5 Takeaways From Online Holiday Shopping 2010

Every fall we see a surge of speculation leading up to the holiday shopping season. Will consumers spend more this year? What should digital marketers do differently to keep pace with consumer demands?

Rarely do retailers look back afterward to ask themselves, "How did we really do and what can we learn from it"

Baynote surveyed 500 U.S. shoppers about their online experience this holiday season. Shoppers provided their thoughts on online retailers' behavioral retargeting and privacy practices, mobile and social features, offers and promotions, and product merchandising approaches.

Some interesting results from the survey include the following:

• 55 percent rated their online shopping experience as "good," equivalent to a "B" grade;
• 57 percent said they'd like online retailers to improve their site navigation, and 54 percent said the same for site search;
• 58 percent experienced retargeting, the practice of targeting consumers with advertisements after they've clicked on a product or promotion but didn't make a purchase in that session;
• 54 percent said they felt retargeting was an invasion of their privacy, and 48 percent are turned off by retailers who use it;
• 84 percent are hesitant or unwilling to share their personal information with retailers to personalize their online experience;
• 13 percent used mobile phones to make holiday purchases this year, while 18 percent used them for comparison shopping; and
• 31 percent were influenced by promotions on Facebook, 17 percent by promotions on Twitter and 20 percent by mobile-based promotions.

What can retailers learn from these findings? They certainly show room for growth and signal the rising influence mobile and social marketing has on consumers' online shopping experiences.

Here are five tips to help you turn last year's "B" grade into an "A" in 2011:

1. Listen to your customers and start improving site search and navigation. Making it easier for visitors to find products is a natural way to increase margins and keep them coming back to your site. Conduct regular tests to ensure your site is easy to navigate.
2. Prioritize personalization, but be careful not to violate privacy. The large majority of consumers are hesitant or unwilling to share their personal information to receive a more personalized experience. Retailers should strongly consider asking visitors if they want to opt in to their profile-based personalization practices.
3. Tread lightly with retargeting. Retargeting can cause serious damage to your brand equity. To avoid appearing like you're stalking customers, Forrester analyst Emily Riley recommends marketers prioritize data testing to find factors that generate lift first and only then cautiously test targeted creative.
4. Expand digital promotions to social media. The survey proved most consumers' purchases weren't influenced by Twitter or Facebook promotions. The percentage that was influenced, is too sizable to ignore. The opportunity to reach buyers via social media will only increase as it becomes pervasive to the online experience.
5. Formulate a mobile strategy. Although consumer behavior still lags retailers’ investments in mobile commerce strategies, I expect to see many more people using smartphones to research and purchase products this year. Retailers that capitalize on the opportunity will thrive.

Carlos Carvajal is vice president of marketing for Baynote, a provider of personalization and digital marketing optimization software. Carlos can be reached at carlos@baynote.com.