eCommerce Tips -- Part 2

Part 2 of eCommerce tips...  look for Part 3 coming out shortly.

Scott

1. Executive Management — typically you’ll find Executive Management has the misconception that once the site goes live the dollars will start rolling in immediately.  As we know this is absolutely ludicrous — the site needs to mature, have campaign dollars spent on it, let alone ensuring the search engines start indexing the site.  Make sure you are DAMN clear by always saying the site won’t generate a single sale for 6 months.  Start your conversations and end your conversations with this important point continuously.
2. Timelines — first, you won’t hit your original timeline.  Live with it.  And if you do, you’ve probably left something off which is critical.  Second, timelines should be built on quarters not months.. it will give you some leeway and is actually more accurate in the end.
3. Privacy and Security — you must make your site bullet proof… your customers data and personal information is critical.  If you’re not going to take the time and money to make your site safe against malicious or accidental incidents then you shouldn’t get into eCommerce.  Hire an eCommerce security and privacy consultant to put the processes and security protocols in place.  This is the most important development and process area when you develop your eCommerce site.
4. Currency — get a currency converter on the site so your customers can understand the true cost in their preferred currency.  Get the data from a company which updates currency rates during the day.  I like to bill in US dollars and collect the money in US dollars vs. the hassle of taking conversions later.  It doesn’t impact the customer as they pay the same on their credit card.  
5. Embargo countries — remember, the US and EU prohibit companies to do business with certain countries e.g. Iran.  So ensure your system is setup to reject these sales.  I’ve always kept the order data in the eCommerce system so I had a record of the failed transaction.  That data could come in handy one day.
6. Trigger on multiple purchases — got caught on this one once.  Someone pinged the site and made multiple independent purchases, paid for them with the same card and they all went through.  Of course the card was stolen and they got some free content.  Put a limit on multiple orders from the same card, address, etc. which can be done during a certain time period.  It will help eliminate another area of fraud.
7. Cross sell across the entire site.  “People also looked at these products”, “People purchased these products as well”, “Consider these companion products”…. are key on the site.  Merchandise the site aggressively.  Tip… if you’re using one of the big platforms, you’ll probably use an algorithm which will personalize these recommendations.  But it will take time for the algorithm to learn…so hard code some cross sell products on the site until it gets enough data.
8. Search engines — once you’re open for business, Google, Yahoo!, Bing, etc. will start sending down search bots to begin indexing the site.  Note… keep the content up to date, fresh and at the top of the site.  It will make it easier for indexing and will keep the bots happy.  Also, everyone focuses on Google but don’t forget to keep things simple for the other engines as well.
9. Shipping costs — free shipping is all the rage during the holiday buying season.  And certain free shipping promotions can help drive purchases as well.  When you’re building the system check that the rates for each shipper you use are accurate.  
10. Handling costs — wonder why you can “get 2 ShamWows for the price of 1”… just pay shipping and handling?  Because handling is another way to get profit.  Yea, you might need to have someone pack the stuff up and that costs you…but using handling costs for profit enhancement is a good idea.  I’m 50/50 on this practice.  It’s nice to have the extra profit, but I question whether it’s worth the possibility of pissing off a customer.   
11. Shippers — I like to use multiple shippers.  UPS, USPS and FEDX.  If overseas, DHL is a good choice.  As delivery methods, costs, time etc. are different, the variety provides your customers with choices.  But, that choice means your systems and logistics need to be setup to accommodate the different shippers.  Making labels, putting in a tracking number etc. should be integrated into your eCommerce logistics.  Speak to a logistics specialist.  And when looking at 3rd party software, see if this is an Out of the Box feature or if you have to buy additional software.
12. Distribution of product — when you start out your site, it might be easy to just have the mail kid pack up the stuff and send it out.  However, be ready to quickly put more resources into product distribution at any time if/when product sales increase.  By the way, make sure you look professional when you distribute your products.  Don’t throw them in a box without proper protection material (styrofoam peanuts, bubble wrap).  Show you’re environmentally responsible by using recycled eco-friendly materials  And don’t hand write the mailing label… print it out professionally.  Tips… include your latest catalog in the box, a thank you note, a coupon for future purchases, etc.  
13. Right products — its key to get the right ones on the site…that’s easier said then done.  It’s a test and learn process… so switch it around.  
14. Right price points — with anything else, getting the price at a point which maximizes profit while maintaining competitiveness will be key.  Set up a site scrap of competitors sites for pricing.  It can help you keep your prices competitive.
15. Consider credit card limits — if a customer can’t pay for it, they can’t buy it.  Credit card limits vary, but it’s easy to determine that the more expensive the item you’ll probably not have as many buyers.  And business credit cards usually have a limit of $5,000 for travel and expenses… Purchase Order Cards can be higher, but I’ve always relied on the $2,500 top end for business card purchases.  Anything above that on the site, will probably require an employee to get a purchase order.
16. Credit Cards — my view… accept as many types as possible.  MasterCard, Visa, Discover, American Express… if people have them, they use them.  The discount rate is always a big concern as its an expense… some sites don’t accept AMX for the high discount cost they charge.  Yes, it can be 100 basis points or more in cost, but I’ll take a bit less in profit to get a new customer any day.
17. Purchase orders — if you’re focused on businesses you should have the ability to purchase using a PO number.  This is going to require integration with your back end finance systems and isn’t a trivial development task.  
18. Tax consequences — for the love of God, charge tax.  It sounds like a no brainer, but I’ve seen sites which don’t do it.  For most products you must charge tax.  If you don’t charge YOU will pay the tax for your customers.  That usually means you’ll lose 5-8% profit.  Hook up the eCommerce tables to accurate tax tables.
19. Backup servers/systems — it sounds like a no brainer as well.  Keep it in mind when you setup your site on a 3rd party server provider.  Find out how the procedure works, what defines “an outage”, timing until the site comes back up, etc.
20. Get em in, get em out… I’m probably in the minority on this, but I like to get people on the site, have them find stuff quick, pay for it and then decide to leave or hang around after that.   If your on site metric is increasing and sales are decreasing it’s more than likely that your customers can’t find the product. Look to lower your on site time while increasing your sales at the same time.

