Don’t e-Commerce, e-Communicate

Business people hear about their competitors making sales online, sometimes with very impressive numbers, and rush to the web with the only objective not to be left behind. As a result, they end up with poorly conceived e-commerce sites that do nothing for the brand and quite often damage the valuable brand assets.

Many online sales channels are simply cannibalizing offline sales. In 2005, a study showed that only 6.5% was actual incremental sales. At the same time, five times as many young people were going online to make their purchasing decision than were doing so just five years earlier. 70% of all purchasers go online to conduct buying research. In one study from 2002, a staggering 12% indicated that they switched brands purely because of what they learned online. This is unheard of in traditional media!

What does all this mean? It means that what you communicate matters more than the media you use.

Instead of using your site to scream at people to BUY, BUY, BUY! you should be using it to talk to them, educate them, and tell them more about your company or products. The sales will come as a result, especially if your site becomes a trusted source of meaningful information. These same principles apply to social media, as these channels are even more influential as a form of educational interaction with customers.

Relationship marketing may be a buzzword that’s been overused in the past couple of years, but it is a valid concept and works very well online when done right. Those who engage in a digital RM program show more than 600% increase in conversion to purchase when compared to traditional RM relationship marketing programs. The web is an information place and should be used as an information source. People expect it.

Many CEOs who spend hours working on their brand message have no idea of the value of their brand when people actually type the band name into a browser’s address bar. People come to your web site, or sign up as a Facebook fan, with a genuine desire to interact with your brand. How much better can it get?

The single biggest advantage of the internet is the ability to educate your target audience. Think about how this compares to other media. This is almost impossible with a television commercial.

Invite your audience

On the web, sites are most successful when they invite people, treating them like intelligent beings who can make their own decisions. You never shove stuff down their throats. This doesn’t mean you can’t be aggressive. Mercedes only allowed people to get info about the C class online. There was no other way to get information during the pre-marketing process. But the web can appear to be disrespectful more quickly than other media, so you have to be warmer and more gentle in your approach.

Once you invite, you have to engage your audience or you’ll effectively kill your brand. If you invite them to a party, make sure a party is what they find. Competitors are one click away, and if they do things right while you don’t, chances are very slim that the online audience will give your site another opportunity in the future.

Treat people like, ah, people

Give your audience the facts they need to compare. You can’t be successful online without providing real information. There are never enough facts! Find things you can point to, like independent third party comparisons. Allow people to sign up for news or to join membership programs. They want you to assist them in making a purchase, and things that make them feel like insiders to information not available elsewhere works wonders. Mercedes dealers allow people to register online for a test drive, indicating ahead of time what kind of car they wanted to test. This allowed the dealers to be fully prepared. But with 3000 daily requests for a test drive, responding efficiently can be a challenge. You can’t delay. Dealers who didn’t respond in 48 hour lost their status as an online retail link. Nike ID was actively used as a test bed for future shoe designs. It wasn’t meant not to make a profit online, but as a research tool.

Getting to yes

All of this leads to the transaction. The interesting thing is that while 95% of all purchases are still made offline, those customers have already made their decision online because they’re empowered by what the web offers them in terms of information. Automobile companies like Mercedes have found that customers no longer ask any questions from salespeople. They walk into the dealership already knowing as much or more about the cars than the people who work there. They’ve been empowered by e-communications.

Defend your brand with conviction

If you know that 70% of your customers are making their buying decision online then why is your online budget only 3%? You can’t expect to have a successful site if you don’t support it. The best companies spends at least 10% of their marketing budget in online initiatives. Non-tactile products are easier to sell online, but the principles are the same.

Your customers are friends

In the past, we called them the “target market.” Then we called them customers. Today, you have to call them friends. That means you have to treat them as friends. E-Communications means carrying on a two-way dialog. Feedback channels are critical. Being respectful of even the most critical comments goes without saying. Don’t sweat it so much when people bad mouth you, because they were always doing that, just not so directly in your face. This happens in friendships. It’s the result of people who care enough to let you know when you let them down. Listen and respond.

Don’t be so bent on building an online store. Instead, focus on building an online community if you want to watch the sales climb.