Typical Timescale - E-Commerce - Lecture Notes, Study notes of Fundamentals of E-Commerce

Students of Communication, study E-Commerce as an auxiliary subject. these are the key points discussed in these Lecture Notes of E-Commerce : Typical Timescale, Crashes, Time Spent, Income, Development, Conversion Rates, Technology, Vendor Selection, Testing, Developer Working

Typology: Study notes

2012/2013

Uploaded on 07/29/2013

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BUILD AND CONQUER HO W TO BUILD AND OPT IMISE EC OMME RCE SITE S
IN TRODUCT ION : THUMB RU LES
80% of effects are produced by 20% of the causes
80% of income from 20% of population
80% of time spent in 20% of your house
80% of crashes caused by 20% of bugs
80% of development on 20% of code
80% of visitors only see 20% of the website
80% of income is made by 20% of customers
80/20 rule doesn’t apply to conversion rates: they are usually much lower!
but: 80% of time spent on stuff that generates 20% of income? how this would affect your business?
Theory of constraints
Building ECommerce Site:
1. Design
2. Technology
3. Marketing but this is the dark horse
HO W TO BUIL D A SITE
Typical Timescale: 10 months
Vendor Selection (1 month)
Project Planning (1 month)
Design (3 months)
Implementation (3 months)
Testing (1 month)
Content (1 month)
Vendor Selection
Freelancer £20 - £40 per hour just one developer working on the project
Mid-range £40 - £65 per hour small businesses: more resources, more expertise
Upper range £65 - £125 per hour challenging solutions, online marketing skills,
dedicated project manager
Top price £125+ per hour
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BUILD AND CONQUER HOW TO BUILD AND OPTIMISE ECOMMERCE SITES

INTRODUCTION: THUMB RULES

  • 80% of effects are produced by 20% of the causes
    • 80% of income from 20% of population
    • 80% of time spent in 20% of your house
    • 80% of crashes caused by 20% of bugs
    • 80% of development on 20% of code
    • 80% of visitors only see 20% of the website
    • 80% of income is made by 20% of customers
    • 80/20 rule doesn’t apply to conversion rates: they are usually much lower! but: 80% of time spent on stuff that generates 20% of income? how this would affect your business?
  • Theory of constraints
  • Building ECommerce Site:
    1. Design
    2. Technology
    3. Marketing  but this is the dark horse

HOW TO BUILD A SITE

Typical Timescale: 10 months

  • Vendor Selection (1 month)
  • Project Planning (1 month)
  • Design (3 months)
  • Implementation (3 months)
  • Testing (1 month)
  • Content (1 month)

Vendor Selection

  • Freelancer £20 - £40 per hour just one developer working on the project
  • Mid-range £40 - £65 per hour small businesses: more resources, more expertise
  • Upper range £65 - £125 per hour challenging solutions, online marketing skills, dedicated project manager
  • Top price £125+ per hour

PROJECT PLANNING

  • Build the Model:
    • use reliable data
    • forecast for:
      • conversion rates
      • retention rates
      • average order value
    • prepare for:
      • best case
      • realistic case
      • pessimistic case
  • Prepare and explore alternatives
  • Examine costs
  • Identify features that matter (80/ 20 ):
    • navigation & search
    • product content and imaging
    • marketing tools
    • integration
    • reporting, analytics, optimisation
  • Competitor Analysis
  • Requirements Gathering (Personae!)
  • Proposal including cost and schedule estimate

DESIGN

Persona Design

  • Karen is 21 and is

engaged to be married

  • She wants to show

her boyfriend, Gary, the types of wedding rings she really loves

  • She has not bought much from

the web although she uses Facebook a lot

  • She is a bit afraid of using

her credit card online

  • Karen wants Gary to spend

a thousand pounds on a ring

  • he can afford it
  • She wants to let him make the final

choice so that it is a surprise

User Analysis (^) CreationPersona

Prototyping and Wireframing

Evolve and Launch

OPTIMISING E-COMMERCE

Some Key Ideas

  • Traditional Computing: analysis – design – implementation – testing – deployment – maintenance
  • Essential for Electronic Commerce:
    • continuous analysis
    • optimisation
  • The goal is to increase profit!
  • Consider your website in the context of your business
  • Businesses evolve and so do the websites
  • Effectiveness of on-line marketing can be tracked (very much unlike the traditional business)
  • Focus on what really generates the income
  • Improvements are subject to careful planning ROI – Return on Investment
  • Evolution rather than revolution ( small changes )

Analytics &

Key Indicators:

  • Numbers of visitors
  • Sources of traffic
  • Landing pages
  • Bounce rates
  • Returning visitors
  • Visitor demographics
  • Time on site
  • Goal completion
  • Changes over time
  • Advertising ROI
  • Conversion rates

A Bit of Economy

  • A small store:
    • Daily visitors = 1,
    • Conversion rate = 2%
    • Average order value = £
  • Q: What is the monthly revenue?
    • 1,500 * 30 = 45,000 visitors monthly
    • 45,000 x 2% = 900 orders
    • 900 x £23 = £20,700 monthly (this is revenue, not profit)
  • Q: If conversion rate increases to 2.2%, what’s the revenue:
    • 45,000 x 2.2% = 990 orders
    • 990 x £23 = £22,770 (£2,070 more!)
  • Q: if average order is now £28, what happens:
    • 990 x £28 = £27, These two changes made £7,020 extra revenue!

Improving Your Site

  • Marketing
  • Search engine optimisation
  • Customer journeys improvement
  • Better landing pages
  • Recognise repeat visitors
  • Remove barriers
  • Improve information
  • Improve calls to action
  • Improve decision support
  • Improve customer service
  • Change the proposition: free shipping, 2 for 1, click & collect

A/B TESTING

  • Test out your changes by offering different experiences to your visitors
  • Different calls to action, design, information, offers
  • Don’t assume that there are general rules
  • Test the big changes first
  • Use a testing tool such as Google Website Optimizer
  • Test creative including calls to action
  • Test “maintaining scent”
  • Test proposition

CONCLUSION

Statistics

  • Sites convert 1% - 8% of their visitors to customers
  • Small changes can have dramatic effects on revenue: going from 1% - 2% doubles revenue
  • Acquiring new customers can be more expensive than retaining customers
  • Many sites are optimised rather than being redesigned

What should you learn?

  • How to read analytics and look at the key numbers
  • Some basic business thinking
  • How to design small experiments
  • How to think like your client
  • That this applies to ALL web design and not just eCommerce

Issues involved

  • Tracking visitors versus tracking patterns
  • Privacy and data protection
  • Seeing the wood for the trees
  • Working with clients and designers
  • Lessons from one site won’t necessarily transfer to another