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Online: Where your business needs to be

01 Jul 2010

E-commerce is the way to grow your business for a relatively modest investment. But establishing a web presence and making it successful are two very different things. E-commerce is a highly specialised field, and the small business that believes just being online will be enough is only fooling itself.

“A lot of people underestimate the effort that needs to go into marketing and promotion of the website,” says Tristan Marris, a director of Auckland-based web design and marketing company 96black. 

“Once you’ve built the site that’s only part of the job; you’ve then got to have an effective marketing strategy behind it to push it forward, and I think the lack of a proper marketing strategy is one of the reasons why a lot of e-commerce websites will fall over.”

Another reason an e-commerce site can fail is the site’s owner believing they can do it all themselves. Their product may be top-notch, but if they don’t know how to market it online, they may be setting themselves up for failure. After all, they may have hundreds, if not thousands, of competitors out there. “An e-commerce site has a huge impact on a business,” Marris says.

“There needs to be a lot of thought that goes into it: how it’s going to be rolled out, where the target market is, where the distribution centre is going to be, how you’re going to get products and services out to your clients – all that kind of stuff.” Attracting customers online is quite different from traditional sales and marketing methods (print media, billboards, broadcasting, etc).

Potential customers who surf the web have come to expect more than just a “buy this!” message. Yes, they want to see what’s on offer, but they want to enjoy the experience too. This is known as ‘engagement’.

When you engage properly with those visiting your site, they stay there longer, come back more often, and purchase regularly. E-commerce strategists use a variety of different tools to achieve these goals.

Of course, every client is different, and a lot of time is spent analysing their product, their customers and their competitors. But these are the tools most commonly used to make e-commerce sites perform best: Search engine optimisation (SEO).

“Any developer should deliver a website that’s search engine-friendly,” says Patrick Howard, Internet Solutions Specialist for The Web Company.

“Optimisation is taking a website that might appear on page three, four or even further down in the search engine ranking positions (SERPs) and bringing it up into the first four or five results on page one.”

A designer trying to optimise a website will ensure that all the factors a search engine looks for when responding to a search query are present and prominent in the site. Keywords can be written into the site’s code, which may even contain a catchphrase, eg: if you’re running a boutique winery in West Auckland, you may want “wine” and “West Auckland” to figure in search results, so you may include a phrase like “best wine in West Auckland”.

To get your site into those first few pages in Google, you’ve got to attract more specific search inquiries. It’s no good including something as simple as “fine wine” – there will be too many other sites attracting that kind of search. Refining searches through careful use of keywords is known as the ‘organic’ approach.

Generally there’s more to it than just keywords, however; it’s often backed up with news articles and blogs that mention a company’s name or product, so creating ‘backlinks’ (links to the site from other sites, web pages, directories, etc).

Organic search results are the ones most web users look at first, but getting up high in those results is a big task because there’s so much competition. The other way to figure prominently in search results is pay-per-click advertising (the best known example of this is Google AdWords). These are the results you see in highlighted areas at the top or right-hand side of a search page.

You pay Google according to the number of ‘clicks’ (visitors) your site receives. These results are generally the province of larger businesses which have the money to out-bid competitors to get their sites in those spaces.

The trick here is to find a niche market where there isn’t so much competition. It’s potentially a handy low-cost tool for small businesses, providing you plan your campaign carefully. This is normally a job for professionals, but there are free SEO tools available online if you want to try it yourself (see boxout).

Email marketing

The key to good email marketing (apart from avoiding complaints that you’re spamming people) is to keep it simple.

Don’t try to put too much detail in an email – most recipients only read the first four or five lines at most.

“You want to engage people, give them a little bit of information to spark their curiosity and lead them through to a website,” explains Tom Reidy, Director of Wellington-based online media company Catalyst90, “because at the end of the day people don’t buy off a newsletter; they buy off a website.”

Email campaigns are especially useful in enabling you to see directly what the reader/potential customer is looking at. Email links can be tracked and the viewers’ habits analysed.

Social media

Social media, eg: blogs, Facebook, LinkedIn and Twitter, is “the next marketing wave”, according to Michael A. Stelzner, founder of SocialMediaExaminer. com, an online business magazine dedicated to social media.

Earlier this year, Stelzner published the results of How Marketers Are Using Social Media to Grow Their Businesses, a survey of more than 1300 US businesspeople, 63% of whom ran small businesses.

“The No.1 advantage of social media marketing (by a long shot) is generating exposure for the business, indicated by 85% of all marketers, followed by increasing traffic (63%) and building new business partnerships (56%),” the survey’s executive summary said.

