Taking Your Organisation into Online Retail – Issues And Challengesv1

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challenges presented for traditional business, moving into the online retail and ecommerce space

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Taking Your Organisation into Online Retail – Issues And Challengesv1

  1. 1. Taking Your Organisation Online Issues and Challenges Faced by Traditional Retailers Jon Bovard
  2. 2. Agenda <ul><li>How do you build an easy to use website for your audience? </li></ul><ul><li>How do you select an eCommerce platform? </li></ul><ul><li>Going online: The REAL challenges </li></ul>
  3. 3. Identity Direct <ul><li>Identity Direct – over 500,000 orders a year </li></ul><ul><li>60% of Orders international </li></ul><ul><li>Personalised gifts – kids focussed </li></ul><ul><li>Was 1% online – now over 60% and growing. Fast. </li></ul><ul><li>Current platform redesign in progress! </li></ul>
  4. 4. How do you build an easy to use website for your audience? <ul><li>HIPPO </li></ul><ul><li>Eye tracking studies/ Usertesting laboratories/Focus groups </li></ul><ul><li>Analytics </li></ul><ul><li>3 rd party tools </li></ul>
  5. 5. HIPPO <ul><li>Highest Paid Person’s Opinion </li></ul><ul><ul><li>“Whatever you say boss!” </li></ul></ul><ul><ul><li>Intelligent guess </li></ul></ul><ul><ul><li>Sometimes a good starting point </li></ul></ul>
  6. 6. Eye Tracking Studies/Labs <ul><li>“Interesting” </li></ul><ul><li>Expensive </li></ul><ul><li>Inconclusive </li></ul><ul><li>“Ok” for landing pages </li></ul><ul><li>Not holistic </li></ul>
  7. 7. Analytics <ul><li>Somewhat useful </li></ul><ul><li>Screen resolution/Technical data </li></ul><ul><li>Is purely objective </li></ul><ul><li>Does not explain </li></ul><ul><li>Can lead to dangerous assumptions </li></ul><ul><li>If not “online” then you wont have any! </li></ul>
  8. 8. 3 rd Party Tools – Usertesting.com <ul><li>Is my website useable or confusing? </li></ul><ul><li>Members of the public – get paid to test your site </li></ul><ul><li>For $29 you get a video of the experience </li></ul><ul><li>A written summary of your site and what they experienced </li></ul><ul><li>Target specific ages or demographics </li></ul>
  9. 10. 3 rd Party Tools – OptimalSort <ul><li>How should I categorise my content? </li></ul><ul><li>Where do I (my customers) think my products fit? </li></ul><ul><li>How should I organise my website? </li></ul><ul><li>Do my offline categories work online? </li></ul><ul><li>Great for sites with a lot of products </li></ul>Feedback from users where your products belong
  10. 11. How do you select an eCommerce platform? <ul><li>Pedigree </li></ul><ul><ul><li>Functionality </li></ul></ul><ul><ul><li>Customers </li></ul></ul><ul><ul><li>People </li></ul></ul><ul><ul><li>Strategic vision and Roadmap </li></ul></ul><ul><ul><li>Backing </li></ul></ul><ul><ul><li>Cultural Fit </li></ul></ul>
  11. 12. The ‘Australian’ challenge <ul><li>Not all The “Big” ecommerce players are here </li></ul><ul><li>Limited local presence </li></ul><ul><li>Limits options </li></ul><ul><li>Time difference = pain </li></ul>The Forrester Wave™: B2C eCommerce Platforms, Q1 2009
  12. 13. Questions to ask your eCommerce platform provider <ul><li>Have you actually built an ecommerce site? </li></ul><ul><li>Who are your other clients? </li></ul><ul><li>Backing and funding </li></ul><ul><li>Customer retention </li></ul><ul><li>Who are the key people? </li></ul><ul><li>Ask about the integrator - not the vendor. </li></ul><ul><li>Are you actually doing the work? </li></ul><ul><li>Find a client that they have lost in the last 12 months. Speak to them directly </li></ul>
  13. 14. Questions to ask your eCommerce platform provider <ul><li>What is your smallest, biggest and average size client? </li></ul><ul><li>How close is your platform fit to my real requirements? (find out yourself!) </li></ul><ul><li>References, references, references </li></ul><ul><li>Who is doing the work for you? Meet the programmers and project managers </li></ul><ul><li>Beware unproven platforms or integrators </li></ul>
  14. 15. How much? <ul><li>Minimum $200k AUD and up…. </li></ul><ul><li>Beware false economy </li></ul><ul><ul><li>Lack of features </li></ul></ul><ul><ul><li>Poor conversion </li></ul></ul><ul><ul><li>Human overhead </li></ul></ul><ul><ul><li>Development flexibility (or lack of) </li></ul></ul><ul><ul><li>Lack of Roadmap </li></ul></ul>
