Retail pathways to online profit
Tuesday, August 12, 2008/
If you already have a retail presence, but not much online, you may not survive the coming lean times. CRAIG REARDON looks at how ‘traditional’ retailers can get the most from some straightforward online efforts
By Craig Reardon
If you already have a retail presence, but not much online, you may not survive the coming lean times. We look at how ‘traditional’ retailers can get the most from some straightforward online efforts
The story Retailers miss golden web opportunities covered the amazing online opportunities that traditional retailers were letting slip through their fingers, while online competitors were simultaneously eating into their business.
But what can traditional retailers do to reclaim their customers?
Here’s some top suggestions for retailers to try if they are tired of losing business to their online competitors.
Look after customers the way they want you to
History is littered with the corpses of businesses that fail to adapt to changing conditions. Don’t let yours be one of them. The internet is not going to go away. In fact, as it becomes available via BlackBerrys, iPhones and other smartphones it will only become more pervasive – particularly if you have a younger market.
Your retailing expertise is still invaluable online. Rather than see the web as a techie thing, look at how you can leverage your real life retail expertise into an online world. This means looking after your customers online as well as in person.
Beware the ‘personal service’ myth
This is one of the hoariest old chestnuts in the business world today – and really just a bad excuse for not getting online. Just because a sale is made online doesn’t mean it’s not “personal”. In fact quite the opposite.
Good customer service is about giving the customer what they want, any way they want it. If this means online, then that’s the way they are going to get it – with or without you. Again, if you don’t look after your customers online, someone else will.
Establish a professional website that you can maintain yourself
You need to get the best website you can afford and make sure it takes the customer as far through the purchase process as your budget will allow. If that means selling online, then sell it online. That way you not only get a sale you ordinarily wouldn’t have but you prevent an online competitor getting it.
And make sure the website has a content management system so you can make changes to the website yourself. Don’t panic about this. With training and guidance it becomes no more difficult than sending an email.
Your online products don’t need to reflect those in your real life store
This is a very important point. Your current store has been built with a local market in mind, predominantly on the basis that customers will come in, inspect and purchase. But on the web you can be dealing with a global market if you so choose.
While it might make sense to stock a particular range of products in your physical store, you might find that online you are better off stocking more products of a specific kind. For example, online gift retailers are really a dime a dozen. But a specific line of gifts, say clocks, may not be well catered for – just like our birdcage website renovation example, as mentioned in last week’s story.
With some research and experimentation, it’s quite feasible to become the world’s leading online store for a range of clocks. You can still sell your other in-store lines, but make them less prominent.
Look at ‘drop shipping’
In keeping with the previous tip, you don’t necessarily need to physically stock the item to sell it online. Some of your suppliers might be prepared to “drop ship” orders – they can ship the product on your behalf. All you need to do is email them the order and add it to your account.
Search engine results are as valuable as online sales
Another myth about the web is the one about actually making the sale online. “Oh you can’t sell our product online, customers need to touch, feel, try on, etc.” If this is the case, why is clothing the second biggest selling line on the web?
But even if you don’t wish to sell online, the promotion the internet can provide your physical store is invaluable. Depending on whose research you believe, up to 80% of all consumers have used the web to research products before buying that product in a physical store. Again, if your physical store doesn’t come up in Google search results, you don’t get the sale, online or off.
Email, email, email
Talk about web secrets! Next to word-of-mouth, email marketing provides the best return on investment you can get. A recent US study showed that marketers receive a whopping 4500% return on investment from email marketing. To save you the maths, that’s a return of $45 for every dollar spent. And it can cost as little as nothing to use it. It should be a No. 1 priority for all retailers – even if you don’t have a website.
Ask every customer to join your email list
One of the craziest things a retailer can do is let their customer walk out their door without obtaining some way of contacting them. You could be saying goodbye to a customer that could be worth thousands of dollars over their lifetime.
Email is one cheap and non-invasive way of ensuring they return – either online or physically. Further to the tip above, to be able to email, you need a list to email to. And in this country if recipients haven’t agreed to receive the said email you can be heavily fined under the spam act. So come up with some valuable content, specials and discounts for your email, and then sell the advantages of this to every customer that walks in your door.
Hire shop assistants who love using the internet
Most retailers have quiet times when apart from re-arranging messes customers have left in their wake, there is literally little to do. Imagine if you could turn that dead time into online sales or leads? The way to do this is to have your staff run your website. Give them the training they need to run your website professionally and you will turn that dead time into significant sales revenue.
If not, hire your nephew/niece/etc
In previous articles I’ve decried the use of one’s family to build the business website. I stand by this when if comes to building the website, but that doesn’t mean they can’t manage it.
If you aren’t familiar enough with the web, then find someone who is. Give them the title of “website manager” and guide them as to the kinds of product that might sell online. I know young people who would give parts of their anatomy for that kind of opportunity, and many will do it on a commission basis too. Just remember to reward them for customers who come to your store as a result of their work as well as sales made online.
Experiment with eBay and other online auctions
eBay and its online auction ilk aren’t for everyone, but that doesn’t mean you can’t experiment with it to gain an understanding of how it could sell more of your products. Because it costs relatively little to start selling on eBay, put some low risk items on it and try different variations till you get some bites. Some retailers love eBay as a means of clearing stock or bundling slow moving products for quick sale.
The best news about the web is the low cost of experimentation. Unlike the physical world where the establishment of an outlet is a relatively expensive exercise, you can now get a professional, secure eCommerce enabled website for well under $5000. And selling your products on eBay will literally set you back only a few dollars.
Go online, see what other retailers are doing and get good independent help to get started. Who knows? You might find yourself with an online success like the owner of bird-cage.com.
Read more web secrets
Craig Reardon is a leading eBusiness educator and founder and director of independent web services firm The E Team which provide the gamut of website solutions, technologies and services to SMEs. www.theeteam.com.au
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