Brick and mortar stores have reason to hope for higher levels of success in business not by investing in opening new stores or expanding existing ones, but by simply creating an online presence. This online migration has placed them along side millions of stores in the virtual, online marketplace that goes beyond geographical boundaries.
The online market place is without threats from large chains
The retail sector worldwide saw a revolutionary change in the twentieth century when chains of big retail stores entered cities and wiped out small, local businesses. This was due to the economies of scale helping them cut costs and profits coming from volumes rather than margins. Examples include Walmart, K-Mart, Carrefour and Tesco.
However, the online market place is more secure for small businesses, and though big names like Amazon.com and eBay do exist, they don’t pose such a worrying threat to local online businesses, which can still make money by offering what their big competitors cannot. The route to this lies in following a path explained below:
- Careful selection of products for online sales- small businesses often sell specialized products that cannot be mass produced and also cannot be bought at big stores. An increasing number of high quality products that also demand a market premium, are available only through the online extensions of existing brick and mortar stores.
- Using price protection to retain market share- With cut-throat competition and a vast market place, manufacturers have started protecting their price levels in the form of an MAP or minimum advertised price, which helps to control the price at which their products are advertised both online and in the physical market place. However, they are not able to rein in the price at which the product is actually sold. This works towards providing a protective armor to small businesses and the buying decision shifts from price issues to other features listed as part of the product information, support and service provided, the website advantages like easy navigation, and above all, product availability. These are significant benefits for online buying, but sometimes, price discounts overtake them.
- Establishing expertise through better service and accessibility- When the products being sold belong to a niche segment and expertise is sought by end users, it is online businesses that benefit the most by providing the advice needed. With expertise in the field once established, converting website visits into sales does not take too much effort, since trust has been built and the customer relies on the provider of expert advice. Content that educates and informs, is another great way to reinforce customers’ faith and belief.
- Creating a niche segment in the market- This helps to maintain focus on a highly specialized field, which will lead to a targeted clientele and visitors. Large stores both in the physical world and online, offer thousands of products. Even smaller ecommerce website offer hundreds of them. It is difficult for customers to screen websites for the product they exactly want. If however, the sites create specialized, niche sections of products, spotting the right commodity will be easier, and search engines will also drive traffic to the specific product that online customers are searching for. Specializing today, offers a bigger advantage than being a generalist who sells everything.
With the path to online success clearer in the mind, it is easier to move ahead according to a well thought out plan of action, and proceeding step by step to achieve the end result, namely, an online presence and customer attention in the virtual marketplace.
This is a guest post from Neil the head of Marketing at eMobileScan. A specialist site that provides solutions to make businesses more productive and cost effective. Their products range from handheld computers like the Motorola MC75 or label printers like the Zebra Zm400. Their solutions are designed to help companies save time and money.