How SMBs Can Increase ECommerce Revenue

eCommerce is the ultimate market-leveling tool for SMBs. Through eCommerce, the location and size of a business no longer matters.

In essence, the Internet has created a jumbo-sized virtual shopping mall in which any and every conceivable retailer can be a tenant.

Yet, cyber mall occupancy alone does not guarantee long-term commercial success. Rather, nextgeneration site functionality and ultra-reliable, highly responsive site performance are essential ingredients for increasing eCommerce revenues. Retailers with the deepest pockets gain a decided market advantage since they have the money both to develop next-generation site functionality, and to build and maintain an eCommerce platform capable of delivering the full impact of this functionality to each and every site visitor.

In reality, options today offer small business more choices that help in leveling the competitive playing field. With today’s web hosting environments — optimized for next-generation eCommerce — platform investments are reduced to a fraction of the cost of individually owning and operating an eCommerce site. With this approach, small retailers gain a significant market equalizer that enables them to compete effectively against their larger rivals.

In this article, we will describe the direction of next-generation eCommerce sites and also highlight how web hosting can dramatically reduce the IT costs necessary to effectively support next-generation eCommerce. As a result, SMBs can increase eCommerce sites and simultaneously decrease their IT costs.

1. Functionality that replicates the in-store shopping experience, and

2. Functionality that creates a distinctive online shopping experience.

o 360° product views – One of the eCommerce drawbacks is the physical separation between shoppers and products. Products such as books and DVDs – for which physical touch is not a decision variable — are two products that have sold well through an eCommerce channel. Other products, such as apparel, do benefit by physical touch. And even though apparel is sold online, the lack of physical touch contributes to instances of shopping online but buying instore.

Next-generation eCommerce sites will do more to transform the online shopping experience into online buying by presenting the product in user-controlled 360° views. In this manner, the shopper gains a richer perspective on the product’s appearance, similar to the instore buyer behavior of holding up and turning the product for closer examination.

o Layered informational mini-screens – In current-generation eCommerce sites, shoppers commonly click through several full screens to gain a deeper knowledge of the product being considered. This site design dictates back and forth navigation by the shopper to re-visit information. Consequently, the full breadth of information sought for a purchase decision seldom resides on a single screen. Next-generation eCommerce sites will offer mini-screens overlaid on the initial product screen, which allows shoppers to zoom in and out of relevant product details and, in the process, never lose connection with the product being evaluated.

o Upfront alerts on product availability – A strong benefit of eCommerce is the capability to present the full range of products and product features. Inventory costs and space limitations of brick and mortar stores are challenged to equal this capability. At the same time, product presentation in an eCommerce site without availability status is frustrating for shoppers, particularly those who have expended time loading their shopping carts only to be informed that availability of one or more products or a specially designed product will be delayed. This scenario is far less common with in-store shopping since the range of inventory is directly visible to the shopper. In next-generation eCommerce sites, product availability status can be offered to the shopper throughout the shopping and selection process. By presenting product alternatives when there are availability delays – which can be built as an option into the site design — allows shoppers to balance their desire for product immediacy and selection range.

o Streaming video – Brick and mortar stores are naturally restrained in the contextual presentation of their products, with actual product benefits limited to a shopper’s understanding of the product and imagination, and perhaps the creativity of in-store displays and external advertising (print, audio, and video). In next-generation eCommerce sites, streaming video propels contextual presentation to an entirely new level, with streaming video mini-clips that spotlight beneficial product features in multiple real-world contexts. Not only will streaming video stimulate a shopper’s imagination and strengthen intent to purchase, it can also be effective in cross-selling other products and optional features, which provide a valuable means to increasing sale size and revenue growth.

o Live chat – An eCommerce site enabled with live chat can address a shopper’s questions or site use issues on the spot. As a result, these sessions contribute to impromptu purchases and a reduction in abandoned shopping carts as well as repeat visits. Live chat offers two specific benefits:

