European Online Holiday Retail Sales To Hit €51 Billion

Net users in Europe will spend a projected €51 billion ($71 billion US dollars) online during the Christmas season this year, according to Forrester Research, Inc. For the full year 2007, Forrester projects European online retail to grow 58 percent year-over-year. Forrester’s holiday forecast covers 17 Western European countries and 22 retail categories, and draws upon its European Consumer Technographics survey as well as data from the Interactive Media in Retail Group (IMRG) for the UK.

Among the findings of this year's survey:

Consumers in the UK, Sweden, and Germany shop online far above the European average, with around 70 percent of Net users shopping online in those three countries. In Italy and Spain, the percentage of consumers making an online purchase is closer to 30 percent.

The largest online retail market is the UK with 27 million online shoppers expected to spend more than €700 each during the holiday shopping season — accounting for a record-breaking €20 billion in online sales. Germany’s online shopping spend has grown to €12 billion, followed by €6.5 billion in France, Italy with €2.1 billion, and the Netherlands with €1.9 billion.

The top three categories this year are leisure travel, clothing, and consumer electronics, which will account for over half of the Christmas season’s online spend.

More information can be found at www.CRMindustry.com.

Survey Reveals Disconnect in Social Media Marketing Programs

According to a new survey by Coremetrics, social media marketing is quickly gaining popularity as a way to gain competitive edge. However, the survey also revealed that time and budget allocations are not yet reflective of this trend.

The study found that the use of Web 2.0 or social media marketing tools, defined as user generated content (including reviews), RSS feeds, podcasts and wikis are becoming more important parts of a complete online marketing program. While most marketers recognize this trend, and are eager to participate, very few have budgets that are in line with that objective.

The findings included the following:

A clear disconnect between the desirability of social marketing and the budget allocated to it:

78% of respondents see social media marketing as a way to gain competitive edge, but only 7.75% of total online marketing spend is devoted to it.

This compares with an average of 33% of spend going to online advertising and 28% to online promotion design and implementation

However, progress is being made in the field:

58% of respondents have implemented user generated content or reviews in the past year

31% of respondents have implemented a blog in the past year

25% of respondents have implemented an RSS feed in the past year

The findings showed that most marketers have concrete plans to implement a social media marketing program at some point, even if not within the next twelve months. Of those marketers, the majority recognize the need to implement or improve their social marketing programs, but cite a lack of tools and expertise as their biggest challenges.

50% of respondents plan to implement user generated content or reviews

22% of respondents plan to implement a blog

20% intend to implement social networks, and another 20% plan to implement an RSS feed

It is not just social marketing activity objectives that are misaligned with time and budget allocation:

Search Engine Optimization (SEO) was ranked as the #1 priority over nine other choices, including email campaigns and online analytics, but ranked only fourth in terms of both time and budget allocation

Email campaigns continue to demand most of a marketer's time (22% on average), while the biggest portion of budgets (33% on average) go to online advertising. This is despite the fact that SEO was consistently ranked as the #1 priority

Online promotion design and implementation was ranked as relatively unimportant, (#5 of 9) but comes in third in terms of both time and budget allocation, ahead of SEO, online campaign analytics and email marketing programs, among others

More information can be found at www.CRMindustry.com

Study Finds the World's Leading Corporate Innovators Stepped Up R&D Spending in 2006

Booz Allen Hamilton’s third annual analysis of the world’s 1,000 largest corporate R&D spenders, finds that these corporations increased their R&D investment last year by twice the dollar amount of 2005’s R&D spending rise. For the first time in four years, the pace of R&D spending in 2006 caught up to the rate of sales growth among these companies. North American headquartered companies led the way with the largest increase in absolute spending; R&D investment in emerging markets continues to grow rapidly, but remains a relatively small percentage of the global total.

