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What SMEs Can Learn About E-Commerce For Their Own Businesses

From what was supposed to be an exciting moment in e-commerce across Australia emerged one of the biggest tech-flops in recent history. If ClickFrenzy wanted publicity, and to be in the spotlight, they almost became irradiated by the glare. Current media are focusing on the negative backlash, yet there are some positive lessons to learn from this online episode.

The Wheel Has Already Been Invented.
Much of the mauling by media, e-commerce and IT experts over ClickFrenzy has focused on the failure of the tech-infrastructure. Not only did their own website fail, but many other Australian retail websites advertising through ClickFrenzy (let’s call them CF for short) slowed or stopped working. Alternatively, major internationals on the site operated as per normal.

The analyses by the experts suggests that the tech-heads at CF poorly anticipated the traffic demand that would be placed upon the website which according to CF Director Grant Arnott, it was an “unprecedented event”.

Unprecedented does not have to mean unanticipated. Andrew Fisher, Chief Technology Officer of JBA Digital makes reference to other websites who always manage to survive massive traffic encounters. Such sites include Ticketek at the time of major concert announcements, and he suggests that the infrastructure needed to cope with the “unprecedented” onslaught of online visitors already exists on these other e-commerce sites.

The lesson for all business owners here is to perform due diligence before getting caught up in the “hype and holler” of some new kind of marketing channel. If you suspect that a marketing opportunity is a “new wheel” then chances are you need to undertake considerably more research before throwing money at it willy-nilly. That’s not to say you must pass over any untested marketing options but realize that “new and exciting” doesn’t always mean the glitches are ironed out, nor does it guarantee it will be well-managed upfront. If you don’t have enough information to make a decision, but still want to test the waters, invest only a small portion of your marketing budget, and avoid big spending.

Pricing Congruence Is Essential.
One of the most typical errors made by businesses venturing online can be seen in their pricing inconsistency across all advertising channels. This means that the same product or service being advertised at a particular price in one space is found in another location for a different price. A basic example of this would be the cost of a hotel room; the same room is promoted on their own website at a higher cost than it appears on a third-party site. This nonsensical practice offers absolutely no value to the hotelier because while the room might be reserved via the external channel, it costs the hotelier a fee just to have that room offered through the third party’s site.

Congruence is essential if you’re looking to utilise various online channels – and the ClickFrenzy failure demonstrated that Pricing Congruence, or Pricing Parity, was as much a reason for the disaster as any infrastructure meltdown. Simply put, consumers who spent (much wasted) time trying to access the allegedly great deals on the CF site soon found better deals for the exact same products online elsewhere. Now, whether these were offered by the same retailer is unknown at this time.

However, the CF fault easily suggests that if your promotions are – for whatever reason – inaccessible via one marketing channel then your own e-commerce site better be ready and raring to handle the influx. Examples where this worked included Windsor Smith and Woolworths’ own Masters Home Improvements both of which reported significant increases in unique visitors to their own websites as a direct result of the failure of the CF site where they both had promoted deals.

The lesson for business owners is this: If you have decided to invest in third party e-commerce sites to offer great consumer deals, ensure you have robust technology at your own site with pricing offers that exactly match or beat those you promote on external sites. You need to be able to both handle the additional traffic and also satisfy price-savvy shoppers who will take their business elsewhere if they suspect you’re “ripping them off” at your own site.
Keep It Simple, Seriously!
One of the big mistakes that retailers made when jumping on the ClickFrenzy bandwagon was “complication”. It is reported that some sites required shoppers to use codes as part of their access or exit, and other retail websites did not show their CF specials at all, adding confusion to an already messy situation. Because many consumers are still transitioning to online shopping and others are yet to make that move, the one mistake no retailer can afford to make is complexity. That is, every step toward purchase must be simple, uncomplicated, easy to make and it must feel safe, consumer-friendly and straight-forward. Nothing should get in the way of the customer saying “yes” to a purchase all along the way.

If you use access codes, separate links, poor navigation, complicated data entry fields, too many steps, more than one page, or any other hindrance to the purchase, anything that confuses the shopper, you can effectively “kiss” them goodbye along with any money they were sure to spend. The consumer experience needs to be so user-friendly a sixth-grader could manage it, and must continuously engage the customer and overcome any objections along the way.  You do not want your customer to jump through hoops and still expect them to part with their cash.  It is not going to happen.

Overall, the ClickFrenzy experience is not a bad one, in total. There were, without doubt, mistakes made that most definitely should have been pre-empted and resolved before they even happened. ClickFrenzy and retailers each showed they had not understood the market and were unprepared. Still, the heroes in the story are ClickFrenzy for having the guts to get in there and demonstrate that Australian consumers are all up for a good deal and are keen to give online shopping “a good crack”. As with any new venture, there will be glitches and there may even be fallout. However, ClickFrenzy sat in that spotlight, copped a beating and bled publicly, and will need to work harder and smarter in 2013 if they are to rise from the ashes.