(1) the on-demand availability of sales representatives enables quicker and more efficient customer communications than serving customers in most brick and mortar settings;

and (2) sales reps have fingertip access to a wide range of product information and are typically better product knowledge experts. With the advent of VoIP (Voice over IP) in a nextgeneration eCommerce site, live chat expands from text exchanges to more personal voice conversations. Text and voice communication also can deepen loyalty and spending by premium customers and can transform intermittent customers into regular customers if both text and voice communications are strategically employed and supported.

o Personalized sales assistance – In addition to being product experts, online sales reps can also become dedicated customer aides. Electronically armed with real-time knowledge of customer identity, profile, and past online and in-store purchases, these sales reps can personalize and enhance the customer’s shopping experience. While similar personalization is possible in brick and mortar settings, location and in-person relationships are limiting factors on the number of customers that can receive this personalization. eCommerce does not suffer from these same limitations.

This next-generation eCommerce functionality is not free. Clearly, there are costs to develop, test, and deploy. These costs, we believe, are unavoidable for retailers who are serious about increasing their eCommerce revenues.

Equally important, but not always fully considered, are the costs of an eCommerce platform capable of delivering the full impact of this functionality to each and every site visitor. In our view, scrimping on the platform will have serious eCommerce revenue implications. Among the most notable to avoid is creating a platform that results in an uninspired shopper. For example, if the functionality does not perform to its potential – through slow responsiveness, jerky video, or voice quality inconsistency – the net result is that shoppers leave the eCommerce site and never return.

To avoid this scenario, companies today must have world-class Internet-connected data center and web servers. To attain world-class, multiple components must be in place. Lacking any one of these jeopardizes eCommerce potential.

o Redundant and highly scalable Web servers – Accommodates all instances of peak visitations and minimizes the risk of server downtime.

o Physical and cyber security – Protects the eCommerce platform and customers’ personal information (e.g., credit card numbers) from disruption and theft, respectively.

o Wideband and redundant access between the data center and the Internet – Access congestion directly correlates to slow response times and a poor shopping experience. Furthermore, as richer media is added to the site, higher bandwidth levels are essential.
o Data center utilities – Air conditioning, heating and electrical power are as essential as the web servers themselves. Failures in these systems are catastrophic to the health of any business.

o Around-the-clock administration – Without flawless operations and expert insight, none of the preceding points are meaningful. This flawless execution is the benchmark of nextgeneration eCommerce and anything less will degrade eCommerce potential and waste the investments in next-generation eCommerce functionality.

The good news is that the cost of these platform components does not have to be a barrier to nextgeneration eCommerce and the benefits it can deliver to the retailer: more revenue and improved customer loyalty. From our analysis, SMBs can reduce their IT costs associated with eCommerce by up to 75% by using a high quality Web Hoster versus a do-it-yourself approach of owning and operating these platform components.

eCommerce has proven to be an effective sales and customer relationship channel for many businesses. However, lack of innovation in site functionality and a world-class platform from which to deliver this functionality will return disappointing eCommerce results. For many businesses, the combined price tag for functionality and platform can be overwhelming. To meet the objective of increasing eCommerce

Conclusion

Web Hosting Delivers IT Cost Savings in eCommerce

How SMB’s Can Create a Distinctive Online Shopping Experience

This functionality also reduces the instances of shoppers leaving without a purchase.

How SMB’s Can Replicate the In-store Shopping Experience

The direction of next-generation eCommerce functionality fits into two categories:

Next-generation eCommerce Sites To Increase SMB revenue

eCommerce Shopping Sites

Today’s world is the world of internet, from gathering some information to buying any product everything can be done by internet. eCommerce is one of the most important facets of the Internet to have emerged in the recent times. eCommerce, which is short for electronic commerce, is the process used to distribute, buy, sell or market goods and services, and the transfer of funds online, through electronic communications or networks. Electronic commerce is commonly referred to as online commerce, Web commerce, eBusiness, eRetail, eTailing, e-tailing, or EC. eCommerce or electronic commerce has opened up new vistas of doing business anytime, anywhere.

