Tweetables

• Europeans make up 12% of the global population, and 21% of the online population Tweet this

• Iceland and Scandanavia have the highest Internet penetration in Europe Tweet this

• Only 59% of Europeans shop online Tweet this

• Romanians, Bulgarians and Italians are least likely Europeans to shop online Tweet this

• 92% of Europeans prefer Google as a search engine Tweet this

• 49% of Europeans use social networks daily, 1/3 of them are Russians Tweet this

• There are 131.5 million smartphones in Europe (46% Android, 39% Apple)
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• It’s predicted that there’ll be 35 million tablets in Europe by 2014 Tweet this

What are some of the key ingredients of Pearson Ed’s digital strategy? They dished at PaidContent Live last week, and we’ve got the scoop.

Sense of entitlements

A digital textbook can be monetized by a variety of business models. For example, a student might buy time-limited access to content, or buy only the chapters associated with course syllabus. Textbook content could also become available as part of a semester-long subscription bundle. Supplementary material like study guides, sample tests, video or learning games could be accessed within content through micro-transactions.

A digital content commerce platform needs to recognize entitlements (rights to access content) and to support re-monetization like renewals, upsells and upgrades.

Programmers as merchandisers

Busting up a 400-page textbook into granular pieces requires this micro-content to somehow describe itself. Of course this supports search features, but also personalization and even guided-learning. Pearson Ed gives an example: the textbook diagnoses a student struggling with the quadratic equation, and prescribes a way out of the rut through supporting materials — perhaps within other publications. APIs make the content-fetching and push-recommendation possible, while analytics drive the intelligence.

Though these content recommendations could be monetized through micro-payments, \with content, it’s not as much about continuous transactions as customer lifetime value. Operational business intelligence is a big part of this, continually learning and shaping business models and consumption requirements that are unknown today.

Melting the snowflakes

Large organizations like Pearson can find it challenging to get different departments and business units to come together, especially when acquired teams come with their own ways of doing things. When different groups see themselves as unique “snowflakes,” IT ends up building a lot of point solutions. Pearson’s working on bringing many groups together to identify similarities, so less marginal work is done, and more core work that can be scaled across groups. Not only does this spare resources, it also creates more opportunity to integrate content across groups into new apps and products.

This and more was shared in the PaidContent Live workshop Rubber meets road – a case study for monetizing content everywhere with Pearson Education’s VP of Marketing Technology and Global VP of Online and Commerce, along with Elastic Path’s CTO and GigaOM’s VP of Research. Check out the full session replay below (41 min). (Disclosure: Pearson Education has recently become a customer of Elastic Path)

Subscribers: can’t see video? View the video on www.elasticpath.com

This is the capsule version of why Jason Pontin, Editor in Chief and Publisher of the MIT Technology Review has lost his religion regarding native and has fully embraced HTML5.

Jason was joined by Nick Alt, VP of Mobile from Vimeo and Ryan Spoon, SVP of Product Development at ESPN on a panel app-tly named Are Apps or the Web the Future of Mobile Content? last week at PaidContent 2013.

“Traditional publishers told themselves something like this: The Internet taught readers they could pay nothing and advertisers they could pay less, and though no one in the history of publishing had ever really liked digital replicas, native apps would be like digital replicas but even better. They would teach readers to pay again…and we could somehow move back into the past.”

Though Pontin never fully bought into that gospel, he did believe native “could do sufficiently cool things that it might be worthwhile investing a lot of money in it.” Not unlike where many retailers and publishers find themselves today.

“Over a year long experiment, we ended up with around 200 new subscribers, we spent around $400,000 in unbudgeted expenses, and my head of digital development and most of his staff left, and the editors were furious.”

After the fact, Pontin determined that for the MIT Technology Review, “native apps were worthless,” and everything of value he wanted to do could be done with HTML. So in October, 2012, the publication joined the Financial Times in pulling its Android and iPhone apps in order to focus more on HTML5.

