1. Crowdsourcing taps into the collective intelligence of online communities to complete business-related tasks that a company would normally either perform itself or outsource to a third-party provider.
2. There are several opportunities to leverage the wisdom of crowd in performing activities at a significantly lower cost, comparing to hiring a third party agency to perform those activities.
3. Some of the very interesting opportunities that I really like are
   1. Naming your business (Squadhelp.com) – you can get 30-40 domain name suggestions for as low as $10.
   2. Designing a logo or design (99designs.com) –great designs submitted from designers across the globe.
   3. Testing – uTest.com or usertesting.com for functional and usability testing.

In today’s world, it is extremely important to maximize the return from every investment and I believe crowdsourcing offers a significant opportunity in reducing the risk and maximizing the quality of your online business offering.

You are probably thinking it sounds cool, but does it have any practical or commercial uses in the retail and eCommerce space? Several retailers are already testing ideas with this concept. Although none have been widely successful so far, I see too major catalysts that could help take this technology mainstream.

First, the latest generation of mobile phones such as iPhone and Droid have all the necessary ingredients to help take this technology mainstream -  a compass and GPS to plot position, 3G mobile internet access and high resolution cameras. Second, the much anticipated launch of Microsoft’s project Natal can take this technology into the households. If you haven’t read about Project Natal, you must watch this video.

This is all good you say, but what about retail and eCommerce? I think this opens up several opportunities for multi-channel as well as online retailers. This technology has the potential to bridge the gap between the offline and digital world in a way that was not possible before. Ability to touch & feel products in the online context or the ability to see digital content such as product reviews in a physical store are all possibilities that are very real with this technology. Here are 6 use cases, along with some examples that would help visualize some of these opportunities:

1. Touch & Feel products while shopping online

One of the key deterrents to online shopping is the concern that users are not able to touch and feel the products. This is a concern especially for apparel items where looks or fit play a significant role in a shopping decision. How about a virtual fitting room where shoppers can see the garment on them, without actually trying it on.  The idea is to take some of the mystery out of buying clothes online — will it fit? Will it look good on me? — and let shoppers see how the garment might look on them, albeit on a computer screen.

Tobi has made a decent attempt at a virtual fitting room concept. Although it needs a bit of improvement to be able to see the exact fit and look, this is an excellent start and definitely has good potential for online apparel retailers.

Rayban has also done a good job in applying this technology so users can virtually try different sunglasses in front of their computer, as if the computer screen was a virtual mirror.

The common theme in both of these examples is that you get an online equivalent of taking your friends to the mall to check out some new products, all from the comfort of your own PC. Still not impressed? Here is another video from Cisco for more inspiration around virtual fitting rooms.

2. Bring the product to life in user’s context

Imagine if you are shopping for an item, and you are able see what’s inside the box in a life like 3D view. This is what Lego did in their stores by installing Augmented Reality kiosks. You can hold up a box in front of kiosk and it shows you what the set would be like, assembled. Not all retailers can afford setting up these AR kiosks in their stores, nor do I think the investment would pay off anytime soon, other than generating a coolness factor. However I do think leveraging cellular phones as an alternative to Kiosks could open up significant amount of opportunities that allow customers to “look inside” a box.

If you sell Furniture or Kitchen counter tops, you should take a look at how Ikea is using AR to try virtual furniture within the context of your own room! No more guessing about whether that mocha coffee table will go with that leather couch you already own. See it virtually, in the context of your own room, without leaving your house.

Another AR tool generating buzz right now is the USPS Box Simulator. Of all the examples I mention, this one has the most practical implementation of augmented reality that creates value for users. Basically, it allows consumers to virtually see what size box their shipment will fit in without buying the box

3. Bring digital product content to offline world

You are shopping in a physical store and would like to know about customer reviews, installation videos or other rich content that would help influence your decision. What if you point your iPhone at the product, and you immediately see all the digital content (reviews, videos etc.) layered on top of that object?  Layar recently launched a new Augmented Reality browser for iphone that seems to have significant potential in this space. The camera lens identifies the product, then serves up the contextually relevant digital information layered on top of the physical product.

