This is a recap of our webinar Multi-Store Retailing: Perks and Pitfalls with Elastic Path’s own VP of Innovation, Jason Billingsley.
Though our webinars are not product-specific — we put these out there for all online retailers to access and enjoy whether you use our ecommerce software or not, this topic is near and dear to use as our most recent version of Elastic Path is really honed for multi-store retailing. If you’re interested in a product-specific webinar on our product you can view the replay of Technical Introduction to Elastic Path Commerce 6.1.
Multi-Store Retailing: Perks and Pitfalls covered:
- Why Multi-Store is gaining momentum
- Types of stores to consider launching
- When to launch additional stores
- How to avoid critical mistakes
What is Multi-Store Retailing?
The key benefit of running multiple stores is higher specificity and relevance to customer and product segments.
Coca-cola began as a single product and grew to 450 brands, 2800 products and 200 countries. Some of these products are very new or niche, like vitamin flavored water – but the specificity is what builds loyalty and differentiation in a saturated market.
A major factor in the success of more specific stores comes from today’s search behavior:
This eye-tracking map shows search listing attention span was higher 3 years ago. Today that has drastically changed. We have learned to skim and skip over content not relevant to us. The reason is self-centricity. A searcher scans to find what is relevant to him or her. If retailers can capture this scent early in the selling process, they have an advantage.
Types of Stores
Many retailers start with a .com domain and focus on the US, and may expand into other markets launching new stores with country-specific “top-level-domains” (site.ca, site.de, site.co.uk for example). But that’s not always necessary. A lot of retailers do well without launching a separate store. You could consider a site that sells internationally from one storefront as “internationalized” and country-specific shops as “localized.”
A recent Get Elastic post described a recent purchase Jason made for his wife’s birthday gift. The site was an “internationalized” niche site owned by CSN Stores, and the site grabbed his attention right from the beginning in the search engine snippet, mentioning it shipped to Canada.
The post also describes how EveryJewelryBox.com addressed his Fears, Uncertainties, Doubts and Dealbreakers in its copy and landing page design:
- Clear messaging “We Now Ship to Canada!” and a Canadian flag icon for quick “scent identification” (reassuring Jason he was in the right place)
- Detailed info on shipping time, taxes & duties, returns, etc. in a pop-up (Very important as you don’t hijack a customer off a product page to show a policy. Use pop-ups or AJAX rollovers!)
- Final price is calculated for the shopper (no charges upon delivery for customs brokerage)
A great example of international selling where multiple stores was not necessary, but Jason noted that a .ca domain may have delivered the “instant gratification” of regional relevance (and assurance it’s the right place to shop) in the search engine. This goes for PPC ads as well. (It may also have ranked higher in Google.ca using location targeting in Google Webmaster Central).
Another thing to consider regarding international usability is currency should reflect the local currency when you land on the site. You can achieve this with IP sniffing tools which may either force-redirect visitors or show messages allowing them to choose their preferred store, storing the preference in a cookie for future visits. (We’re not a fan of portal-like splash pages asking everyone to choose a country. Especially if it’s all in Flash and it plays music by default.)
Fulfillment concerns are also important – some manufacturers restrict where you can ship product. Personally I have shipped products like the Flip camcorder and Dakine luggage to US hotels, crossing my fingers they will arrive on time. Freight transit for large purchases and likelihood of returns are also concerns, as are the extra costs of cross border returns unless you have a mechanism to accept returns in the geographic specific country.
The biggest question is: is the (new) market ready for this? That’s a question we’ll leave you to answer for your own business.
When to use geographic targeted stores:
- When fulfillment is the first decision (medical product example: the CDN retail was $1200, US retail $400).
- Based on product set, ease of shipment, likelihood of returns, if CSRs can handle intricacies of currency, taxation, etc. = good to go if market is there.
Downsides for geographic targeted stores:
- Cultural differences – payment habits are different. Germany not credit card based economy, prefer debit cards. Asian countries pay cash on delivery often. So your multi store structure could change.
- Language – Example: the Vancouver 2010 Olympic Store uses French translation, which was performed by a French speaker from France, not a French Canadian. The dialect has its own nuances which can cause confusion on the site. Even English/English sites can have variants of spellings or even terms people use to describe the same thing (soccer vs. football).
- Technology – EU countries use different electric plugs and adapters than North America.
