How Does Store-Building Software Work?
Web Commerce Today, Issue 5, December 15, 1997
I remember when merchants figured a total with an adding machine, and then wrote out the receipt on a carbon-duplicate pad. No more. The old mechanical "Ka-ching" cash registers gave way to computers with a drawer. Now they've been augmented with UPC codes and scanners to support a sophisticated system which tracks inventory. You only use handwritten receipts these days if you don't expect to sell much.
Three Generations of Online Sales
The short history of sales over the Web reveals three generations of commerce-enabling software:- We began with a simple HTML form (http://www.wilsonweb.com/articles/simple.htm). Forms would take an order, but when you had more than a few products to choose from, the simple form got clumsy, since the order form was on a different page from the product description.
- The next step was "shopping cart" software. Now when you saw an item that interested you as you browsed through a site, you could place it in a "shopping cart" or "shopping basket," which would remember what you had seen, and even kept a running total for you, and probably calculated simple taxes and shipping. These days, "shopping cart" is only one of the important functions.
- The third generation "storefront" or "store-building" software. These stores include the shopping cart, and now allow the storeowner -- with just a Web browser -- to add, delete, or temporarily hide products, change prices, set up sales and promotions, pick up orders securely, manipulate graphics, and integrate the online operation with existing accounting and inventory systems. Let's look at each of these functions -- first from the customer's perspective, then from the merchant's -- so you can see what is possible with third-generation store software.
Sally Shopper doesn't really care about the inner workings of your store, she's only looking for convenience, security, and efficient handling of the her order. Modern online stores work hard at making shopping easy.
Customer's View of the StorefrontProduct Navigation
What products do you carry? is your shopper's first question. Quickly transporting the customer to the product she desires is job one.
Store-building software keeps product information in an online database that contains fields such as product name, SKU, descriptive text, price, weight (to calculate shipping), and the file name of the product photo. The merchant easily selects which products appear on store pages.
Small stores with 20 or so products can get away with a simple menu on the main page, with perhaps a small photo icon of the product. Click on the icon and it takes you to the product.
The larger the store, the more sophisticated a navigation system is required. Large stores usually offer only one product per page, and use both a site search engine and hierarchical departmental menus to browse the store. (See "Getting Customers from the Front Page to the Center of Your Store," Web Commerce Today, Issue 2, September 15, 1997. Navigation is an all-important art if you want to sell products.
More sophisticated store-building software can assign a department or subdepartment to each product, so they be easily linked to the store's menu structure. And since all the products and page locations are in a product database, it's relatively easy to search the database for keywords and locate products. iCat Commerce Publisher (http://www.icat.com), for example, includes fields for category and subcategory on each product's set-up screen.
Shopping Cart
You want Sally Shopper feeling free to browse without being locked into purchasing decisions until later. Online stores quickly developed the metaphor of a shopping basket or shopping cart ("trolley" in Britain) into which customers place selections. Business-to-business sites such as W.W.Grainger (http://www.grainger.com) use the term "order form," more suited to a business purchasing model.
This product selection feature needs to allow Sally Shopper to add or remove products from her cart, and to indicate quantity. One feature that separates elementary from advanced store-building software is the ability to indicate two or three varieties, such as an extra large (size) green (color) flannel shirt. Usually, each size-color combination will be linked to a separate SKU number to make it easy for the merchant to fulfill the order. Imagine selecting shoes (size, width, color) or window blinds (color, height, width). Microsoft Site Server (Enterprise Edition) software, for example, makes this sort of process easy for both the shopper and the merchant.
Calculation
Most store-building software keeps a running total of the items Sally has put in her shopping cart. Once Sally enters her physical address, the program can calculate taxes, and when she indicates her shipping preference, it'll figure shipping costs, too.
When you only need to calculate taxes for shoppers in the merchant's state or city, a simple look-up table by tax jurisdiction indicates the sales tax percentage to add. But what happens when you have physical store locations in 15 states? More sophisticated software now allows for plug-ins such as TaxWare's Sales/Use Tax System (http://www.taxware.com) which calculate in real time exact taxes for the US and Canada. (If proposed US legislation for "voluntary" state tax collection by large mail order companies is enacted, it could eventually force Web stores to purchase such software or be forced out of business.)
