E-commerce vs Traditional Retail the future of both: Friends, Enemies or “Frenemies”

ecommerce image by Cathy LarkinThis chat idea stemmed from a couple of blog posts about e-commerce (and its sibling “m-commerce” for mobile/smart phone/tablet commerce) and the effects on retail and bricks-and-mortar or traditional commerce and shopping. One of them was from Smallbusinesstrends.com: Ten Approaches That May Shape the Future of eCommerce.

Let’s define our commerce terms

E-commerce – selling goods (physical or digital) or services via the internet (via a computer) or mobile phone or tablet. Other related terms: e-shopping, m-commerce. And the newest trend, smart TV-shopping. Already TV retailers like QVC and HSN have an option to shop using your remote…even without a smart TV. In days to come, that may be the tip of the TV-shopping iceberg. My prediction…I think one day you will see something on TV, click your remote and be directed to the website that sells the shirt the actor is wearing. Catalog retailers have been one of the winners in the e-commerce wars. Many turning their paper catalogs into more robust online stores.

We often hear doomsday predictions when a new technology disrupts the “traditional” landscape…

While Radio didn’t kill live performances or books, TV didn’t kill radio, and the internet didn’t kill TV – each new technological improvement did force the purveyors of the old to adapt. But we’ve already seen evidence that Amazon’s e-commerce activities were likely a factor in the demise of Borders Books & Music, both online and their bricks-and-mortar stores. Who is next to go down? Or who is the next bricks-and-mortar retailer to embrace online technology and grow their business? Personally, I prefer to try something on or to hold an item in my hand before buying. While I welcome the innovations of e-commerce, I hope my favorite stores manage to adapt and stick around.

There is a tug of war going on between traditional retail and ecommerce

Both types of stores keep trying to up their game to capture the attention of their customers. Some companies keep trying various ways to customize the customer experience. This can be a workable strategy, or a never-ending wild goose chase. How a store or website looks and functions is important, but beware of innovating too far ahead of your customers. As JCPenny’s former CEO found out. JCPenney: Customers Are Confused By Mobile POS, So Let’s Try Lanyards And Carts a post from Fierce Retail. They tried mobile point of sale checkout, but many customers looking for the cash register…couldn’t find the check out people.  An online example is remarketing or retargeted ads – ads that follow you around the internet after you browse and online merchant. To some they are creepy…like the store sales associate who won’t leave you alone to shop. I find retargeting a waste, as they often chase me long after I have bought from another online merchant, store or brand.

Another trend: cross-channel integration

Trying to make sure the website recognizes the customer on web or smart phone, and have similar branding in store and on social media. For larger operations this can be costly, but can lead to stronger customer loyalty. For smaller companies, it might be too costly, although similar branding in store and on the web should be achievable.

Responsive web design

This also a growing trend. Instead of having a separately-built mobile site, many sites are shifting their M-commerce -to mobile-responsive sites – one that resizes itself to size of screen. While I think this is good, some customer-friendly features can get lost in the simple responsive sites. tablets work well, but on smart phones, sometimes a dedicated site makes more sense. Although responsive web design is still in it’s infancy. I’m betting we will see more innovations here.

Scalability

Retailers, online and off, need to manage growth wisely. It’s not good enough to sell lots of products these days…to last you have to sell good products, with an easy to navigate online and/or offline store, handle shipping and fulfillment to the customer, and try and bring them back for more. S/he who masters those items will rocket ahead, especially when dissatisfied customers can squawk loudly via social media. Estimates suggest that the cost of acquiring a new customer is 21 times more than keeping an existing one.

E-commerce cons:

One thing that is still missing  from the online shopping experience is the personal touch. Customer reviews and “chat with a rep” features help, but you also can’t try clothing on when shopping online. But there is often a trust factor with customer reviews, which some people don’t trust. Let’s face it they can be gamed. Also, some are still loath to trust their credit cards to the whims of the internet and problems of identity theft.

Online e-commerce venues seem to have gotten the view and buy product thing right, but are still struggling with keeping customers happy after the sale – shipping, handling etc. Also from @FierceRetail: EBay Now Racing Amazon For A Delivery Foothold, Expands From Mobile To The Web.

There is some hope for traditional retail…

Millennials Pick Walmart Over Amazon—At Least After They Become Parents

One study indicates that millennials end up selecting Walmart as their store of choice, over Amazon, after they become parents.

New retail trends..pop-up retail

Like the food truck, pop-up retail has taken off in a big way in the U.S. it can be a great way to test products, concepts and generate buzz with less investment for small innovators, and for larger retailers as well. works great with social media to let people know where the physical location of the store is. Mobile commerce has fueled this growth. This ideas came from a white paper available on FierceRetail.com.

Questions:

Do you think Traditional retail shopping and e/m-commerce are friends, enemies or frenemies? Why?

What shopping trend do you think will have the largest effect on the retail landscape & why in next 10 years?

What impact does Social media have on either traditional retail or e-commerce activity?

Can you give examples of a bricks-and-mortar stores that are embracing online, mobile, or smart-TV shopping?

What can we do, as consumers or retail professionals, to help bridge the gap between brick-and-mortar and online stores?

