About 16% of retail sales in the US were online in 2019. This has been steadily increasing from 5.1% in 2007. But brick-and-mortar stores are still popular - 49% of Americans still prefer shopping in-person so they can try things on and interact with helpful employees. However, all of this shifted with the onset of pandemic and the world realised the only way of survival was to shut down person-to-person interactions.
Many stores, especially small shops without much of a digital presence, had no other source of income during the shutdown. Even as the economy reopens, the future of the brick-and-mortar business model is uncertain. On-the-go deliveries of goods will become embedded in every business to future-proof against any future pandemic.
So how can a business transition from a brick-and-mortar model to ecommerce?
1. Product/market fit
First, you need to make sure that you have products (physical goods) that could be sold online. Second, you should consider the customer base you could reach or target with your products. Going from a local shop to a digital store means that you could theoretically sell your goods to customers anywhere in the world. Do you need to change the designs or branding as a result? Are there other complementary goods that should be added to the catalogue?
Reassessing who your customers are and aligning the products you sell to them is a critical step. The physical store experience and digital store experience won't necessarily be the same - although they don't need to be. But just as you design the store floor carefully to draw the customers in, the design of your digital storefront also must be intentional and thoughtful to convert visitors into paying customers.
2. Build inventory management
To have physical goods to sell, you must have an inventory warehouse to process orders and send out shipments quickly. Consider whether you want to have pre-packaged goods sitting in inventory or use the just-in-time approach in which you produce goods once an order comes through. It depends on the products and expected order volumes.
Having an efficient inventory management system is critical as customers nowadays expect speedy delivery and storing inventories can become costly. Returns also need to be received and re-packaged (if not defective), which would require warehouse resources.
3. Have a digital marketing strategy
Digital marketing is important in any business success regardless of whether it operates online or offline. Customers discover new stores and brands mostly online. A digital store can have customers from anywhere in the world. Therefore, you need to think carefully about your online 'real estate'. If you want it to advertise your brand effectively you will need to think more broadly so you can reach the right audience across all markets you wish to target.
Strong digital marketing strategy is how a small business grows into a mega brand. This can be daunting for many small business owners but there are many educational resources in digital marketing available to help you do it yourself. Becoming knowledgeable about digital marketing can help you place the right ads in the right places so you get 'maximum bang for your buck'.
4. Track and understand customer behaviours
In a physical store, you can see immediately if a customer has questions or doesn't like what they see. These in store observations help you update your store design, change up product placement, or intervene to ask customers if they need any help. Such observations can also be tracked digitally in your online store. There are various actions that can be set up if they are triggered by the certain customer behaviours so they can get the support they need.
There are many free tools such as Google Analytics that you can use to track traffic, customer demographics, which pages/products they view, when they exit, and where they seem to struggle. Collecting such data will help you determine and implement right actions such as having a 'Do you need help?' box to pop up on certain pages to prevent customers from leaving the website.
Copyright 2020. Featured post made possible by Daniel Bailey