Tag Archives: Business plans

Bricks and Clicks Retailers – the Best of Both Worlds

The way forward for retail is Bricks and Clicks. In an article earlier this year Justin Taylor head of EMEA retail trying to console Bricks and Mortar retailers said: “despite the impact of e-commerce, physical stores remain a cornerstone of consumer engagement”.

The question that remains to be answered is:  Why is online retail growing worldwide and, at the same time, Bricks and Mortar retailers that are not engaging their customers online are closing down?

Why do Bricks and Mortar retail customers shop online?

If Bricks and Mortar retailers are the cornerstone of customer engagement, then where have their customers gone to? The customers of Bricks and Mortar retailers probably left because they find online shopping to be more convenient:

  • They can shop 24/7 from anywhere;
  • They can get more information about products and services online;
  • They can go online to search for specific products and where to find them;
  • They can compare the prices of products online; and
  • They can share their experience online with friends, family and social communities.

In spite of the fast growth of online shopping, many retailers that are doing their business only online (Pure Clicks) are now starting to look for physical retail space.

Why are Pure Clicks retailers looking for Bricks and Mortar retail space?

It is not a simple matter of Bricks versus Clicks says Justin Taylor. Physical stores remain a hugely important part of the retailing mix as they offer the ability to interact with merchandise, instant gratification for consumers, personal service and professional guidance.

We have seen the migration from bricks to clicks, and the pattern in some instances is now heading the other way as brands born online are now seeking physical space. The answer is Bricks and Clicks retail shops that have both physical and online space. Bricks and Clicks retailers have the best of both worlds.

Integrating the physical with the online may pose a challenge for most retailers. eBizplan, a management consulting business can help retailers to run the physical and online business as one.

Retailers Biggest Challenge – Integrating Online with Offline

Retailers who are for years in business are using technology that is developed for running a physical shop (Bricks and Mortar) better and making shopping for their customers easier.  A study by Forrester Consulting found that although 90% of the UK retailers are now doing business online. However, most of them find it difficult to join their online and offline technology.

Only 26% of the retailers interviewed mentioned that their sales are influenced by the online channel.

Technology use by the customers of Bricks and Mortar retailers

Most of the customers of Bricks and Mortar retailers visit their website to get information about the inventory in the shop.  A recent study by Forrester Consulting,  found that 39% of customers are unlikely or very unlikely to visit a  store if its website does not provide physical store inventory information.

Only 32% of the shop owners that was interviewed offered a function on their websites for customers to view their in-store inventory details.

Customers want shopping convenience

The study indicated that half of all customers cited store pickup options as important or very important to them when shopping online. However, only a third of retailers today already support store-pickup programs.

Read also:  Will “Click and Collect” Solve the Delivery Headaches for Grocers?

The customers interviewed demanded the following:

  • Absolute guarantees that the product is actually available;
  • Rapid picking and notification alerts;
  • Customers want to pay at the point of pickup;
  • Customers want the option to pick their goods up at alternative locations.

In-store experience in the digital age

The customers are in power when they use their smartphones in the shop. They use their smartphones to check inventory availability before entering the store.  The customers also use their smartphones to get more information about the products  they are interested to buy.

Bricks and Clicks retailers need to be both masters of the store and of the digital domain.

eBizplan, an online consulting business, can help retailers to draft a strategic plan to integrate their offline and online business.

Reasons Why Start-Up Businesses Fail

Robin Allen from Smart Insights reported results from research recently done by Quartz why 87 bootstrapped (companies that start without venture capital) failed. Allen highlighted the fact that the results show ‘poor marketing’ positioned above pricing issues, legal challenges or burn out as a reason why start-up businesses fail.

The main reason that bootstrapped companies failed was because their business models were not viable. The matter of having a viable business model and business strategy will be discussed briefly in this post.

The result of the study by Quartz is shown in the table below.

Reasons for failing Number
Business model not viable 10
Customer development issues 8
Lacked financing/investors 8
No market need 8
Disharmony on team/investors 6
Inexperience/skill gap 6
Not enough traction 6
Technical/product issues 6
Lack of focus 5
Ran out of cash 4
Bad location 3
Ignore customers 3
Failure to pivot 2
Hiring mistakes 2
Poor marketing 2
Burnout 1
Lack of passion 1
Legal challenges 1
Pricing/cost issues 1

What is a business model?

