5 Ideas To Bring Your Wholesale/Retail Product Business Into E-Commerce
The current business landscape is wrecking long-established direct-to-physical retailer and physical retailer-to-consumer relationships. Both types of relationships are affected because consumers are reluctant to shop in physical spaces, either because they are concerned about crowds, or because it involves a considerable amount of thought consideration that, before, was not even a blip on their radar. The situation is uncertain: no one knows when the current physical retail environment will recover, and what shape that retail environment will take once the situation, as eventually will, stabilize, and the ‘new normal’ is established.
What we do know today is that many consumers, because of lockdowns, uncertainty about facemask rules, and a general desire to avoid crowded spaces, have turned to their phones and computers to do the kind of casual shopping that would normally support a group of stores in a physical retail environment. If your business depends on selling products to wholesalers, who then resell them to physical stores, or if it relies on physical locations, then your revenue is likely to be lower than it used to be at this time of year. And you need to go where your customers have gone.
The Role of Online Wholesale Retailing
The answer has been to complement the physical business by moving or kick-starting the business online. Some brands have responded by creating a space on Amazon or similar large online retailers. These double as digital wholesalers, with the advantage that you are likely to regain sales, but your business does not gain any of the advantages of digital sales due to individual online marketplace restrictions and marketing constraints. Inside one of those marketplaces, your business is also faced with a large amount of one-click-away competition, automatically generated by the Amazon or similar algorithm that places different sellers side by side for comparison. This usually leads to price competition that drives profitability down to its lowest sustainable point, and sometimes below.
This situation is different from what is encountered in physical retailing, where the appearance of similar stores within a restricted physical area (a street, a boulevard, an open air mall), has the effect of keeping a customer interested in a purchase through the exploration of multiple physical locations about that particular product. One retailer’s approach has a good chance to find its mark through the random distribution of individuals physically circulating through a shopping street without having to worry (too much) about the pricing or setup of a neighboring storefront. The randomness involved allows for a fair distribution of purchasers, over time.
Online marketplaces provide ‘naked competition’ that comes down usually to brand recognition, pricing, and convenience. The intangibles about the brand, if they are not supported by large advertising campaigns, are lost in this kind of transactional environment.
Beyond Wholesale Online Retailing
In contrast to focusing only on the sales that a large online retailer can provide, with their attendant limitations, some brands have decided to open their own online shops by building websites and establishing a relationship with their customers, one-to-one. In terms of long term sustainability for the business, this approach - which uses all the tools available for digital sales and focuses them all on your business and its customers - offers the best opportunity to not just survive the current difficulties, but to provide a springboard for consistent, profitable growth into the future. This approach may not exclude the use of a large online marketplace as a ‘home base’ for sales. Instead, it complements it because it makes a brand smarter about its customers and their connection to the products on offer.
An example is the ‘old’ Apple Computer Company, the one that existed prior to the current incarnation. That company had a close relationship with its customers. In the days before social media and the internet, Apple customers literally had a face-to-face opportunity to talk to people inside the company via the MacExpo in San Francisco, at least once a year. Not only did the company get to connect directly with people who purchased their products, but they had a rich environment that, if studied properly, provided excellent clues as to what the purchasers of Macintosh equipment would likely want next in their products. The same can be said for the days when Apple’s products were the object of discussion in specialized magazines, where editors well-versed on the products provided excellent criticism and offered (unpaid) ideas that could find themselves incorporated into future product plans. This was the method behind the ‘go where the puck will be, not where it’s gone’ idea that sometimes surfaced in the discussions about Apple’s direction with its products.
You don’t get the sense that the current version of Apple Computer has a two-sided relationship with its customers. Not through their online presence, their phones, or their online stores. Individuals may feel connected to the products as they use them, but this is on their own - an empty connection unsupported by the company itself and its customer management system. It is a fandom, not a symbiotic relationship. Apple is not learning from its customers anymore (unless it is through loss of sales due to failures of equipment - as with their ill-fated attempt to ‘innovate’ on keyboards that backfired). Apple now is like many other companies, working through a process of imitation of other companies like itself in a competitive environment, but without a path of its own.
It is a behavior similar to the murmurations of bird flocks. Each bird looks to the one next to it for guidance while flying but none of the flock is aware of the overall shape of the flock itself in the sky and no individual bird contributes to the outlines of the shape except during the process of following the others around it.
Carving Your Own Path For Your Brand
You carve a path of your own for your brand by engaging, listening, and learning from your customers, and taking that environmental information into your company to tweak your products, their presentation, and messaging, and transforming them, little by little, into something unique that may not be predictable from day one - but that as a goal, has a better chance to stand up to any competition into the future because it cannot be easily imitated: people may imitate the externals of your brand, like knock-offs of famous brands you see selling on streets in many cities, but they will not feel right to the consumer you want to have as your regular brand user.
You don’t have to be a guru about your brand and its products - but you do have to care about the people who will spend money to obtain them. That expression of caring, of being willing to understand why people purchase what you sell and how they use it, holds the key to what made the old Apple Computer special, while the new Apple Computer just feels mundane.
