Why "Buy" Buttons Are Booming
By Elizabeth Esfahani

(Business 2.0) – IMAGINE FREQUENTING an online store that knows your size and favorite color and lets you "try on" clothes via a virtual model. Internet retail isn't quite there yet, but it's getting close as online sales prepare for a record-breaking year. In 2004, industry revenue hit $67 billion, according to ComScore Media Metrix, and sales are already up 27 percent this year. But high return rates and the rising cost of attracting new customers are eating into profits, so retailers are looking for ways to juice the online experience—lifting the fortunes of back-end-focused tech firms such as New York's RichFX, Scene7 of Novato, Calif., and Fluid and Organic, both of San Francisco. "It's a turning point in online retail," says Lauren Freedman, president of the E-Tailing Group. Here's how three cutting-edge technologies are helping e-tailers close the deal. — ELIZABETH ESFAHANI

Customization Nike iD recently launched a high-profile feature, left, that lets visitors build their own sneakers. Similarly, Timberland's Boot Studio lets shoppers re-create the company's signature shoe using different leathers and colors. The Fluid-designed site now gets three times as many hits as the basic yellow boot, previously the most popular item. Lands' End says its website, which uses customization technology from Archetype Solutions, has brought in more repeat customers and higher sales.

Online Catalogs High-tech versions of mail-order catalogs are the most frequently requested visual technology, says Christophe Cremault, VP for marketing at RichFX. Even pure-play Web retailers are interested—Amazon released an interactive catalog based on Scene7 technology in April—because customers spend as much as 30 percent more when items are displayed in the context of an outfit or a room. The hyperlinked pages, like Anthropologie's, right, let shoppers make virtual notes or jump straight to checkout.

Dynamic Imaging Interactive images, such as 360-degree views and photos with high-resolution zoom, no longer mean unbearable download times. Benjamin Moore, an Organic client, and La-Z-Boy, left, use "room visualization"—the ability to change wall hues and upholstery in virtual rooms—to give customers a sense of how their selections will look. Of the shoppers who used Scene7's online tool for La-Z-Boy before visiting a store, 85 percent ended up making a purchase.