E tail boston benchmarking report!

The 2013 Technology &Retailer Spending OutlookBenchmarking Study, Vol. 4

Compiled at the 2012 eTail Boston event

The 2013 Technology & Retailer SpendingOutlook BenchmarkingStudyeTail, now in its 15th year, presents senior-level case studies, panels, workshops androundtable discussions covering the challenges faced in all aspects of multi-channelretail. Sessions are geared to cover a pervasive array of information on key areasincluding Pre-Holiday Results, Post-Holiday Results, Technology Spending,International Expansion and Growth, Online Advertising, Content Management,Online Advertising Vehicles, Social Media, Mobile Shopping, User ExperienceOptimization, Search, Email Marketing, Personalization, Analytics, Customer Loyaltyand Engagement and many more.

eTail is focused on providing detailed tactics and innovative strategies during ourannual conferences. Gathering insight from our attendee base not only enriches theconference experience, but provides an additional level of benchmarking that maynot be obtained during regular conference sessions.

During Q2 2012, eTail fielded over 100 retailer surveys in order to uncovertechnology spending habits from a number of verticals, including but not limited to;apparel, sporting goods, consumer electronics, travel and hospitality, mass marketretailers, as well as specialty/niche. Where are retailers spending, and why? What aretheir plans for technology spending in the next 3, 6 and 12 months? What insightcan be gleaned from the research results?

This survey marks the third year of uncovering “from-the-trenches” ideas abouttechnology spending. We hope that you are able to benchmark your externalsolutions against your peers, and look forward to seeing you at our 2013conferences for results gathering from your fellow retailers.

The purpose of this study is to ascertain the technology spending habits, industrytrends and future outlook from a sample of cross-industry, cross-vertical retailexecutives. Respondents were anonymous, and responses were gathered during theeTail East conference in August of 2012.

• Cross-Channel Optimization

• Personalization

• Usability/Testing/UserExperience Enhancements

• Conversion Optimization

• Content Management

• Web Analytics

• CRM systems

• Email

• SEO, SEM

• Mobile

• Social Media

Primary Research Methodology

*

Twice every year, the organizers of the eTail conference spend 3-6 months (continuously)conducting phone and email surveys with executive-level retailers from top industrybrands. Based on our findings, the majority of retailers in 2013 will be focused on:

General Research Findings

*

The 2013 Technology & Retailer Spending Outlook Benchmarking Study2

*Table of Contents

Primary ResearchMethodology .....................2

Complete Survey Results ....3

Summary of Conclusions....7

State of The Industry And Technology Spending .........................10

About eTail ......................12

Table of Figures

Chart One..........................3

Chart Two..........................4

Chart Three .......................5

Chart Four .........................6


Complete Survey ResultsAnd Spending Outlook

� 13% Attribution Modeling

� 13% Online Video

� 48% SEO, SEM, Site Search

� 25% Content Management

� 9% Fraud, Privacy, SiteSecurity & Logistics

� 14% CRM Systems, CustomerSegmentation, Loyalty

� 14% eCommerce PlatformReplacement orEnhancement

� 32% Email

� 32% Mobile

� 18% Tablets

� 18% Merchandising andVisualization

� 32% Multi-Channel Initiatives

� 25% Personalization (website)

� 34% Social Media & SocialEngagement

� 25% Web Analytics/DataManagement

� 30% Usability/Testing/UserExperience

� 9% Payment Processing

� 11% Global Solutions

*Point to note: In Q4 2012,respondents willspend the leastamount of budget onpayment processing,fraud, privacy andlogistics solutions.

““It was another great

show...thank you! In

prior years I came as

president & CEO of

Ritz Interactive, Inc.

a mature company,

and found the show

extremely important

in helping build our

business. This year I

came as president and

CEO of a startup

company, MailPix, Inc.,

and continue to find

the show critical in the

building of my new

business.”Fred H. Lerner, MailPix.com,President & CEO

The charts below outline where respondents are planning to spend externally in terms of solutions.

On a percentage basis, I am planning/evaluating budgetspend externally in these areas in the next 3 months:1

10

0

20

30

40

50

60

48%SEO, SEM, Site Search









� 18% Email

� 21% Mobile

� 21% Tablets









29%• Online Video

• SEO, SEM, Site Search

• CRM Systems, CustomerSegmentation, Loyalty

*Point to note: Over the next sixmonths, respondentswill spend the leastamount of budget onglobal solutions.

““[We] are still talking

about the conference

and how much we

learned. The show is

definitely first class

and well organized.

We look forward to

attending again.”

David Jones, E-CommerceDirect Marketing Architect, The Little Tikes Company


Survey Results

10 20 30

*Point to note: In the next year,respondents willspend the leastamount of budgeton SEO, SEM andsite search.

“"This was my first time

attending eTail. I was

very inspired by the

conference as a whole

and was particularly

impressed by the cutting

edge information and

trends that guest

speakers so willingly

shared. I am looking

forward to next year

and learning even

more!"

