Retailers miss golden web opportunities

The message for retailers is crystal clear writes CRAIG REARDON; if you don’t look after your customers online, someone else will.

By Craig Reardon

Retailers miss out on web

At what has now become a well publicised time of doom and gloom in the retail sector, I have some great news for retailers and it’s this: The internet can multiply your sales with only a modest investment.

That’s right. For only a fraction of the cost of a decent print directory advertisement, you can expand the size of your market over and over again and not have to set foot from your business.

Imagine coming to your business in the morning and booting up your email to find a handful of paid new orders waiting to be packed and sent – and several more trickling through over the course of the day.

And for as little as $2000, it’s possible to corner the online market for your chosen niche. Hard to believe? Then consider this.

Only last week, the New York Times reported that an online birdcage store was sold for $US173,000 three years after its owner Dave Hermansen paid only $US1800 for it and gave it a well needed makeover (though if you take a peek at it, many would argue that the job isn’t quite finished!).

A return on investment of nearly 10,000% in only three years! Selling birdcages! Even the founders of Google would be impressed by that kind of growth.

And what’s more, this online “pure-play” was at a disadvantage compared to its bricks and mortar competitors.

Consider the infrastructure a new online e-commerce player has to put in place to operate their business. The three Ss – stock, staff, systems – and four Ps – promotion, premises, packing and payment options.

Yet existing retailers already have these assets at their fingertips.

With only the addition of the online channel, which is now more affordable than ever, they can be picking and packing off to Finland as well as they can to Fairfield.

But unfortunately the vast bulk of our retailers are proving far too conservative or cynical, or both, to see the light emanating from computer screens around the world. And they’re not getting much help from their leaders.

A few years ago I was consulting to a web development firm that was trying to make inroads into the retail sector. One of the key stakeholders in our strategy was a major retail industry association, so I teed up an appointment for our CEO to meet with the exec responsible for e-commerce within the organisation.

The due appointment time came and said CEO and I were ushered into what we thought was the office of the e-commerce exec, or so we thought. Instead, the office we were led to had all the disembowelled computers and tangle of cables you would expect of the local PC repairer. Thinking we were in the wrong place, I said to the technician we were introduced to that there must be some mistake, we were there to see the manager for e-commerce.

“What do you mean?” said the young systems administrator as he finished soldering some wires together. “I am the manager for e-commerce.”

That’s right, the leadership body of the nation’s retailers had entrusted their members’ e-commerce strategy with their own system administrator. Who of course was a very decent and intelligent professional, but not really someone I would charge with the future of Australia’s online retail hopes.

And this was literally only a few years ago – well after Amazon had US bricks and mortar retailers quaking behind their tills.

Then of course there’s retail mogul Gerry Harvey, who is on the record as saying that internet sales are “a waste of time”. I’m sure his online competitor, where I recently bought a laser printer, doesn’t think so.

The message for retailers is now crystal clear. If you don’t look after your customers online, someone else will.

Come back to this column next week, where I’ll uncover my top 10 online tips for traditional retailers.


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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.

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