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Staples.com is among the InfoWorld E-Business 100 top ten. While redesigning its Web site earlier this year, Staples.com concentrated its efforts on gathering customer opinions, on understanding customer interests, and, perhaps more importantly in the crowded online retail world, on learning how to keep them. Staples.com ramped up customer involvement to the point where the customers, in effect, became co-developers. Involving customers in development allows companies to stand out from competitors with features other than price.

Stapies.com www.staples.com

Project leader Mike Ragunas, CTO

Key project members J.B. Lyon, vice president of business services; Tom Haus, senior product manager

Greatest challenge "The coordination of all the different parties that work together to make something like this happen.lt was probably the biggest development effort we've undertaken up to this point [due to] the amount of change." - Mike Ragunas

Most important lesson learned "Usability and the importance of it, and the importance of content and information.Those are the two key factors we've learned a lot about." - J.B. Lyon

By Stephanie Sanborn

The customer may not always be right, but for Staples.com, the online extension of Framingham, Mass.-based office supply company Staples, the customer certainly makes the difference. While redesigning its Web site earlier this year, Staples.com concentrated its efforts on gathering customer opinions, on understanding customer interests, and, perhaps more importantly in the crowded online retail world, on learning how to keep them.

"We knew we wanted to make some improvements in the purchasing flow, the checkout process, the registration process, and other places where we thought we could make it easier or faster for our customers to shop with us, says Mike Ragunas, CTO of Staples.com."We began doing customer studies looking at how people were using the site, and looking for new ways in which to organize things and identify spots where maybe it wasn't as intuitive as wed like."

Launched in 1997, the original Staples.com targeted the office-supply market, which includes such a wide range of products that a simple search for "paper" would bring up thousands of results with variations on size, paper type, color, and thickness.

"The models that were out there at that point were things like Amazon.com, shopping for books - but shopping for office supplies is a very different proposition," says J.B. Lyon, vice president of business services at Staples.com.

Revamping the site for its May relaunch took about seven to eight months and involved about 100 internal Staples.com employees and outsourced staff at various times, Ragunas says. Although the site did not need a lot of infrastructure changes, there was plenty to do in terms of software engineering.

"We had two different efforts going on: One was the visual design and interface work, and the other was the underlying code work;' Ragunas says. "We used objectoriented design and development techniques to separate out the look and feel from the underlying logic, so we were able to develop the different objects that did the dif ferent pieces of work for us."

Staples.com ramped up customer involvement to the point where the customers, in effect, became codevelopers, Ragunas says. Feedback is collected through internal customer service, e-mails, usability studies, focus groups, and from BizRate, a partner company that garners users' opinions on topics such as site performance and usability. The company also does site-traffic analysis. Site improvements are first tested by customer groups, he adds."We observe how they do it, where they get stuck. We do rounds of that until we get to a point where we know that it's intuitive and customers can find it and use it properly."

Staples.com added enhanced user tools, including "Feature Finder," a context-sensitive sales and search assistant; a "Favorite Items" shopping-list function; and revamped small-business services such as payroll and Web hosting. The company has seen repeat buyers rise 75 percent from the previous quarter, about 70 percent of which are new Staples customers.

Involving customers in development allows companies to stand out from competitors with features other than price, says Christine Loeber, Online Retail Strategies program manager at The Yankee Group, in Boston.

"A negative connotation is sometimes given to feedback because you feel like people are going to say really bad things, but if customers come forward and tell you things about your Web site that aren't working, that's a great opportunity," Loeber says."They've given you a second chance to make things better, and if they see those changes being implemented, that does a lot for customer loyalty."

Such is the lesson learned by Staples.com. "You need to listen to your customers, and I think we've learned that that pays off," Ragunas says. "It's become ingrained for us, something that we really began focusing seriously on when we started working on this release. ... [Customer input] is a critical component."