A business model is according to Magretta (2002) similar to a story – a story that explains how your enterprises works. A good business model answers questions such as:

  • Who is the customer?
  • What does the customer value?
  • How do we make money in this business? and
  • What is the underlying economic logic that explains how we can deliver value to customers at an appropriate cost?

By having the answers to these questions a start-up business will come a long way to establish if their business idea is viable. A business model on its own will however not provide sustainable outcomes for most businesses. A business also needs a strategy…

What is a business strategy?

Whereas a business model is more concerned with the operational activities, the use of resources and the capabilities of a business, a business strategy had more to do with what the business should do in the future. A business strategy answers questions such as:

  • Where are we now?
  • Where do we want to be?
  • How will we get there?
  • How will we stay there and make some money?

A business model and business strategy usually come together in a business plan.

The integration of the business model and the business strategy

A well written business plan may serve as a vehicle to combine a business strategy with a business model. The opportunities and threats identified with the strategic SWOT analysis of the business can purposefully matched with the strengths and weaknesses that was identified with the business model.

Furthermore, if a prospect business owner draft a business plan before starting his/her business, most of the reasons way the business may fail (listed in the above table) may already have been identified and taken care of.

Also have a look why online businesses fail in South Africa

Please visit eBizplan if you want help to develop a business model, a business strategy and business plan for your start-up business.

Note

Magretta, Joan. 2002. Why business models matter. Harvard Business Review, 86-92.

Include a market analysis in your business plan

Drafting a business plan it is important to do a market analysis. You should determine against who your business is going to compete, what the size of the market is, whether the market is profitable and who your customers will be.

A market analysis of your business may seems like a daunting task,  but it is one of the most critical elements of your business plan. The following aspects as listed by Hanna Burmeister recently in the Grand Rapids Business Journal need to be analysed about the market in which you want to start your business:

Industry outlook

A prospect business owner needs to find answers to the following questions:

  • What’s happening in your industry?
    • Describe the size of your industry, expected growth, any sales, operational or management trends.
    • Is the industry seasonal? Are there expected economic fluctuations?
    • Are there government regulations?

Addressing these industry characteristics helps provide a detailed picture of the environment in which your business is operating.

  • Who is your target market?
    • Identify your slice of the industry. Who is your business targeting, and what are their characteristics?
    • What needs does your target market have?
    • How big is the potential market for your business?

This analysis should include both demographics and psycho-graphics.

Competitive analysis

It’s important to spend some time analyzing your competitors. By understanding what’s already out there, you can better determine your business’ competitive advantage. A competitive analysis should address the size of the market, competitor strengths and weaknesses, barriers to entry and market opportunities.

Projections

Do you know what market size and market share are? Knowing how much your potential customers spend will allow you to estimate how much of the market you can attract. Furthermore, you need to project your pricing structure and gross margins. These figures may help determine how profitable your business will be.

Additionally, all of the prior research you’ve conducted with your market analysis will help you with your pricing, gross margin and sales estimates.

Please visit my website eBizplan to read more about business plans and marketing plans.

The value of a business plan when you start a business

How many people that want to start their own business have a business plan in mind as one of the first things they must do before opening their doors? Not many… Recent research reported by the “Start Up Donut” showed that more than 1.5 million UK SMEs (about one third) don’t have business plans.

Every business should have a business plan, since not having it may cause a messy and costly take-off of your business. Here are reminders why having a business plan before starting your business is important:

What is a business plan?

It is a written document that describes your business objectives and strategies, your financial forecasts and the market you are targeting. It will help you set realistic and timely goals, secure external funding, measure your success. The plan also clarify operational requirements and establish reasonable financial forecasts.

Why do you need a business plan?

Your need a plan that will help you to focus on how to operate your new business and so give it the best chance for success. A well written plan with realistic financial proforma statements will improve your changes to secure funding for your start-up business.

A marketing plan may help you to market your product or services at the right place, at the right price and to the right people. The plan will identify what the needs and wants of your customers are also who your competitors are and how you should position your products or services accordingly.

Lastly, will a business plan answer questions such as where are you now? Where do you want to be? And how will you get there? The business plan should be revised regularly since the business environment of today is extremely dynamic.

Please visit my website eBizplan to read more about business- and marketing plans.

Are Your Customers Receiving Your Marketing Messages?

Retailers spend big money to convey messages about their products and their prices to their customers. However, if the customers understand the marketing messages differently as what the retailer has intended, then big money may be wasted…

Know what you want to achieve with your marketing messages

The main reasons why retailers want to communicate with consumers are to inform potential consumers about the attributes of their products. At the same time they want to persuade them to buy the product, and to remind them to continue buying it.

