and with good will. You can profit twice from that: psychological studies have shown that in the event of a complaint, a genuine apology is even more important than a voucher.

Summary

Organic growth rates sink, PPC prices increase, the number of competitors is going up. Internet retail is changing from a growth market to a cut-throat market. Whoever doesn’t optimise is out of the race. Use the opportunities on offer to increase your online shop’s conversion rate and as a consequence your sales and profit performance. Optimisation potential is huge. There is still a lot that can be learnt from traditional retail, especially with regard to consumer psychology and neuro-marketing. Good luck!

The Author

André Morys is the founder of Web Arts AG, a consultancy firm for digital added value focused on e-commerce and conversion optimisation. Since 2004, he has also been lecturing on Usability and User Centered Design at the University of Applied Sciences Gießen-Friedberg and also gives presentations on the subjects of e-commerce and conversion optimisation.

Because customer ratings ought to increase potential customers’ trust in an online shop, the retailer should think carefully about whether they want to use their own solution or integrate a solution offered by an external provider. After all, the success of all rating systems depends on the credibility of their customer opinions.

Furthermore, external customer rating solutions ought to be compatible with a variety of shop software solutions without a great deal of extra effort being necessary. The technical effort required on the retailer’s part should not be excessive. Of course it also goes without saying that external customer rating tools have to work with both off-the-shelf software as well as with open source solutions, for instance Magento.

In order to integrate customer ratings for long-term business success, a few things must be taken into consideration.

1. Trustworthiness of ratings

As usability guru Johannes Altmann aptly summarised on the german online magazine Internet World, the following criteria apply to the credibility of a rating system:

• Customer opinions have to be genuine and the provider has to answer for them. Therefore, opinions should be activated with an additional email confirmation (double opt-in) and be checked by the provider for credibility and reliability.
• Negative opinions should also be included in the ratings, because having only positive ratings appears unreliable – nobody is perfect.

Neutral, external rating systems are therefore enjoying increasing popularity in comparison to internal systems.

2. Collecting ratings

Of course, as many ratings as possible should be collected to truly benefit from a customer ratings system. It is therefore worthwhile integrating the rating option in existing system mails for the respective shop system. The optimum time of sending the email asking for a rating is also incredibly important. Many retailers integrate the request for a rating in the order confirmation email. That is however not perfect because the online shopper cannot yet rate the product or the delivery at that stage. For that reason, it makes most sense to ask for a rating after the delivery has been made.

Similar rules apply to the email which asks the user for their rating as apply to sending newsletters: personal address is priceless. Tip: refer to “recommendation” as opposed to “rating” when addressing the user.

3. Properly evaluate ratings

It is essential to be able to properly evaluate ratings that have been submitted. It is important to differentiate between general customer feedback which can only be used for your own process optimisation and “genuine” ratings with direct customer relevance that have to be analysed and processed.

Many rating systems are constructed one-dimensionally which often makes it difficult for retailers to generate a meaningful analysis. It is better if online customers can rate various criteria, for example delivery time, product quality, customer service etc. That considerably simplifies the strategic optimisation of the in-shop processes.

Reminder functions such as email alerts or an RSS function which automatically notify retailers about newly received ratings are also very popular.

4. Using ratings for shop optimisation

Involve your customers in the optimisation of your shop – after all, the best ideas often come from the community. Collect ideas and suggestions from your customers and weigh up what you can really improve.

For example, customer ratings can sometimes identify errors in your website or in your order process that you possibly hadn’t noticed. Often you can improve your customer service by simply looking at your customer feedback and reacting appropriately to it. Errors that third party providers are responsible for, for example your delivery partner, can be simply and efficiently discovered by reading customer feedback. The same applies to your product range. If you receive negative product ratings about a certain item, it might be sensible to discuss the issue with your supplier.

5. Special case: negative ratings

Some online retailers are often reluctant to use a rating tool because they are worried about receiving negative feedback. However, beforehand you should ask yourself how negative criticism should really be construed. You should differentiate between justified constructive criticism and unjustified criticism, spam or the event that somebody might say something inappropriate. You should always respond to constructive customer opinions: an rational and friendly reaction is to be expected. By giving a professional response it is usually possible to very quickly rebut criticism. In the event of mistakes that they actually made, online retailers should not be too proud to offer an apology and to correct the mistake.

If you as a retailer take your customers seriously and demonstrate that with professional complaint management, some problems can solve themselves within two to three days after the rating was submitted. Problems regarding delivery or usability in the shop are often soon forgotten after the receipt of a great product.

