Business, Ecommerce

Best Market Practices in Online Retail: Planning

Best practices are the acceptable norms, standards and processes which are based as per the industry needs and which help the stakeholders to operate smoothly. They are relevant because they act as a guide to existing as well as new players in any industry. Entrepreneurs, intending to enter a particular industry, are able to initiate first steps through the knowledge of existing best practices, whereas existing vendors will be able to innovate due to the continuous exposure towards the existing norms. We take a look at some practices that are adopted by industry leaders to set businesses on the path of success.

An overview of an e commerce retail value chain shows us the important components through which a product or service usually changes hands. It is the basic path usually taken, and clarity in this helps a new entrepreneur keep his starting strategy in place. Lack of adequate focus on any of these factors could potentially impact the quality of product or service delivered to the customer. Consequently, this may have a long-term impact on the brand value of the firm.

Planning is obviously the first and most critical stage for the launch of any kind of business. It is essential for future online retailers, as it helps them to establish budgets, set targets and understand the various requirements of a setting up an online retail business.

In case of online retail, the following steps and best practices applied to them will be critical for entrepreneurs to embark on their online retail business:

1.  Pilot product category and Selection: The products that an online retailer intends to launch along with its online business. The initial products could be crucial for the success of an online retailer.

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2.  Website Design & Development: It is predominantly a technological decision; however, it is also strategic in nature because the robustness, interactivity and scalability of technology will have a direct impact on customer experience and business expansion.

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3.  Selection of Payment Service Providers (PSPs): A PSP will impact the costs, perception regarding data security and customer service for online retailers. Therefore, a PSP must be selected after careful assessment and evaluation of various alternatives.

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Concluding with some industry examples that created a difference due to continuous focus on evolution in their initial business phase we see,

  • Significance of site domain and user friendly interface in Snapdeal. It initiated its operations with domain; however, later bought the dot com (.com) domain for a cost of US$ 3,000. Snapdeal recreated the entire platform on the back of an in-house technology team, as its website gave a cluttered feel initially.

  • In selecting a product well, Flipkart was a key name that showed success. It started its online venture with a single product category – books; however, after succeeding in books, the company diversified its’ product categories.

Watch this space for more on best practices in Internet Retailing.

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