Editor’s note: Albert Angrisani is president and CEO, and Terri Flanagan is division president, Customer Loyalty Management, at Total Research Corporation, Princeton, N.J.

 Although most of us are just beginning to think about raking leaves and chipping frost from our windshields, retailers have been preparing for the holiday shopping season for months. They are looking to outdo last year’s figures in the midst of an increasingly competitive environment. In addition, industry analysts are predicting a surge in e-commerce sales again this holiday season.

Some of those brick-and-mortar merchants (as well as catalog merchants) are assuming that customer loyalty on the store front will translate into customer loyalty on the "e-front."Yet as Business Week noted in its September 6 issue, "When old-economy companies have tried to beat their Net rivals at the new game, it has usually been the upstarts that prevailed."

Why the disparity? Too many companies enter the world of the Internet without doing the necessary market research legwork. As a result, they may make assumptions about their on-line market base that can prove detrimental to customer loyalty. E-commerce on the Web is still a relatively new medium (or distribution channel) and the same old rules don’t always apply. In order to survive on-line, companies must first survey their potential on-line constituency to move beyond the general myths that threaten success.

Myth #1: Everyone is on the Net. It’s just important to get something up there.

There are very few businesses today that do not have a Web site. Often, out of fear of being left behind and a strong sense of urgency, some companies have quickly developed Web sites just for the sake of having one. Unfortunately, the theory that just having a Web presence is more important than taking time to consider the value offered to the customer couldn’t be further from the truth. A negative on-line experience may impact the customer’s overall impression of a company, which could result in a loss of customers at the off-line venue (catalog or retail location) as well.

Of course, there are also those companies that take the time to develop flashy Web sites, rich with text and color. Believe it or not, those Web sites could be impacting sales negatively as well, if the company doesn’t first have a good handle on what it is their potential and current customers want. The only way to find out what customers want, of course, is to ask them. In this case, conducting a customer loyalty study can help determine if existing customers will translate into e-commerce customers and what portions of the e-shopping experience will affect business most.

Companies must understand that consumers shopping on-line may have a very different agenda, or experience preferences, than consumers going to storefronts. It is critical to ascertain those preferences.

For example, Diane is a loyal Company X customer within the storefront setting. However, she is not at all comfortable with the idea of shopping on-line. If Company X, which sells gourmet food and cooking equipment, launched an e-commerce site, marketing it to Diane would have been a waste of money. On the other hand, had the company asked her, or people like her, marketing would have known that Diane would find a Web site with recipe suggestions, store hours, locations, and in-store sales very useful. In fact, she’d be more willing to shop at store offering such a Web site.

On the flip side, Dan has been on Company Y’s catalog mailing list for four years and has made three purchases. He likes the product selection Company Y has to offer, but even when he sees items he’d like to purchase, he never seems to make the call to order. Company Y might be interested to know, however, that ever since his aunt talked about how easy e-commerce made her holiday shopping last year, Dan and his credit cards have given on-line stores a work-out. And, the more he thinks about it, if Company Y was on-line, he might actually place a few more orders with them too. If only Company Y knew.

Companies doing the research beforehand may be surprised to find out the true constituency of its on-line customers. Once found, these on-line shoppers may still be seeking something much different within an on-line environment than they want in the store. Either way, as long as the customer is given a voice, a company can enhance its Web site where appropriate to provide exactly what the customer desires in terms of shopping experience, pricing, product offerings, and services.

Myth #2: If I do an on-line survey, I don’t need traditional research methods anymore.

An on-line loyalty survey should not run in a vacuum. Research should be conducted concurrently with the traditional off-line customer base as well. Results from each respondent set should be compared and steps should be taken in the appropriate environments to meet the needs of the customer.

It is important to note, however, that the on-line survey brings to the table a unique set of benefits. Perhaps most important in the fast-paced world of the Internet are the timely reports garnered from an e-survey. Executives can download up-to-the-minute, real-time reports whether they are sitting in a hotel room or the boardroom.

