What are the key elements of building effective customer relationships?

Too many companies make it too difficult for people to find information on their Web sites.

Recently Creative Good, a research and consulting firm based in New York, conducted a test of e-commerce sites. Representatives of the company watched 45 "average" online shoppers as they attempted to locate and purchase items from various Internet sites. Thirty-nine percent of shoppers failed in their buying attempts because they found the sites too difficult to use. And 56 percent of the search attempts--using the sites' own search engines--also failed. Creative Good's Founder and President Mark Hurst speculates that if just 25 percent of those misfired search attempts had succeeded online, retailers would have earned an additional $3 billion this year. And when you add the $3.7 billion lost from the 39 percent that failed in their initial shopping attempts--an estimate that assumes an online spending base of $9.5 billion--you get a total of more than $6 billion in unrealized sales.

According to Hurst, the problem is that most site creators focus on design--how many pages, features, graphics or data-collection applications they can put into their sites--but don't consider how their clients will experience the site.

The study also found that a dollar spent on advertising during the holiday season in 1999 yielded $5 in return, while a dollar spent on customer relationship management yielded $60 in return.

Bottom line--it's the end users' experience that counts, and that's what differentiates a site from competitors offering similar goods and services. You can bolster your online CRM solution by incorporating the ideas described below into your Web site.

1. MAKE IT stICKY
"stickiness" is a measure of how users perceive your site. According to Media Metrix, a Web viewer behavior-measurement company, a sticky Web site has contents that draw people back to it frequently.

Determining the sticky quotient of your Web site requires server log analysis. These stats can tell you how long each visitor stayed at your site, how often they return and what drew their attention.

But simply having the server numbers won't do you much good unless you put the knowledge to use and design your Web site accordingly. For example, if most of your visitors spend the bulk of their time viewing specific information, then you should provide more of that type of information.

2. MAKE IT EASY
Jakob Nielsen of the Nielsen Norman Group is one of the Web's leading proponents of the importance of "usability." Nielsen believes that too many companies make it too difficult for people to find information on their Web sites.

A Web site should be structured in such a manner that visitors can find what they need and do what they want easily, insists Nielsen. For example, you may know that your company's consumer electronics division in Chicago handles repairs of laptop hard drives, but no one outside of your company is likely to know that. So don't structure the information in a way that only makes sense to insiders.

Don't disregard the importance of a clean interface. Industry insiders believe that Levi strauss & Co. failed at e-commerce because the site did not provide a good customer experience. Creative Good's Hurst says that levi.com was plagued with slow-loading pages that hindered the customer's desire to shop for Levi strauss products.

"Customers shop online for convenience," Hurst says, "yet levi.com slows customers down by displaying irrelevant pictures of its pouting models. Customers can't find the jeans, so they can't buy the jeans. No wonder levi.com proved to be a bad return on the company's investment."

Hurst sums it up: "If the customer experience was better on levi.com, more customers would buy, and revenue would be so high that Levi's would never have pulled the plug. Levi's withdrawal shows how the customer experience is the key driver of success or failure in e-commerce."

3. MAKE IT PRIVATE
A recent study by the N.J.-based think tank Privacy & American Business and PricewaterhouseCoopers showed that 96 percent of Net users surveyed believe it's very important for Web sites to post privacy polices that detail what type of information is being collected and how it will be used.

The Federal Trade Commission (FTC) is debating the advisability of enacting government regulation to protect Web privacy at all consumer-oriented commercial sites. The proposed legislative model is built around four core concepts. The first is to give consumers notice of what information is collected and how it is used. The second is to let consumers choose whether to allow secondary uses of information (for example, to decide whether their name can be used for follow-up marketing from the company or be sold to a third party). The third is to give consumers "reasonable access" to their information and let them correct any errors. The fourth is to ensure the information's security.

