Why No Sales?
Here Is A List Of The Top Ten Deal Breakers For Online Shoppers.
“So why isn't your site raking in the bucks? You've got products; you've got a URL; you're willing to take people's money; but, no one seems to be buying. What gives?”
has gotta be tough. You can't pick up a newspaper or a magazine these days without reading about some twenty-something whippersnapper making millions--if not billions--selling who-knows-what over the Internet. And it's true. More and more people are buying online, and lots of other people are getting rich selling to them.
An estimated $25 billion worth of consumer spending was conducted online last year, with $3.2 billion in auctions alone! Market leader Amazon.com recorded sales of $293.6 million in the first quarter of 1999.
So why isn't your site raking in the bucks? You've got products; you've got a URL; you're willing to take people's money; but, no one seems to be buying. What gives?
Well, it could be lots of things--some obvious, some less so. If one or more of these deal breakers apply to your site, take it as an indication you're doing something wrong. And then change it--if you can. Some of the reasons why people aren't buying may not be your fault, but they're definitely your problem. So, you had better figure out a solution.
After all, the Web is all about not giving up. It's relatively easy to keep improving your website--and your e-commerce strategy. More to the point, it's essential if you want to survive in e-commerce.
Deal Breaker No. 10: You Don't Take Credit Cards
It ought to be obvious by now, but some Web builders still haven't got the message: If you don't accept credit cards, no one is going to buy anything from your online store.
Heck, this one's obvious even in meatspace. There are precious few successful businesses--online or offline--that don't take credit cards. And if you don't take credit cards in the online world, how are your customers supposed to pay you? Snail mail you a check? Or cash? Not very likely.
It's not hard to accept credit cards on your site. All you have to do is set up a merchant account with a bank, a deal with a credit card clearinghouse, and access to the gateway. (Of course, you typically have to pay a fee to credit card companies on every transaction, too.)
If that's too complicated, a growing number of packaged e-commerce solutions virtually automate the process of accepting credit cards. And some services actually do it all for you--for an additional fee, of course. Some companies, such as Freemerchant.com, even do it for free.
Don't torture yourself over the costs and hassles of credit, though. It's just a cost of doing business. Oh, there's one more thing: don't pass on the credit card costs to your customers, which is a habit pioneered by some lowball outfits. It's your job to cover that cost. Even gas stations don't charge more for credit card purchases these days.
Deal Breaker No. 9: Buyers Can't Find Your Site
Whether you're publishing a site about Web building or selling Beanie Babies to fanatical collectors, you're not going to get very far unless people know about you and can find your site. There's a lot of clutter on the Web these days, and it's all too easy to get lost in the shuffle.
If you're not covering all, or at least most, of the bases listed here, your problem may be that potential customers simply don't know you exist:
- Have an easy-to-remember URL.
- Have a well-known brand name.
- Get properly registered by the major search engines.
- Get in bed with one or more of the major Web portals.
- Get really in bed with the specialized Web portals in your market.
- Buy--or at least trade--Web ads wherever you can.
- Promote your site offline wherever possible.
- Tell your friends about your site at cocktail parties.
Of course, if your traffic analysis shows that millions of people are visiting your site, looking at your products, and not buying anything, lack of awareness is probably not your biggest problem.
Deal Breaker No. 8: It's Too Hard to Buy From Your Site
Just because you're smart enough to figure out how to find and buy a particular item on your site, don't assume that all your customers will be able to do the same. You built the site, so you know how it's organized. You probably don't need any navigation to find the precise page you want, so you're probably not the most representative tester.
In the real world, plenty of shoppers get lost trying to find men's shoes in Macy's, so it's no surprise that they can't find a particular widget among thousands of products on your giant e-commerce site. You need to test your site with real shoppers who are looking for real goods. Ideally, you'd do that before you launch, but the economics of Web building often dictate that you do the best you can on your own, then pay close attention to your site's usage patterns to help people find and buy what they're looking for.
To make sure, put yourself in the position of a cyber-shopper and ask yourself the following questions:
- Is it easy to find the product I want to buy?
- Are related products grouped together?
- Is there a shopping cart system?