4. Product Finders and Store Finders

At its simplest form, you could use an AR application such as Yelp Monocle from your iphone to find different type of stores around you.  This is a relatively straightforward application of augmented reality. However, imagine if the same concept could be applied to product finders within a store. You are standing inside a Bestbuy store and your iPhone app highlights all top rated products in the store which are currently on sale for more than 40% off.   Basically, the concept is to add a rich context by highlighting only the products that appeal to you. Whether you are shopping for a cocktail dress or looking for top rated toys for your kids, your mobile device  could make this a personalized experience by highlighting the products and the shelves that match your interest.  The below video from Thundre shows some additional product finder opportunities.

5. Interactive Product Catalogs For multi-channel retailers such as Bestbuy or Sears, this could be a significant opportunity in future. Allowing users to see a 3D rendering of the product from a paper catalog could bring this channel much closer to a engaging, digital experience. I would love to see a Sears Wishbook catalog where the toys come to life using this kind of technology:

6. Interactive Marketing

Several retailers and product manufacturers have started testing this concept to enhance the effectiveness of their marketing campaigns. Some of the current use cases are very rudimentary but seeing the examples below would help you imagine the future possibilities in the area of internet marketing.

Toy maker Mattel has added augmented-reality technology into a range of action figures released to tie in with Avatar, the forthcoming 3D film. Each toy will come with an iTag – a small plastic card that children can hold up to their webcam. When the card is recognized by the computer, a three-dimensional digital image is superimposed over the card on the computer screen, giving the child the ability to “manipulate” the character or vehicle on-screen by pushing virtual “buttons”.

BMW Mini tested a marketing campaign late last year using simple black and white print ads that would bring the car to life in a 3D view when held next to a web cam.

It is too early to say what kind of impact this technology would have on our day to day lives. I do think a lot of above examples would lose their appeal in some time once the “shiny” effect of this technology fades off. It is important to think about applications of this technology that minimize any extra work from end user perspective, and provide a utility or value that would otherwise not be possible. Even though above examples may sound too impractical or costly to implement, I do think that the stage is being set for a future that would see game changing and practical implementations of this concept in the retail and eCommerce space. Perhaps, the boundaries between offline and online channel will no longer be as rigid as they are today, giving a new meaning to the phrase multi-channel retailing.

I recently came across a great post that showcases 35 online retailers who have done an outstanding job of keeping the user experience simple and fresh. In the past, I have seen a lot of retailers focusing on adding more and more content to the pages so that they can make use of the very last pixel of white space on their page. Looking at these designs, perhaps the focus should be quite opposite – how to remove all the unnecessary content out of a page and increase the amount of that white space so that the users are presented with crisp and quality content that truly matters.

Here’s the list for your design inspiration: http://vandelaydesign.com/blog/galleries/ecommerce-ui/

Google analytics recently rolled out a new “Intelligence” feature which is a great attempt to solve this very problem. Google analytics now keeps track of “expected” data patterns on your site and can notify you via email or online reporting if there are any significant changes on your site activity. For example, intelligence feature could alert you if there was a 200% surge in visits from Twitter referrals during last 24 hours or let you know that bounce rates of visitors from India jumped by 40% last week. Instead of you having to monitor reports and comb through all the data, Analytics Intelligence alerts you to the most significant information to pay attention to, saving you time and surfacing traffic insights that could affect your online business.

Take a look at the video below to learn more about this awesome new feature:

Excited? Well, there is more. Now you can also setup custom alerts to tell Google Analytics what to watch for. You can set triggers on pretty much any dimension & metric such as conversion or orders, and be notified by email  when the changes actually occur. If you don’t have these features in your account yet, you should see them in next few weeks. I think this is a great addition and will really help you operate your online store with lot more intelligence and insights that would otherwise have taken significant amount of time to analyze.

