Brand and Proposition
Generally a marketing problem is a brand and proposition problem. If the proposition is right then pretty much all marketing will work very well. On the other hand if the proposition is wrong then virtually all marketing will fail.
A starting point
There are two kinds of companies, those that work to try to charge more and those that work to charge less.
– Jeff Bezos, Founder & CEO, Amazon.com
Amazon.com is the most successful e-commerce company of all time. Both of these strategies work well but you do need to choose one of them. Generally the value strategy is easier to implement, particularly as a market entry strategy.
The elephant in the room…
How do you beat Amazon?
If you are lucky enough to be working in a market that Amazon has not entered yet then you need to be warned that Amazon is coming.
For the rest of us, we need to think hard about how we can beat them. Amazon generally accounts for about half of the e-commerce shipments in the markets they operate in and most e-commerce shoppers will have payments methods setup with Amazon and will have a high level of trust. Many people will be able to get an Amazon shipment within two hours. The pricing on Amazon is very competitive.
So you need to be clear on why your proposition is better.
Scoring a touchdown against Amazon
- Product innovation
- Unique product features not available on Amazon. An example would be one of our customers who grinds coffee on the day of dispatch resulting a really fresh product that would not be possible thru Amazon.
- Bundled services. An example here would be the running shops who film the customer running, analyse the running style and then use that to offer the best shoe.
- Ordering innovation.
- You own brand. This is usually the best option. The days of selling other brands online are pretty much over.
Richness verses Reach
Adapted from Blown to Bits, Evans & Wurster, Harvard University Press.