INTERNET COMMERCE METRICS

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INTERNET COMMERCE METRICS
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What is Metrics?

• A basic unit used to quantify audience activity
• the yardstick of measurement
• Uniformly defined across the entire medium
• Metrics example in advertising
• click through a metric which describes a user
  positioning his/her mouse over an ad, and
  clicking on it
• page view a metric that entails the successful
  transfer of a web page to the users browser

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What is E-Commerce

• Electronic commerce has been defined as
• all orders received online automatically without
  staff intervention, regardless of payment method,
  for traditional commercial products and services
  (excluding internet access and hosting)
• Internet commerce metrics therefore, is performed
  only on companies whose qualities meet the above
  definition

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Measuring a Sites Performance Quality
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Web Site Performance Quality and Management

• WSPA M is a process of collecting and
  presenting web site performance information from
  the web site visitors perspective
• Critical in managing any web-based presence

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Performance Quality (1)

• 3 basic factors make up a web sites performance
  quality
• speed
• availability
• speed and availability of virtually all sites
  fluctuate with daily ebb and flow of overall net
  traffic

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Performance Quality (II)

• consistency
• can be controlled by web managers by tuning
  servers, databases and backend systems or working
  with service providers

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I-Commerce Metrics Methodology
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ActivMedia Top 100 Retail E-Commerce Websites
(I)

• Conducted 4 successive waves of research to
  define vendors at the top of the e-commerce food
  chain between mid-September 1998 and January 1999
• Qualitative and Quantitative field techniques
• Secondary Database Research
• compilation of 1,000 likely candidate web sites
  and contact information from publicly listed
  top lists by sites such as Lycos, PC Magazine,
  MediaMetrix. Also judgmental inclusions based on
  E-commerce vendor recommendations

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ActivMedia Top 100 Retail E-Commerce Websites
(II)

• Primary telephone research
• Direct contact and screening of each of the 1,000
  likely candidates for E-commerce qualification
  and revenue/growth information
• trained executive interviewers entered each
  company from the starting point and laddered its
  way through the company to qualify them for
  e-commerce capability
• secondary sources (news releases, SEC filings,
  database information sources) were utilized to
  estimate missing data (1 out of 4 cases)

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ActivMedia Top 100 Retail E-Commerce Websites
(III)

• Site Performance data collection
• online server-based Agent technologies were sent
  to scan 240 known E-commerce sites for server
  performance and design characteristics
• ActivMedia teamed up with SiteMetrix for this
  during the high intensity thanksgiving shopping
  period
• integrated 3 elements of site performance that
  determine the quality of a visitors experience
• server response, link integrity and page size

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ActivMedia Top 100 Retail E-Commerce Websites
(IV)

• Field site visits
• made by analysts to the top 100 e-commerce sites
  on the internet to analyze business and web site
  strategies deployed at each site, and create
  mini-case studies for the top 50 merchants

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Business2 The 100 Hottest Companies on the Net
(I)

• Companies must have web-based, or web-assisted
  revenues in order to qualify
• business-to-consumer companies must make money
  from web orders or services, or deliver via the
  web
• business-to-business companies must make money
  from direct web orders, or a significant part of
  the order

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Business2 The 100 Hottest Companies on the Net
(II)

• Winners were set apart based on strategy

Relentless work on branding
AOL Schwab
An intuitive engaging customer buying experience
Amazon.com NECX
Rapid introduction of new services
Yahoo! Sabre Group
Long term approach to investment returns
Marshall Industries Getty Images
Leveraging market value power for acquisition
ETrade Cisco Systems
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Methodology
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Forrester Travel Sites Ranking (I)

• Online travel industry poised to grow from 3.1
  billion now to gt 29 billion in 2003
• Majority will be from travel sites being
  researched on by customers today
• Who is most likely to win? - Forrester Inc.
  Technographics report
• sites ranked by profiles of their current users

www.forrester.com
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Forrester Travel Sites Ranking (II)