Booz Allen also identified three distinct corporate innovation strategies, but concluded that the most significant performance differences lay not in which innovation strategy was used, but in how tightly it was aligned with overall corporate strategy. Companies that get the greatest return from their R&D investment also attributed much of their success to their focus on customer insight throughout the innovation process. In fact, companies that emphasize direct customer engagement reported three times higher operating income growth, 65% higher total shareholder return, and two times greater return on assets than companies less focused on customer feedback.

R&D spending caught up to sales growth in 2006. R&D spending by the Global Innovation 1000 rose last year by $40 billion to $447 billion, a 10% increase. The gain is double the group’s five-year compound annual growth rate and an amount more than twice the 2006 Gross Domestic Product of the Republic of Ireland. And for the first time in four years, the ratio of R&D-to-sales leveled off, ending a sustained four-year decline, with R&D spend matching sales growth (which was also 10%)

Companies headquartered in North America increased their absolute R&D spending by 13%, representing the largest source of dollar growth among the Global Innovation 1000. North American headquartered firms sustained their lead in innovation spending, having increased their absolute R&D spending by $21 billion in 2006, as compared with China and India which increased spending by only $400 million during the same period. Companies headquartered in China, India and the rest of the developing world represent just 5% of overall corporate spending on R&D in 2006, but their five-year average growth rate suggests a desire to catch up quickly. China and India grew their 2006 spend by 25.7% over last year, in keeping with a five-year average rate of growth of 25%.

Most companies adopt one of three strategies for effective innovation. Booz Allen identified three distinct corporate innovation strategies, through analysis of a subset of this year’s 1,000 top R&D spenders, surveys and follow-up interviews with C-level executives. However, no one of these three strategies consistently outperforms the others:

Need Seekers — Actively engage current and potential customers to shape new products, services and processes, and strive to be first-to-market with those products. The DeWalt division of Black & Decker, for example, stresses engagement with customers, and grew its U.S. power tools business from $150 million to more than $2 billion, increasing market share from the teens to 50%. DeWalt’s engineers and marketing product managers regularly visit homebuilding job sites to study building trends and their impact on the company’s products.

Market Readers — Watch their markets carefully, but prefer to maintain a more cautious approach, focusing largely on driving value through incremental change. Plantronics, a maker of headsets and other audio equipment, closely follows technological and user trends in both the commercial and consumer market, creating strategic partnerships with its major corporate customers and relying on a set of strategic filters, such as potential return of investment and sales forecasts, to determine what products to bring to market.

Technology Drivers — generate product ideas by deploying their technological skill and relying on unarticulated customer needs for product inspiration, rather than following the market or direct customer input, to drive both breakthrough innovation and incremental change. Siemens, the German engineering and electronics leader, aligns its long-term innovation portfolio around certain megatrends, such as the rise of personalized healthcare.

Companies that more closely align their innovation model with their corporate strategy perform better. Companies that align their corporate and innovation strategies have superior financial performance, with 40% higher operating income growth and twice the shareholder returns over the last three years than companies with strategies that are less well-aligned.

More than 11% of companies are High-Leverage Innovators. Compared with others in their industries, 118 of the 1,000 companies studied consistently outperformed their peers over the entire five-year period, while simultaneously spending less on R&D as a percentage of sales than their industry median, marking a more than 25% increase in the number of companies that earned recognition in this category compared to last year.

These High-Leverage Innovators attribute much of their success to their focus on the entire innovation value chain, from generating new ideas, to product development, to marketing. All appeared to work hard to make sure their innovation strategies were closely aligned to overall corporate strategy. And all shared a focus on the customer, and the processes they employed to maintain their customer focus throughout the innovation value chain.

More information can be found at http://www.crmindustry.com/

Asia Pacific Customer Relationship Management Software Market Set to Grow by 16.8 Percent Annually to 2011

As enterprises continue to invest in front-office applications, customer relationship management (CRM) software revenue in Asia Pacific is forecast to grow at a compound annual growth rate (CAGR) of 16.8 percent from 2006 to 2011, according to Gartner, Inc. With Australia leading adoption in Asia Pacific with 42.8 percent of the region’s CRM market in 2006, growth will continue to be buoyant in this market, with a forecast CAGR of 15.5 percent to 2011.

