Considerations

• How much control do you need over things like order processing and reporting?
• Are you willing to let your platform dictate some operational business processes?
• Do you have the resources to manage technical development yourself?

Platforms overview

The following is an outline of available platform options, roughly in order of technical complexity, flexibility and long-term cost, from lowest to highest.

Marketplace: brands who are focused on production rather than retail may find it most beneficial to simply sell via a marketplace. If you have a product range that you think may be accepted, then selling on a curated marketplace could be the fastest and most cost effective way to launch your online presence, bootstrapping your online credibility by partnering with an established online brand and benefiting from extensive technical infrastructure and marketing expertise. Alternatively, selling on an open marketplace, such as Etsy, Amazon or eBay, is a quick and easy option for many brands.

Fully managed platform: these are, typically, the quickest and cheapest options for getting a fully featured site off the ground, but are also likely to offer you the least flexibility for customisation. A good thing to look at when deciding if one of these is going to suit your needs is to look at whether there is a healthy ecosystem of third-party apps or plugins. Good examples of these platforms include Shopify and Squarespace, both of which provide intuitive interfaces that even non-technical users can use to build an attractive and functional site.

Self-hosted framework: probably the most well-known and widely used platform is Magento, a proven framework written in PHP that provides core ecommerce functionality out of the box, a healthy ecosystem of third-party integrations and a large community of developer familiarity and support. Frameworks such as this can offer a good balance between speed to launch and common functionality, and an ability to customise processes as your requirements evolve over time. It is recommended to be cautious of less well-known frameworks that have been developed in-house by an agency or that are not community supported, as building on these can lead to becoming dependent on that agency for support. A good way to assess this is to check that the source code for the framework is freely available on a repository site, such as Github or Bitbucket, and that it has regular and recent community contributions.

Custom build: larger ecommerce businesses or those with bespoke needs may consider building their own framework from scratch. This route gives absolute freedom to create the unique features that you may want or need for your business as you are bound, ultimately, only by your own creativity and the capabilities of your development team. This is the route the company took due to the complex requirements of its multi-channel business and, in the long run, it has been a decision that allowed the team to build out an extensive feature set of custom integrations and working processes that have driven exponential growth in recent years and allowed the business to scale technical operations efficiently to keep pace with that growth.

Although picking the right platform is important and should be evaluated thoroughly, it is just the first in a series of design and development decisions that must be made when building and growing an ecommerce business. It is also important to consider how to connect your new online systems with any legacy offline systems.

Marketing department

For newsletters, updates or marketing emails, an initial integration that you will want to consider is with an email service provider (ESP). Although you can use your ESP as a stand-alone tool, an integration allows for a single customer record and much greater visibility and control. In this case, Wolf & Badger (W&B) integrated directly into Mailchimp, which, although reasonably expensive in comparison to competitors, is very easy to use and integrate with other tools. W&B has over 450,000 active user emails on its database and, with a proper integration in place, the marketing department is able to make full use of the ESP functionality to get the most from this valuable marketing channel.

Many ecommerce platforms will often have their own basic email tools built in for transactional emails but, if you are developing your own site or want more power and functionality from your existing solution, you may also wish to use a dedicated transactional email provider. The team at Wolf & Badger opted for Mandrill to give visibility over sending volume, open and click rates, run split testing of content and much more. Do not underestimate the power of your transactional emails as a selling tool – customers are far more engaged when opening order confirmation emails or sign-up emails, for example, than they would be with a regular newsletter, and it is also possible to set up ‘lifecycle’ emails, such as abandoned bag, abandoned browse or repeat-purchase encouragement emails, if correctly tied together with customer analytics data. W&B uses Ometria for this and the marketing team now sees triggered emails generating eight times open-rate when compared to newsletters.

Customer support department

As a small business, it might be easiest to simply interact with customers and answer queries via a personal email account, but any established ecommerce business will tell you that this does not scale well. For the sake of your customer support department, it is worthwhile investing in a subscription to a good help desk tool in order to keep all customer communication in one place. The team at W&B trialled numerous providers before settling on Groove for this. Variable pricing by user met the needs of the expanding customer service team; and for those just starting out, many tools are even free for single users. By implementing templated response macros, sharing support tickets between the team and, most importantly, integrating with customer records, the support team was able to cut average first response times by 50 per cent.