- Product warranty fulfillment – You must communicate the specifics of your warranty fulfillment process, not all can be fulfilled across borders.
- Duplicate content – If you have 2 English speaking country domains you technically have duplicate content (more details later).
- Use a master catalog + sub-catalogs, more efficient
- Don’t worry too much about SEO issues with duplicate content, just make sure you target your site in Google Webmaster Central
- Switch default title tags and meta descriptions to make them country-specific
- Use IP sniffing to redirect or show option to switch stores only to international customers, not all visits
- Don’t be afraid to NOT launch an additional store, but deal with selling restrictions, extra duties/taxes, lead time etc. on your internationalized site clearly.
Brand Specific Stores
ElectricShopping.com and KenwoodMajor.com are an example of a mother site and a sister site that is brand specific for loyal shoppers of Kenwood products.
If a searcher who is loyal to brand can see the brand in the URL: www.kenwoodmajor.com vs. www.appliancesmajor.com, there’s a relevance factor (even higher search rankings) but also a perception of better selection. You can have domain.com/brand or brand.domain.com, but branding in the domain name is far more effective for both organic search and pay per click marketing
When to use brand specific stores:
- If you sell other peoples brands
- If you are a manufacturer with strong brand lines
- Consumer has strong affinity to brand for entire Product line (DeWalt tools)
Downsides for brand specific stores:
- Limiting cross-sell opportunities, if people are highly influenced by cross-selling this may not allow you to do that as well as with a multi-brand options.
- If you can’t launch a brand store, consider brand notifications (new items, new reviews, new accessories) on current store (MyBuys – simple notifications service).
Zappos is a good example of serving customer segments with different shopping experiences.
Based on price segment, a customer sensitive to higher priced market can enjoy shopping without heavy discounted prices or lower prestige brands at Couture.Zappos.com (higher relevance, ease of navigation, perceived value much higher). Some customers are anti-price sensitive and they want a shopping experience that matches that, for which Zappos has 6pm.com. Price-segmented sites may use custom imagery and user interface (no blinking sale prices) or different copy giving the notion of exclusivity for higher end, or sale sale sale messaging for clearance sites. Clearance sites are great for inventory mobility and for more efficient comparison shopping management (certain shopping engines may attract bargain hunters and others luxury shoppers – know your channels).
Jason notes that on Zeta.Zappos.com — Zappos’ test sandbox for user experience — nowhere do you see visibly sale or discount because the mother site is not positioned as a discounter. Their market position is their huge selection and customer service.
Rideshop.Zappos.com caters to sub-segments by interest like skate, surf, snow and BMX. The lifestyles and activities that occur within those sports are different. Even if they’re not different, the perception is that the products are more relevant to the customer.
You also enjoy better cross selling when you know this person is a skater or a surfer, for example. You won’t be cross-selling cowboy boots here.
These aren’t the only types of segments you can target, just examples.
When to use segmented stores:
- Think Cluetrain Manifesto – Markets are Conversations: Where are your customers having conversations? Address that need
- If you can identify candidates for segmented stores: price, experience level (novice, intermediate, expert), gender, age, activity, ADA compliant, green/eco friendly, local
Downsides for segmented stores:
- Unfortunately most retailers do not segment very well or have segmentation history so it might not be a cultural fit
Niche Product Stores
The key is to have strong, keyword targeted domains (largely generics for quick SEO wins). Major players using this strategy include CSN Stores, Netshops and NicheRetail. Mostly for pure-plays and seems to be very popular for the furniture category.
When to use niche product stores:
- If drop shipping is common across all niche multi-store retailers
- For pure plays
Downsides for niche product stores:
- If drop shipping: Returns to own warehouse = importance of inventory clearance store or channel
Regarding SEO and duplicate content, we ran “some sanity checks” on CSN Stores, and for the most part, Google did not even filter if duplicate content existed across domains (if a long tail term) — meaning all the domains were showing up in Google search results. This is consistent with previous findings we had on SEO modifiers for color links. The SEO filters will impact “head terms” (more competitive, like “body lotion” vs a long tail term like “St. Ives Swiss Formula Vanilla Nut body lotion 200ml.” Chances are your web properties will not dominate the SERPs when so many other sites match the query.