- Does the shopping cart work? Does it remember my intended purchases and associated information? And can I remove items without starting over?
- If I get lost or have a problem on the site, can I find the help I need?
- Does the design work in all major resolution settings, from 640-by-480 to 1024-by-768?
- Did you design the site to meet the customer's needs instead of your own internal organization?
Deal Breaker No. 7: Your Prices Are Too High
Just because people seem willing to pay astronomical prices for your company's stock, you should not assume they're willing to pay a penny more than they have to for the products you sell. (Unless, of course, you're selling them on auction--then all bets are off. Auction participants seem to be afflicted with the same dementia that effects buyers of Internet stocks.)
There's probably somebody selling pretty much the same things you are, and on the Web people can get to your competitors' sites just as easy as they can visit yours. Once people discover they can get it cheaper somewhere else, they will--end of story. Already, more and more services--from CNET Shopper.com to Snap Product Finder and many more--make it relatively easy to compare prices. Once XML kicks in, overpriced Web merchants will have nowhere to hide.
That said, current economic conditions on the Web make it very difficult to sell certain products at a price that is both competitive and profitable. In the mad race to build both market share and mind-share on the Web, many companies are happily "investing" millions of dollars in selling items below cost. They're losing money on every sale and trying to make it up by increasing volume.
They can get away with it because Wall Street seems perfectly willing to reward these practices with massive stock valuations. As one e-marketing pundit likes to point out, the perfect Web business model would be to sell $1 bills for 80 cents. You'd generate huge volume and fast growth, along with incredible--and structural--losses. Does that remind you of any high-flying Internet companies you know?
If you can't pull off this kind of stunt yourself, it can be tough to compete against it. Your only choice is cut margins to the bone and to try to hold on until reality returns. And there's no telling how long that's going to take.
Deal Breaker No. 6: Shipping + Handling = Bait + Switch
A low advertised price isn't enough, either. While it's very powerful to promote a low price, shoppers aren't stupid. Once they go to your site and try to buy something, they're not going to be pleased if you load up a bunch of fees and charges to boost the price.
Let me tell you a story. Earlier this year, I needed to buy a PalmPilot, and one site advertised an unbelievable price. I went to the site, worked through the buying process, and then was informed of shipping and handling fees, credit card fees, "profit-margin" fees, and taxes that boosted the price by about 30 percent. Needless to say, I cancelled the order and bought my Pilot elsewhere. Equally obvious is the fact that I will never go back to that online retailer. And I've made a point of telling my friends about my experiences, too.
Things are even worse when buying low-end items. You simply can't offer a good deal on a $3 bottle of aspirin if you charge $4.95 shipping and handling, as Drugstore.com reportedly does.
Hiding your costs in back-end fees, such as shipping and handling, may seem like a clever way to get the low prices that can drive traffic to your site, and it may get you some short-term attention. But there's a major long-term cost in alienating customers, journalists, and commentators. Remember: you're not just building sales and market share, you're also building a reputation. And while sales figures can change rapidly, reputations have a tendency to stick around a while.
Deal Breaker No. 5: Your Customers Don't Trust You
E-commerce is growing so fast that it's easy to forget that it's still a new medium. It's so new that many people are still uneasy about buying online, and many Internet brands are still unfamiliar to many shoppers. If you want people to whip out their credit cards, you have to go as far as you can to soothe their (real) fears, hold their (virtual) hands, and earn their (valuable) trust.
What does that mean? At the very least, it means:
- Disclose the full cost up front: don't hide your fees and costs behind a phony low price.
- Don't advertise products you can't deliver.
- Describe your products honestly.
- Implement effective security policies.
Try to remember that you're establishing trust--not just for your own site, but for the entire concept of e-commerce. Don't ruin it for everyone.
Deal Breaker No. 4: The Devil's in the Fulfillment
This item isn't new to e-commerce. It's been the bane of mail-order sales since the days when the Sears catalog ruled the roost. It drove catalog shoppers crazy then, and it drives online shoppers crazy now. Historically, fulfillment is the biggest customer service issue facing any mail-order company.
