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• By 2007 = £1.226billion online sales 850,000 regular users – 250,000 orders per week
• 12 month sales to Feb 2009 - £1.9billion and profits of £109m
– Facebook founded 2004 – by Sept 2006 was 126th most visited UK site – by 2007 it was 5th most visited – 2009 now 2nd most visited (after Google) and has 350m members (Jan 2010)
– Twitter – usage grew 1600% in 2009 – now 27th most visited UK site – ahead of BBC
2009 - UK online sales estimated £49.8billion (IMRG)
• eCommerce protagonists used the Internet to set out to change business principles
‘Disintermediation’
Definition‘Removing the middleman. Internet based businesses that use the Web to sell products directly to customers rather than going through traditional retail channels. By eliminating the middlemen, can sell their products cheaper and faster. This will revolutionise the way products are bought and sold, and disintermediation is the driving force behind this revolution’
• The eRetail Timeline1990 Tim Berners-Lee invents “hyperlinked” documents residing on networked computers
(the basis of today’ WWW)1994 Marc Andreessen develops ‘click and point’ browser developed – becomes Netscape
Browser – using expanded DARPA network, hypertext and TCP/IP protocols. This provides the e-commerce environment and sets ‘free’ software precedent
1995 Amazon opens in Jeff Bezo’s spare room. eBay conducts it’s first auction1996 Microsoft launches ‘Merchant Server’ combines shopping cart, product database and
secure back end payment modules. The eRetail infrastructure is in place1996/7 ‘Dot Com’ boom starts as companies and investors recognise that a public web
presence was no longer optional.‘Growth over profits’ model becomes commonplace
1998 ‘Always on’ internet arrives when SBC Communications launches DSL – within 12 months 60,000 DSL subscribers and 500,000 using broadband cable
1999 Amazon and AOL companies both report $billion sales. Napster report users of its music swap site rose 5 fold in one week
2000 March 10 – the Dot Com bubble burst amongst bad press many high profile failures ensue – Boo.com, Pets.com,. lastminute.com are the last of the .coms to successfully float in UKThe ‘old economy’ competitors with respected high street brand names pick up the pieces e.g. Argos buy Jungle, Woolworths buy streetsonline
2001 Billions are written off stock market values – ………………………………………...but in the background online sales continue to
• The basis of the boom was ‘land grab’ based on poor business principles but (only) some (very few) made it successfully– Amazon.com eBay – Google – MSN – PayPal (now a subsidiary of eBay) – Priceline.com – Yahoo! – Netflix
• Sports and High fashion e-tailer founded by two Swedes, Ernst Malmsten and Kajsa Leander. Backed by Bernard Arnault, the chairman of luxury group LVMH, investment bank JP Morgan and enthusiastic Middle Eastern investors
• Boo.com eventually burned through $160 million before liquidation in May 2000
• Arguably the largest UK dot.com failure. Why?– Overly complicated Web site– Relied heavily on JavaScript and Flash (when difficult to use)– Very slow to load at a time when dial-up Internet usage was
the norm– Poor management and management controls
• Boo spent cash to market itself as a global company but then had to deal with different languages, pricing, and tax structures in all the countries it served
– Poor marketing strategic decisions• Sales never reached expectations (mainly because the site failed
to work)
For an interesting list of top 10 ‘flops’ go to MSN techs and gadgets reference: http://msn-cnet.com.com/4520-11136_1-6278387-1.html?part=msn-cnet&subj=re_po10
• The eRetail Timeline continued……2001 Organisations who see the paradigm shift of consumer habits continue to develop their
online offer in key market sectors– Grocery– Travel (particularly low cost airlines)– Electronics– Books and media
2002 UK retail sales online reach 4% of total retail sales. £1billion is spent online in one month (Nov 2002) for the first time in the UK
2003 Apple iTunes launches, following rights deals with all major record companies, racks up 70m sales in 12 months and effectively fatally wounds the traditional music distribution channelUK consumers spend £1.34billion in December alone
2004 Global online ecommerce revenues reach $150billion. 1billion users worldwide Half the UK population shops onlineeBay contributes biggest demographic change to UK Internet usersUK consumers spend £1.6billion in December aloneOnline shopping represents 6.8% of all UK retail sales in 2004
2005 Users are online for longer than watch TV eBay represents 24% of all UK site visitsUK consumers spend £2.3billion online in December - whilst high street sales were flatOnline shopping represents 8.8% of all UK retail sales in 2005
The eRetail Timeline continued……2006 10% of retail purchases in UK being made online - £30bn
More strong growth, driven by consumers embracing a broadband lifestyle and retailers investing in better web services the internet beginning to precipitate structural shifts in consumerism.Social networking websites, in particular MySpace and Bebo, are not only capturing an ever-increasing share of UK internet visits but are also accounting for a larger share of upstream visits to retail websites
2007 £40 BN spent online in 2007 (up 33%) on 2006 : Christmas - £15.2 BN spent online in Q4 2007 with December sales 49.5% higher than year before – compared to High Street sales only +2.5%. But Rate of growth slows as economic downturn starts. Christmas Day becomes a shopping day
2008 £45 BN spent online. Twitter emerges as a social network phenomenon. Even in recession online sales continue to increase. iPhone and smart phones (devices) start to give consumers successful alternative mobile internet access