Even without new laws on the books, the FTC has made it clear that it will go after companies that mislead consumers. The commission recently claimed that GeoCities, a Santa Monica, Calif.-based company that runs a 2 million-plus member community Web site, misrepresented why it was collecting personal identifiable information from its members. GeoCities disagreed with the FTC, saying that it believed it made it clear how members' registration information could be used. To settle the case, however, the company agreed to stringent new privacy practices that included the following: barring collection and use of personal information about GeoCities' members by third parties; inserting its privacy notice in more places on its Web site and emphasizing the notice on members' application forms; requiring children to get parental consent when they apply for a membership; and strengthening community leader training. For help in designing your own privacy policy look at the Direct Marketing Association's Web site (www.the-dma.org) and TRUste (www.truste.com). Both list guidelines for developing an online privacy policy. At the DMA's site you can fill out a questionnaire about your company's privacy practices and the site will create an online privacy notification statement to post on your company's home page. TRUste also has a "privacy policy wizard."

4. MAKE IT FAst
Web surfers are looking for material that gets to the point quickly. The easiest way to communicate over the Web is with short bits of text along with illustrations, graphs and/or diagrams. But do make sure all of those graphics load quickly.

Keep the important points on top of the page and provide navigation options on both the bottom and top of each page. Provide a site map accessible via an easily found link to let users know where they are and where they can go. A search feature is a good idea, but make sure it is configured to accept general search terms, not for example, just the specific product names and/or numbers used by your company. If you're going to use a search function, run some searches with it first and make sure it can find your content.

The point is to turn prospects into customers and customers into loyal clients by giving them the information they need in an easily navigated format. The underlying structure of your Web site should be designed to gently lead people where you want them to go. That doesn't mean it should be set up like a grocery store, where people have to pass by the impulse items in order to get to the bread and milk. But do spend some time considering what you want to get from the site, and what you can give people in order to achieve your goals.

Are you pushing a product? Then you want to make it easy for people to find information about your goods or services, and convince them that it is a good thing. You might want to lure people to your site with information, a great link list or some sort of freebie. Of course, you don't let them go right to the "giveaway" stuff--first you make them take a look at what you have to offer. But keep the sales pitch brief and as unobtrusive as possible. If your product is worthwhile, they'll be back.

Or perhaps you're providing technical-support for your products--here you want to ensure that aggravated customers can find what they need as quickly and easily as possible. And note that all Web sites built to support product-driven enterprises should offer self-help aftermarket support to keep clients happy, cut down on basic service calls, and garner information usable for product revisions and marketing use.

5.MAKE IT PERSONAL
One third of all the people who buy online shop at Amazon.com. Obviously this is the place to visit for a crash course in how to build a Web site right. Amazon.com CEO Jeff Bezos says that while customer service is the most important thing in any business, it's more important online than in the physical world. "The reason is, customers have more power online."

Bezos believes that Amazon.com succeeds through providing real value for each specific customer through selection-targeted information based on past purchases and the products purchase history, including interactive features that allow customers to help other customers make purchase decisions.

Amazon.com's use of personalization features is the best in the e-commerce business. For example, one-click shopping allows repeat customers to purchase products with a single click of a single button. And after you've ordered once or twice, Amazon.com also recommends products using a technology the company calls collaborative filtering--suggesting other products that a customer might be interested in based on past purchases.

Amazon.com customers are confident that the information Amazon.com tracks on individual purchases is being used to enhance their experience. But if it's not done right, attempts to personalize pages can backfire. OfficeMax.com's site has a button that invites "first-time users to click here." When they do, they are taken to a page describing the site's frequent-flyer program, personalization features and other information irrelevant to customers who just arrived at the site and are interested in looking at what's being offered.

Compounding the problem, OfficeMax.com asks new customers to "Register Now," pushing people to sign up before they know if the site will be useful to them. The idea is to gently woo your customers before you propose marriage to them.

6. MAKE IT WORK
Charles Schwab's (www.schwab.com) Internet Trading Customer Center serves 2.2 million investors who use the system to research, execute and manage their securities investments. Initially, the system had limited functionality--customers could check balances, buy and sell equities and get real-time stock quotes. The company phased in services, ensuring that each feature worked before launching another. In fact, they didn't advertise the product when it was launched, choosing to work out the bugs with a limited audience rather than to invite the world over on opening day. Yet, in its first month, the system--by word-of-mouth--attracted 100,000 customers.