The store software automatically calculates shipping according to shipping zone by means of look-up tables . Most software allows a variety of ways to calculate shipping: price threshold, weight threshold, or quantity threshold. You can also specify special shipping costs for individual products with out-of-the-ordinary packing containers if you need to. Some merchants find it easier to disable the shipping calculation altogether and add exact shipping charges to the customer's credit card at the time of shipping. Calculating international shipping costs can be especially complex. To simplify shipping calculations, some programs now connect to UPS's integrated Quick Cost Calculator Tool to display exact costs (http://www.ups.com/tools/tools.html).
Transaction
When it's time to check out, Sally Shopper wants to complete the transaction securely and efficiently. The current generation of store-building software is designed to work seamlessly with an SSL secure server so the Web browser-to-Web store transaction is quite secure. Sally isn't nearly as likely to purchase online with her credit card if you don't have a secure server.
Finally, storefront software provides the customer with an immediate on-screen and e-mail receipt for the purchase. From the customer's point of view, storefront software makes searching, browsing, selecting, and ordering easy and efficient -- the precise ingredients you need to convert online shoppers to repeat customers.
Merchant's Back OfficeThe real revolution in store-building software is in the merchant's back office Web browser interface which allows complete maintenance of pricing, tracking, and sales. The primary back office tasks are these:
Tracking Shoppers
Have you ever momentarily left your shopping cart in a grocery store and few seconds later found that someone mistook your cart for theirs, and left you with 20 boxes of gourmet fortune cookies? Store-building software must differentiate between shoppers -- long before they tell you who they are at check-out time. Programs use three ways to track shopping carts:
- A cookie (small computer file) containing your cart number is transmitted to your Web browser and remains on your hard disk during your visit to the store. The use of cookies is quite widespread and used by most store software, since this is probably the most efficient method. Some people see cookies as an invasion of privacy, however, so alternate tracking methods are sometimes needed.
- The temporary IP number automatically assigned by your ISP when you logged onto the Internet can identify you. While you never see the IP number, it can be read by the store software. ICentral's ShopSite Manager (http://www.icentral.com) uses this method when a shopper's browser doesn't accept cookies.
- A randomly-generated cart number can be appended to the URL appearing in your browser's "Location" or "Address" field. Whenever you go to another product page, that cart number goes with you. Mercantec SoftCart StateTrackTM uses this system (http://www.mercantec.com).
More important to the merchant than mere cart numbers, however, is keeping track of shoppers. iCat Commerce Publisher (http://www.icat.com) includes a "membership" feature that attempts to get information from shoppers in exchange for a discount or other special offer. The better software products keep a database of customers which can be used to e-mail information about sales and special offers, as well to present the shopper with an offer tailored to her past store-browsing patterns. For example, when I enter Amazon.com Books (http://www.amazon.com), the store greets me with "Hello Ralph F. Wilson, get recommendations just for you!" How does it know me? Last time I purchased, Amazon's server sent a cookie to my browser which identifies me with a number. When I enter the store, it looks up my cookie number in its database, connects that with its record of the categories of books I've looked at, and automatically sends me book selections which I have not seen before. Customer tracking enables a very powerful cross selling ability, and is available in some of the more sophisticated software packages, such as Intershop Online (http://www.intershop.com) and Microsoft Site Server (Enterprise Edition).
Many programs provide some reports on products viewed and purchased. However, Viaweb Store (http://www.viaweb.com) has perfected an awesome array of statistics which not only tell you what products were viewed, but the most common paths customers take in your store (great for design analysis and improvement), what link the shopper clicked on to get to your store, and which banner ads or search engine links produced the highest per capita sales for your store.
Order Pick-Up and Accounting Integration
While the customer is most aware of security when she places an order, unless the merchant retrieves the credit card information using a secure means, security is compromised at the back end of the transaction. Most store software allows secure pick up of orders in the secure back-office by means of a secure Web browser and SSL secure server. Typically, orders can either be viewed one at a time on the screen and printed out on the merchant's printer, or downloaded as tab-delimited or Microsoft Excel files for importing into the merchant's accounting or order fulfillment system. Mercantec, for example, provides modules for its SoftCart (http://www.mercantec.com) to export orders in formats which can be imported into Intuit QuickBooks or EDI (Electronic Data Interchange format, used as a bridge between accounting systems in business-to-business transactions).
Integration with accounting systems is still in the early stages, however, and is hardly seamless. If your accounting software doesn't readily accept one of these formates, you'll probably have to do some programming to format the order data for easy import. But programming may be less expensive in the long run than manual re-keying of online orders into your system.
