Scaling and growth for e-commerce
E-commerce is growing at an unprecedented speed. Customers appreciate and value the ability to shop without leaving their homes. It’s quick, convenient, and in many cases, cheaper than walking from shop to shop and buying traditionally. Contrary to a popular belief, customers don’t expect retail businesses to move entirely to the internet. They want retailer shops, crew, and the entire supply chain to be more agile. The e-commerce growth is very rapid. Internet sales are growing every year. The COVID-19 pandemic showed us how much. What can you do to stay afloat? I will gladly help you with that.
A complex e-commerce development strategy
Customers have very specified expectations towards e-commerce. E-commerce scaling helps us by giving two choices, but both of them fall into the category: corporations vs the rest of the world. Giants like Amazon and Walmart play by using the hybrid model. Customers can buy the item on the internet and then pick it up on their way from work to home. In one place. Amazon is also going ahead with Amazon go – small shops that offer groceries. You don’t have to even pay – scanners will read the data on the card and accept the “payment” when you leave.
Amazon is winning by having money and scale. The company has an army of warehouse robots, thousands of transport vans, hundreds of planes. It wants to make itself independent from UPS and FedEx. Amazon also wants to get rid of the “last mile” problem, which generates most of the cost when it comes to retail delivery. It has Amazon Flex – thousands of people delivering packages in their private cars. This is what an e-commerce development strategy looks like!
All of this makes competition with Amazon, Walmart, and Alibaba even more complicated. Can you really compete? YES, and I will gladly tell you how.
When organic growth is not enough – e-commerce scaling
Retail giants have their own recipes for success. You have to create your own. There’s no one way to make it. Smaller e-shops have to fight back with different tools. Sure, money is important but what matters most is the consumer’s trust. If have to find out a way to really compete.
An effective sales platform (based on agile and effective Magento, for example) is one thing. Thinking about business optimization is another. Strategy for e-commerce growth should have all the elements that help to fight with e-commerce giants. Plus, you can’t fall into a matrix that Walmart or especially Amazon would want you to.
The problem is that Amazon and other, similar giants, are selling at an unprecedented scale. They have generated profits and mechanisms that allow them to fight competition to the point it will let go, or go bankrupt. Under these circumstances, the growth of e-commerce is especially hard.
What can you do to make sure that strategy for e-commerce growth really makes sense? How does it suppose to look like? I can help you with that. But first, read about traps that are waiting for smaller retailers.
Protection from Amazon – make yourself ready for competing with the giant
The threat from Amazon is a real thing. Yes, it allows cooperation. Smaller detailers can sell on Amazon Marketplace. This e-commerce strategy is profitable for Amazon itself. The larger portion of the profits coming from the shop is generated by smaller shops. There are, however, few problems with that.
First of all, Amazon’s algorithms constantly check what currently sells best. The next step? Amazon is making their own versions of popular products. That was the case for batteries and even… diapers. Diapers.com was selling products on Marketplace, and then Amazon threatened that it will sell the exact same product for… 0 dollars. That meant bankruptcy for Diapers.com. The story ends with Amazon buying the competitor.
The other challenge – fees on Marketplace are high, even 15%. This is a serious struggle for those who want to scale their e-commerce based on Amazon. It’s pricey and drastically reduces profit margins.
The third problem – loans. Amazon even offers loans for retailers that want to sell on Marketplace. The interest rate can be even 12%; that complicates things even more. Scaling e-commerce is even harder.
How can I help you?
No matter if you want to compete with Amazon, Walmart, or Alibaba, or plan to grow with a different model in mind (different than “survive”, I mean) – I can help you with that. The market is consolidating and makes the world go round for giants and smaller companies that find their way. I have made solid market research and I know how to help.