Dana Stringam, Founder & CEO,Micronutrient.com



Survey Results








� 16% Email

� 14% Mobile

� 23% Tablets









30%CRM Systems, CustomerSegmentation, Loyalty

10

0

20

30


On a percentage basis, I AM NOT planning/evaluatingbudget spend at all in these areas:4

Survey Results








� 34% Email

� 32% Mobile

� 38% Tablets









10

0

20

30

40

50

60

57%• Fraud, Privacy, Site Security & Logistics

• Payment Processing

• Global Solutions

““Attending the eTail

West Conference is

something I look

forward to every year…

This convention gives

us a great chance to

network with others in

our industry and help

MyBinding.com to

innovate and discover

new options for e-

commerce technology.

Attending this

conference is a terrific

opportunity for us, it’s

always exciting to meet

others in this industry

and get new ideas .

Going to Palm Desert is

part of our strategy to

stay competitive and

grow as a company.”

Jeff McRitchie, Vice President ofMarketing for MyBinding.com

Summary Of ConclusionsWhen asked the following survey questions, our respondents answered as follows:

Is there a specific time of year when you evaluate external solutions?We received a variety of answers, including every six months and during Q4. Additionally, manyretailers do not have a specific time of the year in which they evaluate external solutions.

The top areas retailers are most likely to spend onsolutions within the next 3 months are:



The top areas retailers are least likely to spendor allocate budget are:


“Guy Kawasaki's

keynote and slide show

was both entertaining,

validating and inspiring

for how to approach

any position held in a

company wanting to

move forward.

Remembering to keep

serving others first and

empowering those

around you with

permission to be their

best and do their best

was the gist I came

away with and hope to

carry forward.

David MacMahan, DivvyMaster

Mobile

GlobalSolutions

Social Media

Fraud, Privacy, SiteSecurity & Logistics

Social Media & Social Engagement

Email

eCommerce PlatformReplacement orEnhancement

CRM Systems, CustomerSegmentation, Loyalty Programs

CRM Systems, Customer Segmentation,

Loyalty Programs

Online Video

PaymentProcessing

SEO, SEM and site search

Personalization

Online Video


Summary Of Conclusions

When Asked, “ What do you see as the biggest growtharea in the next year?” respondents answered as follows:5

� 62% Mobile

� 27% Social

� 25% Tablets

62%Mobile

When asked, “How are you using social media?”respondents answered as follows:6

� 76% Engagement

� 51% PR

� 47% Customer Service

� 42% Sales

76% Engagement

““I look forward to the

Etail West Conference

every year as a chance

to network with my

peers, stay up to date

with emerging

technologies, and

share ideas and best

practices with the best

and brightest in online

retail. Can’t wait for

next year!”

Dave Haber, Sr. Director,Marketing Communications &Social Media, Ice

Better use of data

Summary Of Conclusions

When asked, “Where are you focusing your mobileefforts/resources?” the majority of respondentsanswered as follows:

• Website, app support

• Paid Search

• Research

• Design/Responsive design

• Commerce

• General optimization

When asked, “What are your top priorities in termsof technology enhancements?” the top answers wereas follows:

Mobile

Check-out

Cross-channel optimization

Email SEO

ContentManagement

SEM

Personalization

Platform

Social


““This is one of the

best ecommerce

conferences

available, both in

terms of value as well

as the networking

and learning

opportunities that

come from its more

manageable size and

regional approach.”

Donnamarie Mazzola, BrandMarketing Manager, VoiceSystems Engineering, Inc.

State Of The Industry And Technology Spending In Retail And E-Commerce

Online ad sales in the United States totaled $31.74 billion in 2011, up 21.9% from$26.04 billion in 2010, according to the Interactive Advertising Bureau’s InternetAdvertising Revenue Report, released today. Last year was the first time online adsales topped $30 billion. The trade group says the jump in spending from 2010 to2011 marks a return to growth rates not seen since the 2006-2007 measurementperiod, before the economic recession.

Retail marketers accounted for the single largest chunk of online ad spending in2011 when they spent $7.1 billion on online ads, 22.4% of the total. Retailers’spending on web ads was up 29.1% from $5.5 billion in 2010, according to the IABreport, which is prepared by consulting firm PricewaterhouseCoopers from salesinformation provided by advertising companies and publicly available data.

Online advertisers spent $14.8 billion on paid search ads, accounting forapproximately 46.6% of 2011 total online ad revenue. Spending on other adformats, in descending order of total spending was display/banner ads, $6.8 billionand 21.4% of revenue; classifieds and directories, $2.6 billion and 8.2% of revenue;digital video, $1.8 billion and 5.7% of revenue; mobile, $1.6 billion and 5.0% ofrevenue; lead generation, $1.5 billion and 4.7% of revenue; rich media, $1.3 billionand 4.1% of revenue; sponsorship, $1.1 billion and 3.5% of revenue; and e-mail,$0.2 billion and 0.6% of revenue.

Taken From Internet Retailer

Online retail spending for the fourth quarter of 2011 increased 14 percent, year-over-year, to $49.7 billion, according to comScore, which measures digital data. This growth rate represents the ninth consecutive quarter of positive year-over-yeargrowth and fifth consecutive quarter of double-digit growth rates. For the entire2011 year, U.S. retail e-commerce spending reached a record $161.5 billion, a 13-percent increase from 2010.