Myth #3: I just need to measure satisfaction with my brand.

This issue is not unique to on-line research. Companies are still struggling with customer satisfaction surveys versus customer loyalty surveys. The inherent problem with the customer satisfaction survey is that although it tells a company how satisfied a customer is with the goods or services he receives, it doesn’t give any indication of how loyal to the brand that customer is. A satisfied customer could still switch to a competitor’s product for the right price, the right feature set, or the right special offer.

Unlike a satisfaction study, a loyalty study will look at how the company is doing in comparison to the competition. This data will point out potential threats to customer loyalty. Hence, a loyalty study will help determine what needs to be done to engender loyalty that is less likely to be swayed, regardless of what the competition may do. In the on-line world, it may be something as simple as a section of the site dedicated to alleviating fears about sharing credit card information on-line - something Web-giant Amazon.com has instituted recently.

Myth #4: This on-line survey is my chance to ask them everything I ever wanted to know.

Never overburden respondents, particularly in an Internet environment. The benefit of a Web survey on the corporate end is, of course, the speed at which a company can collect information - that same speed applies on the respondent end as well.

Traditional survey techniques are being met with a higher refusal rate. Meanwhile, researchers are finding that giving Web-savvy respondents the opportunity to participate in an on-line survey at their own convenience is producing stronger response numbers. However, if those on-line surveys are too lengthy and time-consuming, response numbers will begin to decline there as well.

Myth #5: I need to do my on-line loyalty survey in time for holiday shopping. Good thing it’s an instant medium.

Although on-line surveys equal expediency, it’s tempting to move too fast. Jumping into a loyalty survey without dedicating some preparatory work to the project is akin to walking through a minefield. It is imperative that companies exert the discipline necessary to do the planning and preliminary research prior to doing an on-line survey. This is not to say that there is a need for full-blown focus groups and months of research; however, there is a need to at least cull some background information with a limited sample group.

Researchers must keep in mind that asking a group of respondents a list of irrelevant questions will be as useful as not conducting the study at all. For example, if Company X’s clientele is most concerned about receiving their order in seven to 10 days, it will not serve Company X to structure several questions around determining consumers’ product color preferences, i.e.: grape or red. Having a preliminary understanding of what issues are of greatest concern to clients will ensure the most productive survey.

Myth #6: If I build it, they will come.

Conducting a customer loyalty survey on a Web site without some form of enticement is not likely to lead to great results. Ideally, as with most survey programs, respondents should be offered some incentive in return for their participation. If the survey is being used on an e-commerce site, for example, the offer could be as simple as a special on-line preferred customer discount, free shipping, fashion tips, recipes, a frequent-buyer point system, etc. If the survey takes place in a business to business environment, the incentive might be a return of industry-specific data or survey results.

Myth #7: I already have a database full of information garnered from my Web site. Isn’t that enough?

The basic information collected from a Web site won’t paint a big enough picture of customer loyalty. It’s nice to know that 90 percent of customers click over to the blue jeans section of your site, but that doesn’t tell whether or not a good price on a competitor’s denim will lure 60 percent of them away. In addition, click rates may tell a company that nine out of 10 site visitors are not purchasing the products they inquire about, but it won’t tell them why.

A loyalty study is not just a survey placed on a Web site with a haphazard collection method. Wise researchers will use existing-customer and/or lapsed-customer databases to invite individuals to participate. Measuring a customer’s buying history against their loyalty survey responses will provide a more complete customer picture. This total package of information will enable a company to formulate practical plans for maintaining current customers, attracting new customers, and bringing lapsed customers back into the fold.

Ahead of the curve

Loyalty surveys, whether on-line, traditional or, optimally, a mix of each, allow marketers to apply market research to the Internet and more accurately understand the needs of that new breed of consumer. A little legwork can go a long way in keeping marketers ahead of the curve, in an environment that changes daily.