By Justin Opie, Event Director, E-Commerce Expo
The credit crunch. Hardly a day goes by when we don't hear these three words. The high street shops are taking a hit as people are watching every penny and becoming more price savvy when it comes to their disposable incomes. So why is it then that internet firms are reporting booming e-business despite the apparent slump in sales on the high street?*
The answer is not surprising. With consumer 'money-saving' trends becoming more evident than ever, shoppers have taken to surfing the web in search of the lowest prices, biggest bargains and best value for money, all made simpler with the click of a mouse. In fact, over the first 6 months of 2008 the Interactive Media in Retail Group (IMRG), the UK's leading membership community for the e-tail industry, reported a 38% year-on-year increase in online shopping.
With the predicted success of online sales, which are expected to make up 30-50% of all consumer spending over the next 3-5 years, online retailers need to make sure they are equipped. Can they continue, and in some cases start, to handle the rise in demand for their products or services online? Are they able to deal with the growing competition in this marketplace? And importantly, can they offer outstanding services for their products, such as payment options, warranty, service and repairs, which the high street stores currently provide?
The most basic economics tells us that when there is a rise in demand, there is a tendency for this to be followed by an increase in supply. By choosing quality suppliers and delivery services and ensuring items are consistently in-stock, there is a real opportunity for e-businesses to continue to thrive in the current economic climate.
After all, if e-businesses can supply the same, if not better, goods than high street stores, and do it quickly at a competitive price, consumers are bound to completely rethink the way that they shop and turn to their PCs and laptops to get the job done. Interestingly, it would pay businesses to remember that for the younger generation who are digital natives, internet shopping is the norm.
Similarly, an increase in demand means there will also be heightened competition. E-commerce websites must ensure that consumers have all the information they need to make an informed decision about the products that they want to buy.
Photography and video images that showcase products are essential. Shoppers want to know what they are purchasing- if they can't physically feel the product in the same way that they can in a shop, they need detailed descriptions and imagery that will allow them to feel comfortable enough to click 'buy now.'
Equally, the purchasing process must be easy and secure. For example, PayPal is a widely used and trusted name, but what happens when customers do not wish to set up an account with either the provider or the e-store? Can they make one-off purchases? What different payment methods are available? If these questions are carefully considered to meet the needs of consumers, e-stores will become increasingly attractive to shoppers looking for a no-nonsense approach to shopping.
And what if something goes wrong after purchase? Retailers have to provide aftercare to the customer. Warranties for goods, services and repairs are all considerations that companies must make, in the same way that traditional stores do. Get this right and e-stores can continue to compete and possibly even outrun traditional stores. And, importantly, it will make consumers more comfortable when choosing to purchase online.
Deciding to set up an e-business or adding an e-commerce function to an existing business need not be complicated, but it does need careful planning and serious attention to customers' needs to ensure success.
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