• Evaluation of todays web travel providers
• Reach
• the percentage of travel lookers/bookers that
  report visiting a site in the past year to
  research travel
• Booking score
• how well a site converts its experienced bookers
• Revenue index a sites earning power
• how much its visitors spend on leisure travel
  each year, and what percentage is booked online

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Forrester Travel Sites Ranking (III)
Formula Revenue index
X Reach X Booking score Average amount spent
online

• Web portals scored well in
• ratings due to their audience
• reach, but however, produced
• little revenue
• Portals need to add more
• powerful travel features into
• their pages to offer incentives
• for travelers who book through their travel
  agencies

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Forrester Travel Sites Ranking (IV)

• Suppliers have limited reach and
• revenue growth
• Major airline beat this constraint
• by offering full-fledged reservation
• systems on their sites
• Suppliers need to focus on wider
• distribution of their inventory

• Online travel agencies will only be
• in demand for a few all purpose
• sites, although they offer the best
• of suppliers and portals sites in one
• location
• Travelocity and Expedia have ascended
• to the top largely due to their affiliation
• with Yahoo! and MSN respectively

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Forrester Travel Sites Ranking (V)
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I-Commerce Metrics Services
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E-Commerce Metrics Services

• Small and large e-commerce sites need to know
  their web site performance quality,
• How their site ranks in the competitive world of
  e-commerce
• A number of metric sites have evolved in the
  process
• employ different approaches in rating different
  web sites
• discrepancies sometimes exist between these sites

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Media Metrix RelevantKnowledge (I)

• The 2 audience measurement sites produce nearly
  identical results
• Differences lie only in certain parameters
• universe definition
• universe size estimate
• website definitions
• reporting interval
• known sample biases
• standardization of these parameters led to more
  accurate and reliable rating results

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Media Metrix RelevantKnowledge (II)
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Neilsen/NetRatings (I)

• Makes use of 2 methods of measurement
• Measurement technology internet activity
  tracking and reporting software
• BannerTrack
• top banner ads by impression
• advertising by domain
• advertising by company
• CommerceTrack
• CacheTrack

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Neilsen/NetRatings Audience Measurement

• Audience measurement service provides 3 levels
  of audience information
• traffic measures for web sites (by property,
  domain and unique site)
• audience exposure and response to ad banners (by
  advertiser, site and banner)
• audience demographics linked directly to site and
  advertising data

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Service Metrics

• Has developed measurements that use automated web
  site visits to generate data for site performance
• allows customers or professional services to
  isolate and troubleshoot sources of performance
  problems
• managers can prioritize problems and select from
  available options, the most cost-effective
  solution

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Other Web Metrics Services (I)

• Keynote Lifeline (TM) measurement service
• provides small to mid-size e-commerce sites an
  easy and economical way to
• gauge the performance of their web sites
• identify and diagnose problems
• improve service quality for customers online

http//lifeline.keynote.com
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Other Web Metrics Services (II)

• E-Marketer (www.emarketer.com)
• employs a very different approach to compiling
  web site data
• consider data from as many reputable web sites as
  possible
• taken together, multiple sources, coupled with
  common sense and business intelligence , create a
  reasonably accurate picture

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Conclusion
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Questions to Ponder (I)

• Majority of online users may put merchandise into
  their shopping cart, but end up not buying
• Survey by Net Effect indicates the culprit as the
  sites lack of real-time online customer service
  and support
• sites surveyed include Amazon, Dell and eToys
• Online companies must rethink how they can
  provide immediate expertise to customers so that
  contemplated purchase become sales

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Questions to Ponder (II)

• Do we greet new arrivals in a way that will
  enable us recognize them on subsequent visits?
• Do we offers services choices that move customers
  from automated to personal service based on how
  much assistance they need?
• Do we have a system that effectively tracks
  customer events?
• How complete and accessible is our knowledge
  base?
• Are our shopping carts smart?
• Quick easy access to service tools during a
  purchase

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