Defining an eCommerce Org Structure

November 14, 2013 | Posted in eCommerce | By

One of the first things I’m often asked at the beginning of an engagement is “How should our organization be structured?”  Many eCommerce businesses are not set up in a very efficient manner, including many large companies.  Regardless of the size of your eCommerce team, there is a structure that can be used to group functionality and tasks so that the work gets done in the most efficient manner possible.  Every company is different, but inevitably when I work with clients to define an organizational structure for their eCommerce team, I end up with something very similar to the same thing.

If you break down the shopping experience, I find that there are often four different universal areas for businesses to focus for eCommerce.

While some of the specific work tasks tend to cross the lines a bit, the four primary pillars are:

  1. Getting customers to the site
  2. Helping customers find what they are looking for and presenting it in a way that makes them want to transact
  3. Processing customer orders (collecting payment and getting the product to the customer)
  4. Taking care of the customer AFTER the transaction is complete

We can put better names to these divisions of work, which make more sense and give a little more clarity as to the roles and work that is done within each.  Knowing that everyone’s nomenclature is different, we’ll use the term “team” for each of these departments. That is just a personal preference that I have, and it makes it feel more like everyone is working together.  I realize at many places it may not always feel like that.  :)

Marketing Team – This group is responsible for getting traffic to the site.  Any requirement or task that has to do with getting traffic to the site would fall under this category.  Some examples of those tasks would include inbound marketing, pay per click, search engine optimization, social media, homepage design, site look and feel, email marketing, and customer segmentation requirements.  Basically, the job of the marketing department is to get people to the site.  Once the customer reaches the site, the job of the marketing team is done for that visitor.  In essence, the marketing team brings people to the site, and hands them off to the…

Merchandising Team – The merchandising team has the sole job of taking the people who are on the site and turning them into paying customers, also known in eCommerce terminology as, a “conversion”.  If conversion is a familiar term for you, then you would correctly assume that Conversion Rate on an eCommerce site should be completely owned by the head of the merchandising team.   Every task of function needs one specific owner, often with many contributors, and the head of the merchandising team tends to have more tasks than others to own.  In my opinion, and no disrespect to the other areas of an eCommerce organization, but the head of the merchandising team is the most important person in the entire operation.  If you do not have the right person in this role, you will likely fail. If you have the right person in this role, you will likely thrive.

This person needs to be a seasoned eCommerce veteran who truly understands retail, and lives for analytical data such as conversion rates, average cart size, cart abandonment, checkout funnels, and that sort of thing.  As that person is ultimately responsible for those analytics, they also would be the person with final decision making authority over things such as site taxonomy, product detail page look and feel, category structure, and navigational appearance.  They also would own site search and the optimizing of site search results, as well as cross-sells and up-sells, category landing pages, promotions, and ultimately, the entire checkout process.

A good merchandising team will provide a customer with the products they want in a manner in which they expect to find them, and then smoothly complete the checkout and purchase of that product.  A great merchandising team will do the same thing, but also present some higher margin alternatives and perhaps convince the customer to buy a few higher margin accessories or impulse items along the way.   That skill alone is so valuable when you consider the cost of customer acquisition is usually quite high in eCommerce, so selling more to those customers (increasing average cart size) is the difference between a good sale and a great sale, and in essence.. a good year and a great year.  Once the customer has found the products they want to purchase, and have navigated their way through the checkout button, the next hand-off comes when the customer clicks the submit order button on your site.  Clicking that button then passes the baton from the merchandising team to the…

