Friday, January 01, 2010

eCommerce Resolutions for the New Year!

I love when the calendar changes to a new year, because it once again gives me hope that this new year will be so much better than the last. Moving into 2010 from the recession plagued 2009, gives me added hope; it couldn't get worse could it?

As you are looking to 2010 for improvements in your online business? Consider one or more of my top 10 resolutions/suggestions for 2010. Hopefully they will help you with your business in the new year. Theses are not ranked in order of importance just by when they came into my head :) First, the best way to plan for the future is to assess the past, so here are a few suggestions.
  1. Take these first few days of the new year to reflect on what you want out of your online business. There are many reasons for starting an online business; is the reason you started still a reality? Did you just want extra cash? Did you get laid-off and need the additional income? Did you want to expand your Brick and Mortar business? Did you want to grow your business into a huge online operation? Look at what motivated you to start and see how well you did so far. Take stock of where you are currently and be honest about it.

  2. Take these first few days of 2010 to assess your business and the ecommerce climate. If you are a marketplace seller, take stock of what worked and what didn't for each marketplace. Stop looking at each sales channel from the same perspective. If you only sell on your website, then consider growing incremental sales on one or more of the viable marketplaces on the web.

  3. If you are a small seller, part-time seller, lifestyle seller, hobbiest, eBay seller (eBay is your sole marketing vehicle) please understand that ecommerce today is nothing like when you started. There are many more marketing options available now, your competition has increased and the online consumer is much more demanding. The idealism that carried you through the early days of your business needs to be replaced by the cold, hard reality of doing business on the web today. Take this time to assess, how you can achieve your goals in light of the current environment.

  4. If you are a large seller looking to grow your business even more in 2010, take stock of all of the marketing channels available and start using the ones that make the most sense. I would recommend a site called Quantcast.com to give you a feel for what the demographic is for each marketplace. What sells well at eBay may not at Amazon or Buy.com.

  5. Do not "live" on any one marketplace. This applies mostly to small sellers who don't have the resources, nor desire to sell on multiple channels. Take it from me, I lived solely on eBay and waited too long to launch my website, when my business model on eBay no longer worked, I didn't have enough website business to keep me afloat. At the very least launch a website and grow it while selling on a marketplace. If you decide to "live" on a marketplace, please make sure your livelihood doesn't depend on it.

  6. Many online sellers are fantastic at sourcing product, but not so good at the other aspects of the business (customer service, shipment, etc.) If you plan on selling on a marketplace, remember that each channel will become more restrictive, rather than less. Performance will be key to your success on each sales channel.

    Ship your orders sooner rather than later. At Buy.com we require that sellers ship their items within 2 business days. We have some exceptions depending on category. Amazon is heading that direction. They currently do not require it but my guess is they will soon. WalMart does require that sellers ship with 2 business days.

    In a recent Business Week article "eBay's Last-minute Delivery Push" "Vice-President for Buyer & Seller Experience Dinesh Lathi says its sellers take an average of four days to ship items, and 85% of orders ship within three days. That's an improvement over a year ago, though Lathi won't say by how much. "We are working with sellers to make sure they are better-positioned to meet buyers' expectations," Lathi says."

    In the good old days, that kind of performance worked on eBay, because eBay was the only place to get the product, but there are way too many viable options to eBay these days, so shipping in 4-days does not measure-up. If you want to be successful on other marketplaces you will need to improve your performance.

  7. Stop looking at Marketplaces as customer acquisition tools, even eBay: First each marketplace will have rules that restrict you from marketing to their customers and you may put your selling account in jeopardy and secondly because it really doesn't work.

    Consumers shop on these sites for a reason, because they like the broad selection, the way the site works and they know the site will stand behind the purchase. Buy.com customers regularly turn in sellers who market directly to them. Even eBay shoppers are extremely difficult to acquire. I had 400,000 customers at Glacier Bay and only 40,000 of them were regular customers. I could only get maybe 10% of those regular customers to shop from my website.

    Customer acquisition should come through comparison shopping, paid search, SEO and other marketing efforts. Marketplaces should be considered incremental sales channels based on revenue sharing. If the share of revenue that a marketplace gets works within your financial model, then make that marketplace part of your business.

  8. Understand what your business model is: If you are a high value, low volume seller than the marketplace may not be for you. Marketplaces are competitive and usually the lowest price gets the sale. Marketplace managers are looking for sellers with great selection, low prices and great performance, so before you sign-up take this into consideration.

    Many successful online businesses thrive with the high value, low volume approach onCheck Spelling their websites and use marketplaces for liquidation and cost recovery. Find the model that works for your business.

  9. Are you enjoying your business, or is it sucking the life out of you? Take these first weeks to assess what you are doing and either re-commit yourself to your business plan, revamp your business plan or find an exit.

  10. This is specifically directed at eBay sellers. The eBay of today will never again be like it was and you need to finally come to grips with that. Either make eBay work for you or find another option.
Happy New Year to all of you and I would love to hear your comments or additional suggestions.

