A 2019 analysis of Nosto-powered brands revealed that up to 70% of online sales originate from category pages. Yet, most category pages still rely on simple sorting methods, don’t cater to different audiences and are less-than-ideal candidates for onsite testing. In this article, we address these key challenges by illustrating 4 key benefits of using Nosto’s Category Merchandising to create robust, better-performing category page experiences.
Category Pages and the Challenges They Pose
Category pages are, unarguably, one of the most important page types in an online retailers arsenal today. These pages serve as sources of traffic, assist with product discovery and grant retailers the possibility to steer consumer focus from one product to another based on business goals.
So what’s the deal: Why can’t we just sort the products based on some default method and trust shoppers to find what they are looking for?
Pseudo Solution 1: Limited sorting capabilities
Most ecommerce platforms worth their salt offer retailers some selection of sorting options to rearrange the products based on their attributes – which is where the problem with these solutions also lies. Product attributes are very explicit, but don’t really tell you anything about which items should be shown first. Do you want to show the cheapest items first? How about alphabetical order? Neither of these attribute based use-cases make any sense from a consumer perspective since they are not actionable and don’t help shoppers find what they’re looking for.
Pseudo Solution 2: DIY (but spend a lot of time and money in the process)
An alternative solution would be to follow one age-old saying: If you want something done right, you do it yourself. While the saying holds true in this case, it comes with a hefty price tag. Sorting category pages manually requires a dedicated merchandiser (or even multiple merchandisers) depending on the width and depth of the product catalog and how often the product offering changes based on seasonality or trends. Usually, trained professionals who adjust category pages manually generate a fair end-result, but at a significant labor cost that could be better allocated towards other merchandising improvements such as supply-chain management.
The significant drawback usually shared between these two methods is the lack of audience targeting or an easy way to test hypotheses on category pages. Ecommerce platforms traditionally create one category page that is shown to every user with the desired sorting, completely forfeiting any sort of lifecycle management or relevance optimization for customers interested in certain item-ranges.
The 4 Key Benefits of Category Merchandising on Category Pages
Category Merchandising aims to counter the challenges mentioned above by seamlessly blending product attributes, performance metrics, segmentation and a/b testing and allowing merchandisers to reduce their workload while still retaining the possibility of manually influencing the category pages through our innovative visual editor.
1. Product Attributes and Performance Metrics
With Category Merchandising, Product Attributes and Performance Metrics can be used interchangeably to achieve both simple and complex use cases.
Any Product Attribute can be used stand-alone—so if you want to sort by price, brand, inventory level or unique meta fields such as sustainability score, it’s all possible.
However, by leveraging Performance Metrics, you can supercharge the sorting by focusing on the commercial metrics that make most sense, such as sorting by conversion rate, accounting for number of views, determining if revenue per impression is a better measuring point, etc.
Any Product Attribute that is mapped to Nosto is usable out of the box, and Performance Metrics are calculated behind the scenes based on a combination of behavioral science and raw transactional data. Both Attributes and Performance Metrics can be used together, so there is really no limit to creativity when coming up with sorting. Promoting high-converting Nike items with less than 5 units in stock? We’ve got you covered.
2. Built-in Segmentation in Real-time
With Segmentation & Insights, different audience groups can be created and used in tandem between Category Merchandising, other Nosto products such as Product Recommendations, and even by syncing them to 3rd party integrations such as email service providers or Facebook.
Segmentation opens up a lot of interesting use-cases: from influencing life cycle stages (e.g. showing more offers for new users and new items in stock for returning customers) or improving relevance based on previous engagement or transactional history (e.g showing more Nike products to those interested in the Nike brand).
When it comes to segmenting new visitors, we might want to favor products that have a good revenue yield for every product impression using Performance Metrics. These products should statistically work well for unconverted prospects that don’t know what they are looking for yet. However, when segmenting loyal customers who are interested in Nike, we might want to use Product Attributes to favor recently added Nike products or, by using Performance Metrics, the ones that generate the most margin per product view. This essentially mirrors creating dedicated landing pages that cater to a particular audiences’ needs and wants, and can even be synced further with 3rd party marketing tools like ESPs and Facebook to align with outbound marketing efforts.
The possible combinations of product attributes and performance metrics together with segments are endless and scale for most business goals within digital retail.
3. Visual Merchandising
As we mentioned earlier, deploying seasoned professionals to manually set up your merchandising usually generates fair results —but with a hefty price tag for the manual work required.
Adding more interactivity and blending manual work with the power of automation has been a cornerstone of product development at Nosto and deeply ingrained in the DNA of the company. With this product, however, we needed to take it a step further by adding a fully interactive Visual Editor that allows merchandisers to reduce manual work, focus on the essentials and let automation fill in the gaps.
For example, this feature would allow an apparel merchandiser to promote a category page for sneakers by prioritizing higher-converting items, then start mixing and matching the position of items they think might work better or worse based on their professional know-how. Subsequently, they can deploy an A/B test to validate the performance of different tactics. This allows for more informed business decisions and defines how much focus should be devoted towards commercial optimization or delivering a branded experience.
4. Native A/B Testing and Continuous Optimization
Merchandising has many facets and different goals. One retailer might be content with improving overall revenues, while others believe improving margins to be their absolute north star for success. Influencing commercial metrics through merchandising, however, can be difficult because moving an item from the top row to the second row might have a very small difference to the overall revenue (if any).
One of the main problems with utilizing A/B testing solutions on category pages is that the site content is much larger than a banner, text or product recommendation. This usually leads to issues with load times and performance in general, manifesting itself as flickering content or content that takes longer to become visible onsite.
Category Merchandising is built from a server perspective – meaning the content does not change after a page has loaded, but rather when the page is actually loading. The exact methodology varies from platform to platform, but the end result is a reduced impact on site performance compared to more traditional solutions (hence, no visible flickering or noticeable delay in content delivery when conducting an A/B test).
Native A/B testing finally allows retailers to come up with better-informed hypotheses (for example, testing the revenue impact of favoring well converting items vs. promoting new arrivals) and deploy a live test in minutes without jumping between different tools and thinking about the technical restrictions.
Improving Category Pages Using Category Merchandising, Summarized
Category Merchandising enables online retailers and merchandisers to:
- Reduce manual workload by using product attributes and performance metrics to apply different combinations of sorting on category pages.
- Increase relevance by leverage Real-time Segmentation to cater to different audiences with different kinds of sorting methods to influence the customer lifecycle.
- Deploy in-house expertise and know-how and make adjustments using the intuitive Visual Editor with interactive controls to ensure a branded experience.
- Validate hypotheses and deploy A/B-tests without time-consuming configurations, or needing to employ costly experts to interpret the results.
Interested in Getting Started?
Category Merchandising is available for select platforms and also available for manual implementation over a proprietary GraphQL API. Get started by reaching out to your Customer Success Manager or by contacting us at firstname.lastname@example.org.