On the recent Black Friday, another nail in the brick-and-mortar shopping coffin was hammered in. Statistics show 17.7% increase in online sales compared to 2015, and a decrease in foot traffic from 101 million to 99.1 million, we can expect to see this trend continues in upcoming years.
What do brick-and-mortar retailers supposed to do with the above stats is a topic to a different post, but one this is abundantly clear – online retailers need to up their game because competition online in the eCommerce space is getting fierce.
Shopping in the Real World
There are some parallels between shopping in the physical world and online shopping, and online retailers should take some cues from real world experiences; it has been around for a bit longer than the online one after all.
Let’s take a street with many shoes stores along it. How do I, the shopper, decide in which store I will purchase a pair of shoes? A combination of a few things:
- Price
- Selection
- General appearance of the store
- Previous information I have regarding one or some of the stores
Now let’s apply this to online. Appearance and selection are not really a factor anymore in online shopping. Most online shops look great, thanks to the wide availability of eCommerce platforms. Selection wise, it’s basically endless, and we are not limited to one street or one section of town; the internet is our oyster.
That leaves us with price and information – the two crucial aspects of success for online retailers. Let’s start with price.
Say Hello to Dynamic Pricing
Prices online are anything but fixed. They constantly change, due to a multitude of variables such as demand, a chain of supply, availability, buzz and what is referred to as competitive pricing (more on that later.)
Big box retailers have all adapted the usage of pricing optimization software to handle their pricing strategy. Pricing of hundreds and thousands of products is done by an algorithm and updated in real-time, all the time, taking into account of competitors are pricing the same products.
This means that online retailers cannot afford any longer to price their merchandise in a vacuum. It is essential to know how your competitors are pricing the same product because online shoppers are very keen on comparing prices before they make a purchase.
Another example: if you know that your competitors are out of stock for a specific product and you still have it, you can raise the price.
How can you know this? Are you supposed to scan competitors’ web shops day in and day out? Absolutely not. That’s why man created software, and that’s why there are companies like UpstreamCommerce that excel in price optimization and predictive pricing – essential tools for online retailers in today’s highly competitive online landscape.
Information in the Physical World is Presence in the Online World
The other crucial factor in the success of online retailers in their ability to achieve visibility, to have a presence also outside their web shops. The best way and most cost-effective way to achieve that is by SEO – search engine optimization.
Very broadly, this means to have high visibility in Google’s search results when shoppers are looking for the products you sell. Quick example: if I’m looking for wireless headphones and I do a Google search for it, if you’re not on the first page of the search results, I’m probably not going to buy from you, since I won’t even know about your shop.
There isn’t really a DIY approach to SEO; it’s a combination of technical link building, website optimization, and content marketing. Almost all businesses, B2C and B2B alike, hire an outside agency to take care of their online presence, like eTraffic, a B2B SEO agency. These agencies make sure you are visible outside your own domain.
The trick is to “catch” potential shoppers when they search for products and information and compare prices. That’s when the purchase-decision is starting to form.
Conclusion
If you take care of these two factors, pricing and presence, you stand a much better chance competing with big box retailers. The already have the advantage of size and power over suppliers (much like the advantage they have over mom and pop shops of the main street), online retailers must outsmart them where they can in order to beat them at their own game.