The marketing massage must reach consumers amidst messages of competing retailers. The message must be heard in online communities that usually champion Joe public concerns with their critics and praises about the products. Retailers should therefore have a promotion plan to enjoy an competitive advantage…

Plan your marketing messages

Without planning their marketing message, the best-conceived products, at the most attractive prices, will often gather dust on retailers’ shelves. The following steps need to be followed when doing your promotion planning:

  1. Situation analyses – also known as the SWOT analyses. Retailers need to identify their internal strengths and weaknesses to address the external threats and opportunities in the markets.
  2. Formulation the promotion objectives. Retailers should describe their target market as well as their promotional objectives.
  3. Preparing the promotional budget. How much money will the retailers need to achieve their promotional objectives?
  4. Manage promotional elements. What will the content of the message be, what medium will be used (e.g. press, TV or online), who will receive the message, and how effective will the feedback be?
  5. Coordination and integration of promotional decisions. Who is going to do what, when and where?
  6. Measurement of promotional effectiveness. Have the promotional decisions achieved their objectives?
  7. Evaluation and follow-up. Continuous feedback about the effectiveness of the promotion decisions is needed to take corrective measures.

The development and implementation of a marketing plan give structure to a retailer’s management tasks. It also brings a retailer closer to its customers and in contact with a dynamic retail market.

Visit eBizplan for more on marketing plans and business plans.

More Mobile Sales For Online Retailers

Growing your mobile sales in the retail channel starts by delivering the same type of experiences consumers are encountering while shopping online using a computer.

Mobile has since 2014 exceed personal computers for internet usage…

The growth of mobile devices

The onset of smartphones and the roll out of Wi-Fi connections has increased mobile online shopping. Although mobile continues to drive the most sales growth for retailers, the sales still aren’t keeping up with retail traffic.

According to Andrew Meola, IBM found that smartphone traffic beat both tablet and desktop, making up 53% of all online traffic. But mobile still only accounted for 29% of all online sales.

Why does mobile sales lag behind other devices with online sales?

Customers using mobile have to fill out too many fields, and the text is too hard to read, among other things, says Dangelmaier in a recent blog. Merchants haven’t put enough weight into mobile and its impact on converting shoppers into buyers and completing purchases at checkout.

Some customers will abandon their checkout chart if they don’t have or can’t find a coupon to apply at the checkout. A lot of merchants haven’t built platforms that can easily execute coupon codes. Checkout conversion, especially on mobile devices, is a huge problem that needs to be addressed.

Visit eBizplan for your business plan and marketing plan needs.

Five more Trends that Bricks and Clicks Retailers Should Take Note of in 2016

Software AG identified ten disruptive trends retailers should take note of this coming year. The first five trends was discussed previously. Here is the last five trends to watch out for:

6. The internet of total satisfaction

The Internet of Things (IoT) is going to revolutionize the store of the future, with its sensor-oriented devices enabling the most detailed and targeted customer centricity. Retailers embracing IoT will have visibility into inventories via electronic shelf sensors; the ability to create smart signs that are weather- or facial expression-relevant; and the tools to make every loyalty customer feel coddled and important.

7. Immersion therapy

Futuristic technology will immerse customers in the shopping experience. Technologies such as Microsoft’s Hololens will allow customers to augment reality while in-store. They will be able to try on clothes, or design their ideal kitchen, virtually, while sharing their experiences with friends and family. iBeacons™ and anonymous analytical face detection will enable retailers to interact in real time with customers, as well as track their behavior.

8. Clean-up on aisle one

Real-time monitoring capability will be critical for the store of the future, in order to sense, correlate and automate processes from staffing to inventory. Smart sensors will detect activity and provide visibility across a store coupled with streaming data and real-time analytics, allowing for actionable and automated responses to things like a spill in a grocery store or a run on umbrellas in a rainstorm.

9. Buy me now!

Retailers will further customize and personalize instant gratification “buy buttons”, which can be found anywhere from Twitter to Amazon, with the expectation that these will translate into higher earnings. But they will need to make strategic technology investments to ensure real-time inventory is understood and the complex processes involved in new channels are orchestrated correctly.

10. Last Item in Stock

Real-time inventory visibility will dominate as retailers strive to keep the customers informed of stocks at all times. Retailers will control inventories by applying technology that shows inventory levels across all channels.

A Brick and Mortar retailer battles to survive on its own, as is a Pure Click retailer… Retailers need to integrate both the physical and digital systems to prosper and grow during 2016. Visit eBizplan for plans to integrate your physical retail shop with an online retail channel.

