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It's true that there are a number of comparison shopping engines available, but those are primarily focused on "price comparison" versus "product comparison." And because they're largely price driven, they tend to focus mostly on hard goods and commodities like electronics and books, and are typically merchandised with the male consumer in mind. SHOP.COM is unique in that it is designed and merchandised for women, the "CFO of the household" who controls or influences the vast majority of household spending across all categories. So, while we currently offer access to products within 28 departments, we concentrate our merchandising efforts on those departments most shopped by our target female demographic:
- Apparel & Accessories
- Home & Garden
- Gifts & Occasions
- Family & Beauty
And, perhaps even more important, SHOP.COM differs from other comparison shopping engines in that we offer merchants a choice of business relationships – cost-per-order (CPO) or cost-per-click (CPC), each of which may be further enhanced with cost-per-impression (CPM) media promotion. This allows the merchant to select the model that best satisfies their individual business objectives.
Actually, it's pretty simple. Regardless of whether a merchant selects the CPO or the CPC option, their products will be fully integrated in the SHOP.COM search results, allowing shoppers to easily compare their choices. When the shopper clicks on a CPO merchant's offer, SHOP.COM will capture the finalized order and pass it to the merchant for fulfillment. As a result, the merchant will have sold a product at a profit and, in many cases, also acquired a new customer with full lifetime value potential. SHOP.COM bears all the marketing risk to generate that order and, in return, the merchant will pay SHOP.COM a pre-negotiated "success fee" in the form of a percentage of that order's value. SHOP.COM's patented OneCart® is what makes this option possible - more on that in a moment.Should a shopper click on a CPC merchant's offer, SHOP.COM will send that customer directly to the merchant's site. The merchant then pays SHOP.COM a predetermined amount for that very highly-qualified visitor, and it is the merchant's responsibility to convert that visitor into a buyer. In both cases, at the merchants' option, they may also wish to use strategically-placed CPM display advertising that puts their brand and/or offers forward precisely at the point of consumer demand. CPO, CPC, and CPM-all working in harmony.
For merchants who tend to use the Internet as a means of acquiring customers with lifetime value potential, CPO is unquestionably the more cost-effective option. However, some merchants use the Internet more for brand extension and/or presenting offers designed to drive traffic to their brick-and-mortar locations. Others may have highly-customized product offerings or inventory velocity issues that simply make for a better customer experience on their own site. Given these types of situations and business objectives, CPC is a better alternative for both the merchant and the shopper. And, it's important to note that not everyone is allowed to participate in the CPO model. To take advantage of CPO option, merchants must be certified by SHOP.COM™ as OneCart® Trusted Merchant ("OCTM") compliant. This means that they continually meet certain performance criteria sufficient that SHOP.COM will guarantee their performance to our customers. Moreover, it assures all OCTM™ merchants that they are each in the company of other great merchants who share a commitment to brand nurturing through world-class customer care. Consequently, all their offers on SHOP.COM™ will be clearly noted as being OCTM™ certified and, thereby, guaranteed by SHOP.COM™p/>The expectation is that CPC merchants will be every bit as conscientious as CPO merchants when it comes to customer care. However, because the order is occurring on the merchant's site SHOP.COM™ does not guarantee their performance and, therefore, we do not find it necessary to hold them to the same performance standards as OCTM™ merchants.Our goal is to provide merchants with alternatives that will help them capture the maximum possible online demand for their products in the most efficient and cost-effective way possible.
No question that this is an evolution to our business, but we aren't changing our core business proposition. We're enhancing it. In addition to our unique cost-per-order (CPO) model, we've expanded our merchant programs to include cost-per-click (CPC) and cost-per-thousand impressions (CPM) alternatives. Here's why. This expanded model: ...better serves merchants by offering you the choice of our OneCart® CPO model or a CPC link-off option when it better suits the needs of your own business model, either of which may be further enhanced with CPM advertising if you wish; ...better serves consumers by providing them with a truly comprehensive selection of products, product brands and merchant brands in a single location;...better monetizes our traffic via multiple revenue streams (CPO/CPC/CPM) which, in turn, allows us to invest more aggressively in attracting even more of the most highly-qualified traffic for the benefit of all participating merchants.