At any given time, there are approximately 8 million consumers worldwide that actively shop and buy through Web based stores or retailers (nearly one tenth of our world population). Online studies have claimed that online retail revenues will surpass the quarter-trillion-dollar mark by 2011.

How It Works

The three main components of eCommerce are the Merchant Account, the Gateway, and the merchant’s Shopping Cart.

– Customer logs on to Internet to shop and connects to Merchant’s site.

– Customer elects to purchase a service or goods from merchant site.

– Merchants site connects to their Transaction Server (Gateway) through the Internet.

– Transaction Server connects to the Processing Network (ACH) to determine if Customers funds are available.

– Processing Network approves or disapproves transaction.

– If approved, Processing Network tells Transaction Server to proceed with sale.

1. Processing Network authorizes transfer of funds from Customer Bank to Merchant Bank.

2. Transaction Server confirms sale to Merchant’s site

3. Merchants site confirms sale to Customer

4. Depending on setup, Merchant delivers service or goods to Customer.

– If disapproved, Processing Network tells Transaction Server to decline sale.

1. Transaction Server relays decline notice to Merchant’s site.

2. Merchant’s site declines sale to customer.

There are multiple layers of security for both the merchant and customer, both at the site level and in the transaction server/processing network, as well as at the banks. All sensitive information, especially the credit card number, is encrypted before transmission.

It is imperative that an eCommerce website offers absolute security for the transactions that are carried out using credit cards. For the success of any eCommerce website it is necessary that a proper choice of payment gateway is made. A payment gateway is a separate service and acts as an intermediary between the website’s shopping cart and all the financial networks involved with the transaction, including the customers’ credit card issuer and the eCommerce website. If the eCommerce website has already purchased a shopping cart software, it needs to ensure that the payment gateway service is compatible with that shopping cart.

The benefits of eCommerce:

– Purchases can be made 24 hours a day, 7 days a week.

– Ease of purchasing goods.

– Your marketplace is larger and can increase your sales potential.

– Payment for your goods or services can be make immediately.

– Lower Startup Costs Increase Efficiency and Profitability.

– More convenient for customers.

– Reduces your overheads.

– The direct cost-of-sale for an order taken from a website is lower than through traditional means (retail, paper-based), as there is no human interaction during the online electronic purchase order process.

– Transactions can be processed quicker.

– Selling Online allows merchants to target and reach audiences, even on a limited budget. This creates the potential for anyone to sell anything Online.

– You can quickly update prices.

– Easier to Maintain Over Time. If an eCommerce design is done correctly from the very beginning, it will make the task of design maintenance much easier over time.

eCommerce for Import Export Companies

This year, according to eMarketer, one billion people worldwide will have Internet access and nearly 250 million households will have broadband. Although, Asia accounts for 56 percent of world population, but only 10 percent has access to the Internet at present. With the rapid economic development of Asian countries this figure will increase dramatically in the coming years. This ubiquitous presence of the Internet is forcing companies to embrace the Internet as a marketing and sales channel aggressively. Many companies have adopted Internet based technologies to streamline their crucial business processes and benefiting enormously from it.

Import Export companies are no difference! Most export import companies are using the Internet to augment customer base, tap into new markets, research competitors, find new products and evaluate country opportunities. However, many of these same companies are still slow in implementing eBusiness features in their daily business activities and, as a result, fail to garner true value from the use of the Internet. Trading companies – those which are still not doing online business transactions – should follow the examples of their retail counterparts and adopt eCommerce strategies.

