This article discusses the benefits of e-commerce as a retail option in a recessionary economy, and lists effective strategies when adopting an online medium that could result in growth for a retailer.
With the economy performing below normal many retailers who preferred having a physical presence are looking to go online at minimal costs and keep the cash registers ringing. Compared to a traditional brick and mortar storefront, an e-commerce store is a relatively small, convenient and low cost startup.
The only costs involved in the e-commerce platform include the monthly hosting and ISP bills with a website, an e-tailer has the capability to gauge
the market condition and make alteration accordingly taking into account all its benefit, e-commerce can be considered ideal during recession as it helps retailers to stay globally competitive.
Serving retailer and consumers
Today leading global e-commerce retailers earn more than 10 billion in revenue on every portal they own and this shows the shifting trend towards e-tailing.
Videocon is also amiing big on e-biz, “in 2009 our target is to earn online sales of Rs 10 core, and our current sales are very much in line with our target,” adds Arindam Bose, VP-IT, E-biz and and Exports, Videocon.
Consumers today are more open to the online medium. This trend is further catalysed by various product and price comparison websites that enable users to perform reserch on product that they intend to purchase moreover, increasing fuel costs, large mail crowds and low disposable incomes are
are motivating buyers to shop online. Mr Gadia says, “Contrary to a physical store that has issues of a timeline, visibility, etc, an online store runs 24x7, thereby giving us more customers. We serve more than 2000 clients everyday on our online site.”
The e-commerce option caters to customers in the cureent economy because it offers products at lower costs. “E-biz reduces the logistics cost as the goods go directly to the end consumer. Any business model that removes layers and brings the consumer neareer to the munufacturer benefits all,” agrees Mr Bose.
Choose intelligently
Despite its potential many people don't know how to get started with e-commerce and are often confused about the numerous options available. Several solution allow retailers to sell items online
but it is always advisable to apporach retail-specific vendors who can customise solution according to customers business needs. “Each customer has a different requirement. Some want a pure Web shop, while some want intergration with CRM or ERP and yet others seek telephonic booking. Each requirement should be considered individually before offering a solution.”
Though most solations many differ, some are fundamental for every online business enterprise, and these are listed below:
Design customisation soulations: Setting up a business involves considerable time, energy and money. It is necessary to create a brand that customers find familiar. Many e-commerce solutions force retailer into a particular site layout template or theme making them just another cookie-cutter, faceless, online store an e-commerce service provider must understand the objectives of an e-tailer to equip the latter`website with aesthetic solutions.
Scalability solutions: Retailers do not want solutions that limit the number of products on display or the amount of traffic that the site can generate. Therefore e-commerce solutions must equip retailer to add dynamic features to his existing site.
Payment solutions: Many e-commerce solutions force customers to register before making a purchase. Forcing customers to leave a site when they are ready to purchase products is not a smart business pratice. If a customers finds the payment options in the website too cumbersome, he/she may switch to another shopping site. Therefore a retailer must ensure that customers are hooked on to the website until they have completed their transaction.
Order processing solutions: These solutions are specifically designed to save operating costs. In the absence of these auromated soulations a retailer has to maintain the inventory and keep a track of orders and process them.
Search engine optimisation (SEO) and search engine marketing (SEM) solutions: To drive traffic to website, a retailer must employ an SEM or SEO is more popular because of its low costs and better results. However, a retailer must ensure that the SEO uses the right keyword to improve his webside's page rank. The webside must contain the right keyword so that when a user searches for a particuar product,the retailer's website appears at the top.
Majority of the people who go online end up buying nothing or may not even visit a particular website, this is because the retailer's and the service provider may have not set up means to direct traffic to the site.
Coupon solutions: In the face of rising prices consumer have once again begun clipping coupons. Giving away gift coupons serves to increase sales. People are always looking for discounts and freebies, and a site that offers similar incentives often sees repeated visits. E-tailers can send coupon as an SMS with unique promotional codes that shoppers can use on their e-commerce website, and receive discounts on online purchases.
Shopping cart and delivery solutions: A customer should be given a free hand to add products to his/her shopping list, remove product, change their quantity, recalculate, the order before processing and even come back to the same after logging out. On the delivery front, most clients prefer websites that offer free home delivery and, therefore, e-tailers must have a user-friendly deliver solution in place.
Innovation to help you save
In lieu ongoing recession, retailers have started exploring innovation ways to cut costs. Many e-tailer are outsourcing their retail operations to specialised retail vendors for reducing labour costs. One of the affected areas during this slowdown is advertising, and very few retailers seek to manage advertising costs. Retailer should ideally adopt online advertising tools like e-mailers, newsletters, etc. Retailers can send e-mailers, promotions, gift coupons to their existing customers at a very low cost and still enjoy sales benefits.
In order to grow in the exiting scenario, a retailer should place his merchandise where his potential customers are most likely to be. Going by this, the retailer should view e -tailing as a cost effective channel to lure sales.
