martes, 7 de enero de 2014

HOW TRADITIONAL RETAILERS CAN COPE WITH THE UPCOMING ONLINE COMPETITORS BOOM.







OR HOW CONSUMERS ARE USING ALL CHANNELS TO OBTAIN THE BEST DEALS.















In a todays international retail world, where online business is de talk of the town, offering the most growing double digits and fasted future perspectives for your possible retail expansion plans, where we get drunk from the tremendous expansion hunger of the Amazon, Alibaba, Zalando,Vente Privee, etc...selling in one day (the famous Black Friday or Cyber Monday sales) more than the year turn-over of an average street retailer, we are forced to jump on the online fast train, in order to be with the leaders of the crowd.






Suddenly, the traditional retailers are old fashion and the most interesting growing area is the above online business, forgetting often the values of quality and service.   Or lets call it VALUE FOR MONEY.
So... lets focus on online and forget our current retail business......or...maybe...not???

HOWEVER, BELIEVE ME,..TODAY,..PHYSICAL RETAILERS HAVE THE BEST FUTURE!

Let me explain you...with an example.

Last month, we bought our ink for company printer, for the 2nd time with Amazon, as we until that time, were quiet satisfied with the delivery time and selling price.  Where the normal delivery day would be 3 to 4 days (depending the delivery choice you can make,..so faster..more expensive..), this time,we had to wait more than 14 days.  After trying to find out(various calls and emails), what was happening to our ink, we were informed that we actually, had bought a sub brand, through a sub supplier of Amazon and that above supplier is fully responsible for the delivery and that Amazon, can not do anything.  We had to deal the problem with the sub supplier. We did, however order and pay in advance to Amazon and had no idea or knowledge of the other sub supplier. After one week, of calling and emailing, (we were send from one to another, without knowing exactly, when we would receive our so needed ink). we decided to cancel the order and return to our specialized ink retailer with a physical store around the corner, who delivered us in only one day, the missing ink. 

Obviously, this is only an example, but what I like to show you here, is some of the current and future problems of the big online retailers.  Once you understand their organization problems, you, as physical retailer will be able to adapt yourself, offering quick answers and solutions, where above often are failing.  By implementing all multi channel tools, you will able to be more competitive than the major online international retailers.

Why?

Mayor international online companies, have based there huge aggressive expansion plans, on being the first on the market, opening markets worldwide, forgetting often the logistic problematic and needs of each market.  Most of above companies, are investing tremendous amounts of money to be operative, supporting heavy losses for the coming years.  (so..no clear profit previsions)



In order to be competitive...and be able to offer lower prices,...they are forced to have a lot of products in stock, expensive distribution centers around the globe, paying low salaries and offering pessimistic working conditions (ex. lately in Germany) in order to lower the overhead costs to its minimum. (with as result, a often horrible service)  They are in front o a big duality, as, when they start working with sub suppliers, often depending on the un-controlled delivery delays and existing service capacity of above. (you can have the best intentions.., but when the rest does not follow, your whole system is able to collapse).

The huge online return policies, (en case of Zalando, more than 50% of some of the product groups are returned), is forcing above online retailers into heavy extra costs.  

Also, the recently collapse on the deliveries (UPS), where the delivery company, with the lowest price offer gets the order, but unable to offer good service, as agreed.
The recent urgent need of physical sales points (Amazon is planning to open various, around the globe, in order to show there mainly more technical products and Zalando has planned to open it outlet stores in some major European capitals) or the so called 'showrooms, shows the need of the consumers towards something physical, real and secure.
By analyzing the online business, often we enter in circle of the  'the lowest price business' and probably, one of the biggest mistakes of many of the existing current online giants today.  You will always find somebody more cheaper....and to obtain the lowest price,...everything has to follow and be adapted, to, exactly obtain this price policy. (even if you have to cut into service, quality,...or people management)



Final,...do we really know, if above companies are profitable,..as most of the time, they are not very keen in informing about there operations costs and eventual profit margins.

Today the consumer is looking for ' VALUE FOR MONEY'.  Although low price is the main drive of customer to buy, finally, they value quality, service and innovative brands, before taking the final decision and here, the traditional retailer has a big opportunity ahead.



By implementing a multi channel retailing, you will be able to offer your customers a wide range of ways to inform, purchase, return policy,.. or just offering the best pre or post sale service.  This can be through your store, website, by phone (app), mail our home catalogue.

*Your store is the base and reference for your consumer. It will provide security and trust and a kind of repeated customer behavior.   Everybody still prefers to shop in a physical store.
*Your website is a tool, to distribute your products around the globe.  To inform, to sell, to handle and to show your image or what you have today or in the near future to offer. A way to attract the consumers to your store.
*Your catalogue or leaflet is your face and a way to be looked at the home of your client, the latest offers, creating a permanent interest for your products.  A tool to attract consumers. A leaflet, to take home, in order to remember your store or products.  We always we like to look into a leaflet. 
*The mobile (app) and use of digital marketing is a way, to reach your consumer permanently,where ever they are, in order to inform and guide them to your store.
*'Click and Collect' will permit your clients, visit, inform and order from their  home, office, etc... and pick up the goods at one of your physical sales points.

Just have a look and click on enclosed very interesting video, of one of the leading European retailers, in order to understand the importance of cross channel retailing.



CROSS CHANNEL RETAILING







As you can see, by adapting your retail business according to the latest trends, using a multi channel policy, you will be able to compete with the mainly online focused business and competitors.  As retailer with physical sales points, you have the tremendous advantage of using your existing retail network, combining it with all other possible channels, in order to satisfy your consumers and increase automatically your business turnover.
Your current retail position is far more easier than you think and you are miles ahead of some of the major online companies, as you control and own your sales and distribution channels and you possess the long lifetime trust of your clients.  At the end, they know who you are....you are local player.

...SO JUST BECOME AN OTHER EXPERT IN THE REST!

GOOD LUCK.

Latest...
Amazon is planning to offer a cooperation with local retailers, in order to plan a 'Pick up' and 'Post Sales' (clients can return back the goods through above) network. This way, they hope to find a easier way to distribute their products and solve their post sales problems. Amazing how some internet companies, first have tried and trying to kill local physical retailers, with a heavy low price policy and now try to look for a cooperation with the same retailers, to solve their logistic problems.  (probably also offering a very low cost fee...for the work done....)






2 comentarios:

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