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Electronics Top Shopper Back to School Lists, SortPrice.com Says

August 12, 2011 by ecommercejunkie

With the back-to-school shopping season in full swing, what items are consumers targeting most?

According to price comparison site SortPrice.com, electronics and gadgets are once again the most sought-after products in 2011.   The company rolled out its annual top 10 popular back to school products list yesterday, which is compiled using site traffic and user searches.

Gone are the days when pencils, pens, and spiral-bound notebooks dominate back to school shopping lists, though SortPrice is quick to point out that the economic climate is still having an effect on consumer buying habits, even now during the industry’s second-biggest shopping period of the year.

“With the economy still clearly affecting consumer buying habits, we’ve got an interesting dynamic going on this back to school season,” says Doron Simovitch, SortPrice co-founder and CEO. “While parents seem committed to spending extra time looking for the best price on back to school essentials, that diligence hasn’t necessarily translated down to students, who are still targeting higher-end electronics in particular as must-haves before they return to the classroom this fall.”

So what does this year’s SortPrice top 10 look like?

1- Apple iPad 2

2- Sony Cybershot Digital Cameras

3- UGG Girls and Women’s Boots

4- Acer Netbooks

5- Jansport Backpacks

6- North Face Hooded Sweatshirts and Outerwear

7- Bed-in-a-Bag Bedding Ensembles

8- Converse Chuck Taylor All-Star Sneakers

9- Diesel Messenger Bags

10- High-Definition Web Cams

We were surprised to see the iPad so high on the list given its hefty price tag but it’s apparent that more students (and their parents) are viewing Apple’s tablet as a must for a successful school year.

Thoughts on SortPrice’s list?  Leave us a comment with what you’re targeting for back to school 2011!

Posted in Ecommerce, General News / Technology, Retail | Tagged , , , | 1 Comment »

Congress Eyes Federal Sales Tax Bill

August 1, 2011 by ecommercejunkie

Lost amid the rancorous debate over raising the debt ceiling, Illinois Senator Dick Durbin on Friday afternoon rolled out proposed legislation that would clear the way for a federally-mandated online sales tax in states that participate in the Streamlined Sales Tax Project (SST).

The Main Street Fairness Act would essentially reverse the Supreme Court’s 1992 decision dictating that states must rely on physical presence in determining whether or not to force web retailers to collect sales taxes.  Durbin’s move promises to ramp up a heated debate at the federal level between interests on both sides of the online sales tax issue.

“Main Street retailers collect sales taxes on behalf of consumers, why shouldn’t online retailers do the same?” Durbin said during an announcement of the legislation.  “In 2012, states across the country, including Illinois, are expected to lose as much as $24 billion in uncollected state and local taxes on internet and catalogue sales.  From 2005 to 2010 the state of Illinois estimated it lost $153 million each year.  The Main Street Fairness Act doesn’t ask anyone to pay a single penny more in taxes.  Instead, it would help governors and mayors collect taxes that are already owed.”

The SST figured to be the best available resource for bringing about federal control over how and where retailers can collect unpaid online sales taxes.  The program is designed to help states simplify their sales tax laws to facilitate merchants’ efforts to collect sales taxes across multiple states.

More than 20 states currently participate in the SST.

In a bit of a surprise move, Amazon’s vice president for global public policy Paul Misener wrote a letter to Durbin actually praising the Main Street Fairness Act:

“Thank you for your bill that would allow states that sufficiently simplify their rules to require collection of sales tax by out-of-state sellers,” the letter stated.  “Amazon looks forward to working with you and your colleagues in Congress to help enact sales tax legislation.”

Other retail interests weren’t nearly as excited. eBay’s senior director of government relations and global public policy Brian Bieron told Internet Retailer that the legislation would actually hurt smaller merchants, of which eBay has many.

“Forcing small businesses to take on the same costs and tax burdens as national retail businesses is unrealistic, unfair and will unbalance the playing field between giant retailers and small business retailers on the Internet,” he said.

Of course, the ‘level playing field’ angle has been one played up by brick and mortar retail interests for quite some time when debating the merit of online sales taxes.  Lobbying groups like the NRF have made it their cornerstone argument in pushing for better solutions to the tax issue.  As such, it’s interesting to hear eBay make the claim that a federally mandated collection program would actually hurt smaller merchants.

Nevertheless, there are other items that promise to frame the debate on the Main Street Fairness Act moving forward as well.  The biggest might just be how much revenue the law, if passed, would actually generate.  Durbin’s estimate is based on a recent study by the University of Tennessee but other concerned parties—namely the Direct Marketing Association and the online retail group NetChoice—have argued that figure is way too high and that a nationwide sales tax would stifle e-commerce.

