Are We Losing Market Share to Competitors by Not Selling Online?
Are we losing market share to competitors by not selling online? How will our distributors react if we start selling online? What investment is needed to sell online? Should we sell on Amazon or create our own website?
These questions are on the table in many board meetings and management discussions within small and medium-sized enterprises. Just as the COVID-19 crisis marked a turning point for social media strategies and transformed consumer habits, it has also accelerated online sales projects that many companies had planned for the medium term, making them a priority. The lockdown highlighted the competitive advantage of having a direct-to-consumer (DTC) online sales channel.
What Is the Goal of Selling Online?
A company that has never sold online and decides to take the step now must clearly understand the motivations and implications of doing so. There’s a big difference between following the competition and adapting to customer habits and demands.
If the final decision is to sell online, it must be a firm commitment—not necessarily in terms of the project’s scope (it’s not mandatory to sell 100% of the product or service range online; a pilot test with a specific selection may be enough), but in terms of ensuring conviction at all levels of the organization.
If the commitment to online sales is hesitant and underfunded, the results may lead to misleading conclusions about the company’s online sales potential.
Commercial and marketing strategies have been “democratized” thanks to digital channels and resources. Reaching a customer on the other side of the country—or even in a foreign market—is now possible for virtually any company, regardless of its size, marketing budget, or geographical presence.
It is important to clarify that, while an online store can start generating revenue once it goes live, eCommerce is far from a simple “plug and play” solution where orders start pouring in automatically. A well-structured and consistent digital strategy must accompany its launch.
Omnichannel: Putting the Customer at the Center
If potential customers have the option to buy a product like yours online—perhaps at a better price—why would they want (or even be able) to travel to a physical store just to make the purchase?
In online sales, omnichannel simply means making life easier for your customer.
Does it make sense to force consumers to change their shopping habits, or should we instead provide them with all the options they need to buy from us, whether online or in a physical store?
Statistics, such as how often we check our phones, the number of screens we use simultaneously, or the number of active users on major social networks, offer insight into how much of our daily actions happen through mobile devices. That’s why an omnichannel strategy is essential—it allows brands to be present and responsive to customer needs on every platform.
A common mistake is assuming that the most challenging part of launching an online sales strategy is developing the eCommerce platform itself. In reality, the bigger challenge is achieving sufficient visibility and traffic at a cost-effective level to make online sales profitable.
If We Want an Effective and Profitable Online Sales Strategy, We Must Invest the Necessary Resources
Main Barriers to Online Sales for SMEs
One of the biggest concerns for SMEs when adopting a direct-to-consumer online strategy is the potential backlash from their long-standing distributor network. Distributors are often a company’s greatest asset, and many may feel betrayed or threatened by the idea of becoming less essential in getting products to consumers.
As the saying goes, “gratitude is a virtue,” and SMEs owe much of their success to their distributors. However, online sales strategies do not have to exclude physical distributors.
There are multiple ways to integrate distributors into the equation, from using them as click & collect locations and last-mile storage hubs to offering personalized service that blends online and offline sales channels. Omnichannel sales embody this very idea—giving customers a range of purchasing options so they can choose what works best for them at any moment.
Taking the step toward online sales can help explore the viability of the channel and, most importantly, provide objective and up-to-date information about the company’s customer base. This insight allows businesses to refine their commercial messages and in-store positioning.
The Online Channel Will Not Be Profitable Without a Strategy That Combines Visibility, Conversion, and Customer Service
Resources Needed to Launch Online Sales
To simplify the resources required to launch online sales, we can categorize them into two areas:
- Human resources: The team responsible for defining, launching, optimizing, and coordinating the online sales strategy.
- Advertising resources: The budget allocated to different digital marketing platforms.
If we aim to build an effective and profitable online sales strategy, we must acknowledge that significant investment is necessary. Just as we wouldn’t expect a poorly paid salesperson and a few posters to generate record sales across an entire market, we also shouldn’t expect an online sales strategy to succeed with minimal effort or investment.
It’s true that companies today face liquidity constraints, but it’s equally true that without a strategy combining visibility, conversion, and service, the online channel cannot become a sustainable and profitable part of the business.
A key advantage of digital investments and transactional platforms is that every euro spent is measurable. Businesses can track return on investment and analyze performance across different channels—whether through SEO, paid social media campaigns, or website analytics—allowing for data-driven decision-making.
Online Sales Channels: Should I Develop My Own eCommerce or Sell on Amazon?
Once we’ve decided to sell online, the next question is: How should we do it?
We can distinguish four main alternatives:
1. Own eCommerce Store
- Pros: Full control over the platform, no sales commissions.
- Cons: Acquiring significant traffic (users) can be very challenging at first.
2. Third-Party eCommerce Platforms (e.g., Shopify)
- Pros: Faster and easier setup.
- Cons: Less customization and commission fees per sale.
3. Selling on Amazon and Other Marketplaces
- Pros: Access to an unmatched volume of recurring buyers (more than 50% of purchase-related searches now start on Amazon, not Google).
- Cons: Full dependency on Amazon’s policies, fees, and service conditions.
4. Combining Own eCommerce with Marketplaces
- Pros: Leverage Amazon’s massive audience while maintaining an independent online store. This allows businesses to use Amazon as a showcase and develop strategies to drive traffic to their own site.
- Cons: Competing against Amazon’s own search rankings, where the marketplace will likely win.
The Importance of a Seamless Customer Experience
Most SMEs are not digital-native companies, giving digitally born businesses a competitive advantage. These companies understand the critical role of customer experience in online sales.
A company may offer a unique product, a beautifully designed website, and the fastest shipping in the industry—but if the product arrives damaged or the post-sales service fails to provide a swift and effective solution, the customer’s perception of the brand will be negative. Worse yet, dissatisfied customers may amplify their frustration through negative reviews and social media posts.
This example illustrates that online sales are not just about the eCommerce website or marketing creativity. A customer’s experience with a company begins with advertising and organic content, continues through the purchasing process, is reinforced by shipping updates, and culminates in the product’s delivery and condition. If customer support is needed, it becomes another crucial touchpoint in shaping brand perception.
In short, launching an online sales strategy is not just about setting up a website. It requires a comprehensive approach that integrates marketing, logistics, and customer service to ensure long-term success.