Why read this? : We look at different ways to help your e-Commerce knowledge take off. Learn how to get faster and smarter at building online sales. We show how the lessons from our first store cut 3 months of the launch of our next store. Read this to help accelerate your e-Commerce knowledge.
We recently updated our e-Commerce skills section with new articles, case studies and quizzes. It’s part of our aim to share our e-Commerce knowledge to help you build your e-Commerce capability.
As we were doing that, it struck us how much of a role speed has in e-Commerce.
Like marketing, you need a wide range of knowledge to succeed in e-Commerce. But how quickly you can apply that e-Commerce knowledge also makes a big difference.
As you’re setting up your store, every day it’s “in development” is a day you’re not selling. You need speed to help you get over the barriers to e-Commerce which stand in your way.
This week’s article shares lessons we learned which helped us go faster. We launched our first online store with very little e-Commerce knowledge. It took 4 months. But with the e-Commerce knowledge we gained, our second online store only took a quarter of that time.
Our first online store - limited e-Commerce knowledge
Some context. The first online store we did was for a well-known global FMCG business. They wanted to start selling direct-to-consumer (D2C) to solve availability issues. The demand for their products was so high, retailers struggled to keep the shelves stocked.
Not the worst business problem, we have to say.
They’d spent around 18 months talking doing D2C. There were some ‘false starts’ before the project actually started. Some consultants who produced lots of documents, but no actual plan, for example. But mostly, the delay was down to their SAP system not being capable of handling the order to delivery process.
Eventually we got past these barriers. (see our articles on e-Commerce learnings from the magpie and barriers to e-Commerce for more on that). There was agreement to run the set up of an online store as a pilot project, to see if there was demand from customers. That pilot needed to keep things simple, and focus on the basics. More advanced e-Commerce techniques were parked until we were sure customers would actually buy D2C.
To do that, we did what happens in most bigger businesses. We set up a cross-functional project team with about 8 people in it to build the store.
Cross-functional pilot store launch team
We had an e-Commerce manager, who was the overall project manager to launch D2C. Their role was to co-ordinate the different streams, and make sure the project hit its sales targets.
Then, a digital marketer from the brand team. Their role was there to handle the digital marketing aspects of the project. For example digital media, especially search, and the content and design of the store website.
Next, an IT manager, responsible for bringing IT skills to the project. This included choosing the e-Commerce software (we used Magento) and the back-end build of the store site itself (with an agency). This role also handled internal system connections to run the order to delivery system. For example, payments and the transfer of orders into SAP and through to the delivery company.
Though SAP being SAP, we also had to bring in a separate SAP IT manager to the team.
You know it’s called SAP, because it SAPs the energy of anyone who uses it, right?
Then we had a Supply Chain Manager organising the warehouse and delivery systems set-up. They also managed delivery costs and preparing the customer service team to deal with enquiries.
Add in a Finance Manager to validate the forecast, the profit and loss, and the overall business model. And, a Regulatory Manager to make sure we were legally compliant, and to help us set up our terms and conditions and policies.
That was 8 people at each regular project meeting.
Stakeholders and interdependencies
But we also had other stakeholders and interdependencies. For example, the Sales Director was the project sponsor, and was very supportive.
But, then we had a steering committee including the Managing Director, Marketing Director and Head of IT who were less supportive, because they’d never done anything like this before.
A big learning here was to make sure approvals and decision-making goes to people with good e-Commerce knowledge, and not just because of their job title.
We also had global connections in marketing, sales, IT and supply chain keen to learn from us. And by learn from us, we mean ask lots of questions and make ‘helpful’ suggestions all through the project.
And that’s not counting the many people at the agencies and at the delivery company who we involved.
Lots of people then, but none who’d actually ever set up an online store before. So when we built and launched the store in around 4 months, we thought that was pretty damn good. Not quite a great e-Commerce culture right away, but at least a good start.
Our second online store - if you had to launch it tomorrow?
A funny thing happened, though. After the store launched, it did OK for the first 3 months, but nothing special. In fact, sales were below expectations.
And then, we got called into the Sales Director’s office. We were expecting to pull the plug on the store as it was behind target. But it wasn’t that. It wasn’t that at all.
The company had received a serious threat to its product range in-store in another market. An anonymous external party had sent an extortion note, threatening to inject poison into the products in-store.
Pretty serious stuff.
(Note, the extortionist was later caught and jailed by the way).
And that’s when it became clear the safest and most secure way to get products out to customers is through direct channels.
You can track and trace everyone who comes into contact with a product from your warehouse to the end customer.
When your product sits on a shelf in a store, you can’t do that. Anyone could interfere with the products on the shelf. Of course, that almost never happens. But it’s what the extortionist threatened.