Steps to Avoid Being Mundane - First: Interact With Your Customers Non-Transactionally
To avoid being mundane, the crucial thing is to find a way to be relevant to some decision that someone is going to take during their day. It might be almost every day, as a grocery store does, or it may be occasionally, as a computer maker does.
To avoid being irrelevant, you need to understand the decisions that are important to your customers - about your products, and about your brand presence, and their timing in taking those decisions.
A well structured, set of automated email flows that can track specific customers either browsing or purchasing products on the site and then (with subtlety), tease out their reactions after several transactions, can help in this type of situation. This is usually supported by a strong survey-based system that is segmented and structured to appear at different moments during the customer journey.
If you already have a list of individuals in your email system, then building this approach requires careful segmentation based on product and other parameters that can be added, slowly and steadily, to the customer profile as they move through their journey. The parameters and the particulars of the journey are individual to the brand, even in transactional environments. Some brands may require customer education, and so a parameter that indicates their level of engagement with relation to that education would be helpful in segmentation, for example.
Second: Test Your Merchandising on Email
Another way that helps you be relevant to your customers is merchandising your products in a manner that is relevant. What makes a presentation ‘relevant’? If you get customers to react to it, share it on social media, and/or share it with their close circle of acquaintances, then you know that you are on the right track. You may use some of the information from the previous step to begin this type of exploration. However, a website may prove to be too inflexible for that kind of work, and a landing page, too ‘salesly.’ Instead, a flexible testing mechanism based on multiple email layouts, merchandising messages, and presentations can yield valuable information that can then be translated into the more permanent environment of the website both in terms of copy and images. After all, email delivery mechanisms have been designed from the start to yield data on everything their user touches, from clicks to views to engagement via open rates.
Three: Expand Your Learning To Multiple Channels
As information is coming into the company, and it is being put to use in everyday communications via email and the merchandising on the website, it is important to use the knowledge for testing on third party platforms as live presentations, videos, or series of related-theme postings. This need not be done via paid advertising, but using the relevant information gleaned from the ongoing activities to find another non-transactional way to connect to customers online via social media channels. This can be giveaways, or live demonstrations of the product, or any other activity that can be delivered only by the product-owner. Every product has a story to tell and you as the temporary owner of that product can tell that story in many ways and find an audience that is interested in them. This is how the search for relevance in the consumer’s life can take shape.
Four: Tell Your Product's Story But Focus on Its Relationship To The Customer - And The Testimonials That Back It Up
As much as you may be internally fascinated with all the ins and outs of your company's process, chances are that customers, existing and potential, may not share the same type of fascination. Customers like to know that you have thought about them when you are working on your products: how will they feel when they use the product, how will they react when they receive the packaging, how will the product make their lives better. Content marketing that is focused on benefits and the process of delivering them makes for a solid bridge between your brand and your customer base. The existing customer base will be reassured that they have 'backed the right horse' vs. the competition, while the potential customer base will be tempted to take a chance on you based on your content. This is where testimonials play an important part in your product's story: as the last chapter in the product's promise. Any brand can state whatever they want about their product (within legal limits), but only customer testimonials can validate those claims through impartial user opinions. Your content marketing, communicated through all channels, but especially through email flows as part of a 'conviction flow', enhanced by testimonials, has a good chance to open doors for your brand via referrals and relinking.
Five: Keep An Open Mind - But Focus On The Ultimate Goal
Regardless of how much time we put into the discovery and analysis work, there is no replacement for the process of learning how to apply it to the individual audience involved. There are no shortcuts. True, there are some problems that are already solved - for example, instead of creating an entire e-commerce system from scratch, you can use Shopify to create a perfectly suitable store that you can then customize as you need it to make it your own. You don’t need to worry about many elements that used to be cause for concerns for people like me when the internet just began to be commercialized, where nothing was known, and you had to create your shopping cart from scratch for your store. Your particular design problems can be resolved as the store takes shape and you have more income to better manage the details.
Your ultimate goal will likely be to create customers who enjoy using your products, come back for more of them, and tell people about them. But not every customer you gain will hit all those notes. And not every customer you gain, even with all the effort to connect to them, will be open to a non-transactional connection to your brand. People compartmentalize, and you have to make sure that you understand when they don’t want to connect with you, as much as when they do. Keeping an open mind and continuing the learning process will ensure that your brand pursues the ultimate goal of establishing itself in a crowded marketplace with a self-replenishing pool of customers coming and going over time.
I have just finished reading Ten Arguments for Deleting Your Social Media Accounts Right Now by Jaron Lanier. I recommend the book for digital marketers, although, of course, it isn't a 'transactional' book, like most digital marketing books that sell you 'Ten Ways to Increase your Profits RIGHT NOW.' It is a relational book, discussing one single topic from several angles and bringing a very interesting polemic out into the open. Mainly, what kind of a world are we building with these 'social' tools on the internet? Mr. Lanier believes, as should be obvious from the title, that the direction the software world has taken is not conducive to a human world where dignity, individuality, choice, and critical thinking are valued. He believes that social media platforms, and almost all advertising-driven platforms, are complicit in the process of dehumanizing people.
