Online retailPrivacy

If you love your customer set her free

By February 25, 2009 March 6th, 2009 12 Comments

There is a great story on Jared Spool’s blog of how a desire to build a relationship with customers can be counter-productive (thanks to Joe Andrieu for the pointer).

The un-named etailer made the mistake of asking customers to register with the site before they checked out – I can fully understand the impulse behind this – build a list of registered members, improve their future purchase experience, and hopefully improve their loyalty and repeat business stats.

The result, however, was very different.  Total mayhem in fact.

Firstly, when it came to it customers didn’t like having to register:

We conducted usability tests with people who needed to buy products from the site. We asked them to bring their shopping lists and we gave them the money to make the purchases. All they needed to do was complete the purchase.

We were wrong about the first-time shoppers. They did mind registering. They resented having to register when they encountered the page. As one shopper told us, “I’m not here to enter into a relationship. I just want to buy something.”

Some first-time shoppers couldn’t remember if it was their first time, becoming frustrated as each common email and password combination failed. We were surprised how much they resisted registering.

Without even knowing what was involved in registration, all the users that clicked on the button did so with a sense of despair. Many vocalized how the retailer only wanted their information to pester them with marketing messages they didn’t want. Some imagined other nefarious purposes of the obvious attempt to invade privacy. (In reality, the site asked nothing during registration that it didn’t need to complete the purchase: name, shipping address, billing address, and payment information.)

Lesson 1 is don’t make people feel like you are making them trust you or that you assume they want to be your friend.

I’m not here to be in a relationship – that sums it up for me.  If I think about the good relationships I have with offline retailers they didn’t start on the first visit – they started some way down the track, once we had started to get to know one another.  The first visit was all about efficient execution of the purchase process.

Secondly, even if people don’t mind registering in theory, in practice it is a massive hassle:

Except for a very few who remembered their login information, most stumbled on the form. They couldn’t remember the email address or password they used. Remembering which email address they registered with was problematic – many had multiple email addresses or had changed them over the years.When a shopper couldn’t remember the email address and password, they’d attempt at guessing what it could be multiple times. These guesses rarely succeeded. Some would eventually ask the site to send the password to their email address, which is a problem if you can’t remember which email address you initially registered with.

(Later, we did an analysis of the retailer’s database, only to discover 45% of all customers had multiple registrations in the system, some as many as 10. We also analyzed how many people requested passwords, to find out it reached about 160,000 per day. 75% of these people never tried to complete the purchase once requested.)

The form, intended to make shopping easier, turned out to only help a small percentage of the customers who encountered it.

Read the punultimate paragraph in the above quote again – those are some jaw-droppingly-big numbers.

Asking people to register makes the mistake of assuming you are important enough to the customer that they will remember the details they have used.  The second lesson therefore is the folly of that (arrogant) assumption.  (Note this pattern will shift as OpenID and Facebook Connect gain traction.)

Joe quotes Doc Searls as saying “a free customer is more valuable than a captive one” – I’m a big believer in that.  Trying to capture people (or forcing them to register) makes you less attractive.  In the real world we have always known that being needy is a turn-off – yet somehow this doesn’t always get translated online.

And the punchline?  When the un-named retailer changed the process so people weren’t forced to register sales lept up by $15m in the first month and $300m in the first year.

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