Customer Engagement: What Publishers Can Learn From Online Retailers

by , Apr 21, 2006, 3:00 PM
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Online retailers want consumers' money. They create their sites' experience around customer needs almost exclusively. In some cases, they balance suppliers' needs as well, such as brand stores like the one for Chanel at Macys.com. But these objectives are not in opposition--both Macy's and Chanel want consumers to buy Chanel at Macy's, and many consumers visit Macys.com expressly for that reason.

Publishers, on the other hand, want advertisers' money. This sets up a different dynamic than in online retail. Ask anyone at an online retailer who is king, and they'll reply loudly, "the customer." Ask the same question of a publisher, and you'll get a split of responses between "the advertiser" and "the audience." (Thankfully, responses of "the financial analyst" and "the investor" are infrequent enough now to be discarded as outliers.)

Retailers know that their primary objective is to help customers find what they are looking for, purchase it, and then leave. And so they make that their own primary objective. Anything on the site that's an obstacle to the achievement of this goal is summarily removed--superfluous navigation menus and tiers, checkout confusion, even slow-loading images and rich media that do not directly assist in a purchase decision.

Online publishers can learn much from this customer-focused approach. A year and a half ago, pop-ups were panned by the industry and the IAB as short-sighted money-catchers that would inevitably erode publishers' appeal to their audience. Now, with more content choices than ever, and a growing consumer-narcissistic-centric orientation about media and advertising, it's only a matter of time before a similar revolt is staged against page takeovers, expanding banners, ads with audio, video pre-roll, and every other interruptive format that advertisers "find effective" now, or hope to use to replace a flagging format in the future.

One might argue that the customer expectation for retail is different because customers come in searching for something in particular, whereas with news and content publishers they're less likely to be searching, and more likely to be reading, browsing, learning--in a word, consuming. This is true, but not by much. According to Hitwise, the percentage of visitors arriving at the largest retailers through search queries varies between about 10 percent and 30 percent:

Retailers' Percent of Traffic from Search

eBay: 18 percent

Amazon: 31 percent

Wal-Mart: 21 percent

Target: 26 percent

NetFlix.com: 10 percent

Dell: 18 percent

BestBuy: 21 percent

Ticketmaster: 13 percent

Overstock.com: 22 percent

JC Penney: 23 percent

Weighted Average: 20 percent

Source: Hitwise, excerpted from Top 20 Retail Websites, week ending April 15, 2006

The search traffic at leading news and media sites is lower, but not dramatically, with the weighted average only 7 percentage points lower:

News/Media Site's Percent of Traffic from Search

Yahoo! News: 3 percent

The Weather Channel - US: 10 percent

MSNBC: 8 percent

CNN.com: 12 percent

Yahoo! Weather: 5 percent

Google News: 69 percent

Drudge Report: 7 percent

USA Today: 14 percent

New York Times: 15 percent

BBC News: 19 percent

Weighted Average: 13 percent

Source: Hitwise, excerpted from Top 20 News and Media Websites, week ending April 15, 2006

Meaningful engagement is not measured by duration of visit, or pages viewed. Retailers see high metrics here and fear their customers couldn't find what they wanted, then begin immediately scouring their sites for more e-barriers to raze. Publishers, in contrast, exalt: more page views, more inventory, more advertiser revenue next month. But with this many people visiting via search, and many more who visit directly but still in "search mode," publishers can safely assume that much of their audience is mission-driven. If their mission is not accomplished, and accomplished quickly, consumers will seek an alternative, and these metrics may turn out to be a red herring.

However "engagement" will ultimately be defined, it will surely connote a consumer willingness to continue interaction, not a grudging reluctance. Think of all the habits we, as consumers, have altered because an outdated model has been exploded by changes to technology and media: we don't sit in front of a travel agent's desk while she types commands into a computer we can't see; we don't haggle impotently with car dealers; we don't trudge from store to store looking for a replacement cooking grate for our barbeque grill; we don't clip coupons; we don't tally gains and losses in our portfolio using the morning paper and a calculator; we don't hurry home to catch our favorite show; we don't watch the commercials. Media models--particularly those in online media--that fail to regard the customer experience (and by that I mean customer expectations in an absolute sense, not relative to what the experience on a particular site used to be) as paramount will suffer. Just ask any retailer.

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