  15. 16. eCommerce platform: What am I actually paying for? <ul><li>Roadmap – the future . Will it evolve? </li></ul><ul><li>Security </li></ul><ul><li>Flexibility </li></ul><ul><li>Extensibility – integration </li></ul><ul><li>Merchandising and search </li></ul><ul><li>Support and upgrades </li></ul>
  16. 17. Going online: The REAL challenges <ul><li>Structural </li></ul><ul><li>Cultural </li></ul><ul><li>Merchandising Strategy </li></ul><ul><li>Technical </li></ul><ul><li>Human </li></ul><ul><li>Legislative/Legal </li></ul><ul><li>Financial </li></ul><ul><li>Warehouse and logistics </li></ul>
  17. 18. Structural <ul><li>Creating the eCommerce team </li></ul><ul><ul><li>Option 1: Part of the main business </li></ul></ul><ul><ul><li>Option 2: Capitalised and executed separately </li></ul></ul>
  18. 19. Structural - Part of the main business <ul><li>Advantages </li></ul><ul><ul><li>Brand control/cohesion common marketing </li></ul></ul><ul><ul><li>“Shared” human resources/IT (beware!) </li></ul></ul><ul><ul><li>Shared physical resources/equipment </li></ul></ul><ul><ul><li>Shared warehousing </li></ul></ul><ul><ul><li>Lower capital injection </li></ul></ul>
  19. 20. Structural - Separate <ul><li>Advantages </li></ul><ul><ul><li>More agile/speed to market </li></ul></ul><ul><ul><li>Online “culture” might differ to “offline” </li></ul></ul><ul><ul><li>Lower risk of resource conflict </li></ul></ul><ul><ul><li>Run as separate P&L </li></ul></ul><ul><ul><li>Vary marketing and operating strategy </li></ul></ul><ul><ul><li>Merge into the main business when/if successful </li></ul></ul>
  20. 21. Cultural <ul><li>“ this is how we do it now” </li></ul><ul><li>eCommerce requires support at the board level </li></ul><ul><li>Your business is setup for retail. Not etail </li></ul><ul><li>Probably operating at capacity </li></ul><ul><li>eCommerce stretches capacity </li></ul><ul><li>An additional channel adds complexity </li></ul>
  21. 22. Merchandising Strategy <ul><li>Does Online = Offline? </li></ul><ul><ul><li>Price. Are online customers more/less sensitive? </li></ul></ul><ul><ul><li>Can you vary price of online to offline? (without upsetting customers!) </li></ul></ul><ul><ul><li>Audience/Demographic </li></ul></ul><ul><ul><li>Suitability of product </li></ul></ul><ul><ul><li>Do they shop the same way online? </li></ul></ul>
  22. 23. Technical <ul><li>Web developers – unique breed </li></ul><ul><ul><li>Highly specialised </li></ul></ul><ul><ul><li>Technical landscape in Australia different to the UK/US </li></ul></ul><ul><ul><li>Rare skills – local talent difficult </li></ul></ul><ul><ul><li>Even rarer for proprietary technology </li></ul></ul><ul><ul><li>Hosting eCommerce is specialised </li></ul></ul>
  23. 24. Human Resources <ul><li>Find a good eCommerce manager </li></ul><ul><ul><li>Not an IT Manager </li></ul></ul><ul><ul><li>Not a Marketing Manager </li></ul></ul><ul><ul><li>Some Senior Online marketing types </li></ul></ul><ul><ul><li>Bring this person in at a Senior level </li></ul></ul><ul><ul><li>KPI this person </li></ul></ul><ul><ul><li>Keep this person incentivised </li></ul></ul>
  24. 25. Human Resources <ul><li>Other considerations </li></ul><ul><ul><li>Web Content/Merchandising </li></ul></ul><ul><ul><li>Web Design/Interface designer </li></ul></ul><ul><ul><li>Email/Search/Affiliates </li></ul></ul>
  25. 26. Legislative <ul><li>Compliance </li></ul><ul><ul><li>Payment and finance (PCI compliance) </li></ul></ul><ul><ul><li>Privacy (esp email marketing) </li></ul></ul><ul><ul><li>Disability act </li></ul></ul><ul><ul><li>Foreign “eCommerce” laws (Duties, Taxes, Safeharbour, Distance selling UK etc) </li></ul></ul>
  26. 27. Warehouse and logistics <ul><li>Distribution model </li></ul><ul><ul><li>Is you warehouse suitable for direct dispatch? </li></ul></ul><ul><ul><li>Centralised versus single store versus multistore </li></ul></ul><ul><ul><li>Merits of having stock in one place </li></ul></ul><ul><ul><li>Return rates. Apparel and footwear as high as 40% </li></ul></ul><ul><ul><li>Multichannel returns. Allowed or not? </li></ul></ul>
  27. 28. Summary <ul><li>eCommerce is tough. </li></ul><ul><li>Large scale eCommerce is not cheap </li></ul><ul><li>High upfront cost and effort with long term reward </li></ul><ul><li>Find a good eCommerce manager </li></ul><ul><li>Test your site and audience </li></ul><ul><li>“Getting it right” is an going process </li></ul>
  28. 29. Thank you… <ul><li>Jon Bovard </li></ul><ul><ul><li>[email_address] </li></ul></ul><ul><ul><li>http://www.linkedin.com/in/jonbovard </li></ul></ul><ul><ul><li>twitter .com/j bovard </li></ul></ul>

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