The strong performance of the CRM software market across Asia Pacific is being fueled by growth across all subsegments and in particular marketing which accounted for 23.5 percent share of CRM software revenue. Unlike the U.S., where the explosive growth of software as a service (SaaS) solutions has driven demand, the Asia Pacific region is still driven by more traditional deployment of CRM applications.

Despite this, the continuous push of on-demand solutions and market consolidation will continue to stimulate growth. In Australia, the mature IT infrastructure and strong vendor sales and channel infrastructure, as well as the availability of integration and support services, will ensure continued market penetration.

More information can be found at www.CRMindustry.com

New Study Reveals Behavior of CRM Users

A recent survey of 1000 B2B sales organizations using the Salesboom.com CRM platform reveals some interesting data on their behavior when using CRM.

Key highlights from the CRM User Behavior study include:

67% of users continuously seek shortcuts to complete a task.

Frequent CRM logins directly correlate to improved task times.

Workflow automation significantly increases sales when utilized.

Utilizing Leads Web Capture Tools generates more deals.

Only 32% of sales organizations utilize Proposal and Quote Management within CRM.

Only 39% of sales people fully use CRM to their advantage.

1 of 3 sales people use Events and Tasks religiously.

Only 19% of users attempt to build custom reports.

Formal CRM training increases adoption of CRM.

46% of users re-click on a link if load-time is over 2-3 seconds.

71% of users prefer the integrated email client over MS Outlook, when available.

36% of sales users complete more tasks on time when using Real Time Alerts.

68% of administrators don't utilize a sandbox when customizing CRM.

Organizations with highest user adoption rates frequently customize their CRM.

Service Organizations that use Self Service Portal and Knowledge Base close cases 18% faster, on average.

Utilization of Real Time Alerts closes cases 24% faster, on average.

Organizations who fully adopted CRM, close deals 36% faster, on average.

Ajax notes facilitate 61% more data entry compared with regular post style notes.

More information can be found at www.CRMindustry.com.

Personalization More Important Than Ever

As customers -- especially younger ones -- come to expect rich and personalized online experiences in their leisure hours, they will expect it of their services and solutions providers as well. Findings from ITSMA’s recent survey, How Customers Choose, demonstrate that personalization is a factor in the degree to which customers value the emerging digital media offerings from their B2B providers. Though many of these tools are crude and experience and expertise in deploying some of them are limited, marketers who don’t personalize their marketing will miss out on an opportunity to reach customers more directly -- and with lower costs -- than more traditional marketing vehicles offer.

Perhaps the clearest evidence of customers’ hunger for more personalized information from providers is their clear rejection of traditional, undifferentiated one-to-many communications. Of the 346 technology buyers surveyed by ITSMA, 83% said they no longer read unsolicited e-mail. Okay, so maybe that’s not very surprising. But here’s where personalization plays into the picture: Asked if they would read unsolicited marketing materials that contain ideas that might be relevant to their businesses, such as success stories, research reports, and Webinar invitations, 75% said they would.

Now, here’s the interesting part: Asked if they would pay attention to these marketing materials even if they were from solution providers they had not previously done business with, a whopping 92% said they’d take a look. Think you can take your loyal customers for granted by giving them generic marketing campaigns? Think again.

Today, email is the dominant channel for delivering personalized digital marketing strategies, mostly because it’s relatively simple to automate the campaigns. But personalized Websites (a.k.a. microsites) and customized landing pages for customer -- both of which have much more potential to build and maintain customer relationships -- are gaining momentum. They are held back by the relative lack of tools for automating the process, though such tools are becoming available.