We’ll keep tabs on this as new developments emerge but suffice to say it could move pretty quickly now that the debt ceiling issue is in the rearview mirror and quite a few states are facing serious budgetary shortfall questions in the coming weeks and months.

As always, leave us a comment!

Posted in Online Sales Taxes | Tagged , , , , , , | 4 Comments »

June 2011 Junkie Winner – TurnTo Networks

July 27, 2011 by ecommercejunkie

June 2011 Junkie Winner – TurnTo NetworksIn the e-commerce industry these days, information is everything.

A seemingly infinite number of online shopping resources, combined with an economic climate that has forced consumers to save money wherever they can, have put the power squarely in the hands of shoppers.  Concurrently, that climate has also made it imperative that retailers offer as many product research tools as possible in order to retain customers and stay relevant.

Quite simply, online shoppers are smarter and more diligent than ever before.  And while they might not necessarily always spend more, they are usually spending wiser.

Product reviews have always played an important role in an online shopper’s decision.  But our June 2011 Junkie Award winner, TurnTo Networks, has taken the concept to a whole new level.

TurnTo offers a social question and answer product called Ask Owners, which allows shoppers on retail sites to pose questions about particular products to other customers that have already bought them.  After questions have been posed, shoppers get multiple, highly-credible and high-quality answers delivered to them quickly through the merchant site, with links back to the original product pages to facilitate the checkout process.

The concept vastly improves on existing Q & A resources, many of which work much like a message board, where consumers often have to wait long periods of time to get a response to a product question, if they get one at all.  It also brings an added social component to shopping research that many consumers crave.

Speedy responses and high-quality advice, though, are not the only things that make this first-of-its-kind resource so valuable.

According to information from TurnTo, Ask Owners also serves as a powerful customer retention and marketing tool.  Thanks to an average response rate of about 8 percent on questions, merchants using Ask Owners are seeing many past shoppers return to their sites to provide answers to others, which in turn, can lead to even more purchases.

Furthermore, the Ask Owners is proving to have strong SEO and conversion benefits as well.

TurnTo says that visitors using the system tend to buy at rates between two and seven times higher than those who do not.  On the sites of some of TurnTo’s bigger retailers, more than 30 percent of all the purchases originate from shoppers who used Ask Owners before placing their order.

Finally, TurnTo keeps all of the valuable advice provided by shoppers for others to benefit from as well.  Q & A dialog is visible on relevant product pages as a resource for future visitors and all user-generated dialog from Ask Owners is index-able by search engines.  Many of TurnTo’s retail partners have even said that Ask Owners provides more quality user-generated content than their very own customer review systems.

TurnTo lists Emitations, ClubFurniture.com and ePartyUnlimited as just a few web merchants already benefitting from Ask Owners and from what we can see, there should be plenty more added to that list in the near future.

It has been awhile since we awarded a Junkie based on a technological feature but TurnTo is certainly deserving of this month’s edition of the award!  Learn more at: http://www.turntonetworks.com/.

Posted in Junkie Award Winner | Tagged , , , , | Leave a Comment »

Are Online Sales Taxes Confusing Consumers?

July 26, 2011 by ecommercejunkie

The rise in new online sales tax bills in states across the nation has been a top story within the e-commerce and business press over the course of the past year or so.  It seems, however, that not everyone is reading those stories.

In a newly released survey sponsored by the International Council of Shopping Centers (ICSC), 64 percent of consumers in states that have enacted new internet taxation laws either don’t know or do not believe that they’re required to remit sales taxes on web purchases when a retailer does not collect them on their own.

“The results of this study point out that there are widespread consumer misperceptions about the requirement to pay sales tax on Internet purchases,” said Michael Kercheval, CEO and president of ICSC.  “The data shows people are confused as to whether or not they are – or should be – paying tax on online purchases.”

While the study does not elaborate on why so many people are confused about the existence of the new taxes (we’ll get to that later), it does contain some other relevant important data.

For example, 93 percent of the 1,000 consumers polled said they would continue to shop online if taxes were collected at the point of purchase, and even in the event of 100 percent compliance on online sales tax collection among merchants, consumer online shopping behavior would not be materially or substantively impacted much.

Despite that, it would appear that online shopping has not completely made traditional shopping and retail storefronts obsolete just yet.

Nearly three quarters of the consumers believe brick and mortar stores have an “important role to play in the 21st century marketplace.”  And in that vein, many of the respondents selected “choice” and “convenience” as key decision criteria, in addition to price, when contemplating a purchase.  This indicates at least a continued partial reliance on brick and mortar shopping options.