He is right, of course.
This is not to say that his arguments are without problems or that one should uncritically accept everything that Mr. Lanier discusses in his book. For one thing, this is a shorter book where only one side of the argument is heard. Mr. Lanier does not offer possible counter-arguments to his own positions. This is usually a red flag when it comes to reading these kinds of books. However, in this case, it isn't a 'showstopper.'
The reason it isn't a showstopper with this particular book is that, as internet readers, we are submerged in a constant flotsam and jetsam of discussion about the goodness or 'badness' of social media networks. There are arguments floating back and forth about this topic all over the place, in part because it is the fad right now, and in part because there are genuine causes for alarm.
The noise of the discussion disguises whether we have a real problem in our hands or not. However, cutting through the noise, which this book might help you do in your own mind, is a solid first step toward acquiring a 'beginner's mind' to the problem that can help you evaluate and re-establish your own opinions about it without having to refer to endless websites to check what you think.
Mr. Lanier's discussion, and the fact that it is presented in a book form, allows the reader to acquire well-presented arguments for paying attention to aspects of internet-life that most users simply gloss over, in the same way that you gloss over the view from your window after you've looked at it over and over after a few months, or years. You are used to it, and you don't see it as a threat, so your mind ignores it.
Mr. Lanier's position is that, on the internet, there is no such thing as 'the view is not a threat,' because, by design, the internet as it is growing and shaping up as of this writing, is a danger to the kind of human development that encourages independence of thought, creativity, choice and individuality. The claim is that the organic growth of the current social media platforms, and the decisions these platforms make about how they are going to 'monetize your data' create a format that is mentally and socially toxic and that it is likely to tear down the interactions that individuals have used to create community over time without replacing them with anything that can provide similar results. Instead, replacing them with money-driven, transactionally-oriented, interactions that replace 'free activities' like friendship with money-intermediated activities like 'friendship on Facebook.'
This is the same as if a soda company executive would state that their main competition is the municipal water supply and that they wish to replace it with a constant supply of 'paid for' cola dispensers in the home.
Some people would jump at the chance to replace their water supply with this kind of service. To others, the idea may seem repellent. Mr. Lanier falls squarely on this latter camp.
Mr. Lanier's biggest contribution to the discussion is his ability to explain what an alternative to the current model might be, and, without going into all the details (his is not a policy book, but a polemic), he gives enough of a reasonable explanation to make it plausible to consider alternatives to the current, advertising driven model.
As a digital marketer, the advertising-driven model provides me with several advantages that are quite normal when it comes to diffusing a message through the noise of every day life. You get access to a tool that allows you to scale. The efficacy of the messaging, of course, is derived from the quality of the message and the budget behind it: the ability to repeat it over and over again for a relatively long period of time to create a mental habit in the eyes of the viewer, who is perceived as a passive recipient.
Once we stop looking at the viewer as a passive recipient, then we have to decide what kind of message has the best 'optimized' chance to successfully break through the barriers of attention. This messaging is usually of a 'negative bent,' and has been used for years on television commercials for products such as deodorants, fresh-breath mints, and the like: you have a problem, we sell a solution. Or, we've made up a problem and we are selling you a solution.
With social media networks, the ability to modify the perceptions of the viewer, and create some sort of addictive behavior independent of the individual's choice, are the elements that Mr. Lanier points out and that, as marketers, we should be concerned about so we can make decisions about our own desire to employ such tactics or not.
As marketers, this is our choice. Are we willing to make everything we do entirely transactional in nature, like our fictitious soda company executive, so we can intermediate it via a financial transaction to a third party, which in part could be manipulating our minds to make decisions they like?
You only have to look at magicians to see how the human mind can be manipulated into using concepts that the magician chooses them to have. That's an okay thing to do for an entertainment show, one that has a beginning, middle, and end, but do we want a world where every relationship we have is manipulated in this manner by individuals unknown to us (at least with the magician, he is on stage playing with us and it is an unwritten contract that we provide consent to have our brains scrambled during the act, do we give that kind of consent to social platforms every day, and every hour of the day when we use them?).
A revealing detail in all these discussions is that social media executives seldom allow their children to use the tools, and platforms, that they have created.
I think that the answer to the kinds of questions Mr. Lanier poses, and the kinds of questions that we, as marketers, pose for ourselves, lies squarely on this particular detail in the lives of the executives of Facebook and the other platforms.
Mr. Lanier's book is a solid read, flawed in places, but solid nonetheless and a good way to maintain a 'beginner's mind' on topics that otherwise would fly past us on our day to day activities. Reading it is the equivalent of catching your breath after a long run up a flight of stairs.
Daniel Loebl is an experienced Marketer focused on expanding the recognition of customer value inside a business and keeps a 'beginner's' mind approach to business problems.