This is a question that we are very interested in here at SLI. Most of our customers are retailers. Through our services we are talking to these people every day. Our relationship with them feels more like it is more than just a business relationship. Their passion infects us and we really want them to succeed.  

The anecdotal information we are getting about the impact of the financial crisis is mixed. Some have seen a drop in order size and volume and are feeling additional pressure from suppliers wanting to be paid earlier. Others are seeing increases. I see Amazon’s sales were up 31% last quarter.  We are hearing that people are shopping on-line more to save gas – even though oil prices have fallen dramatically. Last week I asked Brian Walker from Forrester research what they are expecting these holidays. They’re predicting eCommerce to grow 12% over last holidays. This is less than the 18% growth that we saw last year but is still significantly better than retail in general.

One set of numbers we can look at is the search volumes we are serving on behalf of our customers. We have seen that the number of searches we are serving across our customers is increasing steadily.  In the last month we served over 150 million queries. Part of the increase we’re seeing is because we’re getting more customers. I dug a little more deeply into the data. I looked at the search activity for  a random selection of our customers for the last 30 days compared to the same 30 days last year. On average there are 28% more searches. Some are down. More are up.

Now just because people are searching more, doesn’t mean that they are buying more (Aaron Goldman had a good discussion about this in his Media Post article: Is search recession proof?).  However it’s a very positive sign.

A wise man wouldn’t make predictions in this volatile market. I’ve never been accused of being wise – I predict ecommerce will be OK – just don’t bank on the huge growth we have seen in past years.

Yesterday we announced that WEBS has implemented our Learning Search to power the site search on its all-things knitting ecommerce site Yarn.com. Aside from strengthening its online brand visibility and improving the customer experience, WEBS has discovered another benefit to an effective site search solution – more productive employees. According to owner Steve Elkins, employees are better able to find information on the company’s more than 15,000 products, which helps them market them better.

Elkins also said that they use our site search to create special landing pages for groups of products, and direct recipients of WEBS marketing e-mails to these pages by individual URLs.

I interviewed Elkins recently on our Ecommerce Podcast. Steve talks about how he and his wife took over the business from Steve’s parents and shares some interesting marketing techniques that have helped grow Yarn.com’s traffic (like podcasting). He also talks about the key technologies (like site search) that have improved their website. (Side note: you may be surprised to find out what Steve’s first online purchase was. Hint: think little blue box.)

Omniture announced yesterday that they are going to acquire certain assets in our competitor Mercado. The deal needs the approval of the Israeli government and that may not happen until the end of the year. In the meantime Mercado’s customers are in limbo from a support point of view. Most of the technical staff in Israel have been laid off, as have most of their US staff (we have talked to many of them) and the Omniture deal hasn’t gone through yet. We got no answer when we tried calling Mercado.  If and when the deal does goes through its uncertain how long it will take Omniture to understand  the Mercado technology to  a point that they can support it fully.

In the meantime I want to reiterate our offer to Mercado customers that are worried about getting through the busy holiday season. Site search and navigation is such an important part of a website – they shouldn’t be at risk during your busiest few weeks.

Today we announced that Jelly Belly are using SLI’s Learning search and Site Champion. We’ve also released an interview with Jason Marrone, Jelly Belly’s e-commerce marketing manager. The interview was fun and informative. It made me hungry talking about all their candy. It was really interesting to hear about one of their most successful promotions that used reverse psychology – they asked their customers not to tell anyone about a special deal they had and before they knew it their servers were overloaded. I know reverse psychology works with my kids – it made me smile to see it working in a viral marketing campaign.

Have you read the news today? If you have, you couldn’t ignore the many stories related to the current economic conditions and questions about what it means for business.

According to a recent story by Kevin Ryan at Search Engine Watch, everyone wants to know what the economic meltdown means for advertising and marketing dollars, and how organizations will shift spending and strategies to put the right amount of focus on the programs that promise to yield the most in terms of revenue or brand recognition.

Just this week we released the results of a survey that highlights some of the top technology tools marketers at more than 300 retail organizations are using to help them drive business and compete for consumer dollars. The survey shows that close to all of the people we polled (90%) rank site search, search engine optimization (SEO) and email marketing as the most important e-commerce technologies helping to promote their online businesses.

Interestingly, we asked these same retailers what programs they would consider omitting from their marketing plans if faced with tightening budgets, and found that those who are minimizing spend due to current economic constraints are not inclined to diminish their core marketing programs – site search, SEO and email marketing – but would rather decrease spending on activities that are less results-driven such as podcasts, static display ads and online video.

It seems only natural that companies competing for shrinking consumer dollars would look to tools they can rely on to help them better appeal to consumers and keep those consumers coming back. We’re happy to report that site search and SEO are two best practices retailers are using to continue promoting sales and customer loyalty today, and in the future.

Related Items:

• Site Search, SEO and Email Marketing Ranked Top Three E-commerce Technology Tools of Choice by U.S. Retailers, Reports SLI Systems Survey
• Site Search Survey Results

There are numerous rumors going round about the demise of one of our competitors, Mercado Software. They have a decent reputation but appear to be having severe cashflow problems. I would like to make an offer to any Mercado customers that are concerned about how this may impact the fast approaching holiday season. At SLI Systems we have the capacity and experience to quickly replace your search and navigation with no up front charges and relatively low monthly fees.  For clients who need a high degree of availability during holiday, we may be able to set up a backup/failover search system.

SLI Systems is in a sound financial position.  We have a lean company and strong revenues from hundreds of customers. We don’t have any cashflow problems and have been profitable for several years. We are still hiring.

Contact us today to find out why sites like Harry and David, Vermont Teddy Bear, FTD, Ulta, and Edwin Watts Golf have selected SLI.

Here are links to stories:

• Mercado: Healthy, Wealthy, Wise. Pick One., Arnold IT
• Market consolidation continues, B2C Partners
• Mercado is shutting down, Startup Israel
• US Staff Layoffs for Israel Based Mercado, newsvine