Planning an E-Commerce Strategy

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1 Planning an E-Commerce Strategy For this last section of my report I will be discussing how I will be creating my e-commerce strategy and what I will be doing in order to plan for it. Before starting the planning side of my e-commerce, I have first looked at various e-commerce sites to help give me ideas of how to create my own (i.e. layout, plan, house style, etc). After looking at a couple of e-commerce sites, I have decided that my e-commerce strategy will be based of the Apples e-commerce website. (Above is a print screen of what my home page will based of) 1 There are various aspects that I need to take into consideration when planning my e-commerce strategy. To begin with, I will need to be able to host my e-commerce website in order to keep it online and running 24/7. To host my website, I will be using Webs. Webs are a free hosting site that would allow me to create my website and put it online for free. However, my website would be private so therefore I would have to pay the company a 10 monthly fee to keep my website online and public. In addition to this, for the choice of my ISP I have decided to use Virgin Media Fibre Optic broadband. The reason I have chosen Virgin Media is because it is the top 3 rd ISP provider within the UK that is also the most cost effective; as well as its strong connection and reliable connection P a g e

2 Next, the purpose of my website is to allow my users easy access to my online e-commerce store that will be running 24/7; ensuring that my customers are able to order products from my site at any time of the day throughout the year helping me to maximise my profit every year since my website is constantly running. Moreover, the client of my e-commerce website is going to be the Collier. The reason for this is because I have been tasked with creating a new, online presence for a new band called The Collier. The Collier are a newly formed band that for the past six months have been trying to make a name of themselves by performing at Chinnerys and even the O2. Past these six months, The Collier have been able to gain some publicity and acknowledgement but however want to take it a step further by creating an online presence. Therefore, I will be creating a website for the band known as The Collier so that they can start to build up their reputation and publicity through marketing the products that they have to their fan base as well as helping them to book tickets through their websites to the gigs that they have. Before I move on to marketing, I will be optimising five search engines so that when my online consumers search for my website they will be able to find it easier; also making it so that when you type in words connected or similar to what my e-commerce site is called it will appear on the first page of the results page also making it so my website will appear on the first quick-search option when you type what you want to search on IE9. The search engines I will be optimising is Yahoo, Google, Bing, IE9 and Firefox. This will make it much easier for the target audience to find and locate the website since these are the main search engines that people use when they are online; therefore it makes sense to optimise these search engines. Moreover, although it may be expensive to optimise these search engines for the consumer base, it will be worthwhile in the long run. Below is the next section for the marketing side of my e-commerce site. This will also be how I will be using my online e-commerce website to market my products (my business plan). Product To begin with, we come to the first P which is product. For this section, I am not selling a specific product since I will be selling a range of clothing and other items for my online consumers to purchase off of my site. For example, you can buy CD s, posters, clothing such as trousers, shirts, hoodies as well as coffee and tea mugs. All of these products will be available both through my highstreet store in Southend as well as my online e-commerce website. These products will attract all ages, genders, races, etc since these products are appealing to a very wide ranged target audience; this being an obvious benefit since the products I sell aren t restricted to a small or certain target audience. Place Next, we come to the second P within the marketing section which is place. For this section I will have both a high street store as well my online e-commerce store. My high street store will be situated in Southend-On-Sea along the high-street. The reason I have decided to choose this location is because it is a highly populated area and thousands of people will pass my high street store every day. Therefore, it makes Southend a prime location. In addition to this, the other location of course will be my online e-commerce store that, unlike my high-street store, will be running 24/7 throughout the whole year whereby my online consumers will be able to easily access it so long as they have an internet connection. 2 P a g e