Order processing department

Tools can help with even the dullest processes. For example, there is now an abundance of third-party options for processing payments on your site that often will be far superior to those that come as standard with hosted solutions. In recent years, a proliferation of new payment providers such as Stripe have enabled a much simpler integration without the need for separate merchant accounts, which is a big time-saver for start-ups. W&B utilises a payment gateway that facilitates multiple currencies and card types to encourage and boost cross-border transactions and, thanks to this, it now sells regularly to over 80 countries. The team also integrated with PayPal, which has proven to be a very popular payment method, representing 35 per cent of all online transactions on the site during 2015.

Numerous other tools have been integrated into the site in recent years and some of the most important, and yet least talked about, of these are around customer security and fraud mitigation that further reduce operational burden for the order processing department and allow for efficient scaling of processes. For example, certain payment gateways include fraud-detection tools, but many of these lack the power and functionality of a specialist tool, such as Sift Science. Since implementing this tool, the fraud rates dropped from 0.5 per cent of attempted transactions to fewer than 0.1 per cent.

Product feeds

The first step in marketing automation should be to produce a high-quality XML product feed using the widely accepted Google specification. As usual, there are tools that can help with this, although W&B manages the process internally in order to ensure that all data fields are included and the feed is regularly updated.

This product feed will be the core of your marketing efforts and can be used for multiple purposes. It will prove invaluable in facilitating sales via third-party marketplaces, listing on shopping comparison sites, powering social shopping feeds, showcasing on Google Shopping, providing content to affiliate marketing channels and much more. With 13,000 individual products from over 700 independent brands, getting the stock data in shape was particularly important to W&B, but, for any retailer, it is worth taking the time to put in a little upfront work to ensure your data is robust.

The team work continuously to improve product listings, not only for conversion rate optimisation onsite, but also to enrich the data feed to drive more traffic and of a higher quality. The difference in sales between those products with detailed and well-written product descriptions, sizing information, material content and multiple photos per product has been found by the team to increase sales by as much as 55 per cent when compared to a lower-quality product listing. By putting the maintenance and improvement of data as a core competency of its merchandising team, the business has been able to drive a significant portion of its sales through channels utilising its product feed.

Marketing automation

Stock data in a standardised product feed is just one half of the equation, and not the only type of data on which a savvy ecommerce manager should be focused. Maintaining good customer data is also central to the marketing strategy and also should be for any site focused on customer acquisition or retention.

With both customer data and inventory data available in the correct format, an ecommerce retailer can make efficient use of new marketing channels and take a real data-driven approach to ecommerce marketing, often in an automated way. For example, W&B chose Ometria to help manage customer marketing across different stages of their lifecycle. This tool is used to trigger automated email campaigns using product data relevant to the right audience at the right time; this led to an increase in repeat purchase rate by 60 per cent and overall online revenue by 4 per cent in the first few months following implementation.

This is just one example, utilising an ever-expanding suite of marketing tools all driven using this customer and inventory data to deliver a strong return on investment across various channels, not just email. Technology-driven marketing tools now drive 39 per cent of W&B’s online sales and have even been shown to increase offline sales, too. Making good use of data and third-party tools should become central to the marketing efforts of any ecommerce business.

Why speed matters

The idea that a website’s performance can affect the revenue it generates is not new. Some of the case studies making the connection date back to 2008. Jakob Nielsen was also writing about the importance of computer response times in the context of usability way back in 1993.⁴ Nielsen referenced earlier work that put response times into three broad categories:

• 0.1 second – user feels that the system is reacting instantaneously.
• 1.0 second is a noticeable delay; above this, a user’s flow of thought is interrupted.
• 10 seconds – the user’s attention is lost.

These timing points still inform website performance goals today. For example, in 2014 a team at The Guardian set (and met) a goal of delivering core content in under 1 second.⁵

A website’s performance is not just important from a user experience perspective. It also has an impact on search engine optimisation (SEO). Google has used page speed as a ranking factor since 2010 and has factored landing page load time into its quality score for pay-per-click (PPC) advertising since 2008.⁶, ⁷

Many organisations see a knock-on effect on cost as well. Faster websites will use less bandwidth and need less storage, which can mean less investment in infrastructure.

