Change - Be ready with a Multi-Channel sales approach
In this time of rapid technological advancement everything around us is changing. Some changes happen very quickly while others evolve slowly over time. The way consumers shop and how we reach them continues to change. At one time experts touted 'online' was the way to sell. Now with everyone wanting a larger piece of the pie changes happen in flash. One recent example is YouTube's recent changes and how they negatively impacted the way creators are able to generate income. How will that affect you as a brand? Will YouTube influencers still be affordable?
The space in which we conduct business has undergone many transformations which have led to catastrophic results for some organizations. Only those who were able to adapt to change survived. Preparing ourselves for future changes is the key to survival and, more importantly, success. The days of focusing on a single sales channel have vanished. In order for a business to succeed in today’s market, it’s necessary to build plans which are both versatile and flexible- Multi-Channel Sales.
Become a "Ninja" - Ready for change
What is a Ninja? How does it apply to business? There are many articles written and opinions, my favourite is this one from the Financial Post.
Financial Post- Eight Ninja Characteristics
Image credit- Handout/Warner Brothers.
Today, from the onset, a business must have the mindset that change is inevitable. Accept it, work with it and prepare for it - be a Ninja. With a flexible plan from the beginning you are able to do more than one task at each stage. You can develop and test at the same time. If at any point you need to modify your product or service, you can do it with ease. Often is the case during product development technological advancements occur which can impact your product requiring changes or even rendering it obsolete. With the Ninja approach you are prepared for whatever may come and ready to adapt to the situation regardless of the change, without losing time or large investments. Those who have this mindset can not only survive change, they can even become leaders in change.
As a young business, you have an advantage over larger, more established businesses. The need to deal with a lot of bureaucracy doesn't exist which allows adaptation to be an easier process.The decision to make a change can be done without all the layers of approval. Whether adopting the Ninja approach during development or in sale stages, a business will be much further ahead than one who does not plan for change.
Online Channel Changing- Impacting Margins
Selling online directly to consumers was once the best and fastest path to building a successful business and still is, to some degree. A broad audience can be reached. Lower overhead costs and higher margins can be achieved in a relatively short period of time. Many companies have succeeded with this approach in the past. 'The Elephant Pants " company are one great example. A brand that was successfully launched online with over $7 million in sales in their first 2 years of operating!
But one must always be aware if there is ‘one small change at Facebook it can cost you millions’. This holds true for any of marketing platforms used to drive sales. Creating an one channel approach has its risks.
Online businesses have been feeling the impact change most recently. The cost of running strictly with an online platform over the past 5 years has seen an increase and is hurting bottom lines. In order to stay competitive, online retailers have had to offer free shipping, free returns and are faced with increased marketing expenses, loyalty programmes, sampling etc. All these increases have had a negative effect on profit margins. Return rates have increased. Now businesses are covering shipping costs both directions. The handling of the actual return and what happens to the product once it’s returned - can it be resold or does it end up in our growing landfills? - is another challenge for some businesses. This brings environmental issues of increased emissions from the vehicle used and where some the returns end up. In December 2019 it is estimated everyday there was 1 million packages picked up by UPS alone. Read more of article- The Verge
The cost of customer acquisition is increasing. An online searches now produce comparisons of your product by some uncredited expert whether you want them or not. This expert also wants financial remuneration if you want a good rating- yet another cost! Amazon is quick to show consumers "recommended products" or "sponsored products" which their algorithm feels are close. Most of the time they are not but it does offer consumers options- plausible or not. In order to compete you need to set daily budgets to spend on Amazon grab potential customers attention amongst their millions of products.
A successful online marketing campaign has become costly. Gone are the days of reasonably priced Facebook advertising, low-cost Google Adwords, Instagrammers not charging an arm-and-a-leg to blog about a certain product. Last year Instagrammers began to see changes to its policies because it wasn't receiving its fare share of the pot. Accounts were disappearing or locked preventing any activity on accounts. Everyone wants their piece of the pie and this has resulted in increased online marketing costs- guess who pays that price? YOU!!!
For online business the cost of technological advancements is creating a demand to increase your monthly spend in order for the backend of your websites to remain efficient. Optimizing the users experience on is seeing a substantial change with more AI applications which include virtual reality, voice search, customer customization with many more changes occurring as we continue to develop new programs.
The impact on margins is growing as competition continues to grow, cost continue to rise, and we continue to technologically advance.
Multi-Channel Approach
What is a Multi-Channel sales strategy? It is retailing through offline outlets and online channels. Selecting from channels which include brick and mortar, pop-up shops, and catalogs, online via websites, marketplaces, and social. Multi-Channel sales approach allows brands to expand their reach, increase the convenience of shopping, lower risks while aligning marketing and sales initiatives. Some may question my definition as feel an Omni-Channel approach is the what is best. Whether you call it Omni or Multi you are reaching customers through a variety of channels. At the end of the day you are making it easier for consumers to find your product.
Implementation of a multi channel sales approach enables brands to reach a larger diverse audience and increase their opportunities for sales. The more places a brand is being written about, sold, pictured increases their visibility and exposure to broader audiences and increasing the potential of acquiring new customers. The sale may not be immediate it may be in the future bu you have planted the seed. Increased exposure improves a brands validity in a consumers eye. If it is being sold by "XXX" or written up on"YYY Website" it gives the customer assurance your brand credible.
Multi-channel strategy gives potential customers the ability to shop on the channel which is most relevant to them, optimizing their experience. It enables buying with ease and confidence in the consumers preferred channel. Customers use several channels to obtain information, read the pros and cons along with a possible test of a product before a purchase. Once comfortable with the information they have collected the decision to purchase is made the customer purchases via their preferred channel.
A Multi-Channel retailing helps lowering the risk from single channel in the event of a disruption. A diverse selection can avoid a significant loss or slow down from changes to a channel. A swing in the marketplace can happen at any time it is essential for brands in order to protect their business from a loss.
Multi-Channel sales offers many other benefits including increasing revenue, repositioning brand, insightful data and speed to market, We are experiencing change frequently. A plan to address changes in a proactive way has become essential. A Multi-Channel sales is an great means to be proactive.
Since 2008, Retailbound has been a retail partner for businesses, helping them evaluate their sales channel options and aligning them with the best strategic partners. We pride ourselves as outside-of-the-box-thinkers, offering creative solutions for businesses to seek out new sales opportunities and management.
If you are looking to scale up your product brand, please contact me at [email protected] for more information.