“Retailing on the Internet” Summary

ArrowQuick Solutions co-sponsored the “Retailing on the Internet” seminar that was held last night at Indian Hills Community College. The dinner and seminar was organized by area chambers of commerce and development organizations and had more than 100 people from local businesses attend. The talks were very educational and the seminar seemed to be well-received.
Kurt [...]

ArrowQuick Solutions co-sponsored the “Retailing on the Internet” seminar that was held last night at Indian Hills Community College. The dinner and seminar was organized by area chambers of commerce and development organizations and had more than 100 people from local businesses attend. The talks were very educational and the seminar seemed to be well-received.

Kurt Peters, Editor-in-Chief of Internet Retailer Magazine, first talked about the market that the Internet provides. Internet sales have seen massive growth since 1998 — $109 billion in 2005, up 25% from the previous year — and will see strong growth up to 2009. Peters also went over the demographics of Internet shoppers: 55% women, with an average age of 44, middle income, and a college degree. Shoppers are buying everything from electronics to beauty products to jewelry online. There are also more than 2 million businesses selling over the Internet, from huge companies like Amazon to individuals selling through eBay. In short, the Internet offers a lot of opportunity for businesses, but there can also be some challenges:

• There can be a lot of competition for certain products.
• It is a new way of operating: methods for customer service, order fulfillment, marketing, and payment processing must be established.
• You must be careful to balance between your existing business and the online business.
• You must understand the technology that you are using.

Peters’ final point was “Embrace Change.” Strength and intelligence don’t matter — it’s how well you adapt to change and keep up with the times.

Lauren Freedman, President of the e-tailing group, focused on the marketing side of things. She went into more detail about the market and shopper mentality, and presented findings from surveys of small businesses that sold over the web. Some basics of Internet retailing:

• Put your website address on your marketing collateral, signage, and receipts.
• Optimize your website for search engines.
• Create your site to be a tool for customers to use. Be an information resource.
• Perform a competitive analysis.
• Partner with chambers of commerce, newspapers, trade associations, other websites, etc.
• Develop an email newsletter or mailing list.
• Deliver exemplary service.

Freedman also provided a checklist for a business when building a retail presence on the Internet:

• Define your requirements and write down a plan.
• Research platforms (stores, software, outsourcing to web firms). Start small and expand.
• Assess your marketing needs (email, search engine optimization, PR).

In general, her advice was very similar to Peters’: Know your customer and their trends; research possible solutions; and balance your resources.

John Wenck, an eBay representative, talked next about eBay’s solutions. In addition to their basic auction service, eBay also offers online stores, which may be an inexpensive and fast way to create a web presence. Wenck also covered some techniques for eBay sellers to customize their stores and perform sales tracking and analysis.

The final speaker was Scott Mooney, whose talk provided a real-life example of e-commerce success. For years, Mooney’s Ottumwa business sent out catalogs for their horse-related products, then in 1996 built countrysupply.com to bring the customers to them. In 2001 they added e-commerce to their website, with an initial product line of 5,000 items. Unfortunately, the ERP system they bought was expensive and overkill for their business, so in 2002 they outsourced the site to a web development firm and focused their company on customer service and marketing. They worked to improve their product line and website services, and have since merged with the multi-channel conglomerate horse.com. Here are the “hard knock” lessons Mooney passed on to the audience:

• Be an early adopter. Be first to market and look for opportunities in other markets and move quickly.
• Be a contrarian. Look for a down-to-earth lowend market that is underserved.
• Know your market and understand the customer. Every business has the potential to interact personally with any other person — don’t get lost in analytics and lose that personal touch.
• Collect customer information and start a customer list.
• Not all retailing is the same. Notice the differences between online and offline selling. Notice the competition and adapt to customers.
• Pricing is an art. Lead on prices for name brand, highly consumable, and price-sensitive markets. Match prices on unbranded or uncomparable items (but include a better value). Perform price “skimming” on new products and products that only you offer.
• Be able to handle the backend of your business. Balance your sales and operations.

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