Ken Natori, president, The Natori Co.

“Videos were completely controlled by us,” Natori says. “They had high production budgets and involved carefully curated and intentional content. That was the past.” 

Now, Natori says shorter, user-generated-content videos are more popular with consumers. The brand works with influencers and features some of those videos at the bottom of its homepage.  

“There’s a much greater appetite from consumers to see video not intentionally curated by the brand but more curated by other people,” Natori says. “There’s more appetite for video, and videos are more plentiful. The technology makes it much easier to post videos from a number of different sources.” 

Natori uses video commerce vendor Firework and artificial intelligence software vendor Agora for video and livestreaming content. Natori says he can record video and use Firework’s app to launch livestreams on its website. He plans to use video to give consumers a “behind-the-scenes” view of products and experiences. 

The retailer plans to work with more social media influencers in the future as well as film more instructional/styling content. The retailer also plans to give shoppers an inside look with more “casual videos,” he says. He plans to film parts of a supplier trip to the Philippines in the coming weeks to give consumers a look at how Natori’s products are sourced. 

“The technology allows us to be creative quickly and easily,” he says.  

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Those are some of the conclusions from a recent holiday spending survey of more than 12,000 consumers in a dozen countries by Cisco AppDynamics, a subsidiary of San Jose, Calif.-based Cisco Systems Inc.

“Consumers around the world are planning to do more of their holiday season shopping online than ever before this year,” James Harvey, executive chief technology officer for Cisco AppDynamics’ Europe, Middle East and Africa region, said in a statement. “On average, consumers expect that 59% of their spending on key shopping dates such as Black Friday and Cyber Monday will be online this year versus in-store, compared to 53% last year.”

With high inflation plaguing much of the world, consumers believe they can find good deals online, especially during big shopping events like Black Friday and Cyber Monday, according to Cisco AppDynamics.

“And this year, they are favoring online shopping over in-store as they believe they can make their budgets stretch further (48% of consumers), get more choice (42%), and avoid last-minute panic buying in the shops (31%),” Harvey wrote in a survey summary.

He added that 43% of consumers expect to do more of their holiday shopping online, through applications and digital services, compared to last year, as opposed to only 13% who plan to buy less.

Holiday spending is up for grabs

But online retailers can’t take this favorable environment for granted, according to Harvey. He wrote that the research found “consumer expectations for digital experience continue to rise, and people’s reactions when they encounter poorly performing applications and digital services are getting stronger. 64% of consumers claim that if the applications and digital services they will be using to do their holiday shopping this year fail to perform, it will leave them feeling anxious and angry.”

Shoppers will be quick to act on those feelings, too. “More than half — 58% — of consumers claim that retail brands will have one shot to impress them this holiday season, and if their digital service or application does not perform well, they won’t use it again,” Harvey wrote. In addition, “71% state that if the applications and digital services that they will be using for their holiday shopping fail to perform, they will be more inclined to go back to shopping in-store.”

A key lesson from the survey is that retailers’ IT staffs must be able to closely observe applications and related systems to ensure they are running properly, according to Harvey.

Cisco AppDynamics didn’t release details about the survey methodology, including in which countries it polled consumers and the margin of error. A Cisco EMEA spokesperson did not respond to several inquiries from Digital Commerce 360.

Cisco, which designs and manufactures Internet Protocol-based networking and related products, acquired San Francisco-based AppDynamics Inc.  in 2017 for approximately $3.7 billion. AppDynamics provides application intelligence software and a monitoring platform to help companies improve software and business performance.

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Angela Hsu has stepped down as chief marketing officer at Overstock.com, which acquired the intellectual property assets of bankrupt retail chain Bed Bath & Beyond in June for about $21.5 million.

Angela Hsu

Overstock president Dave Nielsen has taken on Hsu’s responsibilities while a search for a new CMO gets underway. Hsu joined Overstock as CMO in March 2022. Hsu is leaving Bed Bath & Beyond and Overstock to pursue new opportunities.

“It’s been a pleasure being the CMO transforming Overstock.com into a 100% home furnishing retailer in 2022 and swiftly relaunching as the new online Bed Bath & Beyond in August 2023,” she says in a post on her LinkedIn page. “Now that this incredible period is a fait accompli, it’s time for me to refocus on one of my other passions: growing companies at the strategic level via board director roles.”

Overstock loses Hsu and her ecommerce background

Hsu has a long history as an ecommerce and retail marketing executive. Before joining Overstock, she worked for 19 years as senior vice president of marketing and ecommerce at lighting retailer Lamps Plus.