• UK internet penetration 2008(number of homes online) 66.5% • Number of UK homes online 2008 16.5m • Average online spend in UK 2008 £1,502 • UK homes with broadband 2008 58% • Number of UK online banking users 2007 721m • UK homes with digital TV 2008 87%
The ‘History’ of the digital consumer – 2008 – UK statistics
• Online retail sales increase in 2009/10 by 14% v 2008 • Online search for ‘discount’ doubles• Increased basket size but decreased conversion (from 6.2% to 5%)
• The dotcom boom/bust cycle did not halt the paradigm shift in consumer behaviour and this is now growing in pace for e-retailers
• Disintermediation is now becoming a reality for a number of organisations and may require fundemental shifts in organisational structure and behaviours in the future
• New brand names and organisations can establish themselves quickly and challenge traditional business structures and methods of product distribution .e.g. eBay, amazon, google
• Increasing ‘globalisation’ of product distribution causes pressure on traditional geographical price differentials
• Financial turmoil highlighting consumer need for research and keen pricing offerred by online shopping
Market Research Industry worldwide• In 2007 the total market for market research world-wide was US$ 27bn• The EU and USA each accounted for 79 per cent of the total world
market. • The largest market for market research world-wide is the USA, followed
by the UK and Germany• Growing fastest in Brazil, China, India and Russia – all recording double
digit growth (Europe +2.8%) UK Market Research Industry• Estimated size of the UK Market Research Industry in 2007 was £2.37
billion. • During 2007, the UK market grew by 2 per cent on the previous year
Online Research• Worldwide = US$4.1billion in 2007 – an increase of 14% on year before• In UK online research accounted for 18% of total spend - +5% on 2007
• Web analytics is the measurement, collection, analysis and reporting of internet data for purposes of understanding and optimizing web site usage– Log file analysis– Page tagging
• On-site web analytics measure a visitor's journey once on a website
• This includes its drivers and conversions; for example, which landing pages encourage people to make a purchase
• On-site web analytics measures the performance of a website in a commercial context. This data is typically compared for performance and provides key performance indicators, and is used to improve a web site or marketing campaign's audience response
• Historically, web analytics has referred to on-site visitor measurement
Most Common Measures• Hit - A request for a file from the web server. The number of hits received by a website is frequently cited to assert its
popularity, but this number is extremely misleading and dramatically over-estimates popularity. The total number of visitors or page views provides a more realistic and accurate assessment of popularity
• Visitor / Unique Visitor / Unique User - The uniquely identified client generating requests on the web server (log analysis) or viewing pages (page tagging) within a defined time period (i.e. day, week or month)
• Impressions - An impression is each time an advertisement loads on a user's screen. Anytime you see a banner, that is an impression
Other Measures• Page view - A request for a file whose type is defined as a page in log analysis • Visit / Session - A series of requests from the same uniquely identified client with a set timeout, often 30 minutes. A
visit is expected to contain multiple page views• First Visit / First Session - A visit from a visitor who has not made any previous visits• Repeat Visitor - A visitor that has made at least one previous visit• Stickiness – or Duration - Average amount of time that visitors spend on the site each time they visit. This metric
can be complicated by the fact that analytics programs can not measure the length of the final page view.• Page View Duration / Time on Page - Average amount of time that visitors spend on each page of the site. As with
Session Duration, this metric is complicated by the fact that analytics programs can not measure the length of the final page view
• Page Depth / Page Views per Session - Page Depth is the average number of page views a visitor consumes before ending their session. It is calculated by dividing total number of page views by total number of sessions and is also called Page Views per Session or PV/Session
• Frequency / Session per Unique - Frequency measures how often visitors come to a website. It is calculated by dividing the total number of sessions (or visits) by the total number of unique visitors. Sometimes it is used to measure the loyalty of your audience
• Customer journey – or Click path - the sequence of hyperlinks one or more website visitors follows on a given site
Web server logfile analysis• Web servers record some of their transactions in a logfile. It was soon realised that these logfiles could
be read by a program to provide data on the popularity of the website. Thus arose web log analysis software.
• In the early 1990s, web site statistics consisted primarily of counting the number of client requests (or hits) made to the web server
• This was a reasonable method initially, since each web site often consisted of a single HTML file. However, with the introduction of images in HTML, and web sites that spanned multiple HTML files, this count became less useful. The first true commercial Log Analyzer was released by IPRO in 1994
• Two units of measure were introduced in the mid 1990s to gauge more accurately the amount of human activity on web servers. These were page views and visits (or sessions).
