September 19, 2005
Sometimes, you just have to perform a major overhaul to a few large
eCommerce Web sites in order to substantially increase their overall ROI.
"Gap's three newly overhauled e-commerce sites largely surpass every
other retail site out there today," said Carrie Johnson, a retail
analyst with Forrester Research. "They're providing a customer experience
that other retailers will probably try to figure out how to duplicate."
Are Gap's new Web sites good enough to make up for the fact that the company turned away thousands of customers and millions of dollars in business while it got them up and running over the past two weeks?
The answer appears to be yes, analysts said, thanks to a spate of promising innovations on Gap.com, BananaRepublic.com and OldNavy.com.
In fact, the big question is how long it will take for competitors to catch up, and at what price.
"Gap's new sites leapfrog every other retail site out there today," said Carrie Johnson, a retail analyst with Forrester Research, an online consulting firm. "They're providing a customer experience that other retailers will quickly try to figure out how to copy."
In particular, Johnson said, Gap's sites, which were shut down in late August and reopened to limited numbers of customers over the following two weeks, went far in solving what she called the "too many clicks" problem.
For instance, when women browse Gap.com's T-shirt section, they do not have to click to a new page to see details about the 16 shirts shown on each page.
Rather, when they put the cursor over an item (called "mousing over" in industry parlance), they are invited to click on a "quick look" link for the shirt. That link yields a pop-up window that shows a model wearing the shirt alongside swatches of the colors it is available in. Mouse over any swatch, and the shirt takes on its hue and the window tells you what sizes are in stock.
When a shopper clicks "add to bag" from within that window, the site does not shuttle her to a checkout. Instead, another small window replaces the previous one, showing the shopping bag and asking her to consider multi-item discounts. If she ignores that window or clicks the "close" button, it disappears.
Toby Lenk, president of Gap Inc. Direct, the company's corporate catalog and online division, said the mouse-overs and pop-up windows had cut the need to bounce the shopper off her browsing path each time she needed information.
Lenk declined to say how much revenue the company had lost by shutting out customers for a couple of weeks, but it was probably in the millions of dollars, given that the Direct division's sales last year were US$500 million.
But competitors did not gain much from Gap's absence, at least in the early going. According to comScore Networks, an Internet research and consulting firm, the number of Gap online shoppers who also visited competing Web sites did not spike during the first week of the outage, the latest week for which statistics are available.
The disruption would have been avoidable had the company merely been changing Web sites, Lenk said, but because it was overhauling all the back-office systems used to track inventory and manage promotions, among many other functions, a seamless transition was impossible. "I can't say we haven't lost a customer, but it's a small price to pay for where we're going to go," he said.
He would not disclose the cost of the new system, but analysts said the company could easily have spent $10 million or more on the yearlong project. Gap wrote its own software for all the major behind-the-scenes systems and all features the consumer sees on its sites. Gap did pay software vendors for peripheral Web site and back-office programs.
The go-it-alone approach has raised as many eyebrows as the decision to shut down the sites. Johnson of Forrester said Gap's home-grown strategy "completely flies in the face of every retail technology trend out there."
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But Lenk said the company had little choice.
"We looked at the things we wanted to do, and the scale at which we wanted to do them, and quickly came to the conclusion that the only way to ensure success was to go custom," he said.
One advantage of building the systems without the help of vendors is that the Gap Web sites may keep the competitive advantages of their new features longer than they would have otherwise, because the people who built the features work for the company.
Still, e-commerce technologists pride themselves on their innovative abilities, and Gap's new features could appear on its rivals' sites with unsettling speed and perhaps improved reliability.
Source: eCommerce Times
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