The ups and downs of selling online

Recently e-consultancy has done a couple of stories about selling online and I thought I'd pull out some of the most relevant stats for you, and point you towards the original articles.

The first stat that I thought was interesting was that online sales are generally estimated to make up 7-15% of a brand's sales. e-consultancy was averaging it at 10%. Although that may work very well for high street brands, we think the story's very different for small independent retailers - if you're in a niche market and online suddenly opens you up to customers without a geographic boundary, you can suddenly reach a whole lot more people. We know that one of our clients is currently taking more than 50% of their sales online.

Interestingly, a number of the brands that e-consultancy originally noted (Feb 08) weren't selling online still have no plans to go online in Sep 08. Whether that is because they figured they'd already lost the battle (I can see that Morrison's and Somerfield may feel that Tesco, Asda and Sainsbury's have already beaten them and pilfered all their potential online customers) or because their sales are such high-volume and low-value (though with Asda's George going online, Primark and H&M have more to lose) that they figure it's not worth it, I am surprised that such big brands are still unable to take advantage of online selling.

And then finally e-consultancy summed it all up in a lovely little article that pulled together the drawbacks of not selling online - apart from the loss of a revenue stream that most retailers would be very pleased to have in today's economic climate. Two in particular stick out for me - the obvious one that without online you're limiting your customers to buying from specific geographic locations where you have stores, and to your trading hours - online neatly leaps these two hurdles. And the second one is that you are immediately losing out to your competitors - who can bid on your brand name in an effort to snaffle your customers, or where your customers choose to shop from them because your brand isn't available online. Very few brands have such customer loyalty, or such brand exclusivity, that a customer would refuse to buy elsewhere. Online makes is so easy to search for particular products and compare prices that brands who aren't online are definitely losing out on sales.

By Kate Wooding
Published: 29 September 2008
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Brands poor at Search Engine Optimisation

New research reported in today's Revolution shows that the majority of brand advertisers do not have an effective Search Engine Optimisation (SEO) strategy, negatively impacting on their natural search listings. Essentially, their sites are not search engine friendly, meaning that they rank lower on search engine listings.

Search engine optimisation covers a range of things - from some technical stuff about how your site is built (e.g. sites built entirely in Flash severely restrict Google's ability to 'read' them), how the URLs of pages are set up, to the content and copy on your site, and how your headings show. All tictoc's sites are built with SEO in mind - we covered a bit about SEO in our most recent seminar, and we'll probably cover it again in future events.

By Kate Wooding
Published: 20 August 2008
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Silver lining for etailers

New research shows that the current economic situation may have a silver lining for etailers - although 64% of respondents said that the economic climate would force them to reduce their overall spending, 56% said that they would continue to shop online as much as they are already, while some will even spend more.

The report, by E-consultancy, also looks at the importance of price, user-reviews and recommendations for consumers when online shopping.

Responses show that price comparison sites are becoming more important - the report suggests that retailers should be submitting their product feeds to price comparison engines to take advantage of this - and that user-reviews are also of growing importance, particularly to the younger market (72% of the 25-34 age group said they would be more likely to read online reviews, the figure for over 55s was 53%).

Matthew Tod, one of the authors of the report, commented "We can see from this report that silver surfers are not into social media or comparison engines and are intending to spend more as the downturn does not touch them. But on the other hand a whole group of more financially pressed people now use social media to make decisions and then comparison engines to find the best deal. Complexity rules and simple strategies will fail if online retailers don't understand this."

By Kate Wooding
Published: 15 August 2008
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Are rising prices driving online shopping?

Realised we hadn't mentioned anything about credit crunches or rising fuel prices on the blog (well it's summer, we've got better things to think about like flying ant days and playground games), so thought I would remedy this with a positive little story about how rising prices might actually be driving online sales. Online sales have been rising steadily since forever, and it must be difficult to separate the many factors that contribute to this, but it seems that some clever people think that we might be using online shopping to avoid travel costs (like fuel), or to avoid overspending on shopping trips. Read the full article at e-consultancy here - it also links to a great article by Lorraine Paterson about how to improve eCommerce sites from a usability point of view.

By Kate Wooding
Published: 25 July 2008
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Christmas Spending

It's now that time of year when we all look at our bank accounts and wonder how much we actually spend over the festive period. If your anything like me the answer is too much!

The British Retail Consortium reported that UK retailers recorded their worst December figures since 2004. However, online retailers have had a more successful Christmas as reported by e-consultancy.com.

Figures from the UK show that 4.4 million people spent a total of £84 million on Christmas Day, 269% more than last year with an average of £19.09 per person. While in the US £14.9 billion was spent in December up 19% on last year.

By Alan Masterson
Published: 10 January 2008
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UK online ad spend predicted to rise 25% to top £2.5bn in 07

This year will see UK online ad revenues surpass £2.5bn, according to the latest forecast by Opera Media.

The healthy state of the industry will reportedly continue, with predictions of online revenues increasing by 25% during 2007. This rise will see online, which stood at 12.3% of the total advertising market in 2006, account for 15% in 2007.

Within online advertising, search is continuing to make massive gains. It now accounts for 58% of the UK's total online spend.

Google continues to be the main driver behind search, with an 80% share of the search market. Its nearest competitor is Yahoo! with 8%.

The mobile ad sector has potential to generate further revenue, with 54% of mobile owners accessing the internet every week via their phone.

(Source: NMA magazine)

By Melanie Russell
Published: 11 September 2007
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Women love the web

The internet is becoming increasingly indispensable for women, with over two thirds (66.1%) saying their lives would be disrupted if they had to go without the web for a week.

A study of 1,800 women aged 25 and over found four out of five females go online between 7am and midnight.

A majority of those aged over 65 go online before 7am. A third of women say they use the net during normal hours for primarily personal use, but that climbs to 52% between 4pm and 7pm, when one in 10 women go online for family-related content, and to 70.8% between 7pm and midnight.

In a finding that will pique the interests of marketers who have long targeted the spending power of women, who are seen as controlling the purse strings in many family homes, 54.5% of females said the internet is their primary resources on products they are considering purchasing, beating family and friends (10.9 percent), newspapers and magazines (9.9 %), TV (5.8%), brochures (5.1%) and radio (1.3%).

And some 51.4 % of women of all age groups used the web to do shopping in the last year, mostly for travel (37.5 percent), adult clothing (32.4 percent), health and beauty products (27%), children's clothing (18.8%), financial products (15 %) and groceries (14.9 %).

Some 43.6% of women said their daily routine would be "significantly" impacted upon if the internet were removed from their lives.

Source : Burst Media

By Melanie Russell
Published: 31 July 2007
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