In this three-part series on e-commerce, we help you consider whether e-commerce could be a good fit for your business and evaluate what entry points may work best for you.
COVID-19 restrictions have quickly changed the way people live, work, learn, and shop. Many traditional business models and sales channels are no longer viable – or significantly less effective – due to the current climate. Even as we "turn the dial" toward reopening, it is likely that reopening will not be a linear process, or that consumers will be slow to return to physical locations. Given these potential realities, the choice to add e-commerce into your retail mix provides an additional channel to increase your cash flow and
engage with customers
Key Considerations for an E-commerce Strategy
A few months ago, the process of getting product online may have felt too overwhelming to explore. Yet the pandemic has lowered barriers to entry as small businesses have creatively engaged with their customers online in a variety of ways. In addition, many large e-commerce platforms have increased the tools and educational resources available to help you sell online.
E-commerce is just one tool available to you. The effectiveness of that tool depends on establishing strategies and goals around using it. So what should you consider when deciding whether selling online is right for you?
Does your product or brand translate well to e-commerce? Think creatively, keeping in mind that the old “rules” may no longer apply in light of evolving consumer expectations and experiences during the pandemic. For example:
- While the experience of an overnight stay at a beloved inn cannot be delivered online, bundling certificates for a future stay with branded coffee mugs and the inn's cookbook could help consumers connect with the joy of your brand - even while they are at home.
- Products (spices, cooking gadgets) could be bundled with an experience, such as an on-line cooking class from a local Chef.
- Holiday gift bundles (Father’s Day, graduation, etc.) may keep your products relevant and timely.
If you typically offer a more traditional retail experience, it is likely not worth the time and effort – photographing and cataloging products, taking quality photographs, writing product descriptions – to post all of your products online. Instead, be judicious about what you include online to focus on your most in-demand items, high profit-margin items, or bundled products.
Customer Behavior and Expectations
Do you already have an online presence? What platform are your customers currently using, and what are their expectations for similar products? To address these questions, spend a little time doing some market research on your key competitors. What do they sell on-line, and how does that product mix differ from their other traditional sales channels?
How complicated – and costly – will it be to sell and deliver your product/service via e-commerce? Considerations include:
- Profitability: Is the product worth selling online, or would the cost of shipping outweigh the revenue from the product itself?
- Shipping logistics: Is shipping worth the cost and effort, or are curbside pickups or limited local deliveries a better plan? Do you have the needed shipping materials and a process in place?
- Employee power: Can employees help track and package sales, or is this an endeavor you’d have to take on by yourself?
Time and Cost
As with any new skill, you will need to be honest with yourself about the time and money you have available to spend on developing your e-commerce presence. If you want to feature a few favorite [or high-margin] products on social media as part of a new summer line, that process is significantly simpler than establishing an entire online storefront. Similarly, while many online platforms offer a variety of tools, it still takes a significant time investment to explore and implement those tools – is that process worth it for your business?