As chief marketing officer for Overstock, Hsu made $842,557 in total compensation in 2022.

Overstock.com ranks No. 50 in the Top 1000. The database is Digital Commerce 360’s ranking of the largest North American online retailers. Bed Bath & Beyond ranked No. 47 prior to its bankruptcy.

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Research indicates financial-institution-offered digital wallets provide security without adding more transaction fees for merchants — and consumers trust their banks more than other providers to offer a digital wallet.

Compliments of Paze

The post Optimizing the E-Commerce Payment Experience appeared first on Digital Commerce 360.

“Brands and retailers across categories are scrambling to identify how they can best use AI to elevate their ecommerce customer experience and drive revenue,” Elizabeth Buchanan, chief commercial officer at Rokt, said in a press release. “This research provides decision makers with a roadmap for creating new strategies and implementing advanced tech, such as AI, to significantly help improve the online shopping experience in ways that will surprise and delight shoppers.”

55% of Gen Z consumers in the survey also said they were interested in an AI assistant that could make finding new products simpler. 51% said they would try shopping in augmented reality and virtual reality. 

Gen Z survey respondents also said AI could be used in other ways:

• Compare prices (47%)
• Find deals (45%)
• Receive relevant offers and product suggestions (41%)
• Receive personalized assistance (37%)
• Find reviews (28%)

How will AI change online shopping?

Retailers are already implementing AI to save on costs and improve customer experiences. 

For example, men’s grooming DTC retailer Huron uses AI to automate bookkeeping services. Huron uses AI vendor Finaloop to track revenue across its multiple sales channels and manage inventory.

Online electronics retailer Newegg Commerce Inc. is also implementing AI, but in a way that more directly impacts consumers. The retailer uses generative AI to summarize common points that come up in customer reviews in “Review Bytes.” As of September, 20% of SKUs have AI-generated summaries. 

Google recently released a new AI tool that lets consumers virtually try on clothes. Several brands from Digital Commerce 360’s Top 1000 online retailers in the U.S. are already compatible with Google’s tool. Consumers can try on clothes from Anthropologie (part of Urban Outfitters Inc., No. 30), Everlane Inc. (No. 271), H&M, and Loft (part of Ascena Retail Group, No. 33). The tool can also suggest specific products based on customer preferences like color and price across brands. 

However, some retailers are more cautious about the changing technology. Dean McElwee, director, global ecommerce collaboration at The Stanley Black & Decker Company, recently told Digital Commerce 360 why generative AI is “still immature” and not ready to be implemented just yet.

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The retailer continues to adjust how it engages with subscribers, says Sydney Hamilton, senior director of digital marketing.

“When we started this program back in 2021, it was about ‘how do we just get out there and make a name for ourselves in the college space?’” Hamilton says.

Shoppers can opt out. But, once subscribed, the retailer can re-engage with shoppers during other busy shopping periods.

This year, college-related sales exceeded expectations, Hamilton says, without revealing more. The retailer shared sign up details through signage in-store, online, email and through the header of the retailer’s website. The retailer’s back-to-school messaging campaign is growing in popularity. In 2022, The Container Store enrolled more than 121,000 subscribers, which was 61% higher year over year compared with 2021.

The Container Store shared sign up details through signage in-store, online, email and through the header of the retailer’s website for its college back-to-school messaging campaign.

Back to school SMS text campaign

The Container Store began texting college-bound shoppers last spring — well before school started, Hamilton says.

“We understand this isn’t necessarily the time when people start purchasing,” Hamilton says. “But we looked at when college-bound high school graduates start getting gifts at graduation parties. So we started engaging in April and May about e-gift cards.”

The retailer uses mobile marketing vendor Vibes to reach customers. It’s not always about a sale, Hamilton says. The engagement rate for SMS, MMS and in-app push messages around types of products have increased, she says. The software looks at the list of recipients and their engagement history to determine who is likely to convert at one of three send times a day, Hamilton says. Vibes then sends messages out during their respective engagement times.

“We’ll share the types of products we have and show items they could potentially be using,” Hamilton says. “It’s been a great way to keep people engaged outside of those prime shopping moments.”

Click through rates and promotions

The click through rate (CTR) varies. This year, the retailer sent a text featuring a $20-off promo code for coffee machine and accessories manufacturer Keurig that resulted in 9% CTR. The retailer’s benchmark is 5%. Click through time is best at about 10 a.m., Hamilton says. The text was optimized for send times, meaning that they sent the message on a single day but split it to send in the morning only to SMS subscribers who had shown to engage more with text messages in the mornings. The same logic was applied to texts sent in the afternoon. This resulted in higher engagement versus sending it to all college SMS subscribers at the same time, according to the retailer.

