Welcome to the Age of the Customer! This customer-centric approach is defining modern retail and creating unprecedented opportunities for businesses.
Thanks to the rise of the “sharing economy,” customers can now get the products and services they want, when they want them, without having to leave the comfort of their homes. The sharing economy makes it easier for customers to find what they want, when they want it, and how they want it. It also gives businesses the opportunity to provide a better service, because they have more information about their customers (and vice versa).
The Rise Of The Sharing Economy
To understand the rise of the sharing economy, you have to go back in time to the early days of the internet. The emergence of online marketplaces, specifically for selling services, was a game changer. It created the infrastructure for “ride-sharing” and “house-sharing,” as well as the “gig-economy,” which connects employers with freelancers and independent contractors. As a result of this new online paradigm, more businesses will have a digital foot in the door than ever before. These platforms gave businesses the opportunity to break the mold of traditional retail – offering customers a more convenient, enjoyable, and streamlined shopping experience.
The Impact Of Online Marketplaces On Retail
Thanks to the rise of online marketplaces like Amazon, eBay, and Shopbop, the age of the consumer has arrived! Shopping online is no longer a luxury; it’s a necessity. For many companies, the internet is now the primary (and often only) source of potential customers. Just as importantly, online marketplaces make up the backbone of the customer relationship. Platforms like Shopbop connect businesses with highly-specific audiences, while others like Amazon help businesses thrive in an increasingly crowded marketplace.
How To Sell Services Online
If you’re looking to enter the services marketplace, here are some important takeaways from online marketplaces’ successful strategies.
Focus On Building A Brand
When you build a business online, you need to start by building a brand, not just a website. Your brand is what makes you unique, compelling, and valuable to customers. In order to create value, you need to offer customers something different – something that sets you apart from competitors. This is most effectively done through branding.
An excellent example of a brand-building exercise is Crate & Box, where each week, they feature new and exciting brands that are designed to be exclusive to their platform. On the surface, this may not seem like a traditional retail strategy, but it is. By using their platform to grow their brand, Crate & Box is demonstrating the power of the services marketplace.
Offer Consumers Value
When someone decides to purchase your product or service, you’ll need to satisfy their needs, while offering them value in return. Satisfying your customers’ needs is undoubtedly important, but so is offering them value in the first place. Before you can offer value, you have to know what it is that your customers want. Discovering this requires a good deal of customer research and analysis.
To demonstrate how crucial this stage of their strategy is, Shopbop shared the following example with me:
“A few years ago, we decided to test a pay-what-you-want model in a couple of our stores,” they explained. “The theory behind this strategy was that by offering our customers more value, we would be able to attract a higher-quality group of customers who were more likely to become engaged with our brand.”
As a result of this trial, Shopbop found that customers were more engaged with the brand, and the value they received, in some cases, outweighed the cost of the item. In other words, their customers were more than happy to pay what they wanted for the products and services they used, because they received so much value in return. This type of direct, honest, and in-your-face marketing is what makes digital marketing so effective – and so valuable – in today’s world.
Developing The Right Pricing Strategy
Pricing is one of the most crucial aspects of any business, because you always need to have some way of justifying the cost of what you’re selling. The great thing about the services industry is that, since costs can vary so much, you don’t necessarily need to peg your prices to what you might expect to earn on one particular product. For instance, you might want to sell stock photos for $1 each, or sell videos for $10,000 each.
Instead, you can use pricing as a way of demonstrating value, and in some cases, a product’s value can be determined by the price alone, without any reference to costs. This makes prices very flexible, which can be both beneficial and challenging at the same time.
Build A Loyal Following
One of the distinguishing factors between traditional retail and the sharing economy is the fact that businesses in the latter have an existing relationship with their customers. Thanks to platforms like Shopbop and Amazon, companies can easily connect with consumers who want to hear from them, and who are already predisposed to buying what they offer.
Creating a relationship with your customers is one of the most effective ways of generating long-term value, and it’s definitely worth the extra effort. The more you can do to establish trust and credibility with your customers, the more valuable you will be in the long run.
Build A Data-Driven Marketing Campaign
Thanks to marketing automation platforms like HubSpot and Marketo, it’s incredibly easy to set up automated email campaigns, or to create landing pages, to engage with customers, and to follow up with a call, or a mailer.
Whether you have one person, or a whole team, dedicated to digital marketing, it’s important to understand how to effectively use digital channels, like email and social media, to attract, engage, and delight customers.