At the heart of every business lie transactions. How do you purchase the supplies you need? How do you sell your final product? None of us wants to simplify our work this much but if you can’t get what you need to operate economically and you can’t sell your goods or services competitively, then the other things you do quickly become irrelevant.
The commerce models where this buying and selling happen have been transforming and evolving throughout time, oftentimes hand in hand with new advances in technology and sometimes driven by other factors. For the green industry, let’s consider brick and mortar, eCommerce and direct selling our key ways of exchanging our goods throughout the supply chain.
- Brick and Mortar: Companies that have a physical presence and offer face-to-face customer experiences.
- eCommerce: Trading in products or services conducted via the Internet.
- Direct Selling: The marketing and selling of products directly to consumers away from a fixed retail location. For instance, regional sales reps.
There is a valuable place for each of these methods in every industry, but trends are leaning toward the biggest growth opportunities being in eCommerce transactions. According to Forrester, B2B eCommerce sales were on track to achieve $559 billion in sales in the U.S. by the end of 2013 (they have not reported yet if these estimates were reached). That is more than twice the size of current online consumer sales (B2C eCommerce). The same report found that more than one quarter of respondents were getting 50 percent of their revenue from an online channel.
Why Do People Buy Online?
According to a report released by comScore, Inc. (UPS Pulse of the Online Shopper: A Customer Experience Study), consumers want more choices, more control, convenient returns and the best deals when they shop online. Interestingly though, lowest prices were not always the main motivation for online shopping. It is more a lifestyle, or when done for your work, a way of doing business that appeals to a lot of people in the digital age.
In the green industry, we largely operate under a broker/wholesale model of doing business throughout the supply chain starting with the breeder/producers and culminating at the retail level. To date, our industry has lagged behind others in the eCommerce market at every step of distribution. Regardless of where you fall within the supply chain — selling to other business or to the end consumer — eCommerce is growing at such a pace that you can’t ignore it. If your customers aren’t already asking for it, it is safe to say that as the next generation moves in to decision making roles, they will demand it.
What To Consider When Thinking About eCommerce
- Who is your target market? Do they already do quite a bit of business online? Do they do most of their work at their desks or do they require mobile solutions?
- Can your business operate online without losing your personal touch, relationships with your customer and customer loyalty?
- Are you willing to make the required investments in both personnel and technology required to have a successful online eCommerce site?
Pros And Cons Of Selling Via eCommerce (From A Business Perspective)
|Overhead is not exponential with sales||Initial investment can be very high|
|Growth opportunity through online channels are proving to be bigger than traditional ones||Channel conflict (between direct sales and online channels) could hinder growth if not handled well|
|Can oftentimes help to streamline existing logistical issues||Sophisticated systems required to handle complexities of working with live goods|
How Consumers Could Benefit From Your eCommerce Platform
- More choice and flexibility in how they purchase from you
- Opportunity to review your products more leisurely and on their own schedules, giving them the information to make better informed decisions
- Compare pricing more easily giving them confidence in their purchases
What Are Other Industries Working On?
A closely related industry (in terms of the supply chain set up and working with live goods) that we can learn from is the food and beverage industry. Grocery chains are making big strides in harnessing mobile technology to promote products, increasing product awareness and effectively using that data to better manage ordering and inventory levels at the manufacturer and retail levels.
Take, for instance, MyWebGrocer (a service I have not yet used, nor am I endorsing), which helps retailers provide eCommerce platforms to their customers. ECommerce grocery shopping has grown up to a service where you can shop from anywhere, rely on a trained personal shopper to select your products and either pick up your order or have it delivered right to your door.
To me, this sounds like an amazing customer experience, one that might even connect me more to my current grocer than I am now. Take it beyond the customer experience, though, and think of the data grocery stores now have on this segment of their customers. Personalized marketing and a completely new level of engagement with their customers just became possible.
Let’s look back at the world of flowers and why we should care what grocery chains are doing.
Imagine an eCommerce site that allows consumers to order the plants they need directly from their iPads as they walk around their garden, visualizing exactly what they want. The new generation of consumers, contemplating their garden space, could actually create a virtual garden with their iPads using the inventory of the retailer, create an order, get confirmation, pick it up or have it delivered.
From a business perspective, this offers a better way to connect with the new generation of shoppers who are very connected to mobile technologies in a way that is more effective than selling in brick-and-mortar stores. As a retailer, you also just received some very valuable data that you can use to enhance your marketing.
- Targeted content marketing on the plants they purchased
- Personalized offers that bring them back for more
- Timely tips for summer care – fertilizers, chemicals, mulch etc.
- Promotions for second planting for seasonal gardens – switch to fall and winter color – spring flowering bulbs
- Contest for best garden – linking their customers to each other
This same model holds true for the B2B aspects of our supply chain. Professional greenhouse growers can better connect with their retail customers with online ordering and resources that share data on trends, allowing for more timely promotions and inventory specials. Breeder/producers can connect in real time with their customers and even extend the reach of their marketing to the retailers and consumers in a more effective manner. Overall, it makes our industry more streamlined and more connected to our end consumer.
ECommerce is more than just online ordering. It is a way to better understand, connect and engage with our customers, on their terms, in the digital age. It can’t (and won’t) replace the value of personal relationships in both business and consumer transactions, but if done correctly, it will build on those to make the customer experience so much better.
The technology is there, the innovation is there and valuable lessons are at our fingertips if we look at and learn from other industries and their eCommerce practices.