Trends that Bricks and Clicks Retailers Should Take Note of in 2016

Software AG identified ten disruptive trends that Bricks and Clicks retailers should take note of this coming year. Here is the first five trends to watch out for:

Trends that Bricks and Clicks retailers should take note of

1. Fewer stores, more stuff

Bricks and Mortar retailers will add fewer new shops as they dramatically reinvent themselves to address multi-channel issues. To be honest, I’ve read ever more about retailers closing shops never mind not adding new ones! The Bricks and Mortar retailers that are remaining will serve more as pick up and fulfillment centers. The “endless aisle” concept will extend shelf space to the brand’s full catalog of products and accessible content.

2. Focusing on the individual customer – you

Customer-centric personalization will differentiate retailers by making their CRM strategies more targeted. Retailers may deploy customer-centric technologies such as easy sign-up, and RFID-tagged loyalty cards, which can send personalized rewards over mobile phones when in-store. The technology allows retailers to tap into internal information, known preferences, and social media data to better understand and delight their customers.

3. The right price

Differentiation by price will be much more dynamic in nature in order to beat the competition as customers become more aware and more sensitive to price.  Also, real-time electronic shelf pricing will replicate customers’ online experiences, as well as optimize inventories and reduce labor costs. Real-time personalized discounts and special offers will further motivate shoppers to head to stores.

4. A master system to control cross channel activities

Today’s customers expect to get what they want—where and when and how they want it—and they achieve it by using multiple (Omni) channels for retail and marketing communication. Therefore the complexity of omni-channel processes and how these interact with multiple systems may require a kind of “mission control” center where retailers can see and control every activity across all channels.

5. Predicting your customer’s buying behavior

Predictive analytics in retail will enable stores to know, with a great deal of certainty, what customers are going to want and when. Predictive analytics tools, especially when combined with streaming analytics, offer retailers the ability to manage queues, customer expectations and inventories before there is an issue.

Finally, Bricks and Mortar retailers are battling to survive on their own.  Retailers therefore need to integrate both the physical and digital systems to prosper and grow during 2016. The next five trends that Bricks and Clicks retailers  should take note of will be discussed in a follow-up article.

Visit eBizplan for plans to integrate your physical retail shop with an online retail channel.

How to use LinkedIn as a Marketing Tool

LinkedIn is a business-oriented social networking service that is mainly used for professional networking.  LinkedIn has around 400 million acquired users in more than 200 countries and territories. The basic functionality of LinkedIn allows users (workers and employers) to create profiles and “connections” to each other in an online social network. Lasting professional relationships can so be created. Users can invite anyone (whether a site user or not) to become a connection.

According to iMedia Connection, LinkedIn Groups can be used as a marketing tool for connecting and communicating throughout the marketing industry. iMedia Connection suggests a number of ways that marketers can use LinkedIn Groups to their advantage.

Participate consistently with LinkedIn

Like anything else, you wouldn’t just run one ad for your new product or service. If you believe the improved LinkedIn groups are target-rich environments, then you need to focus your efforts to establish yourself as an authority. Make sure you are responding to articles from others and providing strong and objective feedback. Engage with the members and build your reputation within the group.

Networking with LinkedIn

LinkedIn groups can be used as a networking platform. However the groups are not ideal platforms to sell something from. Likewise, the groups are  not the place to pitch or acquire social contacts or email subscribers.

The best way to make use of LinkedIn groups is to use your time by engaging in conversation and building meaningful relationships.

Find great moderators

Marketers can use LinkedIn groups to their advantage by creating highly relevant groups that provide content of value. Active members who are posting interesting and helpful discussions separates a good group from a great group.  The success of a group depends of the how it is facilitated by its moderator.

Create valuable content

The content of group is of more value when it members participate frequently. Therefore, group members should take an active role in making the content on the groups more valuable. Importantly, new members will be attracted to the group and existing members will choose to stay. The members of the groups become more engaged and the content becomes more valuable since discussions aren’t as public.

Grab attention with images

The first question to answer is “What does your LinkedIn profile picture say about you?” A picture is worth a thousand words. It will take a fraction a a second for someone to draw conclusion about you by looking at your photo.

Try to create your own images. Also, grab attention with images as you do on other social streams, attract industry influencers and engage them with mentions, and get direct access to member’s inboxes with “highlight” emails.

Visit eBizplan for more on business plans and marketing plans.