It’s important to begin experimenting with online personalization, because one day, online interactions are going to approach the kind of intimacy and value of in-person executive meetings -- at a fraction of the cost. But even today, customers are increasingly looking to the Web to make their purchasing decisions, and when they do, you need to make sure they find exactly what they are looking for.

More information can be found at www.CRMindustry.com.

Why Hosted CRM Implementations Fail

CRM implementations have suffered through a spotty history since the mid 1990s. Everyone has heard the countless stories of CRM implementation failures — and the unfortunate people that were removed from their organizations as part of the downfall. This most recent survey conducted by CRM Landmark attempted to discover the frequency and causes of this long-standing issue with regard to the SaaS CRM market.

The CRM implementation failure survey conclusions are as follows:

Presumably due to smaller and/or more phased and piecemeal implementations, the frequency and effects of hosted CRM failures are somewhat less than their client/server CRM predecessors.

A key factor in historical CRM failures - user adoption - seems to be less of a factor with hosted CRM implementations. Nonetheless, change management plays a critical role during any implementation.

Primary factors related to hosted CRM implementation failures included a lack of project management during the implementation, lack of executive sponsorship, resistance to change (including hidden agendas), immature product solutions and a failure to clearly define the project objectives, business requirements and critical success factors.

Possibly the most notable project failure factor and one that represents a change from the prior era of CRM applications is the decreased citing of user adoption as a key challenge during the implementation process. While an initial inference would suggest that the hosted CRM applications have de-emphasized user adoption challenges as they are simpler or easier to use than their client/server predecessors, further analysis also reminds us that the scope and depth of hosted CRM applications often does not yet match that of prior periods. The media attention surrounding user adoption has also brought this issue to the mainstream which has undoubtedly resulted in better implementation planning and execution.

More information can be found at www.CRMindustry.com.

2007 Online Holiday Retail Sales To Hit $33 Billion

US online retail sales this holiday season will reach $33 billion, a 21 percent increase over last year, according to a recent Forrester Research, Inc. survey of 2,500 online consumers.

Among the findings of this year's survey:

Apparel and accessories will top holiday shopping lists — 80 percent of respondents said that they would purchase something in this category online during the upcoming holiday season.

A majority of consumers have a continued interest in free shipping promotions — 61 percent of online consumers said that they are more likely to shop online with a retailer that offers free shipping.

Fewer consumers are willing to pay for "frills" like gift wrap or overnight delivery this year — only 26 percent of consumers said they would pay for expedited delivery prior to the holiday season, down from 45 percent who said they would do so in 2006.

Gift cards promise to be a big winner during the 2007 holiday season — 18 percent of online consumers said that they plan to spend more on gift cards this year, compared with last year.

More information can be found at www.CRMindustry.com.

CRM Growth and Competition on the Upswing

Sales Managers, under pressure to do more with the same or less resources are increasingly upgrading existing CRM systems or turning to CRM for the first time to remain competitive according to a recent survey of Sales, Marketing and IT Executives. The study, performed by T.H.G. Sales Automation in partnership with Microsoft Corporation was conducted from June through August by the market research arm of Kensingtonhouse Ltd.

Interviews that targeted a population of over 20,000 large, mid-sized and small firms revealed that 4 out of 10 firms (42%) currently use CRM systems to increase the efficiency and effectiveness of their sales staff. In addition, 13% are either currently in the process of implementing or have recently implemented or upgraded a CRM System.

In terms of market activity, nearly 1 company in 4 indicated that they were either buying or investigating either a new CRM system or an upgrade over the next six to twelve months.

The study showed a large and diverse array of brands competing for the business with over 30 providers mentioned. However, the 80/20 rule was in effect with the top 7 brands controlling 81% of the market.

Historically, convincing the salesforce to actually use a CRM tool has been one of the most serious hurdles in achieving the promise of Return on Investment. The current data however shows a marked increase in adoption rates with 3 out of 4 respondents indicating usage rates in the 75% - 100% range.