Click through rate is a metric that measures how effective an ad is by calculating the percentage of people who view an ad and then click on it. A benchmark is the typical percentage of consumers who click on a retailer’s content.

The Container Store also sent an SMS text with a 20% discount on 3-tier storage carts, stacking drawers and other storage items. These also saw strong engagement, particularly because the promotion was targeted to only subscribers that previously purchased storage products.

Filling in the Bed Bath & Beyond gap

In addition to targeting text subscribers to maximize engagement, the retailer also noticed an opportunity in 2023 after Bed Bath & Beyond filed for bankruptcy. Online-only home goods retailer Overstock.com purchased it and has rebranded as Bed Bath & Beyond in June 2023. The website went live in August 2023. The retailer was a go-to shopping destination for many back-to-school college students.

“With Bed Bath & Beyond no longer in the market, it did leave a whitespace [this year],” Hamilton says. “So we asked ourselves, where can we fill in?”

Hamilton says The Container Store customer is looking online as well as shopping in-store. A popular promotion is the retailer’s 25% off offer that shoppers can add to their wallet pass on the app, similar to Bed Bath & Beyond’s promotional discounts.

Going forward, Hamilton says the retailer also uses its app to connect with shoppers. In fiscal year 2022, which ended in March 2023, the retailer had 450,000 first-time app downloads.

The Container Store Inc. ranks No. 345 in the Top 1000, Digital Commerce 360’s ranking of North America’s online retailers by web sales.

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Early in 2023, the marketplace built a tool based on Open AI’s ChatGPT that creates a product description based on data that sellers provide about a product’s category, condition, color, brand and more. It took about a month to develop the feature, Zhang says.

EBay calls this its magical listing tool, and it rolled it out for all of its marketplaces sellers listing items in its app in August.

EBay marketplace sellers give AI product description generator positive feedback

The marketplace has been “pleasantly surprised” by the overwhelmingly positive seller feedback, Zhang says. As of late July, sellers have given the tool a customer satisfaction score of 80%, which is among eBay’s highest CSAT scores for recent, new feature launches, according to the marketplace.

“We are so excited about what generative AI can ultimately unlock for our customers,” Zhang says.

EBay’s new generative AI tool writes product descriptions.

Zhang says roughly 30% of sellers shown the generative AI tool use it, and of those, 95% accept at least part of the description. Sellers can tweak the description, edit and delete as they like, Zhang says.

The AI bot tends to add adjectives and can be “a little flowery in the way it describes things,” Zhang says. It’s up to the seller to edit the wording and ensure it’s accurate.

EBay does not label AI descriptions as such

Because the marketplace seller edits and approves the listing, eBay does not label to shoppers which reviews the artificial intelligence wrote. Although, eBay does notify sellers when the tools they use are generative AI.

Kassi Socha, director analyst, retail, at research firm Gartner, cautions brands to be transparent to shoppers when they are using generative artificial intelligence. According to Gartner’s recent surveys, many consumers distrust generative AI, so retailers should be upfront and label content that uses the technology, Socha says.

In a July 2023 Gartner survey of 303 consumers, 34% of consumers rated their comfort level with generative AI in retail as “very or somewhat troubled,” 53% said they think it will strongly or somewhat negatively impact society, and 66% said they are concerned about discrimination or bias in generative AI.

Xiaodi Zhang, vice president of seller experience at eBay.

“I applaud retailers that are adopting the technology with confidence and testing the use of generative AI, but the continued guidance at Gartner would be to approach with caution and be prepared to adapt quickly if a weakness is exposed,” Socha says.

EBay piloted the tool internally before slowly rolling it out to a randomized group, representing 5% of sellers in May 2023.

“What’s amazing with generative AI is how quickly it works. We had a proof of concept in a matter of weeks,” Zhang says.

The tool’s goal is to address “the cold start problem” that eBay marketplace sellers face when trying to describe products, Zhang says.

“When you find something to sell at home, and you are going through the listing, and you are asked to describe the item, a lot of people face writer’s block of, ‘How do I describe this dress I bought last year that I never wore?’” Zhang says.

Further generative AI tools

To further help sellers list items faster, eBay is developing more generative AI tools. One tool allows a marketplace seller to upload an image in the iOS app, and the generative AI will write in the details, such as category, subcategory, product title and a description.

EBay marketplace sellers can upload a photo in the app and generative AI will write a description.