Schwab's center is not totally trouble free; it has had a few notorious outages. But regular clients look at the site's track record and know that everything that can be done to keep the center up and running has been done. Careful site management engenders trust.

7. MAKE IT stRONG
Supporting systems need to work as well as their Web-based front ends. In a survey of online commerce sites, Jupiter Communications found that call centers and fulfillment services are the most vulnerable components of the Internet selling chain. Despite this, only 54 percent of companies interviewed said they had tested fulfillment systems and only 44 percent said they had tested call center performance.

The study asked merchants to evaluate the effect twice the amount of normal traffic would have on Web response rates, levels of service and shipping services. Only 10 percent of sites surveyed said they would be capable of dealing with the surge overnight. Thirty-three percent said that their fulfillment services would not be able to cope with the increase in demand and 29 percent said their call centers were not up to scratch.

Company officials were more optimistic about Web site and server capacity. Eighty-five percent said they had tested their sites and only 15 percent felt their site would not hold up. Jupiter opined that while Web sites are easy to test and prepare for increased traffic, fulfillment services and call centers are not. Both are crucial components of the sell, and therefore demand strategic thinking and investment to ensure scalability.

8. MAKE IT PROFESSIONAL
Jupiter Communications also reports that despite the critical need for more substantial customer support, the number of e-mail queries being answered is decreasing.

The Jupiter survey sent customer inquiries to the top 125 Web sites in the retail, travel, content, financial services and consumer brand sectors, and found that customer service failure rates are higher than last year. Only half of the shopping sites and 40 percent of the travel sites responded within a day. Shopping sites demonstrated a 40 percent failure to respond rate, up from 28 percent last year, while travel sites had a 48 percent failure rate (up from 38 percent).

Forty-six percent of all Web sites tested failed to respond within five days--if at all--or did not have contact details on their site for customer queries. In the same survey last year, this figure was 38 percent.

The study's results suggest that online marketers may need to start implementing multi-channel-automated strategies to retain existing customers and attract new ones. It is important to make sure that services are in place to handle higher than anticipated usage. Unanswered e-mails (and in Internet time "unanswered" translates to within 24 hours) reflects badly on your company.

9. MAKE IT WIN-WIN
The ability to seek out and act upon the demands of the market is what makes one e-business different from another. Call it customer relationship management, value adding or just plain common sense, the ability to act fast on data gathered is what differentiates an e-business from a corporation that simply has a Web site.

But people don't want to feel that your site is simply slurping down information solely for its own purposes. As an example of the right way to do it, visit Outpost.com, a computer hardware and software retailer. Outpost.com has a sales push embedded in its checkout process that obviously helps itself but also helps customers--it simply points you to other products that would make good counterparts to your purchase. If you're buying a printer, for example, Outpost.com shows you a selection of supplies that go with the equipment. The process is so well designed that customers feel grateful for being given the opportunity to add more items to their shopping cart, and it's much more effective than a post-sales follow-up letter.

10. MAKE IT INTERACTIVE
Lands' End (www.landsend.com) gets high marks from shoppers for its clean, easy-to-navigate interface. The site recently added two interactive features that have had even more of an impact.

Lands' End Live lets customers enter their phone numbers on the Web site, and in return customers get an amazingly speedy call back from a customer service rep. Shop with a Friend allows two people in remote locations to get online, page through the site together, use text-based chat and drop purchases into the same basket.

The Internet is an interactive medium and Web sites that take advantage of the technology win high marks from consumers. As Amazon.com's Jeff Bezos says, "if you can do everything that you're doing offline, then why are you doing it on the Internet?"

Following even a few of the suggestions above will boost your site's usefulness to the enterprise and the company. Essentially, it's all about creating trust, something that is in dwindling supply on the Internet.

As a recent New York Times article put it, trusting a Web site "is like following a helpful stranger in Morocco who offers to take you to the best rug store." Don't let your site come across as a hustler that's on the take, but do make sure that you get solid value for your investment.