The case for native

For Pontin’s co-panelists from Vimeo and ESPN, dodging native is not an option. Says Spoon:

“We have a diverse portfolio of products. Watch ESPN streams millions of hours of live footage. This can’t be done in HTML5 in the quality and movability that we want it to. There are other components – scores – which is the fundamental need of what we do, and content, and we build products to serve both avenues.”

ESPN builds its Web experience using mobile first principles, but “for rich experiences, it has to be native.”

Both Vimeo and ESPN cited the communication benefits of their apps. While email is far from dead, updates on things like sports scores hook into native apps much more seamlessly than through constant email updates. Vimeo has run identical campaigns through email and push notification in tandem, and experienced more monthly unique users and revenue for push vs. email.

The summary from the panelists whether to go native or not could be boiled down to “if your content needs to tap deep into the software and hardware of a device, and you want to do things HTML5 can’t do yet, go for native.” But it’s simplistic to conclude that publishers of non-video content should stick with Web apps because MIT Technology Review or Financial Times pulled out.

Looking under the hood

If my client told me “we tried testing our home page, but we didn’t see any uplift, so we stopped testing,” I’d have a lot more questions for this marketer. I’d want to know what elements were tested, what tools were used, was everything implemented properly, how was success measured, how long the test was run, etc.

I have similar questions for MIT Technology Review:

• You achieved 200 sign ups. What was your conversion rate? Was any effort made to improve app store conversion rate (screen shots, description, reviews, value propositions)?
• What is your app store conversion rate relative to Web and Web app? How do you know an HTML5 Web app won’t have similar results?
• How was your native app priced? Was it sold as an additional paid subscription to existing subscribers? How was it priced relative to other delivery formats? Have you explored freemium?
• How many app downloads were existing vs. new readers of your publication?
• How was your app marketed? Was it a silent launch? If you surveyed your entire readership today, what percentage would be even aware a native version was available? What value propositions did you present to motivate subscribers to download your native version?
• What metrics besides new subscribers did you track? Can you measure native’s impact on engagement vs. HTML5 apps, and how did that impact advertising revenue and subscriber retention?
• How did your native users rate your app? Did you gather feedback on usability and satisfaction? Did you leverage push notifiactions to re-engage app users? Did you support offline reading?
• ROI for such a costly project does not always happen within a 12-month span. Why abandon so quickly?
• Have you explored new business models that a native app could serve, rather than simply re-purpose print content? What if the app could provide search across issues, access to back-issues and back-articles suggested through a personalization engine to drive incremental revenue while monetizing your legacy content? In other words, have you explored new business models a native app could be built around?

The publishing industry faces challenges with going native, no doubt. Aggregators like Zite and Flipboard are competitors with a disruptive value proposition. For some publishers, dodging native and partnering with aggregators is an option. Generally, people are reluctant to pay for content that’s easy to find for free. But MIT Technology Review isn’t generic news. It’s possible that any of the above questions hits on a hole in the planning and execution of the native strategy.

Minimizing your risk of trying native

MIT’s native flop was a costly learning. And some learnings can only be reaped after throwing some time, effort and cash at the wall. Every digital and retail business is faced with the decision to build and support native apps, HTML5, both or none. How can you reduce your risk of making an expensive mobile mistake?