EBay also is piloting an AI tool that will remove the background of a seller’s image and replace it with a white image so the product stands out. While a number of eBay sellers have a professional setup to merchandise their product and have robust images, many do not, Zhang says. The tool’s goal is to remove clutter from a home seller’s photo, and help those sellers have a clean photo listing, Zhang says.

“Sellers tell us the background removal tool can make a huge impact on conversion by creating a clearer image of their product,” eBay wrote in a release announcing this tool.

EBay is No. 6 in the ranking of Digital Commerce 360 Top 100 Online Marketplaces.

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The Global B2B Buyer Behavior Report, which surveyed 1,006 buyers in the United States, the United Kingdom and Australia, found that three-quarters of them purchased online but cited concerns about accurate pricing, web page load times and customer support, among other issues. The survey was conducted for ecommerce technology vendor BigCommerce in May by the Price Intelligently data research unit of Paddle, an online payments technology provider.

“The No. 1 reason B2B buyers abandoned their carts was because of technical issues faced at checkout,” the report says. Survey respondents said their main concern about checkout was viewing online displays of complete and accurate pricing.

Global B2B Buyer Behavior Report findings

The report asserts that B2B and retail ecommerce activity is blending among many buyers. This results in more B2B buyers expecting the ease of online shopping they’ve become accustomed to on online retail sites and marketplaces.

The report provides survey results separately for buyers in the U.S., the U.K. and Australia. Some of the report’s notable findings include that, compared with U.K. and Australian B2B buyers, U.S. buyers rely more on online marketplaces to find products. Another notable finding is that 42% of all survey respondents say they still rely on printed paper catalogs to discover products. In addition, the report notes that the B2B purchasing and checkout processes are complicated, requiring B2B ecommerce sites to provide the online shopping and checkout experiences B2B buyers require.

“The way B2B buyers shop is changing, and B2B merchants need to adapt,” Lance Owide, general manager of B2B at BigCommerce, says in a statement about the report. “Buyers are turning to online channels to research, compare and purchase products.”

Following are the survey results for the percentages of U.S. buyers regarding how they discover products, their expected shopping experience, and the checkout process. (Percentages refer to the percentage of respondents.)

How U.S. B2B buyers discover products:

• 66% — Internet search.
• 58% — Online marketplaces.
• 42% — Product catalog (printed paper).
• 42% — Industry association.
• 35% — Online ads.
• 33% — Referrals.
• 29% — Industry publications.
• 24% — Physical ads.
• 23% — Social media ads.
• 23% — Trade shows.
• 14% — TV ads.

The purchasing channels U.S. B2B buyers use:

• 75% — Supplier website.
• 65% — B2B marketplace.
• 53% — In-store/at vendor’s warehouse
• 44% — Sales representative.
• 28% — Social media channels.

The top causes of abandoned carts for U.S. B2B buyers:

• 31% — Technical issues like inaccurate pricing.
• 23% — Lack of secure checkout.
• 17% — Shipping and delivery.
• 15% — Complicated checkout process.
• 8% — Lack of payment options.
• 6% — Lack of payment term options.

U.S. B2B buyers’ most-used payment methods:

• 80% — Credit card.
• 49% — Debit card.
• 39% — ACH/direct entry/direct debit.
• 32% — Third-party payment apps.
• 31% — Digital wallets.
• 28% — Purchase order invoicing.
• 21% — Electronic check.
• 18% — Physical check.
• 14% — Terms through third-party service.
• 10% — Cryptocurrency.

Top reasons that motivate U.S. B2B buyers to purchase online:

1. Customer ratings and reviews.
2. Promotions and marketing.
3. Peer recommendations.
4. Industry publications.
5. Competitors’ usage.
6. Trade events.

Top reasons U.S. B2B buyers purchase online:

1. Compare products and prices across competing vendors.
2. Customize orders; select products and quantities.
3. Save my purchase history; reorder; track orders.
4. Purchase anytime, anywhere.
5. Easier to know my total cost.
6. See live inventory availability and out-of-stock items.
7. Receive customized product suggestions based on search/purchase history.

Top pain points U.S. B2B buyers experience online:

1. Inaccurate pricing and shipping options.
2. Slow website load times.
3. Difficult to contact customer support.
4. Complicated checkout.
5. Poor search and navigation.
6. No real-time inventory information.
7. Data privacy concerns.
8. Lack of payment options.
9. Limited flexibility of pricing/discounting.

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Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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But with the new generative artificial intelligence tools available to brands, it could be “10 to 100 times faster than the manual process for image creation,” Perino says.

“That’s a great opportunity to do something quickly versus having to wait for a photoshoot or having to use stock images,” Perino says.

