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Online E-Commerce a Minor Threat

April 8, 2010 | No Comments »

For many retailers, particularly those with a long history of retailing in the physical world, the Internet is an ominous dark cloud, and even thinking about websites brings a sense of dread. Are e-commerce websites going to steal your business? Will your customers desert you for Swell.com?

Not likely. Internet sales are still a small part of total US sales: E-commerce is less than 4% of US retail sales. Some market segments have much smaller percentages: 1% in Apparel, and 2% in sporting goods. E-commerce is important, but, despite years of hype, online purchasing is not how people buy products. As analyst Greg Sterling says,

The dominant paradigm has emerged: online “shopping,” offline buying.

Nearly all consumers use the Internet for research, and then nearly all of them buy in physical, real-world, brick-and-mortar stores. Yahoo calls it ROBO: Research Online, Buy Offline.

So, don’t be worried about other e-commerce retailers. Don’t worry about not having an e-commerce website. But, you should be concerned if you don’t have any web presence. Retailers don’t need to maintain their own websites, but they do need to make it easy for consumers to find and connect with them. Fortunately, this is getting easier every day, particularly with directories like Yahoo Local, Google Local Business or CitySearch and business-capable social networks like Facebook Fan Pages.

Facebook is the Center of the Web

March 25, 2010 | No Comments »

On a recent trip to the mall, I noticed the URL in the window of a Levi’s store. It wasn’t levis.com, as you’d probably guess, but facebook.com/levis, the URL of their Facebook page. Facebook is becoming the center of many company’s promotion efforts, and may eventually become the center of the typical user’s web experience.

It isn’t hard to understand why. Levi’s has 360,000 fans of their Facebook page, and if 4% of those fans follow a posting on this page, each posting to their page could generate 14,000 hits on the main Levis.com website, a substantial fraction of Levi’s total traffic. Many other sits report that Facebook is the largest referer of traffic to their sites. At Foursquare, Facebook refers 50% more traffic than Google, although other sites that don’t have a strong application-level connection to Facebook report that Facebook has a more modest edge.

Even more surprising, last week Hitwise reported that Facebook gets more US traffic than Google, indicating that we may be seeing another  fundamental shift in how people use the web, away from searching across the entire web to finding a community and discovering the information that other community members publish, a shift that was predicted by social bookmarking sites and discovery sites like digg.com, reddit.com and stumbleupon.com.

For independent retailers, this may seem like a scary new world, but it is actually an improvement, because retailers can get online with Facebook in a matter of a few minutes, without having to spend a lot of time and effort on creating a store website. It is also easy to link Facebook to other websites, either by posting links to Facebook, or including links from traditional websites back to Facebook, as Clarinova’s microsites do on the Home and Contact pages.

If you are a retailer, and are not on Facebook, you owe it to your business to create a profile for your self and a fan page for your business.