– A page view was defined as a request made to the web server for a page, as opposed to a graphic– Visit was defined as a sequence of requests from a uniquely identified client that expired after a certain amount of
inactivity, usually 30 minutes
These are now considered rather unsophisticated measurements• The emergence of search engine spiders and robots in the late 1990s, along with web proxies and
dynamically assigned IP addresses for large companies and ISPs, made it more difficult to identify unique human visitors to a website. Log analyzers responded by tracking visits by cookies, and by ignoring requests from known spiders.
• The extensive use of web caches also presented a problem for logfile analysis. If a person revisits a page, the second request will often be retrieved from the browser's cache, and so no request will be received by the web server. This means that the person's path through the site is lost.
• Caching can be defeated by configuring the web server, but this can result in degraded performance for the visitor to the website.
Page tagging• Concerns about the accuracy of logfile analysis in the presence of caching, and the
desire to be able to perform web analytics as an outsourced service, led to the second data collection method, page tagging or 'Web bugs'
• In the mid 1990s, Web counters were commonly seen — these were images included in a web page that showed the number of times the image had been requested, which was an estimate of the number of visits to that page
• By late 1990s this concept evolved to include a small invisible image instead of a visible one, and, by using JavaScript, to pass along with the image request certain information about the page and the visitor. This information can then be processed remotely by a web analytics company, and extensive statistics generated
• The web analytics service also manages the process of assigning a cookie to the user, which can uniquely identify them during their visit and in subsequent visits
• Examples of use: Allows metrics such as ‘lifetime’ value of a customer to be calculated, plus affiliate links success – but should be treated with suspicion
• Ongoing EU debate and directive – cookie setting
• ‘Usability’ is fast becoming an accepted element of web site design
• The accepted guru (in the USA) of usability is Jakob Neilson – in 1994 he wrote guideline of usability that included 34 major items
According to him not much has changed….• "Roughly 80% of the things we found 10 years ago are still an issue today,“• "A lot of people thought that design and usability was only a temporary problem
because broadband was taking off - but there are a very small number of cases where usability issues go away because you have broadband."
• Dr Nielsen said the success of sites such as Google, Amazon, eBay and Yahoo showed that close attention to design and user needs was important.
• "Those four sites are extremely profitable and extremely successful," said Dr Nielsen, adding that they have largely defined commercial success on the net.
• "All are based on user empowerment and make it easy for people to do things on the internet,"
• The latest statistics on how many words people use on search engines shows that, on average, they use 2.2 terms. In 1994 only 1.3 words were used
Objective • To undertake a study of the ‘usability’ of UK ecommerce
websites from pre-determined sectors and report observations, findings and recommendations on possible site improvements
Deliverables/Expected outputs• Analyse responses using automated information provided.
Rate and provide league table for each site surveyed using scoring method provided
• Provide an overview executive summary by site/sector of performance utilising both quantitative and qualitative data
• Provide suggested changes and improvements to site content and navigation by survey research heading
• Present findings to student body via MS PowerPoint (automated download of statistical information into PPT and qual comments into MS Word will be provided)
Methodology• We will utilising our ‘eMysteryShopper’ site usability testing system• Students will be placed into working sector • You will be provided with a login and password to the system (via email)• Go to www.emysteryshopper.com and log in using the shopper login• Each will have four surveys to complete – one for each of the sites within
the sector allocated/chosen• Visit the site and complete the survey – marking the site and providing
appropriate ‘qual’ comments (this should take approximately 1 hour per site)
• When completed syndicate heads will request data downloads (Spreadsheet (raw data), PowerPoint (tabulated presentation) and Word (qualitative)
• Students will meet in syndicates and tutorials to complete assignment• Present findings• Dates:
2 March Fieldwork starts8 March Fieldwork tutorials – timing to follow 22 March Student presentations
Excellent Good Satisfactory Poor Very Poor Bench Marking
4 3 2 1 0
Banding Score (Approx.)
81% or more
61% - 80% 41% - 60% 21% - 40% 0% - 20%
Definitions Excellent - Exceeds expectations - at least as good as the best sites - Special features that have surprised and delightedGood - On par with other good internet sites - Elements work well - A pleasant experience Satisfactory - 95% correct and mostly understood. Not quite on par with the best Poor - Not useful and difficult to follow. Difficult to use. Slow and contains mistakesVery Poor - Did not work or has serious errors
Scoring - The percentage score is calculated by taking the score given by surveyors for each question and dividing by the total possible amount for each question.
Site Research to include (survey research headings) NB Questionnaire is provided online• Home Page/first impression of site• Search for products and services• Finding products • Range• Shopping basket• Purchase (to credit card page only)• Registration/log in• Customer service – telephone/email• Final assessment
Sectors/SiteseCommerce Sectors• Grocery• Electricals• General Stores• Fashion• Music and Video• Mobile
List of sites – each student surveys each site• Grocery – Tesco, Sainsbury, Asda, Ocado• Electricals – Comet, PCWorld, dabs.com, Argos, • General Stores –, John Lewis, Marks & Spencer, House of Fraser,
Debenhams• Fashion - Topshop, Next, Boden, ASOS• Music and Video - HMV, amazon, Game, play.com• Mobile - Carphone Warehouse, phones4u, e2save, orange