5 Ways To Maximise Online Sales
According to recent reports, retailers are set to see their profits drop by around 5% this year*, adding yet more pressure in the race to remain competitive, visible and omni-present. With resources already under strain, how can retailers maximise online sales and boost their digital presence whilst keeping costs under control?
Thomas J. Vosper, Head of Retail Operations at Pricesearcher provides some advice.
1) Change Your Perspective - Historically, out-of town retail parks, outlets and shopping centres were considered the ideal destination site for shoppers, who would go out of their way to visit and experience the collective offering of several retailers, outlets and services. Some even took this a step further, with the likes of Tesco utilising their huge reserves to create the ‘Mega Store’ experience, offering everything from car washes through to hair dressing. However, over time it is clear that consumer behaviour has shifted back to smaller, convenience stores, in parallel with the rise in Pureplays. Other last-mile delivery options such as Click&Collect, parcel lockers, scheduled deliveries and third party parcel shops has also contributed to this consumer shift and form part of people’s local, regular routines. These elements combined have led retailers to increasingly focus on what they can do to maximise the very first consumer touchpoint, where pureplays naturally excel, and that’s discovery at the initial online search. The smarter retailers are already connecting online product discovery with additional information such as store locations, stock availability and delivery options.
2) Increase Online Presence and Transparency - Increasingly technology-savvy consumers are fueling a rise in the use of smartphones as part of the initial discovery process, with some going as far as conducting online research into product prices and alternative stockists whilst still in the store. More than ever, consumers are relying on independent reviews and buying guides and with such a wide range of delivery and pricing options available via the internet, retailers need to ensure they are present and visible wherever the consumer may be searching for them. The more forward-thinking retailers are already ensuring that their products are appearing on a wide range of channels, marketplaces and search engines. Transparency goes a long way, as you can see from retailers like Amazon, who have gained huge consumer trust through complete price transparency, offers, availability, delivery and reviews and through their marketplace sellers. Naturally, some more risk-averse retailers will be concerned that alongside transparency, products could surface alongside undesirable and unregulated content through traditional search. The solution to this is to focus on vertical search engines which can create a safe environment for brands and retailers of all sizes to showcase their entire range to the world. An example of a successful vertical search engine is Skyscanner, which presents a pure picture of flights, increasing transparency and delivering high levels of engaged customers.
3) Maximise Traffic and Minimise Costs - Adopting a multichannel approach undoubtedly helps to maximise visibility, but there is a price to pay. Commission rates, CPC, PPC, CPA etc all impact this strategy meaning that integration is often hampered by overstretched IT resource, as retailers face constant pressure to ensure they bring in as much traffic as they can for as lower cost as possible. Reduced costs naturally occur with large traffic volumes and resulting increased buyer power, but retailers tend to rely on ‘quick fix’ solutions to achieve this - such as marketplaces, daily deal sites, price comparison sites or even through paid search customer acquisition. Retailers need to be mindful of not simply curating their range or pricing based on cost of acquisition or the development resource required to open a new channel; this can create confusing messages to customers who are engaging across multiple channels or devices.
4) Adopt the right channels - Price comparisons sites are commonly considered by the general public to be ideal for finding the best deals across a wide variety of products and services, but retailers know that from the other side of the fence, they aren’t as impartial as they first seem. The commission and referral-based structure associated with the price comparison site model mean that only a fraction of the product catalogue appears online and will only appear whilst the retailer still has budget available. This model has been used by the likes of Amazon and Ebay to deliver outstanding growth and high traffic levels for retailers, but acting as a kind of ‘online landlord’, this has come at a price. As commission rates continue to rise, retailers are increasingly finding that their revenue is being constrained by tighter margins and ever eroding volumes. All is not lost however, and the good news is that new market entrants like Pricesearcher bring a brand new approach to maximising online visibility which doesn’t look to monetise pure product search in the way that traditional channels currently do.
5) Integration is key - Retailers increasingly appreciate that no one channel is viewed in isolation by consumers, even if the retailer is purely online. The explosive growth in Click&Collect services means that now is the ideal time for online retailers to explore further collaborations with the right carrier companies and last mile solution providers, whilst also making sure they complement current options and customer demographic. Retailers should look to combine efforts with partners who can provide customers with a complete picture of range, pricing, offers and location. On the reverse side, retail parks and outlet villages should be looking to collaborate with their landlord and co-tenants to co-ordinate activities and create a seamless online experience that drives consumers to their out-of-town location as the final destination.
About the Author:
With over 1 million monthly searches, Pricesearcher is indexing over 300 million products and is used by many well-known brands including Argos, PC World, Ao.com, Carphone Warehouse, Benefit, Mountain Warehouse, Curry’s, Mothercare, F. Hinds, Dreams and The Entertainer.