- Carry reviews across stores (make sure they are not delivered through iFrame)
- Use a universal template
- Use content templates BUT try to use modification via variable replacement
- Use distinct customer service numbers
Launch a new store based on loyalty programs when you want to offer exclusives for high value customers. It’s not that common but these days, people are more transient in purchase behavior so this is very valuable when done well.
When to use loyalty stores:
- You have a strong loyalty program
- There is a propensity for repeat purchases (replenishment, low ticket value, life staples, natural life stages – marriage, home, kids, etc.)
Downsides for loyalty stores:
- Perceived exclusion (walking past first class on airplane)
Why to use wholesale/B2B stores:
- Make procurement more efficient
- Find new retail channel partners
Downside of wholesale/B2B stores:
- Do you want it to be indexed in engines if also selling direct to consumer?
- Not all retailers have products that can follow this model
- Hide pricing until customer logged in
- Use price lists based on customer
- Aim for rapid replenishment (customer service is key!)
Campaign Specific Stores
Great for special event marketing like Valentine’s Day, Mother’s Day, the Super Bowl etc. They will have shorter shelf life but also have more relevance. We did a full webinar on holiday and event marketing in January.
Or you can optimize for holiday gifting terms, a cause (Breast Cancer Awareness pink theme), a single product store or hot product launch (Wii Store) or even current event/trend (plastic bottles vs. metal or products that match Michelle Obama’s style).
When to use campaign specific stores:
- For ongoing prominent causes the company is associated with or supports
- Narrow product lines associated with event (don’t launch entire store with Pink ribbon = shoppers can see through that, unless 5% of all orders go to cause)
Strategic partnerships (partner with media, or joint promotion like Omaha Steakss micro-site from Overstock.com for grilling and cooking products) or the CTV (Canada Television) store that sells Olympic gear mentioned in Olympic segments
Downsides for campaign specific stores:
- Possible limited shelf life
- May be additional costs to design, develop (depending on your platform) and maintain
These are deal-of-day sites or any other site that brings customers back daily for a good reason.
Steep and Cheap turns over the offer as it depletes or if the velocity decreases substantially (no interest) to warrant a new deal. It captures excitement and competition, and even offers instant alerts.
When to use sticky stores:
- NOW! Jason is very bullish on this method in this economy
Downsides for sticky stores:
- Some brands are not discounters and have to protect premium positioning
- You may need to cap quantities people can purchase due to Ebay selling or resale
- Work with manufacturers on deals.
- Use alerts (email, RSS, SMS, MMS, IM, Twitter, browser plugins, widgets, etc.)
- Pre-announce to list members based on loyalty tiers to acquire sign ups & promote purchasing
- Use creative pricing (price drops, but inventory is invisible – Jellyfish does this with Smack Shopping)
- Create urgency with time countdowns, show inventory that’s left
- Show percentage of savings use red, strike-throughs, promote price and savings right in the titles, try to use percentage off as a faceted navigation method
- Cross-sell into the outlet store on page
- Use post purchase cross-selling / offers from main store
- Many have communities surrounding them, even Deal of Day forums
- Allow people to store account information so they don’t miss a deal due to slow typing speed – seriously
- Consider swapping the items based on velocity of sales
- If you sell to defined segments (men/women), consider separate Deal of Day sites
- Update the site using AJAX in close to real time or small intervals
Should you no-follow subdomains (or use robots.txt to block search engines from crawling pages) to avoid duplicate content?
We assumed that it would be a problem, but after running our own tests, what we found was that it wasn’t really a problem. All variations of different pages, they’re getting smart on delivering the best page possible. Optimize your Title Tags and target your domains in Google Webmaster Central and you should do fine.
What are your thoughts on the GAP 4 stores 1 checkout strategy?
Good strategy for the Gap but there’s not a lot of crossover. Banana Republic and style is different (but maybe a mom and kids?) Piperlime is interesting, but again not in a position to have 4 strong brands like that. COuld work but there are downsides as well.
Linda’s note: I covered GAP’s talk about its strategy from Shop.org Annual Summit on the Shop.org Blog in September.
Should you market new sites to your current email list?
There’s no reason you can’t market directly, but do it with finesse. We wrote about this recently, and provided some tips:
- Use your regular sender name and sender address
- Clearly reinforce the familiar brand while introducing the new one
- Explain a bit about the new store and shopping experience in the email (set expectations)
- Provide a clear opt-in to the new list, don’t hide it
- A bonus would be a discount or free shipping offer