At Spring Fair I chaired a roundtable discussion with retailers on the challenges of selling online. It was a fascinating chat with an exciting mix of discovery, reassurance, learning, contribution, growth and connection. Here are the highlights, including some useful ecommerce tips for retailers:
How to reach the market
Retailers often ask me about setting up websites for their business. I’m a great believer in the power of sites to leverage your marketing efforts. All businesses need a website to anchor for their online activities, especially for social media and blogging. The easiest way to find a company’s social media details is to go to their homepage. If you don’t have a site then you’re make it difficult for people to find you, talk about you and spread the word about you. A simple website with nice photos of your store and all your contact and social media details is cheap and easy to set up. I recommend installing Wordpress on your web domain as a simple solution that you can tweak yourself. This also allows you to add a blog like the one I have at www.BlueEyedSun.co.uk/blog.
Ecommerce is different matter. We use Magento software to sell on our site. The good news is it’s free and open source. The bad news is that designing and building a website that you can sell well from is a costly and time consuming business. It’s like having another shop. Even after you’ve created your amazing site you still have the problem of getting people to it. I often remind retailers that creating an ecommerce site is like building a beautiful retail store in the middle of the desert with no roads in or out.
The truth is that the war for online retailing has been won by Amazon whose sites have over 183 million customers visit them each month. They are so big and powerful now that it’s very difficult to compete with their SEO (search engine optimisation) budgets that ensure their listings are at the top of Google. Thanks to Amazon we all expect goods delivered within a day and with free delivery. This is tough to compete with. Whenever a retailer asks me about selling online I recommend that they start by selling on marketplaces like Amazon or Ebay. You can also sell using posts on your shop’s Facebook page.
When you sell through Amazon you can fulfil orders yourself or use a service they offer called Fulfilment by Amazon (FBA) where they hold the stock and ship from their super efficient warehouses. The advantage is you outsource this to experts. The disadvantage is that you have to tie up the cash elsewhere rather than on stock in store.
A brief caveat: Selling through online marketplaces is not a panacea for your business. As Bill Gate’s pointed out, in his 1999 book Business at the Speed of Thought, “Now that customers can deal directly with manufacturers, there is little value in simply transferring goods.” Middlemen must add value. You must know what is special and significant about what you do as a retailer. Good service is now standard online so don’t kid yourself that this will be enough. How do you add value in the supply chain? It might be through your buying selection or your ability to drive footfall. Think carefully on it and be prepared to work hard on adding value.
Build Your List
All retailers need to build a list of customers. Either an email list or an online equivalent with followers on platforms like Facebook, Twitter or Instagram. My preference is still for email and physical addresses for direct mailing. Think of these lists as building roads to your website from which you might one day sell.
Once you have built a following and you successfully learn how to sell well online using the strongest marketplace in the world, then you can start to think about investing in your own ecommerce site. Test cheaply and prove your offering works on Amazon or a similar marketplace, then expand.
The exception to this is to be found in countries where Amazon has little or no presence. One of our panellists has nine stores in Bulgaria specialising in tattoos, piercings and graffiti. Bulgaria doesn't really have these online marketplaces so this retailer were able to grow their niche site using powerful online marketing tools like social media that targeted his youthful niche.
Where are your raving fans and customers hanging out online? What do they like to see and share? These are key questions to ask before putting work into social media. Start by visiting these platforms as if you were your customer. Watch and listen carefully to understand the etiquette and what works best first.
Scottish independent retailer, Maia, sells mostly to 35-45 year old females and uses Facebook, Twitter, Pinterest and Instagram as their main platforms. They also use Google Analytics and Facebook Analytics to know their customers. They post daily as they realised that they have to do it properly or not at all. Social media is great for brand awareness. It’s also powerful for customer feedback and a sense of connection with your brand story.
Spreading the word
Word of mouth recommendation works well for most retailers, but how do you replicate that online? Firstly, you need a website and social handles for people to be able to tag you and link back to you. You can also email customers asking for referrals. This is something we regularly do with brides and grooms at Ivy Ellen, our online wedding stationery store.
One of our retailers takes photos of his customers with their purchases which he posts on social media. He has a younger demographic so they are happy to do this and help spread the word on Facebook which has led to over 80,000 followers on his business page.
Amazon also have a simple one click option at the end of checking out to “tell your friends about your purchase.” Effectively the item gets shared on social media and can drive further sales via friends of the customer.
Ecommerce websites have got better and easier to use. Companies like Amazon, Ebay and large retailers spend millions fine tuning these sites to get optimal engagement and drive sales. Just as putting things at eye-line and grouping items by colour can draw the eye in your physical store, so too can you steer customers through your website.
Home pages on websites drive traffic well when targeting specific types of products that target specific groups of customers. One retailer, Sunni, has created customer personalities that he targets, like ‘geeky men’ or ‘girly girls.’ Profiling is going to become huge online for retailers. Psychometric specialists, Cambridge Analytica (the company behind the Trump and Brexit wins), have already shown the power of social media profiling to dictate political change. Further commercial exploitation of our data will follow this and the groundwork laid out by Dunnhumby’s analysis of loyalty card schemes like the Tesco Clubcard.
Generally customers like to be guided through websites and told what to buy. Understanding them well is key to helping them to meet their needs. Standalone ecommerce websites are better for doing this to generate higher order values than Amazon where the sales are often for single items and restrictive with customer data.
You can also use email marketing tools like Mailchimp to target specific customer types and steer those customers from specific parts of your emails to specific products and areas of your ecommerce store.
Getting repeat business
Loyalty schemes work well for bricks and mortar stores. You can use similar strategies online to drive repeat business via email, social media or when customers return. You can even personalise the schemes to target specific groups of customers.
Another interesting idea is to do unique discounts for specific customers. For example tourist buses that might visit your town can be given an offer of a free coffee with every twenty pounds spent in store. Similar offers can be repeated online.
Those are some of the highlights of our roundtable discussion for retailers on ecommerce at Spring Fair. If you get the opportunity to join one in the future, I’d encourage you to do it. It’s a wonderful way to connect with your community and to swap nuggets of golden information that can improve your business.
How retailers can start selling online
10 Things to do in your business before using social media
The Top Ten Business Tools we use at Blue Eyed Sun