Other highlights from Q4 2011 include:• The top-performing online product categories were: Digital Content &

Subscriptions, Jewelry & Watches, Consumer Electronics, Toys & Hobbies, andComputer Software. Each category grew at least 18 percent vs. year ago.

• Ten individual days in Q4 surpassed $1 billion in online spending, led by CyberMonday (Nov. 28) at $1.25 billion. Monday, Dec. 5 ranked second at $1.17billion, followed by Green Monday (Dec. 12) at $1.13 billion.

• 52 percent of e-commerce transactions included free shipping, representing anall-time high. The previous high was Q4 2010 at 49 percent.

• Smartphones and tablets played a growing role in online shopping, withconsumes increasingly using smartphones to check prices and product featureswhile physically in a retail store.

Taken From Forbes

Retail marketers accounted for the singlelargest chunk of online ad spending in 2011...


*

““Etail Palm Springs

was an excellent

event and very well

organized. I go to

many conferences

and it was well ran

with a lot of vibe and

energy. The audience

was always engaged

and the presentations

were excellent.”

Jodie Solomon, Director ofAdvertising Sales, MobileMarketer

State Of The Industry AndTechnology Spending In RetailAnd E-Commerce

Forty-seven percent of executives said they will be investing primarily in calendaryear 2012 in analytical tools to improve company growth, expansion and planning.

The survey, conducted in May and June by audit, tax, and advisory firm KPMG LLP,showed that 72 percent of the retailers said they have a great deal of cash on theirbalance sheets.

Fifty-six percent of them said they only expect a modest improvement in theeconomy, revenue, and hiring in 2012.

The outlook beyond 2012 does not appear promising either: 40 percent of thesurvey respondents said they don't expect a full economic recovery until 2013-2014or later. And of the 100 retail executives, 23 percent said headcount would neverreturn to pre-recession levels.

Taken From Reuters

Most retailers are planning to increase spending on e-commerce technology thisyear, Forrester Research Inc. says in a new report, 2011 Online Retail TechnologyInvestment Outlook. 62% of retailers in the study, which was conducted inDecember, say they will spend more on e-commerce technology this year, and 54% say they will change their e-commerce technology system within the next 12 to 36 months or are already embarked on a replatforming project.

The sharpest increases in priorities were in back-end integration, including ordermanagement and inventory systems, cited by 63.5%, up from 31.6% a year earlier; mobile sites, cited by 52.4%, up from 18.8%; and mobile apps, at 44.4%,up from 15.1%. (Respondents could list multiple priorities.) In a sign of thegrowing importance of e-commerce, 59% of final decisions on e-commerce techspending are made by either CEOs or e-commerce directors, rather thanoperations, marketing or financial officers.

Taken From Internet Retailer


72 percent of the retailers said they have agreat deal of cash on their balance sheets.*

62% of retailers in the study, which wasconducted in December, say they will spendmore on e-commerce technology this year*

““ETail West 2012 was asuper show for us.3 reasons for classifyingthis show as “super show” –

• Number of retailattendees was 30%-40%higher than any otheretail show that we haveattended (and we havedone “all etail shows”since Feb 2007!)

• It’s difficult to beat etailin terms of the “quality”.All top tier retailers werethere and many were inserious “buying mode”.

• The organization of thisshow was immaculate –WBR team was alwayspresent when youneeded them and theywere always trying tohelp you have asuccessful show. That’s abig factor – “organizerswant you to succeed.”

Udayan Bose | Founder & CEO |NetElixir Inc.


About eTail

eTail is a conference series held bi-annually in the United States, as well asinternationally, offering best practices and tactical strategies presented by retailinnovators from every facet of the industry. It is the premier multi-channel andonline retail conference dedicated to supporting the growth of the retail industrythrough high-level networking and extensive thought leadership.

WBR, the creator of the eTail conference series, is an independent researchorganization, devoting 100% of its resources towards executing industry-leadingconferences

eTail is Made by Retail for Retailers. The event content, format and speaker facultywere put together by not only months of research with retailers from every part ofthe industry, but also steered by our retail Advisory Board of leading e-commerceand multi-channel executives. eTail responds to the immediate needs of the industry,helping attendees capitalize on every single growth opportunity.

As many retailers have learned, the eCommerce industry never allows forcomplacency. Trends have been combining to create an explosion of innovation andinvestment in the online retailing channel. The result is a dynamic and competitiveselling environment that will challenge every online seller to satisfy and thrill onlineshoppers – before another retailer does.

If you haven’t already,please visit www.etailwest.com for details on the next 2013conference. Remember to join the eTail community and receive additional freecontent on Linkedin, Facebook, YouTube, Twitter and The eTail Blog.

Email: [email protected]: @eTail_EventsFacebook: http://www.facebook.com/pages/Etail/169797459705058?skThe eTail Blog: http://www.theetailblog.com

Lori Hawthorne, Executive Director, eTail Conference Series

For further information, contact:

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