Entries Tagged as 'Opinion'

Virtual Change Rooms - the eCommerce “touchy feely” front.

People talk about the difference between conventional and online retailing, and talk about how conventional retailing is facing new ‘challenges’.  These challenges are clearly demonstrated by the dire situation confronting Australian retailers in the current market.

The cost structure of bricks and mortar vs Online is one issue, GST on international purchases another, but it all comes back to shopping experience and the perception of value for money.

Online seems to have the price edge, but as any good retailer knows, price isn’t everything.

Anything that is a recognisable commodity, based on brand or even functionality - a pair of Levi jeans, a Samsung 2122 TV, a TAG Heuer watch, 100 feet of rope, a USB drive - does well online.  The key reason being, you know what you are getting.

Some pundits talk about customer service, handling problems…the practical upshot is, you have to send it away if its broken.  Does it matter to whom?  Its usually a factory repair shop nevertheless.  Online operators know this trust is a fundamental cornerstone to their business, and in my experience, superior to many traditional shops.

Improved customer service pre-sale is obviously a good start.  Granted, not every retailer has untrained staff with limited product knowledge on the floor, but with cost cutting, the trend is obvious.  And likewise, not everybody wants the attention, all the time.  I think its nothing new, in terms of the ‘personal shopping assistant’, just a return to the good old-fashioned quality retailing many high standard operations still practice.

Consider that in part of any considered online shopping process, users can consult product specifications, product reviews and comparisons from multiple third party sources, testimonials about the online retailer themselves, location of service centres and precise service policy, etc.  With this kind of resource, do you as a shopper, need a salesperson?

Where online has trouble competing, is in the ‘touchy feely’ department.  Will those shoes really fit?  How does that silk jacket feel, and is it well made?  And with liquidations and sale or special items, the impulse purchase, meandering past them online is a bit more difficult.  And of course, besides size, fit, quality, there’s also smell, colour, sound, texture….

What does online have to offer:

Video
Zoomable and rotatable images
Virtual colour changes
User configurable options
and, virtual dressing rooms

So, this is the area where traditional bricks and mortar retailers still have the edge.  This is the area where they need to exercise their competitive advantage, because, the online retailers are closing the gap.  And a few years down the line, when the NBN brings superfast broadband to the Australian consumer, there will be even better solutions.

And still, what will stop the savvy consumer from going out to find what they want in a shop, then look for the best price online?

Virtual Change Rooms For Online Clothes Stores: Pictures, Photos

Matthew

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Gerry Harvey retreats from war on online shopper

Following up on the previous article, here’s what Gerry did today….

Gerry Harvey retreats from war on online shopper | News.com.au

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Web 2.0 and Brand - Harvey Norman and the GST Debate.

Background:

http://www.news.com.au/business/online-sales-will-kill-jobs-retailers/comments-e6frfm1i-1225981373508

Currently in the news, eCommerce is all the go in Australia.  Our dollar is 1-to-1 with the American dollar, and Australian’s are reaching out, globalising their purchasing.  Add the cost of shipping, quite high to Australia, and the deals are still great.

There is however, no 10% GST on imported purchases under $1000.  The local market is calling foul.  The fact is, add 10% to the purchase price, and the Aussie market still can’t compete….

Remember, you are also already paying a big shipping premium,$20-$60?

A big part of the problem is retail rental rates.  So, you have to feel for the industry - rock, hard place, all that….

Issues to the public:

Retailers in Australia are naturally concerned, seeing their revenues going to overseas online competitors.  So, they are pressuring the government to protect their interests.  Recap:  They send the Aussie jobs overseas to China because they are cheaper, yet scream foul and ‘Un Australianism” when those now otherwise employed people purchase overseas because they are looking for a better deal.

Meyer can buy a pair of Jeans in China (because Aussie labour is too expensive) for $5 and sell them here for $120. Now, a consumer (who used to work in Textiles, but now has a lower paying retail job) can buy those same Jeans from the ‘States for $45, plus $25 Shipping.  Ain’t globalisation a bitch…

This fundamental hypocrisy of the local retail complaint is not lost on the public.

Additionally, watching the Aussie dollar go from .60 to 1.0 against the US dollar, and not seeing notable price reductions is an issue.  It lets us all know who is getting a sweet bite on the cherry.

Add the fact that most retailers are no longer hiring knowledgeable salespeople, but rather whomever will work for the part-time package they offer.  So, don’t even ask where something is, much less how it works.  They handle transactions OK though…

Their posturing about “Saving Australian Jobs” isn’t working very well in light of these realities.

