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Oct 19, 2004
Case Study

How to Convert More Sales from Shopping Comparison Site Traffic (Even When Your Price is Higher Than Competitors)

SUMMARY: Search engines and shopping comparison sites such as Shopping.com and BizRate are fabulous for price-sensitive consumers. But, what if you're the marketer for a site with higher-published prices than the competition's? It's a huge challenge for authorized resellers of products such as consumer electronics, because they are bound contractually not to advertise ultra-low pricing. We met a clever marketer at Car Toys who invented two landing page gizmos that turn shoppers into buyers, despite higher published prices. Learn more:
CHALLENGE


Although Car Toys is the largest mobile electronics speciality retailer in the US, the company's 54-stores are concentrated in just four states. If you're not in Washington State, Oregon, Colorado or Texas, you've probably never heard of them.

For the first few years online, ecommerce Director Glen Hamilton focused on creating the best possible site to convert local visitors, and on integrating with brick and mortars. (For example, the site offers a single handy "your local store" 800 number that automatically routes you to the nearest brick and mortar.)

Sales leapt.

It was time to get aggressive and promote nationally online. Hamilton added Car Toys feeds to almost a dozen shopping comparison sites and paid search engines, including NexTag, Shopping.com, Overture, MySimon, Froogle, CNET, BizRate ... you name it.

(Note: See link below to the eretail syndication service he uses to send and update product feed info without extra tech staff or tearing his hair out.)

This is when Car Toys hit a snag. They're an authorized reseller of consumer electronics -- which means although they can offer low prices to in-store customers, Car Toys can't publicly advertise any prices lower than the manufacturer's suggested retail price.

However, many of the online competitors weren't authorized resellers. They could slash prices publicly if they felt like it. And many did.

"It's a huge challenge for an above-the-board authorized reseller. Many times the price would be lower if a consumer came to our site and put the product into their cart, but we cannot show that in Shopping.com."

How can you convert online comparison shoppers if you can't flaunt your competitive pricing?

CAMPAIGN


Hamilton figured that shoppers from states where Car Toys is a well-known brand tended to convert better than shoppers from elsewhere.

He and the Web team reconfigured the landing pages shoppers clicking in from external search and shopping sites would see. These clicks already went deep into the site, directly to a product page matching their search. Now those product pages contained an extra element -- a detailed column of information entitled "The Car Toys Advantage." (Link below to screenshots.)

Advantage copy bulleted all the ways Car Toys was better than typical non-authorized dealers, including guarantees, factory-new products, and manufacturer warranties. Plus, they tossed in free UPS shipping.

But when a competitor one-click-away on BizRate has a much lower price, you have to offer more than just great service. This May, Hamilton added two gizmos to landing pages to get shoppers over the pricing hump:

Gizmo #1. Orange Price Guard Button

"110% Low Price Guarantee!" reads Price Guard's headline. When shoppers click the button, they activate a pop-up form that explains: "We won't be undersold by any other manufacturer authorized dealer. If you find a lower price, just let us know by filling out the form below and we'll beat it by lowering our price by 110% of the difference between the two!"

The form is pre-populated with the item name, number and Car Toys' "online published price." Consumers are asked to fill in the competitor's published price and URL, as well as their own first name, email, and optional phone number and comments.

Gizmo #2. Price Watch Offer Link

Inspired by Priceline, Car Toys' Price Watch offer allows consumers to name the price they'd like to pay for the item in question, again inputting their first name, email and optional phone number.

Car Toys promises to contact the consumer if the item in question can be sold to them at a lower price in the future. The Watch expires in 90 days.

Both programs generate a series of related automated emails -- such as e-coupons for the products with the best non-publicly advertised offer Car Toys currently allows.

In addition, if the consumer volunteers their phone number in the form, Car Toys' customer service department tries to call them as soon as possible, often within minutes. Hamilton explains, "It's tremendous to visit with someone on the phone."

(Note his use of the term "visit." Hamilton was careful to use that term -- and genuinely mean it -- throughout his interview with us on this subject. The team doesn’t think of themselves as being in sales. They are helping folks out -- advising, answering questions, being friendly. They are visiting in the nicest old fashioned sense of the word.)



RESULTS


Car Toys' online-generated sales this year have been extraordinarily strong. "In 2003 we were 200-300% above 2002. Now in 2004 we're 400-500% above 2003," says Hamilton. "We're at that hockey stick phase in our growth."

He definitely attributes some of that growth to the two pricing gizmos. "We always had a low price guarantee -- but putting a system in place to be able to collect leads and work them -- that's helped make online the fastest growing Car Toys division." On average, 3% of site shoppers click on the Price Guard button and submit a completed form. 1% click on the Price Watch link and submit a completed form. Both numbers are higher than Hamilton's expectations.

Consumers, who the service team are able to visit with via phone, tend to convert at a much higher rate than those who only receive emailed coupons. "Phone's a much more effective medium. We have a much higher close rate."

Phone is more expensive, but because the prospect has such a high buying intention and there's a great opportunity of cross-sales/upsales, conversions are high enough to afford it.

Hamilton says these tests are only the start of his planned site improvements. "We're barely scratching the tip of the iceberg in terms of what we can be doing."

Useful links related to this story:

Creative samples from Car Toys -- includes optimized product sales page for feed visitors, and Price Guard offer info: http://www.marketingsherpa.com/cartoys/ad.html

Mercent Commerce System -- the syndicated info feed service that Car Toys uses to update and maintain product info and offerings on almost a dozen shopping sites simultaneously: http://www.mercent.com

Car Toys http://www.cartoys.com

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