That is backed up by the study “Eine Entschuldigung sagt mehr als jeder Gutschein” (An apology says more than a voucher). It found that a personal apology led to 44 percent of eBay customers who had submitted a bad rating then changing their rating. In contrast, the issuing of a 5 euro voucher, that is to say a monetary consolation, only led to 22 percent changing their rating.

6. Using ratings as a marketing tool

Once ratings have been analysed and used to improve your own customer service, it also makes sense to use the ratings you have received to advertise. The principle of testimonials and recommendations has proved its worth over the last years in online retail as well.

Most customer rating systems offer the option of displaying customer feedback in the online shop in the form of a widget. That has the great advantage that new customers can see other customers’ opinions on their first visit to your shop. New customers do not know your shop and are generally pleased to see that other customers had no problems when purchasing from your shop. Therefore, place the ratings on the entry pages of your shop. They do not always have to be the start page. Many visitors will for example also go directly to your product detail pages via Google.

Insider tip: public comments about negative ratings show your customers that you deal with the problems in your shop. Accordingly, negative ratings can quickly generate a positive effect. In addition, having no negative ratings appears improbable to most online customers and can thus reduce trust.

7. Turn customers into fans

Active complaint management often turns unsatisfied customers into returning visitors and in the best case scenario into a regular customer. Customers who feel like their criticism is taken seriously generally then have a positive opinion of you and frequently even come up with their own ideas for improvement.

In times of Web 3.0 and social media it should be obvious to everyone that customers want to make use of their right to have a say, whether the retailer likes it or not. That is why retailers should offer customers the opportunity to do so in a central place, before they do so in another place that the retailer cannot not know about.

They of course include channels such as Twitter and Facebook. Obviously, some customers will already have made positive or negative comments about your shop there, that much is certain. A Twitter profile and a Facebook fanpage should therefore be standard and at the end of the day are not as much hassle as many people fear.

Summary

Customer ratings are a big trend subject for online retailers and lead to increased sales in the long term. Whoever takes note of the 7 tips is already halfway there. Customer rating solution providers do the other half. The Trusted Shops Customer Rating system is specially adapted to the requirements of Magento users and the starter version is available as a free download. A detailed integration handbook aids quick and easy integration in your online shop.

Register here.

Customers want a say too

The subject of trust will become increasingly important for online retailers over the next few years. Until now, online retailers have essentially had two strategies to convince potential customers that their shop is reliable, customer-friendly and service-oriented.

One strategy is to have their shop certified by a recognised provider of online seals of approval. It is then the provider’s expertise that generates trust. The other strategy is to strengthen their brand awareness, that is to say, use brand marketing. However, experience shows that that is a very costly and time consuming strategy that is only of limited relevance to many online shops.

Customer ratings are now establishing themselves as the third pillar of online trust-creating methods. This trust comes directly from the users themselves because a customer rating has the effect of a personal recommendation. The opinions and experiences of “virtual friends” are slowly but surely gaining the same value as those from personal acquaintances in the real world. Other people who have made purchases in the same online shop become part of the potential customer’s peer group. Potential customers then rely on their opinions when deciding whether to make a purchase.

Transparency and credibility

The success of all rating systems depends on the credibility of their customer opinions. Usability expert Johannes Altmann from the eCommerce consultancy firm Shoplupe considers a customer rating to be especially reliable when

• the opinions are activated “by an additional email confirmation”
• the opinions are checked “for credibility and reliability by the provider”
• “negative opinions are also included in the ratings, because having only positive ratings appears unreliable”
• the provider of a customer rating widget is able to also “make their end customers aware of their rating system”, that is to say they have enough “marketing power”.

The way that online customers can rate a shop is also an indication of the transparency of the system. Many users and providers have also become accustomed to so-called multi-dimensional ratings. The overall rating of a shop comprises many different sub-ratings. With the Trusted Shops rating system, customers can rate a shop’s website, the delivery, the product and the service quality on a scale of one to five stars after completing an order.

Customer ratings – quick and easy

You can integrate Trusted Shops Customer Ratings quickly and easily in your shop. Find out more here

Lacking customer confidence in the probity of an online shop is now one of the most common conversion hurdels for online retailers. Leading eCommerce experts such as Eric Schaffer and B.J. Fogg are convinced that this is the disappointing truth. Manuel Ressel of Web Arts has summed up how online retailers can successfully get over this hurdle and generate more customer confidence.

