Staying strategic with your online business

Mon, 08 Jun 2009 20:03:00 GMT

When engaging in Online Business, it's easy to lose focus due to the sheer expanse of the web. Without strategy, business owners often enter a downward spiral of over-promotion, brand dilution and ultimately, ineffective marketing.

Decades ago, business owners had it easier - they weren't dealing with the "rapid, volatile and discontinuous change" (Charles Handy) we face today. But they did have a strategic, focused way of managing their businesses. That's where the 4 P's come in. Collectively known as the "Marketing Mix", these are four ingredients for success that you must constantly balance and control when running your business.

The 4 P's are still relevant today, but need a bit of an update when applying them to the Online Business world. I'm going to take you through how to balance them Online:

Product

Offering static, catalogued products no longer cuts the mustard. With comparison shopping sites and huge online stores like Amazon, how do you compete on Product alone? Google has changed the way we buy online and your customers now start with the goal in mind (a product), then choose which supplier to buy from.

If you're offering an eProduct or an online service then you still have the power to innovate and stay ahead, but if you're selling tangible goods you need to be offering a valuable experience AND proving your credibility.

Allow customers to offer feedback with comment forms on blogs, announcements and products. This builds social proof for your next round of customers to see, making them feel more compelled to do business with you.
Offer a public forum where customers can discuss what they like/dislike about your product or service.
Give your customers individual consideration and personalized attention through exceptional customer service.
Prove that you're an expert by creating educational videos about your products. Give customers the detailed photo galleries they crave and articles that they want to read, in their quest to become more informed.

Price

Competing on price is a useless endeavour.

The web has introduced almost perfect competition to your now global market and you're looking for more business - but cutting your price is not the answer - it only serves to lower your brand image and the expectation of quality from customers.

As Seth Godin notes, "consumers are shopping for value not price, and value = benefit/price". In today's online world, the mental and emotional benefits often outweigh the monetary price; increase the benefits, and in turn justify your pricing. Here's how:

Make it easy for customers to contact you using automated enquiry forms, set up a detailed FAQ, and take away any emotional stress with instructional articles or videos.
Use email marketing to send out regular Newsletters, containing updates about your Online Business and some industry-specific hints or tips. Offering this unique content will not only set you apart from the crowd, but also serves to justify your pricing.

Place

Customers want to be able to browse and purchase your products or services online - it's plain and simple. Crafting an effective "Place" strategy is about making what you offer accessible at the right place, at the right time and that means having an effective plan for SEO and Social Marketing.

Having an online storefront means that every product you offer has a link which can be Tweeted, Dugg, returned as a Google search result, or blogged about - so in just three clicks, a customer can make a purchase.

In addition, here are two ways you can optimize the shopping experience within your online shop:

Display "Featured Products" on your front page, showcasing new deals that customers will be tempted to click on.
Streamline the online shopping experience. From start to finish, present only the information required, keep clicks to a minimum, and make the "Checkout" button always visible.

Promotion

The Web provides your Marketing Team with a fully-loaded arsenal of promotional weaponary. The key is to use the sniper rifle instead of the shotgun - staying strategic and ensuring that your promotional efforts are improving your brand's position and reputation rather than detracting from them. Due to the open nature and lower cost of online promotion, Marketers must ensure they are not lured into the trap of over-promoting and hence degrading their online image. Promotion, as part of the overall Marketing Mix, should be targeted, undertaken in moderation, and balanced with the other Ps.

Here are some tactics for promoting your Online Business:

Use an online CRM system to more accurately segment your customer database; targeting discounts, special offers and email marketing at warmer prospects who are more likely to take an interest.
Use "below the line" marketing in the form of Social Media. Your online shop is now part of the wider web ecosystem and that means being present on all the major social networks so you can listen and engage with your customers. Converse 90% of the time and sell 10% of the time.
Publish content - videos on Vimeo, photos on Flickr, articles via all the blogs out there - all leaving a trail back to your Online Business.

Mixing the ingredients

The best thing about this recipe is that it gives you the freedom to experiment, working out the unique balance of ingredients that suits your Online Business. The key is to fine tune your overall strategy so that each of the 4 P's work in harmony with the others.

This means that your Pricing strategy suits your Product; that the Place (your distribution channels) take into account the nature of your Product, and that the costs are covered by the Price you're charging; or that your Promotion is highlighting the Product benefits your customers actually want, and you're targeting this at the right market segment.