Tag Archives: e-commerce

Juicy Couture Takes Full Advantage of YouTube

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https://www.youtube.com/watch?v=JBEX_uXFMn8&feature=player_embedded

Last week, Juicy Couture launched a new video via YouTube which has supermodel Candice Swanepool modeling a variety of their clothes and accessories. Sounds like the typical ad we’ve come to expect right? Guess again. What’s so brilliant about this campaign is the fact that they made it interactive. Each and every time Candice is shown with a different article of clothing on, or a different piece of jewellery, a box appears and if clicked on, links you directly to their site where you can purchase said item.

Interactive Video

Like something you see? Juicy Couture provides a call-to-action by linking products in their video to their website

I love this new form of video advertising, as it makes it very easy to purchase anything that catches the consumer’s eye. Juicy Couture has found a way to utilize YouTube and their website together by integrating interactivity between the two. By showcasing their product, and then providing a “call-to-action” by enabling their audience to click through to a purchase screen, this will undoubtedly increase Juicy Couture’s conversion rate.

Clickable Ads

Juicy Couture enables an easy way to shop through their ad

Where will this go from here? It wouldn’t surprise me to see more companies taking advantage of this, as it’s very easy and simple to do. One thing that is a concern though, is that every time you click the video to view the item you’re interested in, the video stops. Perhaps if there was some way they could make it so that a mini pop-up tab came up, it could go hand in hand with the video where the user could shop while the video simultaneously played alongside it.

In addition, I think a big thing for companies to consider is how to implement this through mobile technology. I view this as sort of an interactive magazine, where now, when you see something you like, you can buy it instantly. It also wouldn’t surprise me to see this starting to appear in television shows, especially with the increasing use of product placement. Through smart TV’s, touch screens, and tablets, companies may start to implement this same sort of concept through that medium as well.

The Long Tail – Taking Your Business Online

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The long tail of bdh bikes

Jean-Francois Lapointe added an online business to his BDH Bikes store in 2006 after buying his father’s bicycle shop and has built it into a $4-million-a-year enterprise.

Last week I read an article on the Ottawa Citizen about Jean-Francois Lapointe, owner of BDH Bikeswhich is located in Gatineau, Quebec. Growing up, Lapointe worked for his father at the bike shop, but had to rely on employment insurance during the winters because business was too slow to keep him employed. When he took ownership of the shop from his father, he decided a change had to be made. Instead of focusing solely on the traditional brick-and-mortar business which limited sales in the winters, Lapointe figured it would be advantageous to start selling bike parts online, and it was. By enabling e-commerce through both his website and eBay, Lapointe was able to expand the reach of his company to bike aficionados worldwide. Today, BDH Bikes is considered to be one of “Canada’s biggest online retailers of bicycles, parts and accessories, with yearly gross sales of $4 million.”

This is a great example of successfully moving from offline promotions and communications to include a significant role for online activity. Moving your business online provides plenty of opportunities for growth. In Lapointe’s case, it allowed him to target a niche market through microsegmentation.

Amazon versus Barnes and Noble

This gave him “unrestricted” shelf space, which allowed for more selection for his consumers. In addition, the expanded collection allowed him to reach the customers that aren’t into mainstream products, thus increasing market share and sales. This is called the Long Tail, which Chris Anderson delves into further in his article on Wired.com. For a better example of the Long Tail, take Amazon.com for instance. A typical Barnes & Noble offers a selection of 130,000 books whereas Amazon’s inventory is comprised of roughly 2.3 million books. Although Barnes & Noble offers the most popular and mainstream books available, they fail to account for the segment of customers interested in more obscure items. Amazon capitalizes on this by offering the niche fare that their offline competitors don’t. This is evident by more than half (57%) of Amazon’s book sales coming from outside the top 130,000 titles. The Long Tail proves that even though many consumers congregate towards the mainstream items, “there will always be real demand for niche fare found only online.”

BDH Bikes is just one of the many great examples of the advantages to using the Long Tail.

Best Buy Fights Back

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Today I read an article on Time Business about Best Buy making two announcements which will take effect just in time for the upcoming holiday season:

  1. They would begin price matching online retailers
  2. They will offer free home delivery on merchandise that is out of stock in stores
Best Buy Price Match

In an attempt to combat the recent trend of “showrooming,” Best Buy will now match the prices of their online competitors

These changes are surely a retort to companies like Amazon.com, which as of late has been contributing to the recent trend of “showrooming” which has plagued brick-and-mortars like Best Buy over the past couple of years. “Showrooming,” for those that aren’t familiar with the term, is when a customer examines products in a brick-and-mortar store, and then purchases the same item online, usually at a cheaper price. As a result, it is estimated that Best Buy is host to around 15% of shoppers who come into their stores to test their products with the intent of purchasing online. This number has increased roughly 3% in past two years. In addition, it’s estimated that 43% of electronic buyers bought something online after checking it out in store.

Best Buy is taking these steps to improve the percentage of shoppers who actually enter their stores and leave with a purchase, which is currently about 40% of all shoppers. In addition, Best Buy believes that 20% of all “showrooming” shoppers end up making their purchase in the store, another figure which they would like to increase. “We have a tremendous opportunity to increase that close rate,” said Matthew Furman, a spokesman for Best Buy.

We Price Match Amazon.com

Expect to see more of these signs at your local Best Buy

Although it comes a bit late, I like this move by Best Buy. They acknowledged that they were missing out on sales and took action to increase their conversion rate, which has been in decline for quite some time. This suggests that they’re taking an honest look at their competition and recognizing that online retailing is becoming the preference for shoppers who purchase electronics. According to ShopperTrak, analysts have also forecasted that this trend will continue as foot traffic is expected to decrease by 8% in electronic stores this upcoming holiday season.

However, I see this move being successful in the short run as opposed to the long run. It’s estimated that overhead costs of brick-and-mortars add roughly 10% to prices, so it’ll be interesting to see whether or not Best Buy can survive by matching the lower prices of their online competitors as it will squeeze their margins even further. Doug Fleener, president of Dynamic Experiences Group shares these concerns.

“If you are willing to match price, you let competitors determine your profitability, and if customers know that, you’re only encouraging that behavior. This is not a sustainable strategy with the overhead Best Buy has, and limited time will mean nothing to consumers — there will be no going back.”

Will simply selling more by the volume fix their problem? What will happen come January when sales are sure to decrease after the holiday season? Is there a way to decrease their cost structure in order to remain competitive with e-commerce giants like Amazon? Only time will tell…