When asked about their opinion as to the future direction of how companies will access CRM capability, Web based delivery was the big winner, with over half (55%) of the respondents indicating that On-Demand would be the delivery system of the future. Only 14% picked On-Premise, with the remaining 31% undecided.

The leading Reasons cited for choosing On-Demand were the “General Trend toward Software-As-A-Service (SaaS) and Web Based Delivery” at 31%; “Ease of Access and Flexibility” at 27% with “Lower Cost” coming in at 19%.

The main reasons to choose On-Premise included “IT Control and Ease of Management” at 70%, “Security” at 50% and “Superior Integration Capability” at 20%.

More information can be found at www.CRMindustry.com.

US Interactive Marketing Spending To Reach $61 Billion By 2012

Interactive marketing spending in the US will more than triple over the next five years, reaching $61 billion by 2012, according to a new Forrester Research, Inc. report. Forrester expects that a maturing perspective about interactive channels coupled with technology advances will eventually lead to interactive technologies infusing all marketing efforts, and the interactive marketing organization will dissolve.

The growth in interactive marketing spending represents a 27 percent compound annual growth rate (CAGR) over the next five years. Interactive marketing — which currently comprises 8 percent of all ad spending — will grow to 18 percent of total ad budgets in five years.

Forrester's breakdown of spending includes the following:

Search marketing will triple in five years. Mainstream marketers' aggressive use of search marketing will grow the category at a CAGR of 26 percent to $25 billion by 2012 due to the increasing costs of paid search, additional spending on optimization tools and services, and international expansion.

Display advertising will reach $14 billion by 2012. Display ads will be a key factor in the interactive marketing budget by having an essential supporting role for all interactive campaigns.

Services and integration — not volume — will drive email marketing growth. Spending will focus on improving email relevancy with analytics and data management, and will grow to more than $4 billion by 2012.

Online video ads will significantly increase. Growing consumer adoption of online video will result in a dramatic 72 percent increase in online video ad spending to $7.1 billion by 2012. More customer-centric online video applications will increase the medium's appeal for consumers and marketers.

Social media will drive emerging channels to $10 billion by 2012. Mainstream adoption will boost spending in emerging channels such as social media, mobile, game marketing, widgets, podcasts, and RSS. Spending on social media alone will grow to $6.9 billion as marketers understand how to use and measure this channel.

Mobile marketing will grow to $2.8 billion. As consumers become increasingly tied to personal computing handsets, they'll want to extend their mobile utility to accommodate transactions. This transition will drive mobile marketing to grow to $2.8 billion by 2012.

More information can be found at www.CRMindustry.com.

Be Part of Our Trends in Customer Relationship Management Survey

CRMindustry.com is conducting a benchmark study on the current state of and future direction of customer relationship management (CRM) in organizations today. The questions were designed to capture important information related to budgets, vendors, in-house vs. hosted solutions, the impact of CRM on the organization and more.

We recognize your time is valuable so we have kept the survey questions quick and concise. In addition, as a participant, you will receive a complimentary copy of the executive summary.
We will not share your contact information with any third party and responses will only be published in aggregate.

Your response is requested by October 19, 2007.

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Top 10 Strategic Technologies for 2008

Gartner, Inc. analysts recently highlighted the top 10 technologies and trends that will be strategic for most organizations. Gartner defines a strategic technology as one with the potential for significant impact on the enterprise in the next three years. Factors that denote significant impact include a high potential for disruption to IT or the business, the need for a major dollar investment, or the risk of being late to adopt. The top 10 strategic technologies for 2008 include:

Green IT. The focus of Green IT that came to the forefront in 2007 will accelerate and expand in 2008. Consider potential regulations and have alternative plans for data center and capacity growth. Regulations are multiplying and have the potential to seriously constrain companies in building data centers, as the impact on power grids, carbon emissions from increased use and other environmental impacts are under scrutiny. Some companies are emphasizing their social responsibility behavior, which might result in vendor preferences and policies that affect IT decisions.