From our vantage point, the ICSC seems to be supporting online sales taxes in order to level the playing field with brick and mortar retailers, which is to be expected given the scope of their work.  The study’s press release openly touts the Main Street Fairness Act, which we’ve covered here before, calling it a first step toward establishing that marketplace for a new century.

Still, we can’t help but wonder if this study was more focused on the confusion surrounding new taxes or simply a way to beat the drum for brick and mortar retailers on the whole.  Granted, the ICSC does adequately identify a problem here, citing low consumer compliance with tax rules for online purchases.  And yes, the study does make the next logical connection: that such consumer misconceptions have led to an unfair advantage for online retailers over their brick and mortar counterparts.

But why does the ICSC then go on to tout mostly vague data about the importance of those brick and mortar stores rather than delving deeper into the obvious question that arises from this study (at least in our opinion):  why are consumers confused about their online sales tax responsibilities?  Is it a question of poor communication between lawmakers, regulators and their constituents?  Are shoppers feigning ignorance?  Are retailers not informing shoppers of their tax duty?  Is the confusion a by-product of hastily written and implemented laws that don’t include adequate considerations for enforcement?

Now look, economists, we are not.  But when nearly two-thirds of the shoppers in states using online sales taxes are in the dark on the issue, it certainly begs the question: what’s the point of a tax if no one knows about it and thus, isn’t paying it?  If online sales taxes are to fulfill the aim they’re designed for, then there needs to be a better analysis and reconciliation of this confusion that the ICSC says is rampant among shoppers.

What’s your take?  Why are consumers confused about paying online sales taxes?  Leave us a comment with your response.

Posted in General News / Technology, Online Sales Taxes, Retail | Tagged , , , , , | 2 Comments »

Merchant Tips: Is Contact Data Accuracy Hurting Your Business?

July 25, 2011 by ecommercejunkie

It may not be one of the sexier components of any e-commerce operation, but the fact remains that having solid and accurate customer data information in order to maintain clear lines of communications with your shoppers is a must in this day and age.

The question then becomes, are you one of the haves or the have-nots when it comes to an updated customer database?

According to a new study by Experian QAS called The Dilemma of Multichannel Contact Data Accuracy, it seems that accurate customer contact information is falling through the cracks for many retailers even as many are increasingly finding new methods to collect the vital information.

The overall polling carried out in June by Experian QAS, a division of Experian Marketing Services and provider of address verification services and software, included the responses of 100 or so retailers.  The study’s aim was to review current attitudes toward contact data quality and make recommendations for better collection of such data across multiple channels.

Three quarters of the retailers polled say their databases are rife with incomplete, outdated or simply erroneous consumer contact information.  They further stated that an average of 12 percent of all the customer information in their databases is inaccurate, which further hinders their ability to reach shoppers.  If there’s a silver lining here, it’s that among the rest of the industry sources polled (mostly insurance and banking professionals), there’s actually a higher rate of erroneous information (23 percent) in their databases.

Furthermore, 55 percent of the retailers (versus 68 percent for everyone else) say they capture customer data via mobile applications, cementing the utility and effectiveness of mobile in general.

Still, the picture isn’t a pretty one, as evidenced by the fact that 98 percent of ALL respondents say they waste budget money annually on inaccurate contact data.

“The large amount of erroneous contact data is overwhelming businesses, causing them to ignore the inaccuracies in their system,” said Thomas Schutz, senior vice president and general manager of Experian QAS.  “With the popularity of alternate channels, organizations face more opportunities for growth, but also for error.  Data quality needs to be considered to ensure success from new channels rather than additional headaches.”

Experian’s data shows that 36 percent of retailers use some type of in-house software tools to manage their databases, slightly higher than the survey’s broad average of 30 percent.  The company also states that the lowest-quality information in company databases is often that which customers enter themselves, though 44 percent of the retail respondents to the survey pin the blame on customer service.

Nevertheless, Experian recommends that companies keep mobile data collection to a minimum since such shoppers are often in a rush to finish the check-out process, making errors all the more likely.

“Users are frequently distracted or in a hurry to complete the transaction,” the survey states.  “Organizations need to ensure the accuracy of this information so that they can follow-up.  However, as with adding anything to the e-commerce checkout process, organizations want to make sure they prevent user drop-off.”

The company, among its additional recommendations, also advises that retailers should match stored data on its returning customers’ accounts so the shoppers aren’t forced to re-enter the data with every visit.

Got any feedback on this issue? Leave us a comment!

Posted in Ecommerce, Merchant Tips | Tagged , , , , | Leave a Comment »

Groupon’s Privacy Policy Catches Lawmakers’ Attention

July 22, 2011 by ecommercejunkie

Having established itself as the clear-cut leader in the growing daily deal industry with an army of loyal fans and customers as well as an anticipated $3 billion in revenue this year alone, one would be hard pressed to say that Groupon has anything to worry about these days.