Operations Team – The operations team is responsible for the successful operation of all logistics of completing an order, commonly referred to as ‘Order Processing’.  Order processing begins with the acceptance and processing of the customers payment method, such as a credit card transaction.  This team will own the relationship with any payment processor third parties, banks, merchant accounts, tax collection and submission, and shipping requirements.  Many companies use third party vendors who specialize in these areas, specifically when it comes to tax and shipping, and the operations team is responsible for managing all of those relationships and requirements.  There is a lot of pressure on this area as well, because no matter how great of a job the marketing and merchandising team does, if the operations team drops the ball, then that customer may very well never return to place another order again.  They also have the responsibility of fraud detection, which is a very commonplace activity that is part of eCommerce life nowadays.  Whether your company has a large distribution center or relies entirely on dropshippers, the operations team is responsible for making sure that purchased products are delivered to the door of the paying customer.  This includes the “pickers and packers” who take the item from inventory and prepare it for shipping in an appropriate and cost efficient sized box, as well as overall inventory management to make sure that the numbers of which products are on-hand and which are not, are accurate. Once the package arrives at the customer’s doorstep, then the operations team has done it’s job completely and it is time for the…

Customer Service Team – The customer service team is there to support the post transaction customer experience.  This would include everything from the order confirmation email, order status tracking, and shipment confirmation, through to processing returns if necessary and following up with customers to ensure their satisfaction with surveys or requesting a product rating and review.  This also means staffing a customer service phone number, email, online chat, or even snail mail communication if your organization offers it.  Assuming the customer service team does a great job to complete the sales process, it would then be handed back over to the marketing team to target those previous customers and start the entire cycle over again.

There are definitely many roles and responsibilities under each of these teams, and many tasks have somewhat blurred lines and there is often questions about who owns which aspects of each.  I’ll add a post in the future to talk more about that and best practices for each of these groups, but for now, I hope this helps explain best practices for a high level eCommerce org structure.

Please feel free to use the comments section below to ask any questions or provide your own input as well.
Thanks,
Joe Rozsa

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Intro to Mobile Commerce

November 1, 2013 | Posted in Mobile Commerce | By

What is mCommerce?

Before we dig into what exactly Mobile Commerce truly means, did you know that more tablets sell today than either desktop or laptop computers?  And between Android or iOS smartphones, it is hard to find someone that does not have one of these devices nowadays.  These mobile devices provide the ultimate freedom for consumers who can now be connected virtually anywhere via cell phone service or widely available Wi-Fi.  It is even more common than not for airplanes to provide internet service so that people can stay connected even when cruising around the world at 35,000 feet in the air. The convenience of having a small, light device capable of doing what many people normally used to do on a day-to-day basis, using their laptop or desktop computer, means that more and more people are deciding that they really don’t need those machines anymore.

I admit that I still use all of the above.  I am typing this article on my desktop PC that I use for the serious computing that I sometimes need, while my personal laptop is on my desk to the left of me and a “work” laptop is on my desk to the right of me.  My Galaxy S4 phone is charging on my desk within arms reach right now, sitting on top of my Nexus 10 tablet that is charging as well. My iPod Touch is plugged into my desktop PC, charging and syncing any podcasts that I subscribe to as they come online.  Yes, that is six different devices, all within three feet of me, all of which can do the exact same things (for the most part) but with different features and benefits.

But when I leave my desk for the day, to go grab dinner or help the kids with their homework, or to go mow the lawn, or to sit on the couch and watch an episode of Breaking Bad on Netflix, I always grab at least one of those devices to take with me, and sometimes more than one.  The ones that I never grab, obviously, are the desktop or laptop computers. It is usually my cell phone or my tablet, but I have them with me in case I have the urge to look something up, or send someone a text or an email (notice I didn’t say call), or if a thought occurs to me, to purchase something.

So many times I will remember that I need to buy something at a time other than while I am sitting at my desk computer.  Many of those times, I will go to Amazon or another appropriate ecommerce site and simply place the order right then when I am thinking of it.  Then, it arrives a couple of days later and I remember that I needed that items for whatever reason and take care of the task that I was thinking about when I placed the order.

If I don’t place the order at that very moment, or at least write it down drop it into Evernote (“write”… who does that anymore?), then inevitably a week or two later I will come across the same task and remember that I still need to get that one thing to help complete whatever it was I was trying to do. But if I order it right then, it has a much better chance of actually getting done.