Social Software. Through 2010, the enterprise Web 2.0 product environment will experience considerable flux with continued product innovation and new entrants, including start-ups, large vendors and traditional collaboration vendors. Expect significant consolidation as competitors strive to deliver robust Web 2.0 offerings to the enterprise. Nevertheless social software technologies will increasingly be brought into the enterprise to augment traditional collaboration.

Unified Communications. Today, 20 percent of the installed base with PBX has migrated to IP telephony, but more than 80 percent are already doing trials of some form. Gartner analysts expect the next three years to be the point at which the majority of companies implement this, the first major change in voice communications since the digital PBX and cellular phone changes in the 1970s and 1980s.

Business Process Modeling. Top-level process services must be defined jointly by a set of roles (which include enterprise architects, senior developers, process architects and/or process analysts). Some of those roles sit in a service oriented architecture center of excellence, some in a process center of excellence and some in both. The strategic imperative for 2008 is to bring these groups together. Gartner expects BPM suites to fill a critical role as a compliment to SOA development.

Virtualization 2.0. Virtualization technologies can improve IT resource utilization and increase the flexibility needed to adapt to changing requirements and workloads. However, by themselves, virtualization technologies are simply enablers that help broader improvements in infrastructure cost reduction, flexibility and resiliency. With the addition of automation technologies – with service-level, policy-based active management – resource efficiency can improve dramatically, flexibility can become automatic based on requirements, and services can be managed holistically, ensuring high levels of resiliency.

Mashup & Composite Apps. By 2010, Web mashups will be the dominant model (80 percent) for the creation of composite enterprise applications. Mashup technologies will evolve significantly over the next five years, and application leaders must take this evolution into account when evaluating the impact of mashups and in formulating an enterprise mashup strategy.

Web Platform & WOA. Software as a service (SaaS) is becoming a viable option in more markets and companies must evaluate where service based delivery may provide value in 2008-2010. Meanwhile Web platforms are emerging which provide service-based access to infrastructure services, information, applications, and business processes through Web based “cloud computing” environments. Companies must also look beyond SaaS to examine how Web platforms will impact their business in 3-5 years.

Real World Web. The term “real world Web” is informal, referring to places where information from the Web is applied to the particular location, activity or context in the real world. It is intended to augment the reality that a user faces, not to replace it as in virtual worlds. It is used in real-time based on the real world situation, not prepared in advance for consumption at specific times or researched after the events have occurred. For example in navigation, a printed list of directions from the Web do not react to changes, but a GPS navigation unit provides real-time directions that react to events and movements; the latter case is akin to the real-world Web of augmented reality.

Metadata Management. Through 2010, organizations implementing both customer data integration and product integration and product information management will link these master data management initiatives as part of an overall enterprise information management (EIM) strategy. Metadata management is a critical part of a company’s information infrastructure. It enables optimization, abstraction and semantic reconciliation of metadata to support reuse, consistency, integrity and shareability.

Computing Fabric. A computing fabric is the evolution of server design beyond the interim stage, blade servers, that exists today. The next step in this progression is the introduction of technology to allow several blades to be merged operationally over the fabric, operating as a larger single system image that is the sum of the components from those blades. The fabric-based server of the future will treat memory, processors, and I/O cards as components in a pool, combining and recombining them into particular arrangements to suits the owner’s needs.

More information can be found at www.CRMindustry.com.

E-mail Needs to be More Centralized

E-mail marketing needs to be centralized across all brand communications to increase consumer trust and avoid inbox saturation, according to a new report by Jupiter Research that was commissioned by e-mail marketing firm StrongMail.

The report, titled “The Maturation of E-mail: Controlling Messaging Chaos through Centralization” found that 93 percent of executives stated that their company has deployed some type of e-mail marketing and that permission e-mail marketing now accounts for 27 percent of the e-mail consumers receive in their primary personal inboxes, up from 16 percent in 2003.