According to a recent study conducted by Forrester Research, retail sales are expected to rise 20 percent to US$ 211.4 billion – a two fold increase from only three years ago. Whether you are in exporting or importing business it does not make any difference, by using eCommerce and adding some of the basic eBusiness functions to your website you can also profit from this trend.

Electronic commerce is the process of selling products through the Internet. There are two distinct segments of eCommerce – Business to Business and Business to Consumers. Retailers are mostly involved in B2C and import export traders are often more in the B2B sector. That’s why you need to realize that the components of eCommerce you may need in your website will be based on your business specifics. In general, all eCommerce sites are a combination of some of the following business functionalities:

  • An eCatalog so that buyers can browse through the products you have to offer
  • Product specification that gives detailed technical and delivery information
  • A feature that allows sending request for quote online (RFQ)
  • A product order placing system – normally a shopping cart
  • Ability to view order status
  • Sending a notification if a new product added to the catalogue which was requested by a prospective buyer
  • At least one payment method. For small orders you should have a merchant account.
  • Purchase order sending ability. Buyers should be able to send PO for the products readily available or the contracts already negotiated with you.
  • Billing system should generate invoices automatically

Once you implemented these features there is virtually no geographic restriction on where you can sell your products. If you are an export company you may consider translating your eCommerce site to the language of your targeted market.

This gives you an extra ability to leverage your sales endeavour.

Benefits of eCommerce

Increase revenue: By implementing eCommerce you are opening a new sales channel.

Study shows, a well prepared eCommerce strategy can increase sales from mere 10 percent to several times within the first six month of implementation. There is a possibility that order size per customer will also increase thanks to some eCommerce functionalities like advanced eCatalog, Notification service, order status viewing system and ability to offer related products.

Expand client base: Depending on the exposure of your site, you can acquire customers from every corner of the world. You are no longer confined to any geographic area.

Reach niche market segments: You can market your eCommerce site by pin pointing a specific market segment with the help of the Internet.

Lower operating costs: Your eCommerce site will eliminate or reduce workloads of sales and support force. Marketing on the Internet is significantly cheaper than in offline world. You will also benefit from lower telecommunication costs, losses incurred from document errors, inventory and sales management costs. This will have direct impact on your company bottom line.

Better customer service: The ability to provide decisive information, real time interaction with customers and customer relationship management functionalities allow you to serve your customers better and help increase customer retention.

Enhance your company image: A well-managed, robust and user-friendly eCommerce site enhances positive image of a company.

Are you ready for eCommerce?

Before you implement an eCommerce plan, you need to figure out as an exporter or importer how viable it is for you right now? Are you going to receive the benefits mentioned above? Will the customers from different geographical locations benefit from your new service channel? How critical is a well-described product specification for your customers?

Any company how small or big it is from an eCommerce site no doubt it will benefit immensely. But the question is, are you ready to commit enough time and money to make your new venture successful?

Developing your eCommerce site

Depending on the type of eCommerce site you are planning to build it might take somewhere from three months to over a year.

There are several ways of starting an eCommerce site.

Building in house: You should consider developing your eCommerce site in house only if you have significant experience in this field. In order to build a successful eCommerce site you will need a team of experts in programming, designing, copy writing, and, most importantly, a project manager with the knowledge of your business model, enough technical proficiency and experience so that the system gets developed on time with expected business functionalities.

Outsourcing: There is no doubt that outsourcing is more cost effective and less time consuming for most of the companies. The only thing is you have to choose the organization which will build your site carefully and professionally.

Using web stores: If you are constrained by time or would like to take advantage of eCommerce immediately you can also get eCommerce site from online service providers. These web stores have all the needed functionalities for a true eCommerce site. Some of them are also capable of providing supply chain management and other key business automation abilities. Check out sites like
Rusbiz.com

While implementing eCommerce strategy you need to remember that eCommerce just enhances and complements your present business model but the fundamentals of your business remain the same. However, eCommerce with it’s innate flexible nature may open new business horizons for you with all the risk and reward implications.