Ecommerce and data: finding the gold in a mountain of dirt

Vice president of ecommerce at omnichannel kitchenware retailer Sur La Table, Kevin Ertell stepped into the role nine months ago, bringing with him decades of experience in ecommerce and marketing for businesses such as Tower Records, Borders and Sur La Table blends a sophisticated online sales and marketing channel with a bricks-and-mortar presence that began almost three decades ago.

At the Ecommerce Conference and Expo in Melbourne later this month, Ertell will be presenting his views on data in retail in a talk entitled ’11 Ways Humans Kill Good Analysis’. He says that with the ecommerce world drowning in data, everything that can be measured will.

“The mountains of data can be full of gold if we mine them correctly, or they can just be big piles of useless dirt,” Ertell says.

“All too often, we misuse the valuable data we have and end up flailing away. Many of the reasons we aren’t happy with the results of the analyses come down to fundamental disconnects in human relations between all parties involved. Groups of people with disparate backgrounds, training and experiences gather in a room to ‘review the numbers’. We each bring our own sets of assumptions, biases and expectations, and we generally fail to establish common sets of understanding before digging in.”

MarketingHow does a marketer in an ecommerce business determine what is and isn’t useful data to their organisation – how does one know when they see the ‘gold in the mountain of dirt’? 

Kevin ErtellErtell: It’s tricky, but crucially important, to be able to decipher patterns in the data that drive results versus data points that are interesting but ultimately meaningless.

I think it’s important that marketing executives understand at least the basic concepts of statistics and remember all the nuances of statistics. As time has passed from our initial statistics classes, we tend to forget about properly selected samples, standard deviations and such, and we just remember that you can believe the numbers. But we can’t just believe any old number. All those intricacies matter. Numbers don’t lie, but people lie, misuse and misread numbers on a regular basis. A basic understanding of statistics can not only help mitigate those concerns, but on a more positive note it can also help decision makers and analysts get to the truth more quickly.

Ecommerce experts such as yourself talk a lot about the importance of continually improving the customer experience. Do you think bricks-and-mortar retail marketers can learn something from that?

I think bricks-and-mortar retailers can definitely learn something from the ecommerce approach to customer experience. We’re forced to look at it very closely because we operate self-service operations that must be incredibly easy and intuitive in order to be effective. To some degree, the brick-and-mortar environment has long had a crutch in that good sale associates can overcome bad design, poor signage etc to help get customers to complete the sale. However, it’s very difficult to track those kinds of assist (or lack of assists) from the corporate office on a national or international basis. That’s where a strong reliance on customer experience metrics in bricks-and-mortar environments can really show where problem area are and help point leaders in the right direction.

What other lessons in general do you think ‘traditional’ retailers can take from online retailers?

I think they should also know that their websites are doing a lot more for their businesses than just creating online sales. In addition to online sales drivers, ecommerce sites are great marketing vehicles, merchandising vehicles, customer research tools, and that works both ways, community builders, and in-store sales drivers. If they ask their customers, they’ll find many of them go to the site to research before ultimately buying in their stores. How they treat their sites can ultimately determine the success of those visits.

And vice versa?

Well, traditional retailers certainly know a lot about the business. They’ve been doing it a long time. They’ve spoken to customers face to face and they know what they way and need. I joined Sur La Table only about nine months ago, so I’ve been incredibly reliant on my store operations partners to understand our customers. They know them very well, and they’ve been incredibly helpful in giving me and my team and understanding of how we can create a better experience online for our customers.

What’s the biggest challenge at the moment for ecommerce businesses?

I continue to say it’s customer experience. Most online retailers still have single-digit conversion rates. Those are partly low because, on most sites, only a small percentage of people coming to the site actually have an intention to purchase online. However, the percentage of people who intend to buy still dwarfs the percentage of people who actually buy.  There are plenty of reasons people don’t buy – like prices, shipping costs, and inventory availability – however bad customer experience continues to be an overwhelming reason why people ultimately leave sites before completing a purchase. We all need to be relentlessly focused on site usability to fully meet our potential.

This may be more prominent in tech-based companies, but for marketing executives spending more and more on tech (moving towards a point where it’s even more than CIOs) what are your predictions on the CMO-CIO relationship? Does it need improvements?

I think this is true in most industries. The reality is our businesses are highly dependent on technology. If we have ecommerce, then we have a consumer software application. And if we are developing consumer software applications, then we are technology companies. That means all executives should see themselves as technologist and should be pretty familiar with the capabilities of technology. And at the same time, technologists need to see themselves as business people. They are creating software that is driving the company’s business. Therefore, the ‘business’ team is not everyone but IT. It absolutely must include IT.