This could also be if I see something on a TV commercial that I want, and do a quick price check on my tablet to find the best deal on the item, browse for comparable items, and maybe purchase that item right then while it is fresh in my head.  Or if we’re in the car and my wife is driving (Ed note: NEVER drive and shop, that’s sadly a danger indicative of the times we live in) and we drive by a place that triggers a memory of something I’ve been meaning to look up and order, I do it right there from the car.

I have seen reports that over $25 BILLION of sales will be made in 2013 alone, all online, all by using a device other than a desktop or laptop computer.  TWENTY FIVE BILLION DOLLARS in mobile revenue – and growing.

One in four ecommerce transactions are currently being made using a device such as a tablet or cell phone.  And this number also will continue to grow.

Think it is important to get a piece of that action?  If you have a great revenue generating ecommerce site, but the mobile version of the site is a bad user experience, you are likely losing AT LEAST 25% of your possible revenue just because you are neglecting your fastest growing customer segment.  That is a lot to throw away.  Of course, if you’re general ecommerce site provides a bad user experience, then you should not even think about mobile until you fix your ecommerce site!  That is one thing I hear from so many businesses today that want to jump on the hot mobile trend while their ecommerce site is a complete mess.  Don’t chase that 25% when your 75% is a mess. Get your 75% in order first, then worry about the mobile stuff.

If you have a great revenue generating ecommerce site, but the mobile version of the site provides a bad user experience, you are likely losing AT LEAST 25% of your possible revenue just because you are neglecting your fastest growing customer segment.

So how do you get the mCommerce aspect of your business in order?  Do you need an app?  Redesigned website? Responsive design? Google Glass? (no, not that one… nobody needs Google Glass).  The answer is:  whatever you can do to provide customers with a quality user experience that does not impede their ability to purchase from you.

My one simple rule of thumb is: Don’t make it difficult for people to give you their money.

That is the first and single most important rule in eCommerce.  And it goes for mobile commerce as well.  At a minimum, a responsive redesign of your current ecommerce site is often the most simple and efficient / inexpensive way to allow customers to find what they want on your site, and transact with you.   Many people, however, believe that apps are the future and will be the death of the internet.  That is most certainly not the case, but there is indeed a huge market for those that can create a shopping app that meets consumers’ needs while giving them a quality user experience and the ability to easily transact with you.  Building a native app is a bit more challenging and time/cost intensive.  But it can also be well worth it to do so.

For example, when I am sitting on my couch, I know that the Amazon app is only one touch away and lives right on my home screen. No browser needed, no typing a URL on a small screen keypad… just touch the icon and shop away.  There is something to be said for that.  But if the item I want is a bit unique, or I find that a big box store is not necessarily the best option in that case, then I will find a site with a nice easy to read, responsive design that allows me to browse their site and shop without a dozen errors and layout troubles.  And if I have those troubles on the site, and you are making it difficult for me to give you my money, I can pretty much promise that I won’t.  But someone else who makes it easy for me to give them my money will most likely get it instead.

So there is an opportunity in mCommerce, and it is not too late to get into the game, nor for being an innovator and leader in the space.  But you have to have a plan to do it right and follow your plan to implement it that way.  Because after all, if you aren’t going to do it right, don’t bother doing it at all.  Don’t make it difficult for me to give you my money.

 

Thanks for reading…

Joe Rozsa

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Hosting an IBM WebSphere Commerce Starter Store

February 25, 2013 | Posted in eCommerce | By

As the founder and president of KaLor Technology, one of the most important things that I have done is to become an IBM Business Partner. This gives me access to tons of information that is needed in my day to day world of implementing enterprise eCommerce solutions for our clients.  One of the worst things I do is that I rarely allow myself the time that is needed to go over all of that information that is available to me.

I am in the process of launching a starter store containing the latest and greatest IBM WebSphere Commerce version 7 Feature Pack 5, so that I can demonstrate the power to the world, as well as to provide some training and educational recordings for people while using information for a KaLor starter store.   If anyone has any suggestions for the best way to host this, please let me know.  My team can easily configure, design and install it…  but I am torn with the best way to host the thing right now.

 

Thanks for reading…

Joe Rozsa

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