1. Seal of approval

The use of an established seal of approval, as offered by Trusted Shops, is a proven way of successfully increasing customer trust. With a seal of approval, the external provider vouches for the security of purchasing in the shop with their independent quality criteria. Ressel’s opinion about the general acceptance of seals of approval: “The majority of users do indeed consider seals of approval to be very trustworthy.” He does however warns urgently that there is the danger of self-produced seals of approval. After all, if a user realises that the retailer has produced his own seal, they will feel cheated and any trust that existed will be destroyed.

2. Customer opinions

Customer ratings have a similarly positive effect on increasing customer trust as genuine seals of approval. The same criteria apply  – fraudulent ratings will do online retailers more harm than good. Ressel therefore recommends using rating solutions from external providers.

“Customer opinions about your own product or own company shouldn’t be saved on your own database. That is why self-hosted customer opinions do not have as much weight as customer opinions that are placed on third party pages, e.g. Trusted Shops.”

3. Contact information

Legislation defines how and what kind of information the online shop provider is obliged to include in the disclaimer. After all, knowing which company or person is behind a shop is a key trust element.

4. Professional design

Experience shows that unprofessional designs are considered “cheap” by visitors and therefore have a negative effect on customers’ trust in the probity of a shop. A first step in the direction of a professional design can be made by sticking to basic design rules:

• Law of proximity: elements that belong together should be kept close to each other
• Law of similarity: related elements should be designed in an optically similar way
• Law of Prägnanz: elements that should stand out ought to differ optically from other elements
• Law of closure: closed elements are perceived more clearly as a single unit
• Law of continuity: related elements are arranged along a line considering past experience

Along with these basic rules, professional experience in branding with concise CI features and a strong logo is also important.

5. Content

The content of a website is also a factor in increasing customer confidence. For this reason, it is imperative that all products in an online shop are clearly labelled with a price. Any postage costs should also be listed on the product page, as well as the correct delivery time if the retailer would like to impart this information.

Of course, retailers can and should provide information about any offers in their shop. However, these promotions should not hinder customers from making a purchase. Layer or pop-up adverts should therefore be avoided. Finally, Ressel discusses the content of the address line of the browser.

“For services that are restricted to Germany, a de-domain should be selected, although a com-domain is also okay and should be standard for international shops. Free domains with de.vu-ending or endings such as de.ru which have a reputation for being well-known hacker sites only serve to create complete mistrust.”

Keep the rating form as simple as possible

In order to avoid that customers decline to give a review, the form should be as clearly arranged and as short as possible. The ability to submit a review without the requirement to log in is also recommended – comparable to submitting a commentary on a blog. Few customers will take the time to sign up, even if this entails slight advantages with regard to security. The online shop provider can compensate for this ‘disadvantage’ in general with an automatic confirmation of the email (double opt-in).

Source chart: marketingcharts.com

Request a review at the right moment

If the online customer has not yet received the product or has perhaps not yet used a service, it makes little sense to ask the customer to submit a rating. It would only make sense if the rating form offers the customer the option of not including these criteria in their rating.

In an ideal scenario, the shop system should send a follow-up email around three days after the delivery of the item asking the customer to submit a rating. At that stage, the online retailer can be certain that the product has arrived and has probably already been tested or used. Everything to best satisfaction? Then nothing stands in the way of a totally positive rating.

In this respect, it should also of course be pointed out that you shouldn’t wait too long with the follow-up email and obviously you shouldn’t send it several times.

A tip for experts: if the shop sells products that are often sent as gifts, the follow-up email should not be sent for these gift items as most of the time not all criteria can be rated effectively.

Effective marketing text

Just as with email marketing, the text in a follow-up email is key in the user’s decision as to whether they submit a rating. The following points should be considered:

• where possible, the email should be personally addressed.
• the email text should begin with a ‘thank you’ for the purchase made in the online shop. That immediately creates a personal and positive feeling.
• that should be followed by a sentence explaining that the online retailer is always glad to receive customers’ feedback and suggestions for improvement.
• It is followed by the polite request to submit a rating, stating how long it takes to submit a review. (It should not take longer than one minute to submit a review so that the online customer is not unnecessarily forced to deny giving the rating.)
• it also makes sense to add a sentence which again points out that submitting a rating helps other visitors when deciding to make a purchase from the online shop, as mentioned at the beginning.
• a nice colourful button that links directly to the rating form should round off the follow-up email.
• insider tip: instead of labelling the button “Submit rating” for example, write “Give recommendation” as it conveys a positive impression

Incentives for online customers

A question online retailers frequently ask is whether there are incentives they can offer online customers to submit a rating. Rating system providers cannot avoid this, meaning that many online shops provide their customers with a voucher code in the follow-up email for example, with the hope that they will make further purchases from the shop. This generally has no negative effect on the authenticity of the ratings because online customers have often already received voucher codes etc. in the mail order packages.

