Yahoo Updates Its Small Biz E-Commerce Package

Yahoo Inc. has gone into beta on an enhanced version of its e-commerce hosting service, which is positioned for the small business that can’t justify its own Web team nor the time to outsource it to programmers and Web designers.

Although Yahoo’s dominant service is its search engine and the associated advertising revenue, it has built a substantial e-commerce Web hosting business, touting more than 35,000 such sites hosted.

That number excludes merchants in mass marketplaces or those that sell through other sites—such as Amazon.com—and is limited to retailers with their own domain touting “uniquely branded services,” said Jimmy Duvall, director of e-commerce products for Yahoo.

Duvall says that number makes Yahoo the largest provider of e-commerce and Web hosting services, but analysts question whether that’s a provable claim. Either way, it is one of the largest e-commerce hosting firms.

“It’s a hard number to either verify or disprove. If you talk to the people at GoDaddy.com or other sites with e-commerce services, it’s hard to verify,” said Patti Freeman Evans, retail analyst with Jupiter Research. “Yahoo does have a lot of companies.”

The changes all involve the checkout pages and primarily are design and layout modifications, with the underlying programming minimally tweaked.

Among the changes are checkout pages that can be one continuous scrolling page (rather than the typical multipage checkout) and the immediate display of final pricing (including tax and shipment data) before the customer needs to provide address or payment information beyond Zip code.

E-commerce customers often check out during checkout, according to a major analyst report. To read more, click here.

Another change is the addition of more design options so that the checkout pages can more closely resemble the rest of the merchant’s site.

Yahoo’s focus on the checkout process is understandable as that is both the most complicated and programming-intensive part of any e-commerce site and also the part of the site that has the last chance to either make or lose the sale. A slow, cumbersome or frustrating checkout process is where many e-commerce customers abandon the process.

“Checkout is a key area of any e-commerce site,” said Jupiter’s Evans. “Some 84 percent of consumers abandon their shopping cart. You don’t want the checkout process to be something they trip on.”

Yahoo’s Duvall said the design control changes are intended to address the problem of consumer confusion when the checkout screen looks quite different from the rest of the merchant’s site. Given the large number of sites today that tout products on their site that will really be sold by a partner, the confusion is understandable.

“Buyers would often be confused about whether it was the same store, when they were moving into the checkout process,” Duvall said. “Now we mimic the design and make it look like the rest of their site.”

Yahoo e-commerce customers choose from a set of design templates. The matching checkout pages refer to customers who use one of the Yahoo-created design templates. Instead of having one generic checkout page for all e-commerce customers, Yahoo now extends those design choices to make the site look more consistent.

eBay is pushing to offer more services to attract the same SMB users that Yahoo is pursuing. To read about eBay’s plans, click here.

Evans said the consistency issue is critical to branding, which is going to be important to companies that have opted to do business under their own domain.

“Consumers don’t want to lose out because they’re buying from a small business. The branding experience needs to feel the same as they go into checkout. It’s really important for consumers to be comfortable giving their financial information and not worried about whether they can return something. Keeping the experience consistent is important,” she said.

With the changes, “it’s a smoother experience, a more consistent brand experience. It’s a visual experience, but it’s also a trust reinforcing experience for the consumer,” Evans said. “The contents of the shopping cart also continue through the whole process. That’s not common. This is again a trust reinforcing thing for the consumer.”

Another analyst—Sanjeev Aggarwal, a senior analyst with The Yankee Group—agreed that visual consistency is critical, especially for a small business.

“At the end of the day, the [small-business owner] cares about the user experience,” Aggarwal said. “If the whole site has a consistent look and feel, it makes the user buy the product and spend less time doing it. That’s what this is all about.”

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