e-upturn for 2005?
Every silver lining has a cloud
The problem we face is that in their quest to find good value, shoppers are no longer satisfied with a discount – they now demand the highest discount. Aided by the numerous online price-comparison websites, plus, of course, a bit of intelligent searching using Google, they are prepared to spend considerable time hunting for the very cheapest online price. This frenzy is further fuelled by newsgroups such as alt.consumers. uk-discounts.and.bargains and websites such as Martin Lewis’ www.moneysavingexpert.com
What this means for the online retailer is that you can no longer rely on getting orders simply because you have an online shop, and you certainly cannot expect people to buy from you just because you are a bit cheaper than the shops. You now have to be the cheapest online seller if you want significant order volumes. It is going to get increasingly tough to be a successful online seller, but there are a few tips that might help you to beat the opposition:
l First, make sure your site is listed and indexed by as many of the price-comparison engines as possible. Some will charge for the privilege of being listed, but others are free. Most will want a rake-off from any sales they pass in your direction, though.
l Then keep an eye on those websites and make sure your products are generally in the top half-dozen or so when sorted by price. It is obviously best if you can be right at the top, but not if that means making a loss on every sale.
l The next thing, and this is the clever bit, is to identify when your site is spidered by a price-comparison engine, or when a visitor has clicked through from one, and then offer some kind of incentive. It could be a simple 5 per cent off your pricing, or maybe free delivery. This means that you will show up as cheaper than the competition when subjected to price comparison, but you can still maintain a sensible margin on your other sales.
There is another trick that you can play with Google, but we will tell you about that next month.
In issue 121, among others, we have written about Flex, Macromedia’s server-side Flash application platform. One major criticism we made at that time was the enormous cost of a licence, with a retail price of £10,000 for two CPUs. Macromedia has now announced version 1.5 of Flex, which offers many enhancements, but the most interesting change is the cost. The price has dropped to nothing. That’s right, absolutely zilch. Obviously, there is a proviso to this amazing bargain, which is that Flex can be used only on non-commercial and non-institutional websites at this price. You will need to apply for this licence and register the product, plus pay $8.99 to cover shipping of the product. Macromedia intends to police who’s using Flex and for what, but this is still a most welcome move that should encourage the take-up of Flex no end. The developer version is also free, but cannot be used on a live site. For the full details, take a look at www.macromedia.com/software/flex/productinfo/faq/#ancni
Flex’s performance has been improved by about 50-70 per cent, but Macromedia still recommends six to eight CPUs for a web application, so the hardware requirement remains very high. A considerable amount of work has been applied to the look of Flex web applications. For example, application components can now have their look customised by the use of skins, which are, in effect, style sheets and are applied to the application in a similar manner to CSS (cascading style sheets) on a more conventional website. Flex 1.5 also supports Oracle and WebSphere platforms, which should further add to its potential audience. If you want to find out more about what is new in this version, go to www.macromedia.com/devnet/flex/articles/flex15_preview.html