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Foreword

Foreword

At the time of this writing (2002), e-commerce has a bad name. Many investors stay far away from anything that has “e” in its name and even farther away from pure-play e-commerce. This is understandable because we have just come out of a period where many e-commerce sites went under. A great many of these closed sites seemed to be based on a business model of losing money on every shipment but assuming that this would be OK because they were Internet companies. Many of these same sites also went overboard with expensive, but useless, web design that made it hard to find anything and prevented many users from shopping. I can only cry dry tears over the death of these many clueless e-commerce sites. Good riddance.

There were also some good sites that closed in 2000 and 2001 and I do miss these sites.

Investors sometimes go overboard—one way or the other. E-commerce may not be a diamond-studded goldmine, but nor is it a black hole that sucks money in and never generates a return.

I am a firm believer in the potential of e-commerce. Anything that can be sold by mail order can be sold better on the web, where you can provide much better information than is possible in a print catalog. Multimedia, if used correctly, can add a dimension we will never get in print. Personalization and search tools can allow fast access to a vastly larger set of products and variations than would fit in even the fattest catalog. And instantaneous split-testing of offers, promotions, and wordings is a dream for any marketer who wants to adjust a campaign to the realities of the market in real time instead of shooting off 100,000 mailings before collecting the data.

E-commerce is great for B2C, B2B, C2C, and any of the other weird combinations of letters so beloved by analysts. For many of the more complex B2B products, it is important to realize that people may not add, say, a Gulfstream executive jet to an online shopping cart, but they may still research the purchase (or leasing options) on the vendor's website. Online merchandising and presentation of the complex buying options that are common for big B2B orders can be a major way of reaching customers, even when the final sale is closed through traditional channels.

In a recent usability study, my team and I watched users make 496 attempts at performing tasks on e-commerce sites. The test spanned 20 sites based in the U.S., focusing on large sites but including a few smaller ones as well. On average, the user success rate was 56%.

E-commerce sites lose almost half of their potential sales because users cannot use the site. In other words, with better usability, the average site could increase its current sales by 79% (calculated as the 44% of potential sales relative to the 56% of cases in which users currently succeed).

International usability is even worse. Based on our study of overseas users shopping at the same 20 sites, I estimate that the sites could increase their overseas sales by 49% if they provided those users with the same quality of user experience that they offer domestic users.

Clearly, e-commerce sites have great potential for improving usability and, thus, increasing sales. My twenty-site usability study resulted in a list of 207 guidelines for improving the e-commerce user experience (the study can be downloaded from www.nngroup.com/reports/ecommerce). After reviewing several mid-sized e-commerce sites, I found that, on average, they complied with only 37% of the 207 usability guidelines. Compliance was particularly egregious in international usability, where the sites followed only 15% of the guidelines.

Best-selling sites are better at following the e-commerce usability guidelines: across 10 big e-commerce sites, I found an average compliance rate of 53% with the 207 guidelines (i.e., 110 guidelines followed; 97 violated).

These simple numbers tell a deep story: e-commerce sites can do so much better than they do today if only they would design more for the special characteristics of the online medium. That's the main reason I am bullish on the future of e-commerce. I haven't even talked about the potential of new technology or the fact that the number of Internet users worldwide is expected to double from about half a billion in 2002 to a full billion in a fairly small number of years. Yes, both of these changes will happen, and they will both add substantially to e-commerce sales. But even today, with no need for anything else to change, most e-commerce sites could double their sales if they would improve their websites to comply with well-documented best practices.

I highly recommend the expert guidance provided by Chandler and Hyatt. This book provides readers what they need to know to greatly enhance the customer online shopping experience and webstore usability – and, therefore increase sales.

Jakob Nielsen, Ph.D.

Nielsen Norman Group

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