Is your supplier also your competitor?

There are certain things some businesses do that make me scratch my head and wonder if they’ve thought of the implications behind their actions. One in particular is the way they’ve designed their websites that are not e-commerce capable. How many sites have you been to where they list the brands that they carry, usually with a link to that brand’s website, thereby taking you away from their own site?

Now, I understand why some retailers do this. Rather than paying a web developer to constantly update the product offerings, it’s easier to just link to the brand page and you can see the product there. Even better, the brand does a much better job at selling the product that they can do on their own page right? That’s perfect; except for one thing . . . the brand site is also an e-commerce site.

In essence, the retailer is sending their customer to another store that carries their product which invites that customer to purchase online. This would be the equivalent of sending them across town to the competition. Make no mistake; the supplier has no qualms about taking your sale. Sure you may have a territorial agreement but that usually does not cover web orders, and most suppliers will not have agreements in place to send the orders to various stores for fulfillment. Why would they? They just made the sale themselves and thanks to the retailer their site got free promotion.

So my suggestion would be that if you do this on your site, check the links you have going to your suppliers and see if they sell those products online. If so, you may want to reconsider sending your customers to their site. My second suggestion is this. If your customer can find you on the web, and find your product on the web, why aren’t you letting them buy from you on the web?

Competition is quickly heating up as customers buy more and more product online. Don’t give all your sales away to someone else; it’s not good for business.

Can E-Commerce Help Seasonal Retailers?

On my most recent vacation to the east coast of Canada I had the opportunity to visit a lot of small towns in PEI, Nova Scotia and New Brunswick. Our timing was great as these towns were just heading into their off season, so there were lots of specials to be had and not a lot of line ups to participate in things that make these places so much fun to visit. Lots of shops were offering great sales and we took advantage of as many great deals as we could.

One thing struck me as interesting though. Almost all of these small specialty shops advertised that they ship anywhere in the world. When I asked them if I could order from them online, most said no, but I could just call them and place an order or just send them an e-mail for more information. There were others though that did allow me to go to their sites and place orders. This was important for me because there were some shops that had great products that I wanted to get for Christmas gifts but didn’t want the hassle of taking them on the plane, or simply didn’t want to blow my entire budget.

By using the old way of doing business, a seasonal retailer is virtually limited by the traffic that comes into the store during their busy season. With e-commerce that season is extended all year round and they are no longer dependent upon foot traffic. This is even more apparent for specialty retailers that produce or make unique items not available anywhere else.

Consider this example for some of the opportunities that e-commerce provides. I found this great shop in Nova Scotia that specialized in making unique jewelry from sea glass collected from the nearby beach. I bought several gifts for my family but I knew more people that would love this type of stuff. After purchasing a few necklaces, I got the website address so one day I could order more. When my girlfriend wore hers out one night, people were commenting on it and asked where we got it. When I told them, two of our friends went online and purchased some for gifts and one of them even posted it on their Facebook Wall.

Had this small (and I do mean small) retailer not had an e-commerce site we never would have had the opportunity to buy more when we got back and they never would have sold to our friends who had never even been to Nova Scotia. This little shop was not a giant retailer or even a large one for that matter, but they are learning to make money even when the tourists are gone. On top of that, we get updates through Facebook when the owner has made more new and unique items and we can just purchase it from their site.

I guess my question to everyone out there is what are you doing to ensure your season is extended all year? How easy is it for your customers to find, buy and share your items with their friends? How much money are you leaving on the table?

The Power Of A Post

For those of you who may still be sitting on the fence about whether or not having some sort of social media presence may impact sales or product awareness, conider the following.

Yesterday I received a post from the Starbucks Facebook Fanpage which I follow, which means every time they put out a post I will see it in my Facebook feed. The announcement? Simply that their popular Pumpking Spiced Latte is going to soon be back on the menu. Now this is a drink that most people already know about and many enjoy.

I took a screen shot of what this post generated. Now the Starbucks page has more than 13 million followers. Yes, that's right, 13 million! That post genereated over 5,000 comments in less than a day, and close to 34,o00 people acknowledged the comment by saying the "liked" it.

The financial cost to Starbucks to generate that type of publicity? $0.

Still think social media shouldn't be part of your strategy?

Lessons Learned: Candle Retailer Regrets Custom Shopping Cart

Lessons Learned: Candle Retailer Regrets Custom Shopping Cart

This is from another blog I follow. For those of you looking at starting an e-commerce site, beware of some of the pitfalls that can happen when deciding on a web page format. As this retailer found out, Flash can make a site really cool looking but Google search does not pick up Flash so your website can be very difficult to find.

Also, another good point he brough up was with regards to hosting versus a managed service. He made quite a large investment in servers that he ended up not needing in the end.

Anyone looking or considering e-commerce, please feel free to give me a call or e-mail me and I will be happy to share my thoughts, insights and ideas with you.

Charging Customers Merchant Fees

This past weekend I was in a small town in Alberta, enjoying the gorgeous mountain scenery, nice weather and great little independant shops. Most of the time I really enjoy these stores because they are smaller, a bit less busy and quite friendly. However, it's these smaller stores that I always get very irked when it comes time to purchase something. Why? Because when I go to use my debit card some of these stores charge me 20 cents or more to use it.

Now, I understand the reason behind this, I'm not insensitive to the reason it is charged. Somewhere along the line the merchant is being charged by their provider that amount for each debit transaction. In a store with lower ticket transactions, such as $2 and $3 I can see that (even though I don't like it), but I can understand. Afterall, 20 cents on a $2 transaction is 10% which affects the bottom line no doubt.

But how about my $50 transaction? That 20 cents represents .004% of the transaction. Hardly fair and it leaves a very bad impression on me, the customer. This store went even further as to have an independant cash machine on hand that charged $1.50 to withdraw cash!