At the time, the only way to be sure the products weren’t tampered with in store was to have them behind the counter. Or with security guards in the aisle. Fine, in the short term. But not sustainable long term.
But with online deliveries, every part of the supply chain is secure.
So, the Sales Director asked how soon we could launch a D2C store to cover this other market. The only objective was to do it fast. Like tomorrow. So, we had carte blanche to decide how best to do that.
That’s having taken 4 months the first time.
Why did it take 4 months the first time?
So, we spent a lot of the time on the first store in planning. Deciding the target audience, the store positioning, our competitive strategy, and so on.
In fact, all the things we cover under Strategy and Plan in our online store dashboard. Although, this stage can also be called “arguing”. Because, there was a lot of that, too
(though we made a point of not having a dedicated strategist on the team – we’re not big fans of that role. Strategy is everyone’s role).
We did this with the sales and marketing members of the team, plus their bosses who wanted to be involved. Add in the steering committee who wanted to sign off the business case. We reckon at least 2 of those 4 months were spent planning. Arguing over details like branding, pricing and sales copy. Writing powerpoint decks with all the business plan details. Lots of check-ins and stakeholder management.
We also spent about a month gathering and / or creating digital assets, writing website copy and preparing the SAP system upgrades and customer service training.
And then, it was about a month to actually build the site. That also meant testing it, and placing trial orders to make sure everything worked properly.
From 4 months to 4 weeks
The second online store, the one we’d to launch “tomorrow” was in fact live in 4 weeks.
And in actual fact, we had a “working” though very clunky solution in place we could have turned on in a week, if we’d needed it.
Compare that to 4 MONTHS on the first store.
How we got it from 4 months to 4 weeks, was by stripping out everything that wasn’t vital.
We already had the “plan” on the first store. So, we could lose the “planners” and focus on the “do-ers” on the second store. Everyone else was politely told to get out of the way.
We stripped the team down to 3 core people, with only 2 approvers. Everyone else was “informed” only. That team had absolute power to make decisions. That team did the work in 4 weeks.
The team was one project lead (us) who combined the marketing, sales, finance (business case) and project management roles. No delays arguing over whether this image, that piece of copy was “on brand” or not. No delays arguing about pricing and delivery costs.
We had the IT manager, and the Supply Chain Manager go full time to sort out the website build with the agency, and the distribution set-up with the delivery company.
And that was it.
The Sales Director and the Regulatory Manager were the approvers.
No finance sign-off. No global stakeholders. The rest of the directors trusted the Sales Director and the small core team to launch the store quickly.
It was quite a lesson for us.
Smaller teams mean faster results
Looking back now, we know it’s possible with the likes of marketplaces to set up an online store in less than a day.
One person can do it on their own, if you choose to use print on demand or drop shipping.
In those channels, you outsource payments and supply chain, as those normally take the most time.
We couldn’t have done this project in a day. But, there were lots of ways to reduce the time.
With lessons from the first store, it was clearer what we really needed to go faster the second time around.
If you’re a big business looking to stretch into e-Commerce and setting up your own online store, you’ve probably got ways of running other projects you think will just port over to D2C. But, unless you’ve have that existing e-Commerce knowledge, that’ll take time.
If you want to go faster, you need people who already have e-Commerce knowledge. Put them in small, agile, empowered teams. Smaller teams with clear decision-making authority mean faster results. In other words, set up your e-Commerce culture properly.
But, we know this is a challenge for many businesses. They want to make sure they do things properly. They want controls, checks and validations in place. But, they don’t want to put anyone’s nose out of joint. And they want to protect their existing businesses, systems and reputation.
And that’s all fine. But, you can’t have all those things, and still be fast to market. You need to choose what’s more important for you.
Conclusion - smaller teams, faster results in e-Commerce
And here’s where being small in e-Commerce is actually an advantage. Because, you can go much faster than bigger businesses. You have a lot of opportunities for first mover advantage.
Online shoppers don’t really know how big your business is. They just know what it does for them. And if you can build better D2C experiences for them, because you build your e-Commerce knowledge faster, that puts you well ahead in the race for the online shopper’s dollar.
On your marks.
Get ready.
Check out our e-Commerce lessons from the magpie article for more lessons from the operational side of e-Commerce. Or get in touch if you need help setting up your own store.
Photo credit
Sprinter : Photo by Braden Collum on Unsplash
Rope netting : Photo by Clint Adair on Unsplash
Small fragile delivery box in hand : Photo by jesse ramirez on Unsplash
Calendar (adapted) : Photo by Brooke Lark on Unsplash
Three people pointing at laptop : Photo by John Schnobrich on Unsplash
