Do You Need an
Online Store?
-- by AllBusiness.com, http://www.allbusiness.com
-- http://www.redtienda.com/english/newsletter76.htm#1Internet
consultants once claimed it was possible to sell
anything over the Internet. But the recent
dot-com downturn has shown that this isn't the
case.
It's true
that the Web is a great way for customers to
order many types of products and services. And
almost any small business can benefit from a Web
site that spreads the word about its products or
services. But not every firm will benefit by
inviting customers to order its products directly
over the Internet. If you're thinking about
issuing such an invitation, there are a few
considerations to keep in mind:
Your
niche.
The
biggest Web-based retailers spent millions of
dollars to establish themselves - and many of
them are no longer in business. Growing
businesses can't compete on this level, and they
probably wouldn't want to anyway. Many online
businesses, however, have successfully targeted
underserved market niches - for example, selling
out-of-print sailing books.
The same
goes for market segments such as CDs, videos,
drugstore items and software. Make sure your site
offers something customers won't find on sites
run by the Internet giants - or for that matter,
at the corner store.
Your
competition.
Chances
are, someone else already sells your product over
the Web. In fact, the online competition might be
fierce. That doesn't mean you should steer clear
of it, however. Instead, you can try to figure
out ways to steal market share.
That
means checking out your competitors' sites and
improving upon them. Maybe your typical
competitor's Web site downloads slowly or has
poor aesthetics. Or maybe the company isn't
offering a good selection or fair prices. If
nothing else, perhaps you can be the first
company to sell a given product with great
customer service, on-time delivery or a
money-back guarantee.
The
nature of your product.
Some
products sell especially well on the Internet.
You should decide if your goods fit that
description.
CDs and
DVDs sell well on the Internet because it's
easier to gather information about them online
than in a store. Books sell well on the Web
because it's easy to build a community of
customers who will review the books they purchase
and read other customers' reviews. In both cases,
sites can track customer preferences and suggest
possible purchases - as a result, customers often
buy more items than they intended. And consumers
know that a copy of a book or CD they buy online
will be identical to a copy they'd buy in a
store.
The Web
also is a great place to sell products that most
people don't like to shop for. On the other hand,
there are some things consumers need to touch or
try out in person before they buy: You can't test
a lounge chair or try on lipstick over the
Internet. That said, if you have both a store and
a Web site, customers can check out items in your
store and then purchase them later online.
The
nature of your business.
You
should also consider the logistics of selling
certain items over the Web. Even if you offer low
prices, for example, shipping charges could make
it cheaper for customers to shop for the same
products locally. Customer service is another
touchy issue; many online stores have suffered
because they can't offer the level of service
customers expect from brick and mortar stores.
And the more products your store offers online,
the more careful you'll have to be about tracking
your inventory. You don't want to risk having
customers buy out of stock or discontinued
products.
As many
online businesses have learned, shipping,
customer service and other overhead costs can
quickly outweigh any extra business you generate
through your Web site.
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