Sep 1, 2012
If I have learned anything over the years while running ecommerce businesses, it is to plan for everything, and expect the unexpected. Growth requires adaptation, constant attention and change. "You reap what you sow," "garbage in, garbage out," and the list goes on. I have been fortunate enough over the years to have consulted with store owners and operators, for both international name brands and one-person start-ups, and at some point during the process of building their businesses, the same "ah ha" moments come to light. By sharing these moments, I hope all ecommerce businesses, both new and seasoned, find better understanding of some common issues all retailers face at some point.
Lesson 1: Growing an ecommerce business will be harder and more expensive than you think.
Two of the biggest misconceptions I find in stores who seek growth is that you can "do it big on a small budget," and that it cannot be that hard to achieve sales. Remember that success is never easy and valuable advice does not usually come cheap. The complex nature of running any business makes it susceptible to all types of twists and turns along the way, any of which may make the process harder and thus more expensive to complete. So, prepare a budget that helps you gain access to the resources you need to succeed, and then see it through for a minimum of two years, three to four preferably, before you even think of saying, "It doesn't work." It is not going to be easy, but with the right team behind you, you will most certainly find success in the end.
Lesson 2: Growing an ecommerce business will take longer than you think.
Everyone wants it yesterday. The fact is, no business is built overnight and all successful and sustainable businesses took time to get there. They only became newsworthy after they achieved success. The blood, sweat and tears shed behind closed doors, before the media discovered their success, is likely never told, but it is real. For many new businesses, the two year mark is a big one. Most will not be around after that period, out of cash and short on sales, and those that do survive still have a way to go to find true success.
If you do not set aside a proper budget to last a period of one to two years, then your chances of success could be greatly reduced. Even then, there are no guarantees one will find success. The only guarantee is if you do not try it, and do not set aside the right resources to make it happen, you surely will not succeed. Be patient yet be smart in your decisions.
Lesson 3: Educate yourself about what it takes to run an online business.
If you think because you operate a successful offline retail operation that you know what it takes to run a successful online operation, think again. Running an online business is similar to, although very different from running an offline store. Yes, the same basic business principles of expense, revenue and retail hold true, but the way you approach the implementation can be quite different. Although, with the right team in place, you will not need to know all the intricacies of running an online business, you should be educated enough to understand on a high level what is going to take. It helps for managing expectations, budgeting and a whole range of other items you will run across.
Lesson 4: Who you hire and how you use them is vital to your success.
As briefly mentioned in lesson three, to be successful requires the right team of individuals, preferably those who have, "Been there and done that." A track record of success and experience means you are getting what you pay for and can count on the quality your team brings to the table. Talented teams are not easy to find and do not always come at the lowest price, but when you find them, seize them and do not let go. They are your lifeline to success and without them you could be in for real trouble.
This does not mean you need to hire in-house employees to get the job done, which can be costly and come with a whole set of added issues. Often times, the best route is to outsource the tasks to an individual or group of individuals who can help you get where you need to go. Some of the biggest names in the industry use contracted workers, accounting for more than 70 percent of the total ecommerce team.
Lesson 5: The foundational principles of excellent offline retail still apply.
You cannot just think, "Build a website and they will buy." It does not work that way. Do not get so caught up in the online world that you forego the basic principles all offline successful retail businesses follow: Timely and friendly customer service, with the "customer is always right" mentality, fast and accurate fulfillment, effective marketing, products that are in-demand, the right mix of pricing and promotion. All of these elements need to be present in some way in the online world.
Lesson 6: Distractions will occur. Have a strategy, plan accordingly and stay focused.
As any business owner knows, nothing ever runs 100 percent smoothly all the time. Even some of the biggest online retailers have seen their share of problems (including server down time) during operations. It is not a matter of if it will happen, it is a matter of when it will happen. Consider this when planning, and develop a recovery or emergency strategy to remedy the problem as quickly as possible.
Likewise, do not get distracted by all the new tech gadgets available promising to make your business better. Yes, some might work for your business but others will not. It will be your job to keep focused on those items that fit your specific vision and align with your company objectives. Be open and willing to listen, but be smart enough to understand what works for your business and what does not.
Lesson 7: Your customer is way ahead of you, and your competitors probably are too.
Every so often I still come across a client who tells me their customers are not Internet savvy, and thus the online world of ecommerce simply will not work for their business. This is so far from the truth that I cannot believe I still hear it. Nonetheless, it is my job in these cases to help the client understand that their customers are shopping on the Internet more than ever. With the increasing popularity of tablet devices, smart TVs and the like, it opens up a whole new user demographic, and their customers are shopping at competitors' sites. Do not think that just because your customers might not be tech or Internet savvy that they will not shop online. Rather, think of ways to improve their customer experience surrounding your online store in an effort to make it even easier for them to buy from you.
Lesson 8: It only gets harder and more expensive the longer you wait.
You have to do it now, stop waiting. Too often I hear, "We have no budget to do this," or, "We can't afford to do it until we have more sales." Remember, you have to be willing to spend money to make money, and if that means operating in the red for a time then, so be it. With the right plan in place, your efforts will eventually pay off in the form of profits. If you keep waiting until you have enough cash to get the job done, you will likely never have enough because the longer you wait, the more expensive it is to get it done. So what you thought you needed the first time around is now far different than what you expected. If you keep waiting, it will never happen. Take the plunge, go all in, and fight like mad to stay afloat. That is how all successful businesses start.
Lesson 9: This will become the most exciting venture upon which you have ever embarked.
Despite the hard knocks and lessons learned along the way, despite the bumps and bruises, there is not a single ecommerce store owner who has not thrived on the feeling they get when they go to sleep and wake up richer in sales. Who does not want to make money while they sleep? It is a feeling that can only be described when you achieve it, and to all those I have coached who have felt this, it is one of the most exhilarating and rewarding journeys a store owner can have.
If you have fears or doubts about running a successful online store, but have always dreamed of doing just that, it is time to put those fears aside and act. The longer you wait, the harder and more expensive it is going to be to accomplish that goal.
Eric Leuenberger is an ecommerce expert, founder of Ecommerce Amplifier, and owner of Voom Ventures, LLC, whose products and services help store owners and operators increase traffic, maximize ROI, decrease expenses and increase revenue. He can be contacted online at www.voomventures.com or by phone at 866-602-2673.
Topic: Business Strategies
Related Articles: Lessons Running Online Business
Article ID: 1645
Entire contents ©2020, Sumner Communications, Inc. (203) 748-2050. All rights reserved. No part of this service may be reproduced in any form without the express written permission of Sumner Communications, Inc. except that an individual may download and/or forward articles via e-mail to a reasonable number of recipients for personal, non-commercial purposes.