Or do they?

Two members of Congress, Rep. Ed Markey (D) of Massachusetts and Joe Barton (R) of Texas, smell something a bit fishy when it comes to Groupon’s privacy practices and have submitted a written inquiry to the company requesting more information, specifically on the issue of possible ‘mobile tracking’ of customers.

Recently, Groupon updated its privacy policies and part of the revision was a clause that allows the company to track the locations of mobile customers, even when the Groupon mobile applications are closed on their mobile devices.  Groupon initially said the change was part of its expansion of Groupon Now, which relies on geo-location technology in order to offer shoppers deals based on their real-time locations.

The policy states:

If you use a Groupon mobile application and your mobile device’s settings allow it, we may collect mobile location information from your device.  Our application may be designed to collect information even if you are not logged into the Groupon application.

Included in the policy is another clause that says Groupon can share similar information with its retail partners that offer the actual deals featured in the service.  This enables those merchants to communicate directly with consumers and target them with advertising as well.

The Markey and Barton inquiry requests an explanation from the company on how exactly it gathers location information when a user’s application is turned off, whether or not Groupon gives its customers an op-out option and whether its mobile data collection policy is consistent across all devices.

The pair, co-chairs of the Congressional Privacy Caucus, also wants more information on how and why Groupon plans to collect, and then use, consumer information.  One passage of the letter references how the policy approaches children:

“Groupon indicated that it omitted a section in its previous privacy policy discussing children’s information because its web site is not geared toward children,” it reads.  “What mechanisms does Groupon have in place to identify the age of its consumers?”

A spokesperson for Groupon says the company has received the inquiry and “looks forward” to explaining its privacy practices and overall business model to the lawmakers.  Groupon has until August 10 to respond.

Thoughts? Leave us a comment!

Posted in General News / Technology, Mobile Commerce | Tagged , , , , , | Leave a Comment »

Is Back-to-School Shopping Already Doomed?

July 21, 2011 by ecommercejunkie

The calendar only reads July 21 but should retailers be concerned that the back-to-school shopping season this year is going to be a bust?  Maybe so.

A survey by the National Retail Federation (NRF), conducted by BIGresearch earlier this month, reveals that consumers will likely reign in spending on school supplies in 2011–families with kids between kindergarten and grade 12 are expected to spend roughly $603.63 during the back-to-school season, which would be a decrease of 0.5 percent from last year.

Total spending for the retail industry’s second most-important shopping period of the year, for K-12 and college combined, is expected to total about $68.8 billion.

Still, high prices at the gas pump combined with continued record unemployment around the country seem to have already hurt the prospects for a bigger back-to-school season.  As a result, shoppers are going to be looking for deals wherever they can find them and retailers that hope to survive will need to oblige.

“Families aren’t opposed to spending on what they need, but parents want their children to take a good look around at what they already have before deciding what to buy for back to school this year,” said NRF President and CEO Matthew Shay in a statement.  “Retailers understand consumers are extremely focused on value and are taking this opportunity to offer substantial savings on merchandise.”

The survey polled 8,694 shoppers in early July.  Highlights from the data include:

–57 percent of respondents will shop at department stores, targeting private label brands that are often a cheaper alternative;

–Electronics won’t be nearly as sought-after this year, with slightly more than half of those polled planning to buy them, down from 63. 7 percent in 2010;

–With 43.7 percent of respondents saying the economy will force them to spend less in general, 39.9 percent will be looking for store-brand or generic items and 50 percent will be shopping for sales;

–The web will once again be a haven for back-to-school shoppers; 31.7 percent will go online in 2011 (up slightly from 30.8 percent a year ago) and 29.8 percent will use online comparison shopping resources;

–Average spending on clothing ($220.60) and school supplies ($88.99) will slightly decrease this year, while families will spend an average of $104.53 on shoes, a slight increase over last year;

–A majority of those polled (68.4 percent) said they plan to make at least one purchase from a discount store, while clothing stores (48.7 percent), office supply stores (38 percent) and electronics stores (21.7 percent) should also be good for at least one purchase as well.

The results overall tend to mirror similar (and earlier) assessments of the 2011 back-to-school shopping season.  While the numbers don’t seem too bad per se, the estimates certainly fall short of what many in the retail and e-commerce industries have to be hoping for as the summer starts to wind down.  Only time will tell if actual sales equal, fall short, or exceed the expectations put forth by the NRF and others.

As always, leave us your thoughts and comments!

Posted in Uncategorized | Tagged , , , , , , | Leave a Comment »

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