How to Stay Competitive in the Face of E-Commerce Giants
Online shopping has hit its stride. But with all the things that set it apart from traditional retail — more convenience, options and ways to buy — there's one facet that won't ever disappear: retail giants.
Just as mom-and-pop shops watched department stores and big-box retailers spring up and seemingly take over, independent online sellers are watching giants like Wal-Mart's website and Amazon.com encroach on their virtual space. And like their brick-and-mortar counterparts, these giants have more money and manpower to swallow additional costs that boost customer satisfaction and increase repeat purchases. Small retailers just don't have the infrastructure built to do this.
How, then, can smaller, independent e-tailers compete?
3 Ways to Beat the Giants
Small brick-and-mortar businesses thrive off of the "shop local" experience. For e-commerce businesses, however, maintaining that experience is difficult when they're trying to beat out giants like Wal-Mart or Amazon but have lost their "shop local" angle.
That doesn't mean you're doomed — it just means you'll have to put in the extra effort to ensure your customers keep coming back. Here are three ways how:
1. Control and optimize the unboxing experience.
Lots of people love the thrill of getting a package at their doorstep, and that thrill intensifies when the package itself — not just its contents — welcomes them home. Branded packaging is your customer's first physical interaction with your brand, meaning it will give your customer his or her first impression of the product and your brand. The quality of the materials and what the package looks like can have a drastic impact on your brand's image. In fact, more than half of online shoppers believe premium packaging means a brand is more upscale.
2. Find a fulfillment center close to your customers.
Why do people love Amazon Prime so much? Free two-day shipping can be tough to resist. Most retailers aren't able to offer this, but they can still make sure their customers aren't waiting longer than necessary to receive their goods. When fulfillment centers are close to your customers, shipping costs and wait times decrease.
When looking for a fulfillment center or storage warehouse, make sure it's near the bulk of your customers, carrier shipping hubs, and ports, if necessary. It may be a long trek for you, but the benefits for your customers will outweigh the extra time and money.
3. Create all-star customer service processes.
One of Amazon's biggest assets is its customer service capabilities. This has been a big driver behind its success. Amazon's response times are quick, its return guidelines are clear and the retailer largely prevents surprises.
While customer service might seem difficult when you're a one- or two-person team, there are several ways to make sure your customers know what to expect from you, as well as how to reach you in an emergency. Make return guidelines easy to find, create a Twitter account for support representatives, or use a live chat application to increase your customers’ loyalty and confidence.
E-commerce giants are just like big-box stores: they have money and resources that the small fries don't. However, that doesn't mean those smaller sellers can't win. As long as independent e-tailers find ways to meet their customers’ needs — whether it's through packaging, shipping or customer service (or hopefully all three) — they'll be able to stand a chance in the face of even the tallest e-commerce giant.
Jesse Kaufman is CEO and founder of ShippingTree, a provider of cloud-based logistics and e-commerce fulfillment services for consumer product companies.
