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 E-commerce SolutionWhile many people are aware of how an e-commerce solution can help you sell products online, most people are yet to truly grasp the opportunity associated with this.
In his 2006 book, The Long Tail, author Chris Anderson argues that the internet has changed the way the world does business, both in areas that most of us are now aware as well as many areas that very few businesses have yet to take advantage of. An effective e-commerce solution, including a comprehensive strategy and not just any old shopping cart program, can help anyone in almost any industry take advantage of these opportunities.
To summarize Anderson’s definition of “The Long Tail,” imagine a traditional bookstore located in any American town in the early 1950’s. The store is 1000 square feet in size and almost all of their customers do business by walking through the front door. Because of overhead, inventory costs and limited shelf space, the store needs to use what space it has to carry books that will sell in significant volume. They cannot afford to waste much shelf space on books that are going to sit for very long without generating some revenue. Therefore, most of the store’s inventory is made up of the best selling books available at the time. If it has enough shelf space to carry 1,000 titles, he may carry the 1,000 best selling books at the time.
Ecommerce Solutions help companies reach The Long TailNow flash forward to 2007. An effective ecommerce solution now makes it possible for that same bookstore to offer not just 1,000 books but 100,000, 1 million or 10 million titles. Limited shelf space is no longer an issue and inventory costs can be nonexistent since your e-commerce website allows you to offer a book to a customer without actually buying a physical copy of the book. A picture and a description presented online are all you need.
And what Amazon.com discovered is that those books that would not have made it into that traditional bookstore because they did not sell enough copies (those books ranked between #1,001 and # 10 million on the current best seller list), while selling fewer and fewer copies individually as you move out the distribution curve, when all of those books are looked at together they sell many, many more copies than the top 1,000. And because of this, Anderson points out that the real opportunity in today’s economy is not in the best selling “hits” but in the thousands and thousands of products, services and customers that make up “The Long Tail.”
Companies like Amazon.com, iTunes, eBay and others have already learned this. But what is most interesting is that smaller regional and even local companies in every imaginable industry, some selling large volumes of products and others selling to niche audiences, are discovering that an effective e-commerce solution can help anyone take advantage of “The Long Tail.” These companies are using custom e-commerce solutions to increase revenue, lower inventory costs, lower customer management costs and increase customer satisfaction and loyalty, regardless of their size or position in their market.
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