Of course, a nice, simple short URL could also be included in the mail order packages to remind customers about the rating form.

Recently, prize draws have grown in popularity, for example where a winner is drawn from the last ten ratings and is awarded a voucher code.

If the online shop also has a retail outlet, you could use the opportunity to direct the customer to the rating form on a laptop or postcard with a short URL and ask them to submit a rating – why not?

Summary

With these incredibly simple tricks, the number of ratings for your online shop should increase considerably. Why not try it out?

4 pillars of online trust: 80 percent increase in the conversion rate

Ash is CEO of the online agency www.sitetuners.com in San Diego, which specialize in the optimization of landing pages. During the ConversionConverence in San José, he clearly described how to increase customers’ trust in online shops.

On the one hand, the user needs to boost customer confidence with the first page view. On the other hand each visitor needs to accomplish trust no matter who he is or what requirement he has of the shop.

The four pillars Professional Design, Seal, Guarantee and Customer Review help build this trust. Due to Ash, they even increase the conversion rate up to 80 percent.

Seal

According to Ash, a seal provides evidence that the shop is approved by an independent certification company. The UK Online Fraud Report 2010 also measured that 85 percent of the interviewees look for signs which give them convidence that the shop is secure.

A seal like the Trusted Shops seal of approval can be such a sign. It is only integrated in online shops that achieve more than 100 legal criteria checked by the Trusted Shops legal experts.

Guarantee

Tim Ash went on to explain that guarantees help retailers to reduce customers’ fears in online shopping. With guarantees, retailers adress consumer fear and provide immediate solutions.

This is how Trusted Shops buyer protection works. It includes a money-back-guarantee if the money paid in advance is not refunded following use of the right to cancel or shop insolvency. Therefore buyer protection is an important attribute of the seals’ trust and thus the confidence in Trusted Shops.

Customer review

Sharing customers’ opinions and experiences about an online shop helps generate social acceptance of the shop and increase customers’ trust, as Ash explained in his speech. But a retailer will only achieve this acceptance if he communicates the opinions publicly.

The Trusted Shops customer rating system is an example of how retailers can generate trust throughout a community. This can be used to clearly demonstrate customer satisfaction immediately in the shop.

Optimise trust in your online presence with Trusted Shops

With Trusted Shops, online retailers can optimise three of the four pillars of online trust in their shop. Find out more about the seal of approval, buyer protection and customer rating.

Online customer reviews and ratings have a significant influence on the shopping behaviour of consumers buying online.

According to the Deloitte study more than half of all U.S. consumers and 69% of Millennials say that reviews and ratings by other consumers influence their buying decisions more than any other type of online advertising. As a result of the study 51% of the respondents said they had purchased products based on an online recommendation, and 24% said they would like to have an online service that recommends products based on consumers’ recommendations.

An ecommerce persuasion poll, carried out by user experience consultancy, Webcredible, revealed that almost one third (28 per cent) of online shoppers are most likely to be persuaded to make an online purchase by the reputation of the retailer.

Only 50 % of the eretailers use customer reviews

Still, though, only 50% of online retailers use customer reviews on their sites, according to Forrester Research. Those who don’t likely fear what their customers might say. They shouldn’t, according to Forrester, which also found that 25% of online shoppers report that they are unlikely to purchase a product after reading negative reviews, and most don’t take those reviews seriously.
But there is another reason why retailers should consider integrating a system into their online-shops that gives their customers the opportunity to share their service experiences: It can increase their creditability with their customer base overall.

Honest and impartial reviews written by real people enable consumers to choose the right shop for a product or a service and to buy with more confidence.

The Trusted Shops buyer feedback service

In addition to the well known trustmark Trusted Shops is offering a review and rating service where online buyers can provide feedback on transactions, rate online shops in a structured way and leave comments, provided they registered for a Trusted Shops guarantee at checkout.

Shopkeepers can use these unbiased buyer feedbacks to learn what customers liked and disliked, identify potential issues and use these insights to improve the shopping experience.

Click here to learn more about the Buyer Feedbacks by Trusted Shops.