We don't have "classes" of merchants, and we won't skew search results based on CPO versus CPC or, unlike some other comparison shopping engines, how much a merchant is paying. Our overriding mission is to create and deliver the most compelling shopping experiences for our customers. That means that relevancy trumps everything else, so products that best meet the customers' search terms will be presented highest in the search results.
OneCart® CPO merchants get:- Orders at a profit, because your commission percentage will always be lower than your margin on your products
- 100% incremental orders, because shoppers discovered/rediscovered you through SHOP.COM's marketing efforts rather than thinking to go directly to your own site and would have purchased from a competitor had your products not been available on SHOP.COM
- No marketing risk, because you only pay after you've received and processed bona fide orders
- Complete customer information and associated/authorized (opt-in) marketing rights
- Ability to participate in affinity partnerships, reaching "closed communities" of shoppers
- Participation in all OneCartŪ multi-merchant features
- Address Book
- Gift Registry
- Wish List
- Save-for-Later
- eGifts
- Gift Card Functionality
- SHOP.COMpanion Widget
Link-Off CPC merchants get:- Highly-qualified traffic, because the search process has been narrowed before the shopper ever visits your site
- Competitive CPC rates that are flat (no bidding), allowing you to better manage your marketing spend
Both CPO and CPC merchants get:- Potential participation in SHOP.COM's marketing and merchandising to targeted and lucrative female demographic
- Seasonal merchandising
- SHOP.COM sponsored/funded promotions
- Regular email communication
- Print catalog
- The Shopping Vine blog
- Cart-Me-Away shopper game
- CatalogLink.com
- Access and exposure to unduplicated traffic
- Access and exposure to incremental traffic within merchants' targeted demographic
Unlike television or radio or print where you pay for total reach, the Internet lets you reach customers one-at-a-time. And, whether it's CPO or CPC, your marketing investment with SHOP.COM is variable based on success and completely within your control. Online shopping is a "pull" phenomenon in that shoppers search, find and buy what they want rather than a "push" phenomenon where merchants promote what they want to sell. So, while our on-site merchandising will speak to women, our external traffic driving strategies will attract both men and women because we'll be promoting access to all the products within our 28 categories.
When it comes to shopping, aesthetics and "voice" and merchandising are much more important to women than they are to men. Generally speaking, women are disinclined to shop on sites that are heavily skewed toward men, but men have few qualms about shopping where women shop as long as the site has the products they want and prices are good - and SHOP.COM offers them both. So, given the choice, we'll merchandise to women. Here's why. Women control the vast majority of household spending and influence much of what is spent by others. They buy not only for themselves, but for their families. They also do most of the gift purchasing, not only for seasonal holidays but for birthdays, weddings, anniversaries, graduations and other such special occasions in their lives. She is "CFO of the household" and if you aren't marketing to women today, your SHOP.COM volume will be completely accretive. If you are marketing to women, you'll find more of them at a place that's designed and merchandised especially for her. Either way, you need to put your products where she wants to shop.
According to Praxis Research, in November 2007 the SHOP.COM shopper demographic was as follows:- 71% Female; 29% Male
- Age 30 - 55
- 75% of SHOP.COM customers
- 70% Married
- 72% Employed
- Household Income of $72K - $78K
- Compared to $65K for all online shoppers
- 50% College Graduate or More
- 9% higher than average online shoppers
You're absolutely correct, and that's precisely why we've expanded our model. The 71/29 speaks to shoppers whereas the 50/50 speaks to traffic. Adding the CPC option will accommodate more merchants who will allow us to better satisfy the shopping tendencies of all of the tremendous traffic we're generating. By better serving customers, we'll better monetize our traffic and that will allow us to drive even more traffic for the benefit of our merchant partners.
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