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When retail sales are slow, diversifying online can lower your risk

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Published on January 11, 2012 When retail sales are slow, diversifying online can lower your risk

Posted at 6:43 am in Ecommerce by

Last updated on October 30, 2018

However you look at it, having a physical retail shop is tough at the moment, with no easing in overhead expenses like rent and utilities but relentless downward sales pressure. Figures from the Australian Bureau of Statistics have shown it was no easier during the Christmas period with a drop in sales between November and December from $20.909 bilion to $20.885 billion – instead of the 0.3% rise that economists had forecast.

Retailers are scrambling for different ways to grow their sales, and one excellent option that many are turning to is selling online. If people aren’t buying in shops, it doesn’t mean they’re not buying at all, it just means that their mindsets have changed as well as the way they shop. Opening an online shop is a cost-effective way to reach out to more customers to help fund your existing physical shop. And there’s no reason that the two can’t co-exist quite comfortably.

Online Presence (static website or Facebook page) vs online shop

If you’re a business under cash flow pressure should you just get any presence online you can – is just a Facebook page sufficient? Or should you open a full online store and give your customers another buying channel?

Unless you are selling a complex product that is not suitable to online purchase, you are missing potential customers if you don’t have some sort of buying facility online. Showcasing your products on your Facebook page is equivalent to doing a mailbox drop with a flyer – it might get you a few more browsers in your store, but you miss out on people who may be looking to buy then and there.

What’s more, it’s hard to search engine optimise a Facebook page for the particular words or phrases that your customers may search for because you have zero control on how Facebook chooses to lay out your page, or how the content on the page stacks up against your competitors. Facebook is an excellent tool, but using only a Facebook page is like trying to sail a yacht with just one sail.

Open new marketing channels

Selling online will help you reach as many customers as possible, and open up opportunities your business didn’t previously have:

  • Customer registrations through your store, gives you a steady stream of subscribers you can convert into repeat buyers or market through newsletter sales or email offers
  • The cost of an online sale is generally lower than the cost of a sale in a physical store – your store’s rent for example gives you an entire 600 product store for just $60 per month (and only $49 if you buy while on special at the moment!) – what is your store in the local shopping mall costing you?
  • You have the opportunity to combine your offline and online store in creative ways. Some shops overseas are turning their physical stores into showrooms rather than buying centres, holding fewer stocks on site and therefore lowering the cost of their rent – with sales principally going online. Others are using “cross store” promotions or using their online sales/newsletter subscribers to drive traffic into their physical stores for special VIP nights, party plan gatherings etc.
  • Thinking creatively there are many ways to use offline and online together. Think of something that nobody else has done, and try it…..!

A physical shop on its own can leave you exposed in an increasingly competitive world, but a combined physical/online experience can spread your risk for minimal additional outlay. It’s a low risk way of opening up new marketing channels and if you choose a shopping cart provider with Australian ecommerce features and a cancel at any time option (like Ozcart) then you are protecting yourself while giving it a go – the Aussie way!

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