Brand:

Harvey Norman has always had a great brand image, capturing the unique sweet spot in Australian culture, “The Battler.”  The little guy doing well against the odds.  Personable, approachable, just like us.  Our mates.  Same as St George Bank has carried well.

Problem is, Gerry Harvey has just burned his Brand, and with Web 2.0 you can see it happening before your eyes.  Gerry is in the news, and the commentary is blistering. Twitter is going off on him.

In his attempt to garner better revenue, he may have lost the baby with the bathwater.  He has just put himself into the same boardroom as David Jones, Meyer and Target, and low and behold, he’s the spokesperson.  Bad move Gerry.

Now, St George Bank, that’s an interesting counterpoint.  Now owed by NAB, one of the “Big Banks” the St George brand has been kept alive, not merged.  While NAB can boost rates above the Reserve Bank rate, and stand equal with the other big banks, sharing the damage.  St George never comes up.  Sure, St George rates go up, after the news cycle on interest rates passes.  St George brand is still “the Battler” even if it has long since ceased being the reality.

Gerry Harvey has always been the strength of his brand.  Can do man, sharp and compassionate, and the stores carry his name as the Brand.  He is banking his power as an Australian Icon will carry him through this battle.   The feedback from web 2.0 is that he is wrong.

It will be interesting to see if he steps back, or continues to push.  Its a battle that will be hard to win, in an unwinable war.

Consumerism in Australia is not ‘fundamental’ like other Western capitalist democracies.  Australian’s are more resistant to brand marketing, and conspicuous consumption - outside housing.  This resistance has relaxed with the booming economy over the last 10 years, and the influx of migrants with more comsumerist attitudes, but with the GFC, Aussies started saving and paying down debt, and lo and behold, looking for better deals.   Those values are not far beneath the surface, and rising.

Now is the time for innovation, not recrimination… eCommerce is here to stay.


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Online sites win journalism firsts at Pulitzers

One thing we all know, the newspapers and magazines are hurting. But, there is more news and information at your fingertips than ever before.

A new model is slowly evolving to face the opportunieits online: Free news with ads, paid news (with ads too?), sites that consolidate news from other sources, Citizen Journalism…

Pulitzer Prize for Journalism is a benchmark of sorts, here’s what happened this year.

Online sites win journalism firsts at Pulitzers

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Google email takes on Facebook

Social interactive marketing is reaching further and deeper into our everyday interactive experiences.  1.5 million daily visits to gmail are not to include an increasing social element, with, I suggest, more to evolve.

I think its plain to see that Google knows no bounds as it expands across all interactive frontiers.

Google email takes on Facebook | News.com.au

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To Niche or Not to Niche? Report Challenges Long Tail Theory on P2P Networks

Since the rationalisation of the Magazine Industry, when broad spectrum publications began to be replaced by niche topic publications, the conventional wisdom has been that ever increasing specialisation and topical focus was the way to secure your future in publishing.  Followed up by the audience orientation of different radio talk shows and even television networks, this seemed to prove the conclusion.Now, the  report linked below seems to indicate there is a future for broad-based content, and that niche marketing and communication strategies may not have cornered the market.

In the P2P world of music downloads, it appears the “top 40″ are still the downloads of choice, even though there is so much more niche content available out there.  In P2P, the long tail is pretty stumpy.

Report Challenges Long Tail Theory on P2P Networks | Epicenter | Wired.com

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CRM Is Not A Four Letter Word.

Customer Relationship Management article from Retail specialist Peter Ryan.  Fits nicely with the principles of engagement as a tool for increasing customer value.

Red Communication Australia: CRM Is Not A Four Letter Word.

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The great Spam attack

Just a note to my friends and readers - I recently suffered a significant attack of the bot spammers and have been forced to delete and repost most of my articles to get rid of the comment spam.  Unfortunately, I lost a lot of good comments as well.  Please accept my aploogies to those of you who took the time to comment.

I’ve turned off the commenting feature for awhile while I beef up my spam protection.

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Digg CEO Jay Adelsons Take on the So-Called “Revolt” | Epicenter from Wired.com

An interesting web2.0 question, when your business is built upon user content, what do you owe the leaders of the community?

A big site like Digg faces a significant issue here, but what about the web2.0 functionalities you build into your own site? Is this another case of training your brand to live and let live, or is it a case of losing control of your operation?

Are your community content generators customers or are they simbiotes? Are your objectives the same, or are you financing your own downfall? Are you prepared for the answer?

Digg CEO Jay Adelsons Take on the So-Called “Revolt” | Epicenter from Wired.com

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Technorati

Check out my Technorati Profile
more code for my Technorati Profile

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