Coping with the recession by going online
The slowing U.S. economy and a worldwide rise in gasoline and food prices is causing problems to many retailers, especially those with a niche product. Yet, their competitors, who are selling similar products online, seem to be doing fine. Web retail sales are growing at double-digit rates and this trend is expected to continue, despite of the weakened economy. It is quite difficult to recommend a smaller retailer, who is struggling with all his might to survive, to suddenly move into e-commerce. However, many larger companies have their retail websites set up, but seem to underestimate the demands of the online shoppers. I believe, it is viable for these retailers to concentrate on this channel, especially if their high street stores are not doing well.
To be successful, it is crucial to know more about the customers and to be able to comply with their needs and expectations. A recent study indicates that the price is no longer the only variable, according to which an e-shop is assessed. Online shoppers are no longer willing to make tradeoffs. Apart from the obvious benefits of online shopping – convenience, a large selection and a competitive price – customers have high expectations, when it comes to site and delivery experience. Clear information on delivery charges and the possibility to track the progress of the items ordered is considered as more important than shopping from established websites, well-known brands or having a large variety of goods. Another key factor is a clear arrangement of the website. From my own experience I can say that it is very frustrating to search for a common product under very general and unclear headings only to find that a mouse is listed under a heading “convertible devices” and an iPod is referred to as “black electronics”. The availability and load time of the website are important as well.
Surprisingly, many web retail sites selling electronics or apparel do not meet the above requirements very well. For example CircuitCity.com and BestBuy.com have ended up in the middle rankings of a recent report evaluating top 100 online retailers on customer satisfaction. Circuit City has been experiencing sluggish sales in the last few quarters and is searching for a way, how to get back into black numbers and catch-up with its main rival Best Buy. I believe that this company could improve its market position by ensuring that its e-commerce channel meets the needs and expectations of the online shoppers. This might be quite demanding though, since shoppers can compare their experience with the sites such as Amazon.com, which sell electronics as well and have a very good ranking.
From my point of view, this recommendation could be applicable for some other retailers, which are having a tough time due to lower consumer spending and need to cut costs and gain new customers in order to stay "in the game".
Surprisingly, many web retail sites selling electronics or apparel do not meet the above requirements very well. For example CircuitCity.com and BestBuy.com have ended up in the middle rankings of a recent report evaluating top 100 online retailers on customer satisfaction. Circuit City has been experiencing sluggish sales in the last few quarters and is searching for a way, how to get back into black numbers and catch-up with its main rival Best Buy. I believe that this company could improve its market position by ensuring that its e-commerce channel meets the needs and expectations of the online shoppers. This might be quite demanding though, since shoppers can compare their experience with the sites such as Amazon.com, which sell electronics as well and have a very good ranking.
From my point of view, this recommendation could be applicable for some other retailers, which are having a tough time due to lower consumer spending and need to cut costs and gain new customers in order to stay "in the game".
Sources:
posted by Zuzana at
Thursday, March 20, 2008
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