The report found that almost an equal number of respondents to the survey cite multiple user support and enterprise coordination of e-mail mailings among the most important challenges they face when working with e-mail. Despite the fact that e-mail deliverability issues can be remedied through infrastructure such as regular mailing list hygiene practices, this must be executed across a business. Executives are challenged in optimization partly due to the lack of centralization and messaging coordination.

While executives are challenged with coordination, the report also found that 54 percent of respondents view e-mail as a central driver to increase sales and revenue. But marketers need to be relevant to keep this channel producing.

More information can be found at www.CRMindustry.com

Consumers Are Turning To Online Reviews In Large Numbers

Enabled by new information technologies, consumers have real-time access to information, insight and analysis, giving them an unprecedented arsenal to help make purchase decisions. At the same time, these technologies provide a voice and a venue for anyone with something to say, allowing individuals to shape reputations of consumer companies and their products, according to a new Deloitte study.

To build their knowledge arsenals, consumers are turning to online reviews in large numbers – and those reviews are having a considerable impact on purchase decisions. According to a recent survey by Deloitte’s Consumer Products group, almost two-thirds (62 percent) of consumers read consumer-written product reviews on the Internet. Of these, more than eight in 10 (82 percent) say their purchase decisions have been directly influenced by the reviews, either influencing them to buy a different product than the one they had originally been thinking about purchasing or confirming the original purchase intention. Interestingly, while the percentages were slightly higher for the younger generations, all age groups are reading and acting on online reviews at significant rates. In addition, the reach of consumer reviews isn’t limited to the online world; seven in 10 (69 percent) consumers who read reviews share them with friends, family or colleagues, thus amplifying their impact.

While the survey found that reputation and word of mouth – both factors that are greatly influenced by online reviews – are the key factors that influence consumers’ decisions to purchase a new product or brand, many other factors also play a significant role. “Better for you” ingredients or components, eco-friendly usage, and sourcing were each cited by approximately four in 10 consumers as important factors in making purchase decisions, while eco-friendly production and/or packaging was cited by more than one-third (35 percent).

Recent recalls of imported products are also contributing to this trend: one-third of survey respondents (33 percent) said that, as a result of recent recalls, they now look for more information on the packaging/product and almost one in five (18 percent) said they now look for more information on the Internet or in other locations.

More information can be found at www.CRMindustry.com

Multi-channel retailers spending more on improving e-commerce platforms

Multi-channel retailers are allocating more of their IT budgets to improving the cross-channel customer experience, including improving or replacing business-to-consumer e-commerce platforms, according to a new study from AMR Research Inc.

57% of retailers surveyed said they are adding to or improving their e-commerce platforms, while 30% said they are maintaining their current platform, according to AMR. The remaining 13% are not using an e-commerce platform.

AMR also found that more retailers are bringing their previously hosted e-commerce applications in-house to exercise more control and flexibility in their cross-channel operations and visibility to consumer activity. Only 27% of those surveyed outsourced web hosting in 2007, down from 35% in 2006.

Retailers also are spending about 40% more on security and compliance budgets this year as the deadline looms for compliance with the Payment Card Industry Data Security Standards, according to the survey. Budgets for PCI data security standards jumped to 57% of the total security and compliance budget, up form 41% in 2006.

In addition, to improve cross-channel retailing services, such as cross-channel returns or online ordering with in-store pickup, 4% to 9% of survey participants are adopting inventory, order, and returns management applications for the first time, AMR found.

Overall, growth in IT capital costs is expected to increase 3% this year to an average spend of $27,359, up from $26,464 in 2006, AMR says.

Source: Internet Retailer

More information can be found at http://www.crmindustry.com/

Retailers Are Getting Better At Welcome e-Mails -- When They Send Them At All

Retailers still have some catching up to do in their thinking about how to use e-mail, says a new report from The Email Experience Council, a unit of the Direct Marketing Association, a trade group that represents direct marketers and catalogers.