3 Price When it comes down to the price of my products, I will need to consider a few factors. The first factor I will need to consider is how much it will cost as if it is too expensive then my target audience will be put-off from buying and may end up buying my rivals product and if it is too cheap, it might be seen as my products are an inferior quality compared to some of the other, well known brands. Furthermore, I will also need to make sure that my price is also competitive against other big label brands too as my product will need to compete against the competition if I want it to sell. Therefore, by putting the price a few pounds ( ) lower than the big label brands, this will ensure I have a competitive price and will help to increase the chances of my product selling as we well as selling better than my competition. The next factor I will also consider is the psychological side. This is because if a customer sees too prices (both prices are on the same product), one being 1.99 and the other being 2.00, 99% of people will buy the product that has the price of label of This is because when we go and shop, we often want the best deal and what is convenient for us. So, if you are quickly choosing a product and see that the same product has a label of 1.99 instead of 2.00 we will automatically think we are getting a good deal and saving money and therefore, we will pick the price that is only one penny less than the other. Therefore, by using this information this will help my price to become more competitive since my target audience may be more likely to buy my product if it is seen as a slightly cheaper price than my rivals. Other factors such as introductory pricing and price skimming will also have to be considered. Introductory pricing is where for the first few weeks the product is reduced by 10, 20 or 50% and the price will then go back up to it s original, base price. This is a tactic used throughout the business world as if the product is successful enough then your target audience will already like the product and will continue to buy it. So, if the product is favoured enough by your target audience, when the price goes back up to the base price your customers will still continue to buy the product. I intend to use this tactic as for the first few weeks I can use my reduced price scheme to help generate interest in my product throughout my target audience. So, one the price is returned to its base price, my audience should already have interest in my product and will continue to buy it even when the price returns to its original value. Lastly, I will also have to consider price skimming. Price skimming is where if the product is new on the market (and also exclusive) you can charge as much as you like for it. However, after a wile other firms will start to bring out products similar to the one you originally brought out to begin with, therefore pushing the price down and making the price non-exclusive. Although my product will not be an exclusive product, if I was to use fragrances (or a combination of fragrances) that no other company has used, this will help to give my product a USP (unique selling point) which may become more preferable with my chosen target audience. This would mean that my product will have a competitive edge since no other companies will use the same fragrances that are used within my product. If this unique fragrance is shown to be a more preferred fragrance within boys compared to my competitors, this would suggest that I would be able to sell more (which would also increase stock turn) as well as helping to increase my net profit. 3 P a g e

4 So, after considering all of these factors I will make sure that all of my products are just slightly cheaper compared to bigger and more well-known brands. Therefore, this will help to keep my price competitive and to help me retain my customers. Promotion For this last section, I will speaking about my promotional methods that I will be using. For promoting my e-commerce site, I will be using search engine optimization, social networking, PPC (Pay-Per-Click), press releases and marketing. The internet along with my own website allows for them to reach the majority of their customer base through online means. The reason for this is because the internet allows them access to online advertising which is a very effective promotional method. By using the internet, I will be able to advertise on social networking sites such as Facebook and Twitter and on their own website along with others such as YouTube and sports life. This will be my other main promotional method as internet advertising has been proven to be a very effective promotional method. This is because a very wide and board consumer base use these social networking sites and because the consumer base for these social network this will fit in well when using it to advertise and promote my business since the business is going to be promoted to all ages since it can attract all ages; this also being a very good method of further promoting the business and increasing the publicity for the business. Next, I will be using pay-perclick (PPC) whereby the business will receive a small amount of money every time a user on the website clicks on the advertisement. However, it is important to note that this method is best used on websites that receive a lot of viewers on a daily basis. An example of this would be using this PPC method of Facebook. Since Facebook receives millions of users visiting their website each day. This is obvious a better method for Facebook when compared to Myspace since Myspace will receive much less viewers on a daily basis. Furthermore, the PPC advertisement will depend on its size and position. A bigger advertisement near the centre of the screen will cost more since it is more likely to attract the attention of the viewer and therefore makes the viewer more likely to click on the advertisement. After that, I will have various different press releases. Press releases are where my business will release information for their customers. This could be about new site changes that are going to happen (e.g. a new layout, etc). These press releases will not only advertise my business to my customers but can also keep them up-to-date on the latest information about the business and the direction it is heading in. However, this isn t one of their main methods as the main purpose is to inform their already existing customers, but can however, act as promotional method for my business. Moreover, I will also be using marketing. marketing is where by when my customers sign into my website using their login details (such as their address and password) I will be able to use their s to them the latest news and information about my online e-commerce website or about the business in general. However, it is important to note that I will only be able to do this if they agree to having s sent to them often ticking or un-ticking a box to say if they wish to receive daily s from my business. Through marketing, this will allow me to advertise new products that have either been newly released or new products that will be available soon to purchase from my e-commerce site; helping to increase product recognition and helping it to sell more. In addition to this, I will also be able to view what my customers have purchased and then send them similar products that they may also want to buy; helping me to market my products through my website and for me to make a larger profit at the end of the year. 4 P a g e