“People age 20 to 29 spend the most time using social media marketing (59.1% spending 6+ hours weekly), followed by 40- to 49-year-olds (58.3% spending 6+ hours weekly) and then 30- to 39-year-olds (58% spending 6+ hours weekly).” Social media is a more subtle way of attracting customers.

You don’t use it to push advertising at them; rather, you tell them about your business, keep your brand in their minds, and stimulate their curiosity to go to your website and check out your products. It’s a low-cost tool, but it requires more time from the person using it to make it work effectively. Facebook pages have to be updated regularly, and queries from readers responded to promptly.

If you’re on Twitter, you’re operating on a one-to-one basis, so the onus is on you to keep tweeting regularly, ensuring those following you don’t get bored.

“The worst thing you can do is just jump in there and do nothing,” says Catalyst90’s Tom Reidy. “You still need to dedicate actual time to manage these tools, interact with these tools, to growing and fostering your networks.”

The need to invest time in social media marketing is echoed by 96black’s Tristan Marris and co-director Mark Osborne. “If you’re not actively putting your time into it, then your community is not going to put their time into it as well,” Marris says. “You’ve got to be constantly putting good information up there on a regular basis and fostering that community.”

“It needs to be a really big part of the sales component of a business,” adds Osborne. “If the sales guys aren’t using it as best they can, it’s going to become more a burden than a tool.” Mobile technology is another growing factor in social media marketing. Smartphones can be used to generate content as well as read it, so latest news and even images can be uploaded and shared. “All of a sudden you can start to engage with these channels no matter where you are, and also start to share your experiences,” Tom Reidy says.

“All of a sudden the power of your network is in your pocket rather than restricted to your desktop.” The Web Company’s Patrick Howard expects to see a lot more ‘mobile market’ in the next couple of years. Users will be able to ‘opt in’ to mobile-based campaigns, which will generate text messages to their phones when they walk within a certain distance of a certain shop, offering discounts and other special deals.

“Social media is all about making you feel special,” says Graham Dockrill, Director of Christchurch-based digital agency hairyLemon. “So you do need to be there, on social media environments, because everybody else is there and if you want to be seen as one of the ‘cool kids’ you have to participate.”

The Amazon effect When it comes to engaging customers and keeping them coming back, online retail giant has set the standard. It does this by encouraging customers to ‘review’ the products they’ve purchased. “One of the most influential factors in our buying decisions is the opinions of our friends and relatives,” said Smashing magazine in an in-depth analysis of the Amazon effect.

“Likewise, a large majority of online shoppers now trust what other customers say about the products they buy, more than the e-tailers themselves.”

So Amazon customers get free space in which to comment about CDs, DVDs and other products. They give star-based ratings to products, and other customers can read this feedback before purchasing, or even add comments of their own. All of this is available at a click on the product’s page.

Customers therefore get to make more informed purchases, so not only are they more likely to return to shop again, but the retailer gets useful information on popular and unpopular products. If they’re stocking products less likely to be returned, they’re doing better business.

“Any time you can make it an experience that’s unique to an individual is just so valuable,” says Tom Reidy. “I wouldn’t be surprised if we see more and more of that personal engagement coming through sites as people look to engage in better and faster ways and to make more lasting engagements as well.” Trade Me adopts a similar approach, allowing buyers to comment on their experience.

“People love that transparency,” says The Web Company’s Patrick Howard.

So how are we doing?

Asked how New Zealand e-commerce sites are performing attracted a predictable mixed bag of comments from the experts we interviewed. The consensus: they’re getting better, and there’s still room for improvement. “We’re pretty nimble with our movements; we’re pretty fast to learn and fast to adapt and then fast to make it better” said Tom Reidy.

Patrick Howard reckons New Zealand SMEs online fall into two camps: “You’ve got the camp that says ‘how cheap can I do it?’ and it’s all about budget, and then you’ve got the other camp that realises that the web can account for a significant part of your revenue if you understand what your service or product is that you want to engage a user with on the web, and how you go about doing it.”

“I think the reality is, we’ve always been a country of do-it-yourselfers, and that’s not going to change; we’re phenomenally good at it,” said Tristan Marris, “but there’s an increased awareness in the marketplace that you need to be thinking about your brand, your image, usability; not just doing a cheap job and getting something up there.”

But on one question, the experts all agree: if you’re a New Zealand small business, you can’t afford to be without a web presence.