Most store software now allows integration with real-time credit card authorization systems, though many merchants don't process credit card transactions until product fulfillment, and don't need real-time authorization capability.
Product Additions and Editing
Any healthy retail store is constantly changing. Previous generations of store software required HTML coding for each product. The latest software allows you to set up your products in two ways:
Database Upload. Larger stores, especially, enjoy the ease of maintaining their product database on a desktop computer, and then uploading the database periodically, automatically updating the store which draws on that database. This can be a bit tricky to set up, but for stores with more than a few hundred products it is necessary. Store software on a Windows NT server (such as iCat Commerce Publisher, Microsoft Site Server (Enterprise Edition), and Inex Corp.'s Commerce Court, http://www.inex-corp.com) can be updated with a Microsoft Access database, either directly or by means of ODBC drivers. Stores on Unix operating systems may need to be updated using a comma- or tab-delimited file produced a desktop database program.
Browser-Based Maintenance. The new crop of store software allows product maintenance using only a Web browser in the store's password-protected back office. Storeowners can add products, hide out-of-stock products from view, or change prices with ease. Smaller stores will find this extremely attractive, using store software such as ICentral's ShopSite Manager (http://www.icentral.com) or Viaweb Store (http://www.viaweb.com). You can also mix the two approaches: upload the initial product database, and then make modifications with your Web browser online. What you often can't do, however, is to download the modified online product database back to your desktop to reflect changes you may have made in the back office since uploading the most recent database. (This can force you to do you updating either with the database or with the back office, not both.)
Sales and Promotions
Using your browser in the back office you can easily place items on sale, move them to a specials page, or (with more sophisticated software) set up percentage discounts for certain customer classes or on orders of $100 or more. These powerful features make store software without a back office obsolete.
Graphics
Most store software allows some graphics uploading and placement. Each product can be linked to a photo, for example. Viaweb Store (http://www.viaweb.com) excels, however, in its ability to create automatic thumbnail photos from product photos, and colored headline graphics in your choice of font style -- good quality, too!
Inventory and Fulfillment Management
Most less expensive store software lacks built in inventory management capability, though you'll find it in Intershop Online (http://www.intershop.com). Newer software by companies targeting large corporations now offers systems integration with inventory and accounting. You'll see this with Pandesic (http://www.pandesic.com), Open Market (http://www.openmarket.com), and others. Smaller direct marketers using Mail Order Manager are watching with interest the development of Dydacomp's SiteLink store software tightly integrated with M.O.M. databases (http://www.mailordercentral.com/mainsitelk.asp).
Updating the Store
It used to be that to make changes, the merchant would have to use HTML code to alter the store's pages. No more. Now store building software uses templates to generate (publish) HTML Web pages in accordance with changes the store owner makes in the back office without any need to know HTML. Some software, such as ICentral ShopSite (http://www.icentral.com), generates real Web pages which can be fully indexed by search engines and display quickly. Larger stores, however, usually turn to dynamically-generated Web pages which do not exist on the server until a specific shopper calls for a product found on those pages. While these are not searchable and come up somewhat more slowly, they are not nearly as bulky or difficult to index and manage as thousands of individual Web pages.
As an electronic commerce consultant, I'm often asked, "Which is the best store building software." The answer is, "That can vary, depending on your company specific needs and budget." Take time to understand your company's present requirements and future plans carefully, read product reviews linked to the "Shopping Technology" section of our Electronic Commerce Research Room, try the various company online demos, and you'll get a feel for which features are most important to your needs. That way you can select store software which is right for you now, and for the future.
Related articles and Resources
If you liked this article, you'll find similar pieces every month in Web Commerce Today, focused specifically on selling products directly over the Internet. A one year subscription entitles you to the e-mail version, plus full access to our Electronic Commerce Research Room, the largest collection of links to e-commerce links and resources anywhere on the Internet. Subscribe today!Tool: "Store-Building Software Evaluation Guide". Excellent as a consultant's tool, or to help in-house staff determine the right software for your store. Thirty questions you need to consider. The mistakes this guide save you will pay for your Web Commerce Today subscription many times over.
"Why Freeware Shopping Cart Programs Are So Expensive". Cautions about, and links to, freeware and shareware store programs.
"Shopping Technology" shelves in our Electronic Commerce Research Room link to dozens of reviews of leading store building software. Think how much time this will save you in "due diligence"!
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