STORES Magazine - August 2008 - (Page 60)

WORTH WATCHING / WEBSITE OPTIMIZATION E-tailers Get Psyched Behavioral psychology unlocks clues to website conversion rates BY D. GAIL FLEENOR s retail websites begin to mature, the quest for shoppers, not just visitors, becomes ever more crucial. Some etailers try to improve the odds by using click statistics that record customer behavior, while others hire consultants to analyze page layout. 7 Billion People has entered the fray with the release of software that offers retailers the ability to examine the psychology of buying behavior and improve transaction closure rates — more commonly known as conversion. A Austin, Texas-based 7 Billion People wants to personalize the e-commerce experience for every individual customer. Its team is composed of psychologists, behavioral scientists, information technology experts and software engineers. Formed in August 2006, the company was “in stealth mode” until its behavior analytics software was released in February. “When we started this company, we had heard things about standard e-commerce requirements, that conversion rates averaged about 3 percent,” says company CEO Mark A. Nagaitis. “We knew customers were doing weird things on websites. Sixty percent abandon shopping carts. Even the flagship of e-commerce, Amazon, has an abysmally low conversion rate when competing with face-to-face shopping. “We saw that something was still missing, the emotional factor, and the psychology of buying.” Many crucial elements of face-to-face selling such as body language, tone and the actual words used, have been left out of e-commerce, he says. 7 Billion People’s chief scientist Bill Minnis is a practicing behavioral scientist with extensive experience in linguistics and the language that affects behavior. “He examined how people sell face60 STORES / AUGUST 2008 “We put the psychologist’s brain into a neural network that looks for clues about how customers make – Mark Nagaitis, decisions.” 7 Billion People to-face,” Nagaitis says. “We put the psychologist’s brain into a neural network that looks for clues about how customers make decisions.” Behavior-based portraits The resulting product, MarketMaestro, tracks 15 primary attributes in a psychological model and generates eight different “portraits” based on human behavior. Customer motivation, buying methodology, site presentation preferences, and other factors define each portrait. Reports showing which portraits are drawn to websites and specific behavior on the site, such as visits, returns, abandons and conversions, are created. The software analyzes this data for correlation and “dissonance” and provides site recommendations to e-tailers. “With close to seven billion people in this world, there are seven billion marketing messages,” Nagaitis says. “We want to put the right product in front of the customer in the way that will make him want to buy.” He cites differences in online shoppers such as consumers who are process-oriented and like following the typical online checkout process; other customers may like random access and feel constricted by a rigid process. Nagaitis recently worked with a cruise company. Eighty-five percent of customers “were abandoning at step four of the checkout procedure,” he says. Using MarketMaestro, some clues were found. One type of customer was concerned about the safety of online transactions and needed reassurance that using a credit card online was safe. Since transactions on the website involved thousands of dollars, satisfying this customer’s need for safety reassurance was critical. “We recommended that they move up their policy information and VeriSign logo,” Nagaitis says, and the result was a 50 percent reduction in abandonment rates. MarketMaestro runs on 7 Billion People’s remote, hosted servers to transparently monitor customers’ online behavior. E-commerce sites can then view MarketMaestro reports through the web portal. All that is required of the retailer is the addition of three lines of JavaScript to the store website and a quick test, Nagaitis says. From airlines and car rental agencies to fashion and computer retailers, MarketMaestro is helping a wide array of businesses improve their conversion rates, Nagaitis says. “We believe we will help increase a customer’s top-line revStORES enue by at least 5 percent.” D. Gail Fleenor, a Virginia-based freelance business writer, has nearly 20 years experience in retail and consumer research. WWW.STORES.ORG http://WWW.STORES.ORG

Table of Contents Feed for the Digital Edition of STORES Magazine - August 2008

STORES Magazine - August 2008 Contents Executive Editor's Page President's Page The Lure of Free Shipping Walmart’s New Look What Shoppers Think Will Widgets Work for Wheat Bread and Wasabi? 10 Things You May Have Missed Numbers Worth Counting Full Price/Markdown Retail People Store Design Industry Economics Hot 100 Retailers Concept2Watch Mobile Technology Small Store Technology Website Optimization Site Selection Mobile Payments Recycling Merchandising: Cool Sells Merchandising: Merchandising in Mexico Store Construction & Development Human Resources Loyalty Programs Mobile Marketing Loeb Retail Letter Arts Update Point of View NRF News Retail Crossword Retail Industry Calendar Last Laugh

STORES Magazine - August 2008

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