In today’s article, we are going to look at eCommerce in the traditional sense with a retailer having their own eCommerce site. We will explore the other online channels in future articles.
For most retailers, traditional eCommerce should be the center piece of an omni-channel strategy. Not only does it allow your customer to buy from you at their convenience but it can be the focal point of all of your marketing initiatives, regardless of channel. Your eCommerce website can be the driver of new business, a way to interact with current customers, and even used to drive foot traffic into your brick and mortar store.
The Pros of having your own eCommerce website:
You are in control of your customer
Promotions, New Product Lines, Seasonal Offerings, etc. can all be easily featured on modern eCommerce sites
New customers searching for the products you carry can find you and confirm that you have what they are looking for and make purchases
You can cross promote between channels using your eCommerce site as the final link to complete purchases
You can drive foot traffic into your brick and mortar store
There are many more but let’s look at these primary ones in a little more detail.
Your are in control of your customer
When a customer makes a purchase on your eCommerce site, you capture essential information about them. Name, address, phone, and email are the basics that will help you turn a new customer into a repeat buyer. On shopping platforms like Amazon, the customer belongs to Amazon, not you. Being able to market to your customer and increase their lifetime value to you is critical to success. An article by John James of Engine Commerce illustrates this point quite clearly: How we built a $100 million eCommerce business using 8th grade math He shows how increasing your margin and reducing expenses, while nice, isn’t the key to explosive growth. Marketing to your customers and turning new customers into repeat customers is and it applies to in-store as well as online customers. If you don’t control your customer, you are losing sales.
Promotions, New Product Lines, Seasonal Offerings, etc. can all be easily featured on modern eCommerce sites
One of the cornerstones of a good omni-channel strategy is to be able to give your customers the same experience wherever and whenever they interact with your store (there are rare exceptions which I will discuss in a bit). Just as you feature items in your shop window to draw in people walking by, the home page on your eCommerce site should entice browsers to click further. Featuring promotions, new products or brands, and popular items and keeping them fresh, just as you do those items in your store window, is crucial. Modern eCommerce platforms have made it much easier to change the content featured on your home page yourself so you should strive to have your home page reflect what you are doing in-store.
New customers searching for the products you carry can find you and confirm that you have what they are looking for and make purchases
As I mentioned in last week’s post, up to 80% of customers research online before walking into a store (or while in-store) to make a purchase. If you don’t have a quality eCommerce site utilizing proper SEO techniques, perhaps augmented with search engine marketing, those customers won’t know you exist and someone else can get the sale you should have had.
You can cross promote between channels using your eCommerce site as the final link to complete purchases
Featuring products in emails, on social media, or through other channels that allow you to link back to your eCommerce site can allow your customers to purchase from your site in as little as two clicks. Making it easy to buy from you is one of the primary purposes of an eCommerce site. Using other channels to drive your customers there only makes sense.
You can drive foot traffic into your brick and mortar store
Even though a consistent experience across all channels is extremely important for a solid omni-channel strategy, there are times when it makes sense to favor one channel over another. Perhaps you have just remodeled your brick and mortar store and would like to encourage people to come in. In that case, offering a coupon on the website that can only be redeemed in-store can help you achieve your goal. In the same vein, you can offer coupons to your in-store patrons that they can only redeem online to drive new visitors to your site.
The Cons of having your own eCommerce website
Cost
Management
In my mind, eCommerce is so crucial to today’s retailer that cost and management aren’t really cons but things that need to be addressed in a way that makes sense for your business.
Cost
Typically, there are two types of costs directly related to running an eCommerce site: The upfront costs of getting a website setup and running and the ongoing costs associated with maintaining the site.
Setup costs can include software, design and development, and data entry. These costs can range from $0 to $50,000+ depending on the platform and features desired. In reality, no site can be setup for $0 since there is always the business owner’s time involved and even though it may not be out of pocket, it is still an expense that should be considered. How much you should spend on setup depends on your vertical, number of items, long term goals, and the resources (both human and financial) that you have available.
Ongoing costs include fees for hosting for your site, the costs associated with maintaining the database and home page, and any other fees you may incur like credit card processing fees. If you do most of the work yourself and don’t do many online transactions, you might get by for as little as $50/month in out of pocket expenses. Using employees to maintain the database, using a more feature rich eCommerce platform, and including a marketing budget to promote the site can drive monthly costs easily into the thousands of dollars. That is fine if the sales you are making (or planning on making) support those kinds of numbers.
Management
Hand in hand with the ongoing costs is the effort it takes to maintain the site properly. Item entry, inventory accuracy, ability to coordinate marketing efforts across channels, customer addition and maintenance and ease of home page maintenance all play a part in a successful eCommerce effort.
eCommerce platforms that integrate directly with your in-store POS can make a huge difference by essentially automating items, inventory counts, and customer data but tend to be more expensive than non-integrated options on a monthly basis. In my first post, I go into more detail about considering integrated eCommerce and why.
Marketing should be planned and executed according to that plan. With the competition in today’s eCommerce landscape, just because you build a great website doesn’t mean it will succeed.
Like your shop window, your home page will need consistent attention. Whether you are hiring someone to do this or doing it yourself, you will still be the one determining what sales, products, and brands to feature.
The bottom line is an eCommerce site can require (and should receive) as much of your time and energy as a new brick and mortar location.
With a solid eCommerce website presence, you will be able to grow your business utilizing the website and other channels in concert.
Good luck selling!
Jim