This is a loaded question, most of the worlds biggest online retailers started out as local bike store who did the right thing at the right time in the right place. Local bike shops have made it big and many others are trying.
The real question is, “why do some bike shops make it and others fail?” If the successful online shops did the right thing and the right time in the right place, what are the wrong things?
Lack of Genuine Committment
There is a different between trying to be successful online, and actually committing to online retail. The common scenario is that the local bike shop decides it wants to go online – pays a web design company $10,000 to create a shop and struggles to get sales. When they do get sales, fulfilling orders is messy and in no time the online inventory is out of date, along with the software and it discarded as an expensive failure…. because ‘the internet doesn’t work’.
The web design agency play a role in the demise for failing to educate the bike shop and showing them the big picture. And the cost conscious bike shop all too easily ignores or overlooks key parts of online retailing. As noted in an earlier article, If you build it, they won’t necessarily come.
Part of genuine committment is a vision to look beyond the word of the one-dimensional web design company and take the initiative to understand the building blocks. Also to question information, to analyze, to research and make smarter decisions.
The building blocks for successful online retail
A brief and incomplete list of some of the key building blocks:
Marketing: whether big or small, you have to invest in marketing. You have to spend money and the smart retailers also discover the best channels and keep trying new approaches.
Fulfillment: A massive topic, and for the sake of simplicity includes logistics. This is ensuring that the inventory is current, that delivery projections are up-to-date through to processing the order, packing, dispatching, delivery and tracking. All along keeping the customer informed and happy.
Customer Service: As with traditional retailers, customer service can make or break you. Of course the customer service requirements for online sale is different, but customers want immediate satisfaction and immediate answers. Word of mouth is just as important for online retailers and negative customer experiences are amplified even further in the internet.
Technology: From responsive websites to cater to smart phone and tablets to effective order process as well as clever technical integration and Search Engine Optimisation (SEO) and Search Engine Marketing (SEM). You need an expert at your side who knows technology.
Price: The internet makes it inherently easier to compare prices, as long as the retailer is trusted the the lowest price wins. Why pay more for the same product (an online retailer can hardly sell their ‘customer service’)?
Any bike shop can set-up online, but a visionary does more. They understand the potential of online to their business, they understand the change or adaption required. They invest and continue to drive, often employing specialists which push their online retail abilities beyond others.
It means that online retail is not for all, traditional businesses certainly shouldn’t ignore online retail (they need to adapt to remain competitive) but if a retailer isn’t truely dedicated to opening up online retail, they are often better off investing in their core business.
But their are plenty of sales out there, and just because one retailer is popular, it doesn’t mean they can maintain. Management and profit orientated decisions can taint a retailer leaving gaps for young online retailers who can do it better.
photo: © ubray