Just my 15%

17 comments:

Randy Smythe said...
This comment has been removed by the author.
ebuyerfb said...

With regards to #6 you have to keep in mind that eBayers are notorious for adding a few days (in their mind). Two specific cases I've dealt with come to mind:

1) Years ago I sold something to someone in Canada on a Saturday night and the buyer asked me for tracking info about 36 hours after purchase. He stated it had been 4 days and I politely reminded him that it had been less than 48 hours so there was no way it could have been counted as 4 days and then gave them them the requested info. I had just returned from the PO.

2) Last month I received some suggestions with regards to one of my applications a user had recently subscribed to and then unsubscribed from. They stated they had been messing with it for days but couldn't figure it out. I looked at their info and they had only been registered for 12 hours.

Anonymous said...

In Regards to #7 Stop looking at Marketplaces as customer acquisition tools.

"and secondly because it really doesn't work."

If it really doesn't work then why every time I order from buy.com on ebay do I get at least a full color sales flyer promoting buy.com? Why would buy.com spend so much on advertising in an ebay purchased package if it does not work?

Randy Smythe said...

Anonymous,

I don't have anything to do with the Buy.com business on eBay but I do know we follow the rules of each marketplace we sell on.

If you purchased from Buy.com directly and then purchase from us on Amazon, it is possible you will get some communication from us.

Before I started working at Buy, I made an order through them on eBay. I didn't want to use PayPal so I completed my order on Buy.com I then did not opt out of emails and began receiving occasional deal emails.

Is this possibly what happened with you?

permacrisis said...

"If you are a small seller, part-time seller, lifestyle seller, hobbiest(sic), eBay seller (eBay is your sole marketing vehicle) please understand that ecommerce today is nothing like when you started. The idealism that carried you through the early days of your business needs to be replaced by the cold, hard reality of doing business on the web today."

Or so businesses would have you believe. My Craigslist sales say otherwise. The TRUE cold hard reality is that person-to-person selling is a threat to big business, and they love to spew platitudes like the above in order to supress it.

But Craigslist's current success makes liars of them. Imagine if they allowed shipping!

Consider that people are willing to drive 30 miles and risk dealing with perverts in order to buy directly from a person, save some money, and avoid doing business with a business. And above all else GET THAT ITEM- "Item" Randy. Not "Product". To me, that says something.

It says that the more conservative the rest of e-commerce becomes, the bigger advantage an anything goes, devil-may-care, wild west marketplace (for example an auction-only venue) will have, and have it all to itself.

The need is stark, the need is gaping, and it's already been proven that the space is lucrative. Why no one is rushing in to fill the void is a mystery worthy of Scully and Mulder.

Randy I hope you are right and the web becomes devoid and sterile- it will make the debut of such an auction service all the more audacious! They will have what ebay once did- no competition.

Randy Smythe said...

permacrisis,

It's good to see your comments. I haven't given up on my concept of a Classic eBay. I still believe they should spin off the auction biz into it's own little universe, but the reality is that OOAK, Vintage, Collectibles etc. is not a huge growth area; though it is still very profitable.

My perspective has changed though. I used to look at eBay strictly from my viewpoint as a seller and what mattered to my business and 100's of other sellers out their like me. Now that I work for a marketplace and see how customers view 3P sales my perspective has changed a bit.

A private company like Craigslist and to some degree, Etsy doesn't have the growth demands that a public company has. Investors often drive the ship. For public companies it is all about the combination of Top Line and Bottom-line growth.

Look at Amazon's and eBay's share prices. eBay makes a ton more money than Amazon does, but Amazon is the growth story and the share price reflects it.

eBay wants to grow it's Marketplace business and they need to split things up in order to do that.

permacrisis said...

I take umbrage to the suggestion that if you do what you do for love, just give up and quit.

We are still here. We are bruised, bloody, and bowed, but not dead.

Randy Smythe said...

I would never suggest quiting what you love... just that the ecommerce world has changed and things won't be the same.

I loved selling DVD's but I loved making money more. I quit when my model no longer worked for me, rather than re-organize and try a new model that I wasn't in love with.

I don't like banging my head against the wall...

Anonymous said...

In Regards to #7 Stop looking at Marketplaces as customer acquisition tools.

Is this possibly what happened with you?

No, I am referring to a full color sales flyer that comes packaged in the box with the product, not the Great Email Blast that I get from buy.com about your product.

I do love to receive the Blast, but get irritated every time I see the advertisement that comes in the package, as Buy.com has recently been on a rampage to make sure that their sellers do not include anything anywhere that references or directs customers back to the sellers site.


"but I do know we follow the rules of each marketplace we sell on."

I have always assumed that buy.com had a special "Diamond" agreement that overrides the ebay rule about including advertisement for the buy.com site for there ebay sales, if not then your statement is incorrect.

Randy Smythe said...

Annonymous,

I don't recall an eBay rule against package inserts. I think most everybody does that with their packages.

I haven't sold on eBay in years so maybe I am mistaken but when I was selling there was no specific prohibition against including inserts in the packaging.

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