New Retailer? Save Some Money For Marketing!

In the good old days of the internet, many retailers had a ‘build it and they will come’ approach to launching and managing their online stores. These were the days when Yahoo dominated all and when the online ecommerce store was often an ‘afterthought’.

This week, some of the UK’s best known ‘bricks and mortar’ retailers have gone the same way as the Titanic. Woolworths, MFI, and many others are feeling the pinch of tighter consumer spending and intense competition from retailers in the online sector, a space that is becoming increasingly competitive as the consumer pound finds itself floating through cyberspace (retro word alert!) rather than passing over shop counters.

So, we are left in a situation where thriving online competiton means that often, only the strongest will survive. A big mistake often made by retailers first entering the market is to assume that the internet is a ‘big place’ and that with all of those people buying online, even a small slice of the cake will do. However, even this can be very difficult to achieve without a strong marketing plan and the budget required to implement it.

This week, I spoke to a new retailer who was struggling for online sales. They have a nice looking store, a good range and competitive pricing and service.  They had spent their money on the store/products and had left nothing for marketing in a very competitve sector.

When a new store launches it will receive no traffic. No traffic means no sales. No sales means no revenue. No revenue means no ongoing budget. No ongoing budget means no marketing. No marketing means no traffic. Repeat ad infinitum.

So, the point is that marketing has to be pre-budgeted and should never be an afterthought. When a retailer is assessing a new venture, the first question should be ‘How Will I Market It’ closely followed by ‘How Much Will It Cost’.

If this isn’t done, there is a strong chance that the iceberg may appear a little sooner than you think…