• Don’t be a first-mover. Sit back and watch your competitors. Are they pulling out of new channels as quickly as they got in (think Facebook Stores)? It’s the safe option, but carries risks of lagging behind the competition and concluding that it doesn’t work for your industry based on one or a handful of withdrawals, without knowing the reasons why the projects failed.
• Pick a flagship platform. Some businesses offer only Apple apps, for example. If it’s successful, branch out.
• Wrap it in native. A quick fix is to take a common HTML5 code base and wrap it in native code for each app store. Not as robust as a full native app, but enables you to fail faster and gauge customer acquisition and revenue uplift without investing too many resources.
• Use an app builder. The classic build vs. buy decision – there are vendors that can build you an app at a fraction of the cost of doing it in house. As with ecommerce platforms, businesses that require custom features likely won’t find app builders sufficient.
• Use a touchpoint broker. The big challenges in bringing commerce to new touchpoints is costly experienced developer resources, long project lead time, and the security risks in exposing business logic to outside applications. We set out to solve these problems through a dynamic touchpoint broker. Elastic Path Cortex turns content and transaction requests into simple language that developers can easily embed into a variety of device and platform-friendly apps.

To end on a positive note, Popular Science has netted over $1 million in revenue after design, licensing and revenue share with Apple on its iPad edition. Popular Photography has converted 10% of subscribers to iPad. And Condé Nast grew digital sales by 268% in 2011.

Future made $1 million from the iOS Newssatand in its first month, with 75,000 new subscriptions.

Take heart. Native apps are not dead for publishers industry-wide.

Opinions vary whether the novelty may wear off, the bubble burst or if it will truly disrupt the international banking system as we know it. But the question for ecommerce professionals is whether or not Bitcoin should be considered as a payment option today.

What is Bitcoin?

Bitcoin (BTC) is a peer-to-peer digital dollar that was created by an individual or collective by the pseudonym of Satoshi Nakamoto. Any computer can run a free application called a Bitcoin miner that performs the necessary calculations to create the coin, storing BTC in a free, open source digital wallet of your choice. All churn-and-burn activities are broadcast across the public Bitcoin network and permanently recorded, and it claims to be anonymous and untraceable to any individual (though a core developer told Gawker law enforcement could apply network analysis to track down individuals if need be).

Bitcoin’s both a currency and a commodity — speculators have sent BTC’s value soaring and crashing. Despite this, Bitcoin is being taken seriously by Web properties like WordPress, Reddit and Wikileaks, physical businesses like bars and restaurants, and several small-business ecommerce software platforms now have plug-ins that support BitPay (a Bitcoin payment processor that performs exchange into local currency at its daily rate). Bitcoin claims over 4,500 digital and physical companies use its service.

Why Bitcoin for Commerce?

Bitcoin charges no transaction fees for consumers. From a merchant perspective, Bitcoin’s lower transaction fees (1-2%) and protection against any type of reversal or chargeback makes it attractive.

BTC also opens up business to customers in countries unsupported by PayPal and other credit issuers, as well as minors. Unlike bank transfers through PayPal, payment clears instantly, a benefit for both business and customer.

Bitcoin for digital products

Digital goods publishers and online service providers like Web hosts have much to gain from access to a truly global market — physical shipping is moot.

While other virtual currencies like the defunct Facebook Credits are limited to a closed platform and typically siphon a large chunk of revenue (Facebook Credits was 30%, for example), Bitcoin’s universal, making it appealing to developers and publishers who want to maximize content monetization and use a standard virtual currency that’s platform agnostic.

Is there demand for Bitcoin as a payment method?

Those in the know about Bitcoin tend to lean on the techie side, so your target customer may still be blissfully ignorant about it. In fact, offering it as a payment option to those who don’t recognize its branding can lower conversion by introducing confusion.

On the other hand, if you’re a small business with a tech-geared customer, riding the wave and getting listed in shopping directories for BTC holders could build awareness of your site and be a value proposition to this customer segment.

Web host Namecheap’s web site claims customer demand fueled its decision to include the payment option. “For months, Bitcoin has been requested of Namecheap among the tech audience. We’re pleased to announce that we’ve listened to your feedback.”

Risky Bitness

As a digital currency, Bitcoin’s potentially vulnerable to hacking, the public losing interest or the bubble popping. And while it’s a proof-of-concept that shows promise for decentralized money, it’s yet to be proven. There remains enough FUD (fear, uncertainty and doubt) to keep customers from demanding it as a payment option. And to become truly disruptive requires a critical mass of trusting users.

