Rudelle Blogging

The secret of Wal-Mart profitability lies into impulse purchases. I visit Wal-Mart to buy some butter and rice. After a dozen of minutes hanging in their premises, my cart is quickly filling up. While browsing around, I am visually strongly encouraged to add a whole bunch of various articles. And it works!
Wal-Mart marketing tactics rely on a complex of blend of products and its associated merchandising (put beers next to pampers). These tactics became so important that a whole marketing research domain has been growing under the name of category management.
On Internet, category management seems of lower interest. Thanks to the magic of Long Tail, e-merchants offer an almost infinite range of products. With a good search engine indexing its catalogue, e-merchants manage indeed to achieve spectacular results. As an example, more than 60% of all books sold by Amazon are rare books, which are not available in traditional bookstores.
The paradox of this Long Tail strategy is that it kills impulse shopping. To browse around these giant catalogues, users are required to enter very precise key words. As a result, they only buy only they were seeking for.
To combine (at last!) Long Tail and impulse purchases, e-merchants need to promote products that users would not have thought spontaneously.
The problem is that in most of the cases, these promotions are not relevant. This translate into very low rates of impulse purchases (on average, less than 2% of visitors). Tomorrow’s challenge thus consists in personalizing for each user specific products.
These techniques require very sophisticated mathematical tools. But they will have a crucial impact on bottom line of the industry. Amazon which understood this trend ahead of the pack, has invested a huge amount of money in this field.
“One fits all” easy strategy will be soon dead. Within the next two years, e-commerce sites which will continue to promote the same products to all their visitors are likely to be out of the game.

Welcome in the marvellous world of “Long Tail”. Long Tail is supposed to make gold with loosy back catalogue. I mean a magic way to make business without relying on blockbusters (for details on this buzz word, check the excellent article of Wikipedia on the subject).
For instance, it is common knowledge that Amazon.com generates more sales on unknown books than on best sellers. The classical brick and mortar rule which states that 10% of all existing products account for 90% of sales is no more valid on the Web. In a digital store, to a physical store, zero storage cost offers the option to present an almost infinite number of products. In theory, e-commercial sites have no more limits on their inventory size. In particular, no more need to focus on a specific niche like in the old physical world. You just need to plug a fast and efficient key word search tool on your huge digital catalogue and you can serve the entire universe.
This looks too good to be true. Indeed, offering millions of products implies that customers know… what they are looking for! Indeed, it is impossible to browse around all the catalogue. Moreover, very often, the customer has a very vague idea of what he is looking for. He wants “a new cool shirt”, not “a yellow pink shirt with a rasta logo on its back”. Traditional search tools are unable to look for a “cool shirt”. Cool is not only a vague notion, it is specific to each of us!
All of us have been stuck one day in the 10th sub menu of a site “where there is all”. That is to say, in order to maximize potential of this famous Long Tail, it is necessary to invent new tools to browse within those giant catalogues.
For instance, take blogs. I love to learn that there are more than 30 millions blogs in the cyberspace. What an incredible Long Tail! But these blogs are confronted with the same problem of relevance. In all this enormous sea of posts, how can I spot those which are of real interest for me? I mean, without wasting hours browsing randomly?
Intelligent personalized filtering is definitely the next frontier of Long Tail.