Making the Right Technology Investments to Drive Ecommerce User Experience Improvements
In-store shopping experiences vary widely by brand and category. Most buyers set their expectations accordingly. If you’re making an appointment to access high-end merchandise with the assistance of a personal shopper, you’re likely to receive an offer of a glass of water (or wine). Yet a bargain-hunter is often grateful for a relatively clean restroom or an available chair in the fitting room.
Online shopping experiences, however, are faced with heightened expectations across the board. Buyers know companies have access to data and, as long as it’s done elegantly and securely, expect them to use it to make their buying experience better.
A poor online user experience (UX) can lead to high bounce rates, low conversion rates, and ultimately, lost revenue. Because UX is crucial for the success of any ecommerce company, business leaders are rightly focused on leveraging technology to enhance the customer journey and make the experience of shopping on their sites more enjoyable.
The following are some of the most common technology investments that ecommerce teams consider making.
Inventory Management Software
Inventory Management Solutions are primarily meant to help a company keep track of their goods and forecast inventory needs. Active inventory management allows you to optimize your stock levels and reduce stock-outs. But there are also ways to leverage inventory management software to ensure a frictionless shopping experience online.
When a buyer visits a store, it’s easy to see what’s readily available for purchase. Sometimes they might ask for a different size, or to check for another color. But with multiple buyers browsing online at once, it’s more difficult to see what’s in stock or if someone has already put the last of an item in their cart. Dynamically warning online shoppers of low inventory or limited availability of specific sizes or colors can reduce out of stock frustrations. Temporarily hiding options or items that are unavailable can also keep shoppers focused on the products that are in stock, increasing conversion opportunities. And, on the flip side, highlighting overstocked items can expose customers to products they may not have found otherwise, and increase revenue.
One of the most effective ways to improve ecommerce UX is by using personalization technology. Personalization technology allows you to tailor the customer's experience to their specific needs and preferences. This can be done by using data from previous purchases, browsing history, and online behavior to make personalized product recommendations, targeted marketing campaigns, and customized landing pages.
Ecommerce teams leverage personalization software frequently to create:
- Recommendation engines: These use data from customer browsing and purchase history to recommend products that are likely to be of interest to them.
- Behavioral targeting: This means targeting your marketing campaigns to specific segments of your audience based on their browsing history and online behavior.
- Dynamic content: This is when you personalize the content on your website based on the customer's location, demographic data, browsing history, and other factors.
Intelligent Search Software
Search, along with navigation, is one of the most essential elements of ecommerce UX. Customers should be able to find the products they are looking for quickly and easily. It’s not as easy as it sounds, though, since shoppers often don’t know products by name or might be searching for a category or specific color that requires sophisticated indexing. Return no results and they won’t be able to buy. Return the wrong results and they’re likely to leave your site for a search engine where they know they’ll find what they’re looking for.
Whereas site search allows customers to search for products on your website using keywords or phrases, faceted search allows customers to filter their search results by specific criteria such as price, color, and brand. There are also more sophisticated solutions that leverage Artificial Intelligence and user data to prioritize search results that are more personalized or relevant for the user.
How quickly, where, and in what format you display relevant search results can have a significant impact on the user’s next click.
Digital Asset Management Software
Product videos and images are an essential part of ecommerce UX. Customers want to see the products they are interested in before they buy, and videos and images can give them a better idea of what they're getting. Beyond traditional static product photos, many ecommerce teams are investing in:
- 360-degree product images: These images allow customers to see a product from all angles, giving them a better idea of its size, shape, and features.
- Zoom functionality: Zoom functionality allows customers to zoom in on images to see more details.
- Product videos: Product videos provide customers with a better understanding of the features and benefits of the products they are interested in.
Digital Asset Management (DAM) software is a tool that allows ecommerce companies to store, organize, and manage their digital assets, including standard and specialty product photos and video. The software provides a centralized location for all digital assets, making it easier to search, retrieve, and distribute these assets across different channels.
Ecommerce companies use DAM software to improve their workflow efficiency and to ensure brand consistency. It can also improve the customer experience by ensuring that all digital assets are high-quality, consistent, and on-brand, which can lead to increased customer engagement, sales, and brand loyalty.
A/B Testing Software
A/B testing platforms are tools that allow ecommerce companies to test different versions of their website or marketing campaigns to determine which version performs better in terms of key metrics such as conversion rates, click-through rates, or revenue. These platforms work by randomly dividing traffic or users into two or more groups and showing each group a different version of the website or marketing campaign. The platform then tracks the performance of each group and provides statistical analysis to determine if there is a significant difference in performance between the different versions. This data is used to make informed decisions about which version to implement permanently.
Ecommerce companies might test different product descriptions, pricing, or images on their website to see which ones lead to higher conversion rates. A/B testing can also be used to test different versions of landing pages or checkout processes to optimize the user experience and increase conversion rates. These and other valuable insights can help them improve the online shopping experience and ultimately increase revenue.
Website analytics software is used to track and analyze website traffic and user behavior. In addition to tracking various metrics such as the number of visitors, bounce rate, pageviews, and conversion rate, the software can also provide insights into user demographics, interests, and behavior. Ecommerce teams can view the pages visited, time spent on a page, and actions such as adding products to the cart or completing a purchase.