Here are some specific examples of how online retailers can use these intelligence features effectively:

1. Understanding seasonality of the products – Setup alerts for changes in conversion rates for specific products or categories over a time dimension so that you can be notified when it is time to review your product assortment from seasonality and relevance perspective.
2. Understanding changes in zero search results – You can setup alerts that would inform you if the % of zero search results spikes above normal. This is usually an indicator that more customers are not able to find the products they are looking for. You can then evaluate the top searched keywords to find assortment gaps.
3. Understanding the effectiveness of PPC campaigns – Lets say you setup a PPC campaign that results in a drop in the conversion rate. This is typically an indicator that the PPC campaign is not driving productive traffic to your website. Setting up an alert in these cases would allow you to aggressively manage your Adwords and other marketing campaigns so that you can avoid throwing money on campaigns that are not very effective.
4. Impact of social media – You posted a new story on Digg which went hot last night. It would be nice to get an alert if the traffic pattern on your site changes due to your social marketing efforts.
5. Drop in conversion rate – Lets say your server receives a huge surge of traffic and the users are not able to complete checkout due to performance problems. Wouldn’t you want to be notified immediately so that you can take corrective action? You can setup an alert that notifies you whenever the conversion rate or the order volume on the site deviates from the expected range.

I think this is a great feature to provide you access to more real time, actionable insights that will not only help you make more informed decisions but would also point out operational problems on your website on a more realtime basis. And best of all, it is free!!

Having been an e-commerce manager for a while, it didn’t take me long to understand the name of the game. When it comes to running a successful e-commerce business, the name of the game isn’t so much about generating traffic, as getting whatever levels of traffic you have to convert. Online conversion can come in many forms. If you’re selling a product online conversion happens when a visitor makes a purchase and becomes an active customer, and if you’re offering a service your conversion might be getting visitors to phone-in. In order to increase your online conversion rates on a budget try my tips below.

1. Mention Your USPs Across The Site – Every online retailer has at least one unique selling proposition. It could be your prices, your level of service or anything of real value to the customer. Most online retailers will mention their USP only on their homepage, but truth of the matter is that many visitors especially those coming from Google search will land directly on a product page. Unless the USPs are copied across the site, they might never be seen so make sure your USPs are visible across the site.

2. Openly Accept Communication from Visitors – Veteran online retailers know that it is important to backup their online offers with a solid communication platform in the shape of telephone and email support. In today’s web reality this might not be enough. You might want to look at additional communication channels such as online chat, Voice Over IP providers such as Skype and online feedback forms to ensure you cater for enough visitors as open communication can help increase your credibility.

3. Compare and Adjust Your Prices On a Regular Basis – Statistics say that 80% of customers will first research before committing to buy. Based on this figure you should aim to ensure your prices are as competitive and as close to your direct competitors as possible because there’s no hidden it, if a better deal is out there customers will find it. When comparing and adjusting your prices, look at the overall price to the customer also taking into account any shipping fees and taxes.

4. Mirror Your Offers Across All Channels – From time to time you might have a fantastic offer on the site. The trick is to mirror your offer across all your marketing channels ensuring that no matter if visitors came from one channel or another the offer is highlighted. Even if on a small scale, you are very likely to employ some form of multi-channel marketing. If for example you are offering free delivery for a day, be sure to mention the promotion on the site for visitors coming directly, in your paid ads for visitors coming via the search engines and in your newsletter for existing customers.

5. Introduce New Related Products – To increase revenue many online retailers focus on two avenues. The first is an attempt to increase the number of visitors to the site and the second is an attempt to increase conversion rates based existing levels of traffic. Another avenue is the ability to increase revenue, to boost conversion rates and expose the business to more traffic by adding new products suitable to the business. As an online retailer you should always be on the lookout for new opportunities and closely follow customer trends and taste.

6. Diversify Product Offers – Over time we came to the realization that some customer groups find free delivery offers appealing, some find buy 1 get 1 free offers appealing and some find price drop appealing. To become an appealing proposition, consider catering for as many customer groups as possible by diversifying your product offers.

How did you increased your conversion rate?