For now, only businesses with customer demand for Bitcoin should add it to checkout. The rest can sit back and wait to see whether this turns out to be a disruptor or just a digital pipe dream.

Image credit: PeaceNewsNow

While ecommerce Easter eggs 1.0 hide in websites (or others’ websites), 2.0 eggs appear off your storefront, in mobile apps, social networks or even in-store.

This season, UK grocery chain Asda took the Easter egg concept literally, running an augmented reality egg hunt in its stores. Hunters armed with the Asda mobile app could scan eggs that transform into virtual eggs with secret letter inside. Finding all the eggs to complete the password wins the player a free gift.

Other possible Easter egg tactics include collaborating with third party app developers to embed free downloadable content, buyable products, loyalty rewards points or coupon codes and vouchers, similar to Bonobos’ collaboration with NotCot. Of course, these rewards could be integrated into a brand’s own apps or social presences via API mashup, such as a Facebook Tab.

Easter eggs don’t need to have any connection to the Easter holiday, they just need to be hidden. In an ecommerce context, eggs could be triggered while using a store finder tool (e.g. showing a city’s sports team’s mascot that qualified for a championship final), viewing certain products/content or even searching specific terms.

Google’s hidden a number of Easter eggs in its search properties, most of them are quite funny. Hello? Is it Lionel Richie you’re looking for?

Apple’s Siri tells you how she really feels about select movie searches.

If humor matches your brand personality, playing up Easter eggs may pay off in positive vibes and word-of-mouth. But tread carefully, any content on your website or in your app that causes confusion or hurts conversion can backfire. Consider traditional user testing to measure reactions to avoid rotten eggs.

Traditional Easter eggs are found serendipitously, not announced, but Easter eggs can be part of a gamification strategy for your transactional or branded app to increase engagement. Hint: If you run an Easter egg contest / promotion, be sure to note in your analytics the beginning and the end of the game, it will surely produce unreliable site/app usage data as page views are not necessarily indications of popular content or purchase intent.

Have you found any Easter eggs on retail sites or apps in the past year? Drop a line in the comments!

What makes this infographic interesting for ecommerce pros is many of these online properties have become entrenched in the daily lives of consumers and offer businesses marketing channels where the eyeballs and attention are.

What I find most interesting is how it appears that for every 2 emails sent, one Youtube video is viewed, and how by 2015, the device-to-human ratio will be 2:1.

Click to enlarge infographic

Tweetables

• Every minute, 204 million emails are sent Tweet this

• Every minute, 1300 new mobile users are added Tweet this

• Every minute, 47K apps are downloaded Tweet this

• Every minute, Amazon makes $83K in sales Tweet this

• Every minute, 320 people join Twitter and 100K tweets are sent Tweet this

• Every minute, there are 277K Facebook logins and 6 million page views Tweet this

• Every minute, >2 million Google searches are performed Tweet this

• Every minute, 1.3 million YouTube videos are viewed Tweet this

• By 2015, the number of networked devices will be 2x the global population Tweet this

If you aren’t familiar with RSS, this video explains it “in plain English.” Essentially, RSS is a way to syndicate content like blog posts, video or new product listings (though not the only format for syndication). A content publisher makes a feed of this content available for consumption through an RSS reader, email, widget or other application that can turn it into a friendly format.

Though these may be fringe use cases, some practical example of RSS on ecommerce sites include:

Site personalization

Netflix offers public and private RSS feeds. Members can personalize suggested content within their account, or subscribe to public feeds such as top 25 by genre.

Orbitz launched its RSS collection in 2006, they still exist today along with the option to add to your Yahoo portal page (hey, it was the 2000′s!)

Though it’s not obvious, Zappos offers their geek-savvy customers the option of subscribing to a brand’s new listings by RSS in addition to email notifications from brand category pages.