5 In addition to this, we come to the advertising, security and costs of creating an e-commerce website. To begin with, we come to advertising costs. The main bulk of the advertising costs will be optimising the search engines that I have already previously stated. The costs of optimising all of these search engines will come to 800; and although it is expensive it will be worth it in the long run this being a monthly cost. After that, we come social networking where it will be a monthly cost of 100 per advert on both Facebook and Twitter. Therefore, two advertisements on Facebook and Twitter will cost me 400. Moreover, when we come to PPC (Pay Per Click) this is where for every person that clicks on our advertisement, we get paid a very small amount; but using PPC on a large social networking site can be very beneficial. The cost of putting a PPC advertisement on a social networking site will be around 100 and for every user that clicks on our advertisement we could get 1p. In addition to this press release won t cost anything see they are free and will be freely posted to our customers and marketing will cost us between 40 and 60. Security costs will consist of making sure the server room is secured using advanced keypads. These keypads will cost between 50 and 150 and is essential in ensuring that only the allowed staff members of the business can access the server room. Other costs such as buying security cameras around the building will cost well over 350 since I will be having multiple security cameras placed around the building as well as a motion sensors and electronic trip system so that if the building is broken into an alarm will be raised. Moreover, I will also need software protection for viruses and malware which will cost me between 70 and 150 depending on how many machines needed to be protected. To renew the software it will cost a further 70. Further encryptions and firewalls that are advanced will be over 200. Lastly, to start up the e-commerce business I will need a building, a sever, technicians/developers as well as on-going maintenance costs. Depending on the size of the building you get, the cost can go well over 100,000 and to cover that course I would have to take out a loan in order to cover the costs. Moreover, I will also need a development team to help me create and design the website. The cost will be 50 an hour and 32,000 a month. This cost will continue depending on how long it will take to design the website. In addition to this, computing equipment can range between 400 and 600 and the serves ranging from 500 and 1000; also remembering there will be maintenance costs than will cost well over 250. Documentation: In addition to what I have written, I have also drawn (on three separate pages) the site maps, contents and storyboards of my e-commerce website. This will be attached to this document after it has been printed off. Moreover, I will need to review the assets of my e-commerce website and what assets I will want to use to help build upon and create my e-commerce website. These assets will include images, mainly of the different products that you can purchase from my website. Some of these images are going to be advertisers advertise their own products through my website. I will also have flash animations to help make my e-commerce more appealing and interactive (also helping me to appeal to a wider target audience) and therefore, on my home page there will be an animation where by it will cycle through my top selling (bestselling) products on my website. In addition to this, I will also have a drop down menu that allows my customers easy access to all 5 P a g e

6 different sections of my website. Without this, my customers would not be able to navigate through my website; therefore making it an essential asserts to have on my website. Moreover, I will also be using banners as well. These will be advertising banners used to advertise either my own products or my advertiser s products on my website. Since this banner will be quite large (often interactive too) as well as at the top of the page above the drop down menu, this makes it an appealing method of advertising on my website which will help me to generate more revenue from advertisers advertising their products through my website. Furthermore, I also have the structure of the website. The structure of the website will include nine interactive buttons on the drop down menu which will be located at the top of the screen. This drop down menu will stay at the top of the screen and shall not move no matter what page the user is on. The first button is the home page button which is labelled as The Collier. After that, the 2 nd button is news, the 3 rd is tours, the 4 th is images, the 5 th is music, the 6 th is shop, the 7 th is payment, the 8 th is basket and the 9 th is bookings. In addition to the drop down menu, there will be a search bar on the menu that will allow consumers to search for content on the website. After this, there will be advertisements on the left and right of the screen; not being obtrusive advertisements so that it doesn t put off customers. In the middle of the screen, there will be the main part of the page with text and images on that will vary and change depending on which page you decide to click on. For example, if you click on the images page the page will have 5 rows of 5 images on the page with a description at the bottom of them where as the home page booking page will have more text on it with a couple of pictures to help break it down. For image and product details, there will be a large section on my website dedicated to this since it will be used to hold a picture of every single product that I sell through my website as well as having a description for every product on my website I have created an annotation document whereby I have drawn out the page with my product images and details and annotated saying what each section on that page is. Moreover, it is vital that I plan out my house style and then make sure it is consistent throughout my e-commerce website. The house style will include fonts (style, size, and colour), images as well as the background colour. To begin with, for my website I will need to make sure that I am able to have a colour, font and correct size that are able to be read by all of my consumers. To combat this problem, the base colour of my text will be black and the size will be 11. My font (style of the text) will be Arial Black since this is one of the most common fonts used by big businesses that have an online e-commerce site. My font, style, colour and size of the text will be consistent through my e-commerce website. However, there will be an option on the website where by my customers are able to choose their own style of text as well as the colour of size too. This is to help people that may have trouble reading what is on my site. In addition to this, there will be between one to two images on each page on my e-commerce website if it is appropriate, this being consistent throughout my e-commerce website. In addition to this, my background colour will remain white since the black text will be able to be easily read off of it. Similarly, I am free to also use other colours such as light blue, light red and light green. Lastly, we come to payment systems. As an e-commerce site, I will need to be able to implement various ways in which my consumer s would be able to pay for their products when ordering them through my e-commerce website. For my e-commerce website I will be using four different payment 6 P a g e

7 methods. These will be PayPal, NoChex, Credit and Debit Cards as well as Secure pay. All of these methods are safe and secure methods that are protected by both the payment companies as well as my own business since I will have various security systems and fire walls put emplace to make sure hackers and viruses are not able to breach these payment methods through my website. These will also be used when ordering products from my website and to do so there will be a page dedicated to this where the user can select each product they wish to buy, add it to their basket and then checkout using one of the payment methods provided. This website is what my e-commerce website is based off 7 P a g e

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