[June 27, 2005]

ActivePoint Research Reveals Top Retailers� Online Sites Fall Short in Natural Language Search Capabilities

Experienced Consumers Lack Patience For Sites With Poor Search Results

Leading retailer Web sites get mixed grades when rated on the ability to offer pin-point search results for online consumers, while research shows that more experienced shoppers favor sites that provide more relevant search results.

Furthering an industry-wide effort to create a more successful online shopping experience for all consumers, research sponsored by ActivePoint illustrates the need for more intuitive search and discovery capabilities with familiar retailer web sites, such as Ann Taylor, Coldwater Creek, Neiman Marcus and others.

In addition, recent research from Forrester Research shows that more experienced online shoppers are more concerned about getting good results from site search. Some 74% of those who have been active online purchasers (one purchase within past three months) for four or more years say that relevant site search results are important.

ActivePoint�s sponsored research randomly selected five online retailers recognized by the e-tailing group, inc., as �merchants that excelled at online customer service� in Q4 2004. The five sites (Ann Taylor, Coldwater Creek, Land�s End, Neiman Marcus and Nordstrom) were tested on the basis of how well their search windows were able to recognize natural language search terms.

�As one of the e-tailing group�s benchmarking criteria included �keyword search,� we decided to take it a step further and investigate the natural language search functionality of the retail sites,� said Moshe Ofer, CEO, ActivePoint. �Our results show that merchants such as Coldwater Creek and Ann Taylor may provide top-notch email response times and shipping status updates, but their natural language search capability is lacking.�

The research methodology employed three natural language sentences to search for products within all five of the B2C sites. The research took place on May 31, 2005. The terms used were:

� Yellow raincoat with a hood
� V-neck cashmere sweater
� Boot-cut khaki pants

Results for �yellow raincoat with a hood� were disappointing, except for Land�s End, which found 15 relevant products � all yellow with a hood. Both Ann Taylor and Coldwater Creek were unable to locate the item. Despite perhaps not having the item in stock, these merchants failed to offer similar products such as a �waterproof jacket.� Although Neiman Marcus delivered 113 results, sometimes less is more, as the company offered everything from sunglasses to make-up with the first raincoat appearing on page three of the search results.

Land�s End fared well with the �v-neck cashmere sweater� search, locating 13 cashmere and cashmere-blend sweaters. Unfortunately, Ann Taylor and Coldwater Creek were unable to decipher what the consumer was looking for and produced �no results were found as an exact match.�

Lastly, when looking for �boot-cut khaki pants,� the consumer would be out of luck with Coldwater Creek, which delivered � �We�re sorry, at this time we are unable to locate the item you�re searching for on our site.� Although Nordstrom did not deliver exact matches, it provides the consumer with a choice of certain jeans and maternity pants, for example.

�The results clearly illustrate �there�s room for improvement� in the e-tailing sector when it comes to site search,� continued Moshe Ofer. �The merchants must not forget that online consumers will patronize sites where the shopping process is easy and intuitive, whether that means delivering pin pointed results or similar suggestions based on the natural language search.�

About ActivePoint
ActivePoint, a provider of contextual natural language search and guidance engines, is based in New York, NY with development facilities in Netanya, Israel. ActivePoint's TX5(TM) Discovery Engine is a contextual relational search and guidance system that emulates the human communications process. Built on an application service provider (ASP) model, the company has customers in the US, UK and France. ActivePoint is a subsidiary of ActivePoint Inc., a Delaware holding company. TX5 is a trademark of ActivePoint Inc. ActivePoint is a registered trademark of ActivePoint LTD. For more information go to www.activepoint.com.

Note: The survey conducted was completed as a random search to highlight the need for contextual natural language search as a way of enhancing the customer experience and sales for retailers and should not be construed as diminishing in anyway the companies mentioned in the press release.

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