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What Do We Really Mean When We Talk About Business Relationships?

business relationships, networking, trust, transactionalThis is a question I have thought about a lot. Maybe my perspective is a bit skewed due to my introverted nature. When I think relationships, I think of meaningful conversations, easygoing chit-chat and comfortable silences. And yet, there are countless posts about how to work a room, get to know the “right” people and become the go-to person when you need a resource.

Are business relationships really just relationships?

There are so many posts exhorting us to build positive relationships with complementary professionals, employees, customers, vendors, mentors and the list goes on. We are told that our success depends on the quality of our relationships with those in our business network. But what if we are making them more complicated than they need to be?

Maybe because business relationships are not exclusively about finding common interests

This may be the nub of what makes these relationships so complicated. When you’re in business, you are looking for ways to maximize profit, advantages and opportunities for your business. You are supposed to be doing this. However, you and I and just about any other person you meet does not want to feel as if they are your meal ticket.

Business relationships are really transactional relationships

In a 1996 research survey conducted by the ESRC Centre for Business Research, University of Cambridge, Brendan Burchell and Frank Wilkinson write, “Trust is seen as having a central role in generating cooperation in business relationships.” This may seem obvious but trust has taken on more significance as collaboration becomes more of an innovation norm. So,  when we talk who exhibits integrity or authenticity in their online and offline demeanors, we are really asking if we can trust this person. Another factor is that our reputations are often defined and created by those we associate with. The degree with which we invest in revealing ourselves figures into the transaction.

What can you do for me + what can I do for you x how much I let you know me = depth of our business relationship

Which brings me back to my original question

What do we really mean when we talk about business relationships? It may be that we discover friendships. But, more often than not, are we really talking about how we might mutually benefit each other or how you might benefit me?

Join us for to discuss this topic on the Twitter chat, #KaizenBiz Friday, July 19, 2013 at 5pm GMT/12pm ET/9am PT

What are the gradations of business relationships?

To what degree do we vet the people we build business relationships with?

What are the top 3 skills needed to build positive business relationships?

If business relationships are akin to friendship, then why do they challenge us?

Where does social media fit in to the process of building positive business relationships?

Since doing business globally is much easier now that before, what special considerations are there for building positive business relationships?

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Will Crowdfunding Change How Venture Capitalists Operate?

crowdfunding, venure capitalists, startups, entreprneneurs, small businessesYou’ve got an idea that you’ve turned into a product. Your customers are happy and you’re on the brink of adding more. But your startup hit a major stumbling block. You need capital to expand so you don’t fail with your new customers. If you’re like most entrepreneurs, you make it a point to attend events and meet with angels and venture capitalists. And you start hearing “no.”

A few of the typical stumbling blocks of why angels and VC’s say no

  • There is no clear plan to attract more customers
  • They can’t see how your company will become of the Fortune 500
  • They don’t know you or your track record
  • Competition in that particular market is too high
  • There isn’t a clearly defined way that the startup is different from its competition

There are more reasons and sometimes it is a case of the entrepreneur just not telling the story in a compelling way. I have even heard stories of how investors couldn’t understand the concept of the company and/or product. But, it remains that there is a need for more capital if the startup is going to grow.

Enter crowdfunding

If you are familiar with the “friends and family” form of funding a startup, then crowdfunding can be seen as an extension of that idea. Basically, crowdfunding is “the collective effort of individuals who network and pool their money, usually via the Internet, to support efforts initiated by other people or organizations.” It can be a useful tool for early stage and small business owners to fund a company or just a particular project. Often there is some sort of free offer or giveaway for investors. And although it has become quite popular in the US, a recent survey from Massolution shows how much it has grown worldwide over the last year.

Disruptive force

One potential area that crowdfunding could disrupt the traditional model is that some entrepreneurs want to raise money without giving up equity. Most investors seek a way to minimize risk by owning a percentage of the venture. In a VentureBeat post, it was noted that there are other ways that this could be a disruptive force. People who would normally not even get a first look from a VC (i.e. music bands raising money to record, social organizations, small to mid-sized companies, etc) can raise capital for their organizations or projects. It also uses a current social and professional network that may or may not include traditional investors to connect to interested people. This means the reasons why people invest change also. There is more emphasis on the personal connection, support for the mythology of do-it-yourself and community. Another way that crowdfunding can disrupt investing is that new startups can establish themselves because they have more than the bootstrapped funds. Then there is the startups in countries that either have difficulty accessing venture capitalists or are looking for microfinancing.

So, what do you think is coming next with crowdfunding? Will it change how venture capitalists invest? Join us Friday, July 12, 2013 at 5pm GMT/12pm ET/9am PT for the Twitter chat, #KaizenBiz as we discuss crowdfunding

What makes crowdfunding so appealing to startups and small businesses?

How are crowdfunding investors different from more traditional investors?

What are the advantages of using crowdfunding as a way to raise money for your startup or small business?

What are the disadvantages of using crowdfunding as a way to raise money for your startup or small business?

What effect, if any, is crowdfunding having on venture capitalists, angels and other traditional investors?

What trends do you see emerging with crowdfunding?

 

http://venturebeat.com/2013/06/24/crowdfunding-vs-seed-funding-all-money-is-not-created-equal/

http://blogs.wsj.com/venturecapital/2013/06/24/fundamerica-ceo-crowdfunding-is-bigger-than-the-internet/?mod=dist_smartbrief

 

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