multi-channel internet sales review

©2009 Yeoman Technology Group – All rights Reserved

Internet Sales TrendsUnderstanding the Major On-line Sales and

Distribution Systems on the Web


Goals of TodayOutline the various Internet Sales Channels

Current State of WebBusiness potential of eachExamples of missed opportunities

Discuss Customer Buying TrendsConsumerBusinessGovernment / Education

Recommend Specific ActionsShort termLong term


About Yeoman

Multi-Channel Distribution ApproachFocus on entire webSegment into ‘channels’Match customer buying patterns

Internet focus is on Sales, not MarketingRely on usage statistics to support any assumptions


What’s an Internet Sales Channel?

DirectMajor

E-TailersBid / Auction Supply Chain

SystemsReferral /Associated

Knowledge / Social

Anywhere from 10 – 30% of a manufacturers sales comes from one of these channels


2009 Internet Revenue by Distribution Point

14%

28%

16%

31%

8% 4%

DirectE-TailerBidSupplyReferralSocial

Source: 2009Aggregation of IDC/Gartner stats for worldwide sales via different channels


The Big Myth

DirectMajor

E-TailersBid / Auction Supply Chain

SystemsReferral /Associated

Knowledge Centric Social Centric

Each are distinct channels with their own group of competitors, systems, and links


What Channels Matter?Base on customer pattern

Presence – Are they active usersPropensity – Are they likely to buy while therePurchase – Are they buying

This is a separate criterion from what you would use when looking at general marketing, branding, or customer support.


Traditional Sales & Distribution Model

Manufacturer

Distributor

Retail

Partners

OEM Consultant

Direct

Sales Team


Internet Delivery not consistent

Manufacturer

Distributor

Retail

Partners

OEM Consultant

Direct

Sales Team

Direct

ETailers

Bid

Supply Chain

Referral

Social


Internet Sales ChallengeEach Channel has multiple vendorsNone of the systems are interconnectedExistence in one may HINDER client ability to find you in anotherCan require significant investmentMust be aware of traditional channel conflictNot the core focus of any one group within a Company

Often get lumped in with IT, Marketing, Finance, or Support depending on system


Direct Channel

Easily understood10-30% of buyers look to Company site firstMost common source of channel conflictOften have to compete with Corporate & Marketing teamsWho owns the site?Major focus on “SEO”

Issue

•US Software firm didn’t want ‘direct’ site

•Felt it would conflict with channel

Problem

•Major price differences on web

•No way to find price

•Competitors always ‘appeared’ lower

Solution

•Establish main presence on web

•Avoided conflict by fulfilling via partners

•Eliminated pricing questions


Auction Systems

$100 billion marketEBay most commonly knownHeavy system use by consumers and heavy equipment mfgNeed to have presence to protect brand

Issue

•High end consumer coffee manufacturer felt they didn’t “need” to be on EBay

Problem

•They were there

•New products via retail partners

•Plus those searching were sent to competitors

Solution

•Create “Outlet” store

•Call out copyright infringements

•Protect other brand and partners


Supply Chain / B2B

The Quiet Giant (<$200b)Major vehicle for many organizationsFast growth in Gov/Ed spaceNo interconnectivity or links to general searchBusiness is there, you may just not know about it!

Issue

•Sonicwall has steadily tried to build newer products for larger clients

Problem

•Large Fortune 500 client wanted 200 Sonicwalls

•Product was not in system

•Notice went out to suppliers, who bid Cisco…..

Solution

•Establish Direct Link

•Work with partners on other systems


Major E-Tailers

$180 billion last yearTop 500 dominate marketControls a whopping 30% of user trafficMost have virtual inventories and direct feedsMajor mistake to believe its consumer only

Issue

•Celestron Biological Microscope never considered Amazon as a place for their products.

Problem

•Four vendors had products listed

•Major gaps in product specs and details

Solution

•Establish Direct feed into Amazon

•Clarified gaps in product details

•Best selling Biological Microscope


Referral Systems

Account for 13% of all major E-tailer traffic10% Growth in 2009 Requires feeds into core systemsReferral fees 1-6%Will take feeds which help search engine ranking

Issue

•High End Dress manufacturer forced to layoff due to retail clients. Web page does poorly

Problem

•Great name among shoppers

•Can’t afford marketing budget

•Great margin to share

Solution

•Establishes relationship with major women’s referral systems

•Offers higher ‘cut’ relative to all others


Knowledge Systems

Very common on webFocuses on specific topic

Controlled discussionsHigher end informationSeparate from ‘selling’ site

DIFFERENT from social sites

You control contentNo peer controlBrand is managed

Issue

•Book publisher was trying to identify ways to make more clients aware of their specialized solution

Problem

•Main discussion site owned by competitor

•Controlled community

Solution

•Establish own site

•Partner with other non-profit options


Social Networking

Major focus for marketingAre customers buying?Need to stop wasting resourcesAggregate postingsStudy trafficDetermine if sales oppty exists or is it just branding

Issue

•Regional Bank was struggling with Marketing's obsession with social networking

Problem

•Wasted time

•Wasted resources

•No deliverables

Solution

•Figured out how to sell!

•Established SINGLE posting of mortgage rates

•Multiple systems, thousands of followers.


Take Away Points

Key Items to remember:

Web serves multiple elements within a businessMarketingSalesSupportDevelopment

Align the web responsibility and functions with the Lines of Business

Need to look at entire Internet infrastructure at a holistic level


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multi-channel internet sales review

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