But right now, Perino is not confident generative AI is ready to create images from scratch for its brand. For example, if the brand were to say, “create a Ghirardelli logo,” Perino is doubtful the AI would get the logo exactly right.

And getting it exactly right is critical.

“We have very high expectations for how our images to look,” she says.

Where Ghirardelli Chocolate Co. is currently using generative AI is for editing images on its product detail pages. On a recent photo shoot for its new no-sugar-added baking chips, the brand used generative AI to remove part of a napkin in the image and fill in the background with a part of the product’s bag.

Ghirardelli uses AI to decide how to tweak product images

But editing is as far as Ghirardelli will let the generative AI create. The brand will, however, use artificial intelligence to help guide its decisions about what images should look like.

Since Q2 2023, the brand has used image-scoring software Vizit to evaluate its images. Vizit uses artificial intelligence to analyze how impactful an image is and to catalog the attributes of the image. Based on publicly available metrics, such as likes or shares on a social media website, Vizit can analyze and score an image, and suggest tweaks.

The technology is helpful when deciding which images to use on product detail pages and the changes Ghirardelli might make so the images perform better, Perino says. For example, Vizit’s technology scored many of its closely cropped baking images higher than those that were zoomed out, and so those are the ones Ghirardelli will use on its page, Perino says.

Instead of having a 2D static image of its chocolate chip bag, another tweak Vizit suggested was to have the image on the package “burst” off the package for more of a 3D look. In the same image, Vizit also suggested to make the text larger for “12 oz.” With these tweaks, Vizit scored the image at a 95, meaning it has a high likelihood of converting shoppers, compared with the image without these changes, which it scored at a 6.

Vizit’s AI technology scores Ghirardelli’s package image above lower compared to the one below with the chocolate chips bursting off the package and the 12 oz. bag size in a larger text size.

Perino did not share any data about increases in conversion since using Vizit’s technology. Vizit says its clients typically have a 15%-25% increase in conversion rate when using the images it suggests, says CEO and founder Jehan Hamedi. Hamedi did not share how many clients it has, but in 2021, he told Digital Commerce 360 that Vizit has less than 100 brands that use its technology, including padlock products MasterLock, shoe brand Reebok, and food brands OceanSpray, Tyson, Cliff Bars and Mars Petcare.

Brands jump on using AI technology

While Vizit’s technology doesn’t use generative AI, it uses artificial intelligence to help brands more effectively and more efficiently increase sales, Hamedi says.

“Where the rubber really meets the road for these businesses is how AI and these tool sets actually help drive sales,” Hamedi says. “Because at the end of the day, every brand is in business and exists to sell products and create positive outcomes.”

With the popularization of OpenAI’s ChatGPT generative AI chatbot, Hamedi says many in the ecommerce industry are talking about AI and becoming more educated on how AI can be practical for businesses.

“It’s created urgency among our customers about how to adopt AI because it’s a new arms race,” Hamedi says.

Ghirardelli’s future applications of generative AI

Ghirardelli has plans to use generative AI in other ways in the future, such as  creating product copy on the product detail page and updating product copy with relevant search engine optimization (SEO) words and for creating images, Perino says.

“We are excited about artificial intelligence as a digital technology and how can it help us be faster and more nimble, and how do we update, create and improve our content,” Perino says.

For example, Ghirardelli wants its product detail pages to be updated with seasonal SEO words, such as chocolate for Halloween, Christmas, Mother’s Day and graduation. Today, the brand manually updates this copy to ensure the detail pages can show up high in search results.

Ghirardelli, however, finds that generative AI is not yet refined enough to have mastered brand voice and tone, and it is waiting until it improves before having a tool write copy to go live on its site.

“We’re excited,” Perino says. “It’s such an interesting time with AI right now, but it needs to be tempered with a bit of caution and guardrails.”

Brands should use caution with generative AI right now

That’s particularly true for a food manufacturer like Ghirardelli, given strict government regulations about food and beverages. For example, Ghirardelli can’t call some of its products that might be commonly referred to as “white chocolate,” because they do not contain cocoa and are not technically chocolate. Instead, it labels products as “white baking chips” or “vanilla flavored.” Perino isn’t confident that generative AI would understand this distinction.  

At this early stage of generative AI, brands should have a cautious approach to using the technology, says Kassi Socha, director analyst, retail, at research firm Gartner. If brands are using generative AI today in their business to create content, she suggests still having manual oversight before anything is published.

“Generative AI can suggest copy and suggest opportunities, but there still needs to be a team in place to validate some of the outputs,” Socha says. “With any machine learning or artificial intelligence, it’s only as good as the inputs, and it take time to optimize and learn.” 

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