Ecommerce companies use website analytics software to gain a better understanding of their customers and to make data-driven decisions about their website and marketing strategies. For example, they can use the data collected to identify areas of the website that are underperforming or causing high bounce rates, and optimize those areas to improve the user experience and increase conversions.
Reviews, Ratings, and User Generated Content Integrations
Many online shoppers have come to rely heavily on reviews and ratings when making final purchase decisions. Ratings and reviews provide customers with valuable information about the products they are interested in and can also help to build trust in your brand. Building up your own inventory of reviews and ratings can be time-consuming and challenging, so integrating with existing review sites is common.
A lot of online shoppers also look for social proof beyond written reviews. Bringing in user-generated content (UGC) onto your site via social media integrations can showcase your products in a more natural way – without the staging and professional lighting of traditional product photography. When browsers see people like themselves gaining value or pleasure from a product, they’re more likely to purchase.
Live Chat / Conversational AI Software
Many websites, not just ecommerce stores, leverage live chat or conversational AI software to help with customer support. Some services are still managed by actual humans who are on call to answer questions, troubleshoot technical issues, assist with post-sale problems or returns, or otherwise act in a similar fashion to a sales associate in-store.
In recent years, software has evolved to handle more interactions through intelligent auto-responses and pre-defined workflows that don’t require human intervention. This has helped businesses reduce payroll costs and “manned” support inquiries dramatically. As services like ChatGPT become more mainstream, these software integrations for ecommerce sites are poised to deliver fully personalized shopping experiences akin to an in-store personal shopper. We remain a few years from the bot pouring your glass of water (or wine) for you while you browse – but never say never.
Identifying the Tech that is Worth the Investment
Some of these tools are required if you wish to run a successful ecommerce business, and some are nice-to-haves (or luxuries for smaller companies hoping to grow). Companies may find themselves having to decide between two potential investments and evaluating which would have a greater impact on their business.
Even if you’re lucky enough to have a full tech stack at your disposal, it’s important to regularly review whether your ecommerce user experience investments are paying off, or if your tech is going to waste.
One of the major challenges in getting a return on investment (ROI) for ecommerce technology solutions is the rapidly evolving nature of the ecommerce industry. As technology and trends evolve, ecommerce companies must continually update their platforms and solutions to stay competitive, which can be expensive and time-consuming. Additionally, implementing new technology solutions often requires a significant investment in staff training and support, which can add to the overall cost.
Another challenge is the complexity of ecommerce technology solutions. Ecommerce platforms often consist of multiple systems and solutions. Directly integrating these systems can be difficult, leading to additional costs and delays. Additionally, ensuring that all systems are working seamlessly and providing accurate data can be a challenge, which can lead to costly errors and inefficiencies.
According to a report by Forrester Research, ecommerce companies waste an average of 25% of their technology spend each year. This is often due to a lack of integration between technology solutions. Companies might also invest in a new technology without fully understanding the features and functionality, or expect the tool to solve a challenge but underestimating the personnel and training needed to take full advantage of it. All of these can lead to underutilization and poor ROI.
To oversimplify the answer, the technology worth investing in is the technology you can fully utilize to achieve ecommerce experience improvements.
Overcoming Underutilization and Overspending
There are four critical paths to ensuring your tech stack doesn’t go to waste:
First, don’t buy overly sophisticated tools that offer more than you need or that you can’t adequately staff. If you aren’t planning to use more than 50% of the functionality, it’s probably not the right technology for you. A/B Testing platforms, for example, can deliver incredible value for organizations that are fully staffed to build and run large-scale experiments frequently. But they can become unwieldy for small teams with competing responsibilities.
Second, look for functionality in your existing tech stack that can get you 80% of what you need from a new tool without making a second investment. Using the same A/B Testing example, many companies can likely make do with connecting their existing Analytics platform to their existing Frontend-as-a-Service platform. Combining the tracking and reporting capabilities with the content creation and fast iteration capabilities they already have can allow them to run content experiments and deliver incremental improvements to their ecommerce experience with regularity.
Third, look for opportunities to expand the impact of the tool beyond its original intent. The ability to tap into your inventory management software to display dynamic messages related to inventory availability, or to automatically point shoppers towards the inventory you want to move, was likely not listed on the sales collateral for the platform. The problem to solve was real-time visibility into the inventory status and location, in order to help businesses optimize their inventory levels, reduce carrying costs, and avoid stockouts. The value-add is using that data to create automated promotions and urgency for shoppers browsing online.
Fourth, and finally, invest in technology that can reduce or replace high-cost line items from other categories of spend. In the Conversational AI example noted above, businesses are able to reduce the size and work hours of their support teams by deflecting a large portion of simpler requests through automation. If there are tools that let your existing staff become more productive, reduce the need to hire specialized or additional roles, or otherwise allow you to reduce your costs, that is an immediate payback for the investment.
By taking a strategic and thoughtful approach to ecommerce technology, companies can optimize their investment and drive growth and profitability.