But in today's age of internet banking and my iPhone, this is what I did. I put the $50 on my Visa card because I refused to pay this 20 cents (on principal). In essence because I felt the merchant was making me pay for his cost of doing business in the form of a fee, if his Visa rate was 3% that transaction cost him $1.50. It cost me nothing because with my banking app on my iPhone I simply paid it online on the spot and didn't have to pay any fees.

I've noticed that there are some pubs and restaurants that don't take debit but have a cash machine on property that charges sometimes $4 to withdraw cash, and that's on top of the $1.50 the bank charges you! These businesses, in order to save on debit transaction fees and making it inconvenient for the customer are driving them towards using their credit cards, thus costing the business in the long run.

Have you come accross this practice anywhere? Do you think this is fair? Please let me know your thoughts on this, and if you're a business doing this, please enlighten me or change my thinking.

Do You Know What They Are Saying?

Have you ever wondered what customers are saying about your business? Most owners think they know, but I promise you, most have no idea. Why? That is because they don’t look or listen. Most owners I’ve met are truly afraid of social media, but it’s more a fear of the unknown, which is a completely normal reaction. So, I wanted to put a challenge out to everyone on this no matter what your business is, and I’d like you to share your results with me. By doing this experiment, I’m hoping that you’ll see what is happening outside your doors without having to start a Facebook Fan Page, Twitter account or join Foursquare.

This is an exercise that any business can do and it won’t take you long at all. I also promise you that the results you’ll see will give you pause and will force you to think about your business. When you Google your businesses name, how deep into the search do you go? Are you just making sure your business name is listed at the top? Go deeper into Google and find out where your business name or product name(s) are popping up. Try the same with your own name. More importantly, what is being said about your business on Yelp? or Foursquare? or Facebook? How about the many other popular sites? Or sites you had no idea existed? What are they saying? If you found some conversations or comments that’s great, because if there’s nothing that means that no one is talking about you which is worse! That’s part one of the challenge.

For the second part of the challenge I want you to try and participate in the conversations. Is there a negative review or comment? Try answering that person directly through e-mail (don’t do it publically). If you resolved their complaint will they change their opinion? Are people asking questions about your business? Try answering them and helping them out. Are there any conversations going on around a topic or issue your business is trying to solve? Try participating in that conversation.
The point of this exercise is to show you that even if you aren’t part of the social media shift that is taking place, other people are and you don’t want to run the risk of alienating those customers or potential new ones. Join the conversation that you may not even know is happening. And if you can’t find it, ask yourself why and if there is anything you can do to start one!
Over the next couple of months, try devoting one hour per week to this exercise and see what the results are. Also, I’d love to hear your opinion on this and if you do try it, what your results were!

Try Starting With These:

Google

Youtube
Twitter
Yelp
Urban Spoon (Restaurants)
Facebook
Foursquare
Review Center

New Technology Trends For Restaurants

The restaurant industry is facing new challenges with technology and how to rapidly change and adapt to take advantage of new trends, such as social media, mobile technology and the web.

The following video (first four minutes) is a brief interview with Jeff Riley, CEO of Dinerware regarding what they see as the upcoming technology trend challenges facing the industry and what they are doing in order to meet these challenges.



If you'd like some more information about Dinerware in Canada, check it out at my company website Factor One.

If you're a restaurant owner, please share what you feel is the most pressing trend for your business and how are you leveraging your current technology to meet your customers needs.
Do you feel that you are prepared to handle these challenges?

Foursquare Marketing

I found this article online the other day. The example here is restaurant oriented, but the same prinicpals apply to retail. Nothing is stopping anyone from doing this right now except you and your imagination.

Check out the article.

The Power of 1-Click

When you think about e-commerce and online ordering, without a doubt there are two kings that rule this world. Amazon and Apple. How big? In 2009 Amazon's net sales increased 28% to 24.51 billion dollars. For 2010 they're averaging about 65 million hits per month. iTunes statistics are just as amazing. In February of this year, Apple sold it's 10 billionth song. On January 5th, it had it's 3 billionth app downloaded. In 2009, iTunes generated just over 1.8 billion dollars in revenue.

One of the reasons for the success of these two sites is how easy it is for a customer to buy their products. If you have an account at Amazon, it is literally as easy to buy as 1-Click, talk about your impulse buy! In fact, Amazon has a patent on the term 1-Click and licenses that patent to Apple.

I can attest through my own experience how powerful that is. When I find a book I want to read on Amazon and I decide I want to buy it, I click on the "1-Click" icon and it literally downloads it to my Kindle. On my iPhone, I can hear a song on the radio and use and app to find out what that song is and simply click buy and it downloads it from iTunes instantly onto my phone.

My question to you as a retailer, is to look at how easy it is for your customers to buy your product, whether it's in the store or on-line? How many times have you walked out of a store because the line up was to long? How many times have you aborted a purchase online because of how many steps you have to take to complete the purchase?

If you want an example of how frustrating an online buying experience can be, try ordering a flight on Westjet and pay for your flight with a credit card. Not only do I have to put in my information, I have to then get my card "verified" by another credit card service that requires another password. Through my various bookings on Westjet it quite often makes me jump through this hoop even though I've saved my info. I have also booked on Air Canada when they've had the same seat price just because I didn't want to go through this hassle.

How important is this from an e-commerce standpoint? According to a recent Goldman Sachs report e-retail will grow at 5 times the rate of traditional retail. Online sales are currently $134.9 billion but are expected to grow to $624 billion by 2020. Where is your company positioned to capture a piece of this money?

Please let me know which sites you enjoy buying from and which ones you don't. I'd like to hear your opinions.