Ebay has long enabled users to save their search terms and opt into daily email summaries of new listings.

Recently, Ebay redesigned its US home page to include saved searches in a Pinterest-style, personalized feed that updates in real time.

While the general population may not “get” RSS, they certainly are familiar with the idea of following feeds, thanks to Facebook, Twitter and their social cousins. Ebay suggests similar feeds to follow (based on saved searches), and enables users to connect with Facebook to import interests from profile information.

Affiliate development tools

Developers can also pull Netflix’ public RSS feeds to power apps like Instantwatcher, which alerts users to expiring Netflix titles, among other tools.

Ebay uses RSS feeds for affiliates, who can create a customized feed of new products that fit a set of Advanced Search criteria.

New product or deal alerts

RSS vs API

Web users are much more familiar with the concept of following micro-streams of content a-la-Twitter than subscribing via RSS. With Google Reader’s exit, even the geekerati will be hard pressed to subscribe to ecommerce feeds, though there’s opportunity to continue to offer RSS updates through Zite, Feedly and similar apps for sites where RSS is a popular feature.

RSS still has value for on-site personalization like Netflix, where members can use it to tailor content they see when logged into a site.

But the question is, should you use RSS or an API to build this functionality?

The difference between RSS and API

Though RSS feeds may be delivered as part of an API, RSS is used to push fixed content updates, such as new product additions, daily deals or latest product reviews. If your feature requires more interaction by the user other than subscribe and watch the content updates roll in, or if you want to slice or mash up your content beyond what RSS can do (including integrating with Facebook Connect), and API is your better option.

RSS or API for developers and affiliates?

Developers are a different breed than your typical non-technical consumer, and offering them standard RSS (alone or as part of an API) enables them to pull your data without having to write any code themselves. But again, RSS has its limitations, and if it’s important for you to offer developers such as affiliates a way to create more complex features with your data feeds, consider an API.

Dear Google Reader Subscribers

Our stats show the bulk of Get Elastic RSS subscribers use Reader, and we would love to keep connected with you after Google Reader shutters. If you’re looking for a worthy substitute, check out Econsultancy’s 40+ alternatives to Google Reader. If you’ve found an alternative you love, please share your RSS reader suggestion in the comments.

The idea’s primary purpose is to solve a usability issue on devices with slower refresh times, such as ereaders that use electronic paper, which can range from 100 to 250ms. Users accustomed to fast refresh of LCD and CRT displays (~15ms) can get confused by longer delay and assume their input was not registered.

Another issue gravity-based link assist intends to address is the difference in pixel granularity, which increases the chance that the device activates a different input than what the user intended. Both hiccups can affect on-device transactions, and could mean more money for the Kindle bookstore, or massive licensing revenue should it be adopted by other websites.

How it works

According to the patent filing, the solution uses “gravity parameters,” or distance thresholds from a clickable target that can be predetermined or configured by the user. Image links may have stronger pull than text links, for example. Or higher-priority actions may be given stronger “gravity” than others. Links with weaker gravity may be skipped over by the moving pointer. The pointer will settle smack-dab in the “assisted-center” of the target link.

So I know you’re all thinkin’ – how can we use this for evil in website optimization? Wouldn’t it be nice to use a Ouija-like director to your primary call to action! But this functionality would likely cause more abandonment when it’s not needed for accessibility or usability reasons on fast devices. Amazon’s apparent intent is better accessibility rather than maximizing profits.

But the patent is drawing criticism that the “gravity wells” should not be patentable, that it’s been applied to assistive technology and gaming applications for years. One commenter on Wired says ”It won’t surprise me in the least when Amazon attempts to patent gravity itself.”

Hat tip to StorefrontBacktalk for the story idea

As a novel device that’s expected to run apps and connect to the Internet, the natural curiosity is what potential it holds for digital marketers and ecommerce. Is G-Commerce on the horizon?

