Businesses and consumers depend on the internet for research and make purchasing decisions, yet numerous businesses fail at making connections and turning these potential customers. A majority will set up websites, while some play around with online media or even create Facebook pages, but they only get only average results. And, even more importantly, some companies are closing down due to being too slow to adjust by integrating the internet into their business plans. Why do so many businesses fail, yet certain companies succeed? What are the key areas Australian business need to concentrate on to make sure it is done correctly?
In Google I saw some of the biggest retailers fall behind after years of providing insights and trends that could have helped them better meet the needs of the demands of customers today, but they were unable to act promptly enough. Of course , there are certain exceptions, but overall we can say that this: the Australian retail industry is in the back of the 8 ball!
Based on my experiences working with companies of all sizes, I have discovered that there are five main reasons that businesses fail on the internet:
1. The business plan is not working from the start!
Businesses must have the business strategy because without one , they would not have been able to establish a company in the beginning. However, things are changing and in the past 10 years, consumer behaviour and markets have drastically changed. The internet has reduced barriers to entry for businesses to offer products and services in your region and customers have come to realize the potential of internet research to determine the most effective option and find the best price. If you’re not able to offer the most competitive offer, customers can quickly find out.
What does this mean for your value proposition and price? Does your company possess a sustainable competitive advantage? Are you still trying to find the right segments of customers?
However great your site is, but if the value proposition you offer isn’t compelling enough, users are likely to abandon your site and likely never come to your site again. With price transparency facilitated by the internet , you will not rely in price as a determining factor. This raises the issue of what value you can add by offering other options to provide the best customer experience.
2. A lack of digital leadership
I suppose this shouldn’t come as a surprise considering that the top executives of many established Australian firms grew up during an age prior to the advent of the advent of the internet. They’ve gotten to their current position because of their expertise and experience in what works. The issue is that the way they operate now is not the same as the way things were done 10 years ago.
However, to change the way companies operate in order to better serve the customers of the future requires a clear understanding of what success will look like in five years’ time, and to consistently drum into this idea to its employees. The problem is that digital expertise is often a part of lower-level employees of the company who are unable to influence or direct the multichannel strategy of a company. The top executives are ensconced in their current strategy and don’t see the wood for the trees, allowing them to see the importance of online and how they can invest in their social media channels and websites as assets.
This lack of digital understanding at a higher level results in a inadequate online strategies and one that isn’t owned or promoted by the top executives of the company. Change is happening, however for certain businesses it’s not enough, it’s too to be too late.
3. Unsufficient allocation of resources to online channels
“We’re in need of we have a Facebook channel”! but what’s the right social strategy, and who is responsible for it? “We must use the data we collect to help us make more informed decisions , but who is knowledgeable and has the time to analyze the data. “We require a better site however what is the best investment to get a result that really delivers?
The way to go about going online is to tick boxes without really understanding the investments and resources needed for success and most important, perform better than your competitors. It is true that executing every aspect of online efficiently requires humans as well as the right technology platform in order to be successful. This is the reason I am bringing up my next topic.
4. Making the wrong choice when it comes to 3rd party providers
While I don’t claim that it’s easy to choose the most reliable third party because there are a lot of options out there , but you must determine the price level you’re looking at to ensure you get the best solution that meets your needs. Be wary of sales pitches that sound like a scam and providers that appear more affordable than else. The biggest mistake I’ve seen businesses make is that they choose the most affordable website or SEM provider that has a lower management cost.
The majority of services will require man hours, therefore the price you pay for is what you receive. Research and talk to experts in the industry to ensure that you’re choosing a service provider who are able to meet your goals and to determine if it’s worth the extra cost to achieve the result you want.
5. Structure of the organisation and how it is defined
There are two reasons for this two because they are connected. Many times I have observed the online channel acting as a silo within multi-channel retail enterprises. Everything is therefore rated by the sales made online instead of taking into account the role the internet plays in driving sales via other channels like phone calls or customers in stores. Businesses continue to invest in traditional media, without actual measurement tools, when more targeted and effective online media is accountable to the online sales and therefore is undervalued. This results in a inefficient allocation of marketing dollars and an under-performing return on investment.