However, despite a burgeoning web performance industry and a growing list of case studies pointing to a link between a website’s performance and the money it makes, many websites, especially in the retail sector, are still failing to get the basics right.

Three of the biggest barriers to a fast website

How do you know if your website is as fast as it should be?

Measuring a website’s speed is not as straightforward as it might sound. How fast a page loads at any given time depends on a range of factors and everyone’s experience will be slightly different. Bandwidth, latency, device, browser and even the time of day can have an impact. Part of the challenge, then, is deciding on the conditions in which to test.

Then there is the issue of what to measure. Do you wait until everything on the page has finished loading? Recently, the trend has been to try to measure performance in a more sophisticated way by looking at what is likely to have the biggest impact on the user experience. For example, Pat Meenan at Google developed a metric known as Speed Index, which looks at the rate at which a page becomes visually complete above the fold.⁹

Ultimately, the way you measure performance should be determined by what you are trying to achieve, and the tools of the trade fall into five broad categories:

1. Synthetic monitoring
   Synthetic monitoring regularly checks a website’s load times and availability under carefully controlled conditions. It does not necessarily replicate a typical end-user experience, and the times it records may or may not be representative. However, synthetic monitoring excels in benchmarking and tracking changes in performance over time, and it can be invaluable in helping organisations identify and understand slowdowns, as well as other errors, such as missing objects on a page.
2. Real user monitoring (RUM)
   RUM aims to measure a website’s performance from the point of view of everyone who visits it. This makes it less good for benchmarking – for example, a website might look as though it has suddenly become much slower simply because it is getting more visits from people with a slow internet connection. However, it does give organisations useful insight into how their website is working for customers in different regions or on different devices. RUM also tends to benefit organisations with very large volumes of web traffic because more data makes it easier to identify patterns and trends.
3. Application performance management (APM)
   APM tools typically look at a website’s performance ‘from the inside’, and often they are used by web operations teams to debug back-end performance issues, such as slow database queries, rather than measure performance from the end user’s perspective.
4. Load testing
   Load testing examines how a website responds to different levels and patterns of traffic by subjecting it to increased load in a controlled environment and measuring the impact on performance. It is particularly important for organisations whose websites are about to enter uncharted territory – for example, a retailer that is about to launch its first TV ad campaign.
5. Real-browser performance testing and analysis tools
   Finally, there are a number of tools that offer performance testing from real browsers under controlled conditions. These can be very versatile. At one level, they can be used to create dashboards, giving an overview of performance, both over time and in relation to the competition. But they also offer a lot of detail, giving analysts insight into how every object on the page loads, with reports to help them understand performance from the visitor’s point of view and pinpoint the bottlenecks.

Many organisations use a combination of tools to understand how their website is performing, what they need to do to improve it and how performance relates to key metrics, such as conversion.

Simple steps to optimise performance include:

1. Set goals and communicate them effectively
   Web performance key performance indicators (KPIs) do not need to be complex, and a simple goal such as ‘The home page should be visually complete above the fold within 1.5 seconds at a download speed of 5Mbps’ is better than none at all. Precisely where KPIs should lie depends on a range of factors, but a good starting point is to benchmark the website against the competition.
   Everyone involved in the website also needs to know what they are aiming for. This does not just mean the people building and maintaining the site – it also means anyone specifying requirements. For example, do branding guidelines require the use of certain custom fonts? If so, how might this delay the point at which text on the website is displayed? And will the business value of custom fonts outweigh the negative impact of that delay?
2. Test – and report – regularly
   The only way for an organisation to know if it is meeting its KPIs – and how any updates will affect performance – is to test. Ideally, tests should be carried out in carefully controlled conditions, so that results are not affected by external factors.
3. Focus on the big things
   The factors that have the biggest impact on performance are often the simplest ones. For example, most site owners could make big gains just by auditing and optimising the images on their website. Others could benefit from activating compression for text files.
4. Change one thing at a time
   It is important to know whether and to what extent changes designed to improve performance are working, and this means taking a scientific approach to optimisation. This is important because some techniques for making web pages faster come at a cost. Some could even make the website slower in some circumstances. Following a pattern of ‘test, change and retest’ will help to ensure that every improvement has the desired effect.
5. Remember why you are doing it
   Website performance optimisation is not a goal in itself. From a business perspective, it means delivering important content to potential customers as quickly as possible, so that they are more likely to make a purchase. In this sense, it is just one of a whole range of factors that affect buying decisions. It just happens to be one that is too often overlooked.