A disruptive device?

Like smartphones and tablets, Glass can capture input and send and receive information. Innovative as it is for headwear, nothing it does can’t be done through smartphones — take a picture, record video, check stocks, weather, email, receive texts, make a video call, use GPS, etc. The differentiator is that it’s hands-free (aside from controls on the side of the device), enabling quicker access to information, while bringing the connection “closer to the senses.”

Elastic Path digital commerce strategist David Chiu comments:

I don’t think that Glass will be disruptive just because it’s a wearable device. That’s like saying that a mobile phone with no software or apps is disruptive. Both are just pieces of glass that provide a UI. The disruptive part will be the evolution/creation of digital products and services which provide value-adds that weren’t previously practical without that specific kind of screen (PC, laptop, television, tablet, mobile, and now wearable).

Developers will shape the utility of Glass, but ultimately it’s Glass users who will determine what “sticks.” But that doesn’t mean we can’t do some crystal-ballin’ on what may emerge.

Disrupting Search

Perhaps Glass’ biggest disruptive potential is how we search when we’re on the go. Google’s mobile Search app currently supports image capture search. For example, aiming the camera at a book’s barcode using the Google Search app…

…brings up options to search Google Shopping or view in Google Books.

Google Shopping further drills down to vendor results and “search nearby.”

A Glass Search app is a no-brainer. A mash-up with Maps and a database of local product inventory (provided through data feeds from local merchants) leveraging GPS could provide directions to the nearest copy of this book, all without pulling your phone out of your pocket.

But Google’s more ambitious than this — it could one day disrupt its own search engine baby with the expansion of its card-based Android app Google Now. Cards are packets of information organized around subjects like sports, travel, weather, real estate and restaurants that are personalized and predictive, like an always-on digital butler.

Imagine a Google Shopping card, integrated with Google Wallet, that enables a purchase experience like this:

Glass could capture a barcode, scour the Google Shopping database and identify available product attributes, enabling the Glass user to add to a virtual cart and purchase. The card could use a predictive decision engine that selects the lowest price plus shipping source (or highest rated merchant), eliminating the need to comparison shop or share financial information with any third party.

Will you need a Glass App?

Glass is paired to a mobile device, so it could easily tap into existing smartphone apps. Glass has an API for developers, but it’s too early to make a business case for Glass-specific ecommerce apps.

However, Glass may in the short-term boost Android’s momentum, amping the priority for developing Android apps over iOS. Considering Apple’s share of the mobile OS market is decomposing, iOS apps may become much more of a luxury than a necessity for mobile commerce.

In the long-term, rather than require native apps, Glass and other “smart” products are expected to be platform agnostic, fetching and sending data from apps in the cloud, sending and receiving only the digital information it needs to perform its own relevant functions. Gartner calls this “cognizant computing.”

Cognizant computing is not a new concept, it is the natural evolution of a world driven not by devices but rather collections of applications and services that extend across multiple platforms and exist outside the realm of connected screens, such as phones, tablets, PCs or televisions.

Disrupting the WWW?

These cloud-based, platform-agnostic apps and services offer the “ultimate in responsive design,” and could be what ultimately disrupts the browser-based World Wide Web as we know it. Commerce may be conducted entirely through APIs.

Until Glass and its API are officially released to the masses, we don’t know exactly how (or if) users wanna use it, and what apps make sense. Innovation will unfold (and we’ll be watching). The question is, can you future-proof your business against emerging tech and ensure your products and services are accessible in the context your customers are seeking them?

Joshua Topolsky is one of the privileged few who’ve actually been able to try them out. Check out this footage from his visit with its engineers.

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Glass and iWatch are just 2 of the possible gadgets that may displace smartphones in the future. Google hopes Glass is a consumer-ready product by the end of this year.

Without an interface, does Google Glass have potential for ecommerce? Stay tuned, we’ll discuss next post…