Simply put: you've got to make it clear--up front--exactly when an item will be delivered. If you don't have it in stock, let shoppers know before they go through the buying process. And definitely let them know before they actually order the item. If people have questions about when their purchases arrive, answer them promptly.
Use only quality shipping outfits and have procedures in place to track orders and shipments. If customers have problems, they're your problems, even if the shipper caused them. Remember: the customers gave their money to you, not to the shipper.
Fortunately, the Web makes it easier to handle these issues. Automated online systems can let many customers check on their purchases without having to speak to a customer service representative--saving everyone's time and money. But automated systems are not enough. No matter how good your system, it won't cover every situation, so you still need a back-up process with real human beings.
The bottom line: the sales process isn't over until the customer receives the merchandise--and it arrives on time, in good condition, and is exactly what they ordered.
Deal Breaker No. 3: Edsels, Yugos, and New Coke
You can do everything right on your website, but you still won't sell anything if you're not offering what people want. Equally important is that your wares must be something people want to buy online.
Some things you just can't sell anywhere at any price (you should see the huge box of Desert Storm baseball caps in my father-in-law's garage). Do you think the Net would have helped Ford with the Edsel, made people drive Yugos, or mitigated the New Coke fiasco? Aside from the current phenomena of people buying all sorts of junk in online auctions, I don't think so.
Even if you're peddling products with a demonstrated market, some things don't lend themselves to online sales. Anything that sells by catalog should work, and the Web can work in other areas, too. But in many cases the Web can do little more than set up the sales, not close the deal. TV commercials promising to deliver cars like pizzas to the contrary, you still tend to need a car dealer to finalize the deal and prepare the car. And you definitely want to have a relationship with the dealer when you need service. Someone's got to let the buyer kick the tires and go for a test-drive. Once in a while, brick and mortar can be useful stuff.
On the other hand, small transactions--less than $5 or so--still aren't economically viable on the Web. In most cases, transaction fees and shipping costs total more than the purchase price. Other types of sales are predicated on immediate gratification. When you want something now, even "absolutely, positively overnight" isn't soon enough. Finally, sometimes the target audience simply isn't online in great enough numbers to make for a successful business. For example, selling farm implements to the Amish online probably wouldn't work, since they'd be unlikely to have credit cards, computers, Web access, or even telephone lines. It wouldn't matter how good the scythes were or how badly the Amish needed them.
Deal Breaker No. 2: Not Giving Something Away
When you start talking about e-commerce, it's easy to forget that the Internet was once all about freedom. "Information wants to be free," claim rebel programmers promoting open source computing. Maybe so, but on the Net people want everything to be free!
That doesn't mean you can't sell online, but it does mean that Web surfers often expect something for nothing. And if they don't get it, they're likely to head elsewhere before they hand over their credit card numbers.
So, it may sound paradoxical, but in order to effectively sell on the Web, you often have to give something away. Sure, brick-and-mortar car dealers sometimes offer free hot dogs to entice shoppers to visit the dealership, but online giveaways are practically a cost of doing business.
What you give away can vary, according to what you have available, what you can afford, and what you're trying to sell. Examples of Web freebies range from limited versions of software products to services like free email and free Web access, and even to free computers! The key is to come up with premiums that not only attract people but also get them to buy something, too.
Deal Breaker No. 1: No Sizzle, No Dice
They say that a true salesperson sells the sizzle, not the steak. On the Web, your customers can't actually experience the steak, so the sizzle is all you've got. If your e-commerce site is dull, boring, and behind the times, don't be surprised if visitors to your site don't muster the enthusiasm to pull the trigger and actually buy something. If your site isn't exciting, shoppers won't be excited either.
There are an infinite number of ways to create shopping excitement, including:
- bold design;
- clever copy;
- snazzy technology;
- special deals and promotions;
- giveaways; and
- hot, hard-to-find, or exclusive products.
In the physical world, retailers have developed plenty of ways to encourage impulse purchases. That's critical, because in today's affluent America, the overwhelming majority of purchases are driven by factors other than true need. Your job is to come up with Web-based ways to drive impulse buys, or you will quickly find yourself a wallflower at the big e-commerce party.
Please consider the environment before you print this document.