eCommerce Tips - Part 1

eCommerce Tips… 

1. Check with and get educated on credit card and purchase order processing early in the game.  Depending upon the size of your commerce business, past security issues, technology, etc. will determine how complicated your approval process will be.
2. Get a complete and full list of requirements prior to ever talking to a vendor.  
3. Run pro-forma financials on the eCommemrce business… determine the revenue/cost expectations and where that break even point will be.
4. Have a “mini” commerce system built by the software vendors to really understand how everything works.
5. Go to AND sit down with a current company using the software to actually see how it works… it will help you determine the complexity of the software.
6. Build your product catalog early!  And I’d recommend you put NUMEROUS catalog managers on the task… better yet, farm the work out to a low cost center where you can get a ton of people working on it at a lower cost.  Trust me on this one… it will take a hell of lot longer than you think.
7. Simplicity is always better.  You can add and potentially make the store more complex later, but come out with a simple “buy and sell store.”
8. Go out of the box — everyone says their business is “different.” But I’ve seen that not to be the case.  Remember, the more tweaks you add to the system the more risk you have of a break, higher costs, etc.
9. Don’t overbuy — buy with the opportunity to grow.  You probably don’t need the tricked out CMS, tons of licenses, etc.  Buy small with the opportunity to grow big.
10. And for God’s sake don’t get caught up in the whole “package” sort of deals.  Understand exactly what you need and buy that.
11. Under promise the system functionality and sales - no matter what!
12. It will take 18 months to start to really see sales take off.  This isn’t a “turn on the facet” type of sales.  Many will expect the sales to role in on day 1.  Be sure to communicate and set expectations.
13. Outsource web services — I like Amazon Web Services (AWS)… they’ll keep your servers and the security aligned.
14. Put together the first 2 quarters eCommerce marketing plans… products, pricing, copy, promotions, etc.  Execute them closely, track the results and make changes quickly to improve results.
15. Have a professional writer manage the copy… and get someone experienced in direct response copywriting.  Keep them on a long term contract to ensure the text is consistent across the site.
16. Negotiate the software contract aggressively.  The margins on software are huge, so step up your game.  Get procurement involved to handle the situation.
17. Develop the store outside your IT department.  Nothing against internal IT departments, but they probably don’t have the experience in developing the software and we all know priorities change like the wind.
18. Ensure  IT has full time support resources post initial development to manage the platform.
19. People are the most important part of the eCommerce environment.  You MUST get people who are experienced in eCommerce or .com management.  They need to have program management skills, financial knowledge, IT focus, business management, and marketing skills.  Yes, you’ll pay for the best… but it’s worth it.  You’ll also need lower skilled workers, but ensure they have the experience you require.
20. Resources — someone for search.catalog, management, marketing, IT, dev. security, processes, etc.

Stay tuned for more tips...

Scott

Marketing is Sales — Learn to Live With It

As Marketers we continually screw ourselves every time we open our mouths and spout out… the brand, advertising, radio, tv, print, events, digital, creative, marketing “expense”, media, etc.

All of those terms scream — Expense!  It reinforces the misconception that all marketing is expense… and people outside of Marketing (e.g. Finance/Sales, etc.) keep thinking “why do we spend so much money on this fluff.”    

Whether we like it or not, we Marketers have branded our work expense.  So every time the company needs to cut expenses… the Marketing budget is the first stop.  And the self fulfilling prophecy of cutting the budget which decreases the effectiveness/metrics gives critics more ammunition that Marketing just does “stuff”.

Learn to live with it folks… Marketing is Sales!  Yes, we are Sales People.  Damn it, we’re in Sales!  Why??  Every single dollar spend on Marketing should drive sales.  Think about it… why would Company Executive, Board of Directors and Shareholders support the expenses associated with Marketing.  Because they expect… no demand… that sales will be positively impacted by the expense.  

Marketing Research

Advertising

Creative

Media — TV, Digital, etc.

Direct Mail

Database Marketing

Marketing Operations

Technology

Web Sites

Headcount 

And the list goes on and on…

We must change the language first… we need to add the word “sales” into our vernacular.  

Sales drive by advertising

Sales Web Site

eCommerce

Web leads

Demand generation sales

Advertising sales / lead generation

Sales customer research

Events which drive sales leads

Sales metrics

The change in language starts to change the way our budgets are looked at.  Now we can start dialog around cutting budget cuts sales.  Finance and executives will now be forced to reconcile budget cuts on sales drivers vs. marketing expenses.  It’s a hell of lot easier talking about how those budget cuts will impact sales vs. how GRPs or brand awareness will be impacted.

Scott