Its second annual study of 118 online retailers’ e-mail practices found that nearly a fifth (19%) take more than 24 hours to acknowledge customers when they sign up for e-mail communications—and a third of those take more than a week. “In the world of digital communications, that’s an eternity to wait for a welcome e-mail,” the study says.

But at least they are sending welcome e-mails. The study reported that 28% do not welcome their customers who sign up for e-mails, down from 34% a year ago.

Other findings in the Retail Welcome Email Subscription Benchmark Study report include:

• 58% of welcome e-mails were Can-Spam compliant, including both a mailing address and an unsubscribe method versus 52% last year. “Not all welcome e-mails need to be compliant, but considering that these are welcome e-mails for promotional e-mails, the EEC believes that they should be,” the report says.

• 62% of welcome e-mails asked subscribers to whitelist them by adding an e-mail address to their address book, up from 49% last year.

• 79% of retailers sent out welcome e-mails formatted in HTML, up from 69% last year. The remainder sent text-only welcomes. Most of the HTML welcome e-mails were HTML “lite,” the group says, making extensive use of HTML text.

• 75% of the welcome e-mails include the retailer’s brand name in the subject lines, same as last year. The council notes that including the brand helps the subscriber recognize the e-mail as one that was requested.

• 32% of welcome e-mails include a discount, reward or incentive, down from 34% last year.

source: Internet Retailer

More information can be found at www.CRMindustry.com.

Survey Reveals Top 100 U.S. Online Retailers’ Customer Service Shortfalls

With U.S. online retail sales for Q1 2007 totaling $31.5 billion, an new independent study has revealed that U.S. online retailers are failing in key areas of customer service, which has the potential to be devastating to the online retail market which is forecasted to reach $329 billion in 2010.

In a mystery shopper exercise conducted from April to June 2007, 34% of emails went unanswered by 100 of America’s top online retailers, with just over 50% of responses providing accurate and complete information. The findings of the audit are highlighted in a report published by Talisma Corporation.

Talisma asked the leading U.S. online retailers the following questions:

• What credit/debit cards can I use to make payment?
• What are your shipment charges?

Talisma’s audit awarded each online retailer a score out of 100, based on a range of customer service criteria, including speed of response, accuracy, completeness of information provided, and the personalization of interactions. Although 93% of companies audited responded to phone queries within 30 seconds, only 5% were able to communicate with personalized content – by referring to caller ID or a customer profile. Personalization is increasingly being recognized as a critical factor in delivering customer service excellence. In fact, customers are beginning to expect to be acknowledged and treated as “special” on return visits across all channels of communication.

Of the estimated 230 million U.S. Internet users, many are well versed with the use of chat, and prefer to communicate with online retailers that way. However, only 30% of the audited retailers are able to accommodate that channel preference. Even worse, for those customers who prefer to find information themselves before contacting customer service, a mere 3% of online retailers offer full-fledged Web self-service.

However, there were some bright points in the audit, including the fact that 100% of the audited companies provided access to phone-based customer service, with 95% providing it for free, and 96% provided access to email. Unfortunately, while 78% of U.S. Internet users shopped online in 2006, online retailers aren’t taking full advantage of the Internet channels. In effect, they are missing out on tremendous opportunities for both revenue growth and customer service cost savings.

Overall, the survey revealed that online retailers are failing in three key areas:

1. One-third of email queries were ignored - Email is generally accepted as one of the most efficient communication tools. This seems to have been overlooked by many online retailers as 34% didn’t reply to customer emails.

2. Lack of Self-Help Tools - 97% of online retailers had no knowledge base to help prospective buyers make an informed decision based on product features and suitability, known issues, or customer service accessibility and policies.

3. Accuracy of information provided - only 51% of emails and 72% of phone calls answered provided accurate information.

Additionally, the audit revealed that 89% of online retailers do not provide agents with a unified customer history of all customer interactions across channels.

More information can be found at www.CRMindustry.com.