In summary

Speed matters: faster ecommerce websites tend to deliver better results. It is, therefore, important to understand how a website’s performance correlates with key metrics, avoid common mistakes and ensure that performance is addressed at every stage of the website’s lifecycle.

• A retailer’s revenue and costs are both affected by how fast its website loads and/or displays.
• Recent trends have led to image-heavy websites with large volumes of third-party content, which, in turn, have led to slower load times.
• Improving the performance of an ecommerce website is as much an organisational and cultural challenge as a technical one – larger organisations could find this challenge harder to overcome than smaller ones.
• There are a number of different ways to measure a website’s speed – how quickly a web page displays is at least as important as how long it takes to finish loading.
• It is possible to make big performance gains by focusing on a few, simple things, but it is important to be methodical: test, improve and retest.

Key findings

• Watchfinder’s growth to £55.5 milion turnover has been made possible thanks to the evolving IT capabilities.
• The introduction of ecommerce following the implementation of 3D secure targeted business focus.
• Machine learning will drive the optimisation of the company going forwards.

Interviewee

Jonathan Gill has spent over 10 years developing the company’s hardware and software systems. His interest in coding started in his teens, inspiring him to cut his teeth at software development agency Illuminaries and launch a 20-plus year career in software development. Gill joined Watchfinder on a consultancy basis in 2003, making the move permanent two years later.

About Watchfinder

Since 2002, Watchfinder has developed from a homegrown business to a multi-million-pound business shipping to multiple countries.

Watchfinder is one of the world’s largest pre-owned premium watch retailers, founded in 2002 as a purely online business by two friends and watch enthusiasts, Stuart Hennell and Lloyd Amsdon. The company stocks over 3,000 watches at an average unit price of £4,000, with a turnover of over 13,000 units and £55.5 million annually. There are over 50 brands available, including Rolex, Omega and Breitling.

Watchfinder diversified into traditional bricks-and-mortar retail solutions in 2012, with the opening of its first boutique in The Royal Exchange in London. It has since opened 3 more boutiques, 2 private showrooms, and a manufacturer-certified service centre, staffing over 110 employees nationwide. This unusual approach has been led by the strong development of an IT-based infrastructure, building a core business online that has then naturally flourished into a fully rounded commercial entity.

Its online sales strategy

The approach to Watchfinder’s online retail strategy is to have a strong paid and organic search presence, to reach users that know what they want but are not aware of Watchfinder. This is achieved by feeding the top of the funnel with programmatic real-time buying of display targeted to strong audiences. This complements offline marketing strategies.

The path to purchasing a £4,000+ watch is around 30 to 90 days, so the process is, mainly, about nurturing the customer through the consideration stages to conversion. By offering the opportunity to win a pre-owned Rolex, visitors are encouraged to sign up to the Watchfinder newsletter. They will then receive emails with new arrivals and offers; this targeted approach gives the company high open rates and click-throughs.

As customers move further down the conversion path, and they start spending a significant amount of time onsite browsing certain brands, they will receive targeted remarketing messages via display. These messages are designed to tread that fine line between ‘top of mind’ and ‘ad fatigue’.

From here it is about delivering the premium level of customer service that someone spending £4,000+ on a watch expects. Regular emails put new customers back into the consideration phase, where they are presented with more watches that they could part exchange for.

Much of this strategy has evolved over the last couple of years as the tools that facilitate remarketing become more widespread and through Watchfinder’s long-term relationship with paid search and display agency Periscopix.

The key challenges over the next 12 months are to make use of these new features within its mature market in the UK, whilst rolling out, testing and developing the current UK strategy within the global market.