The perils of E-Commerce

In a retail culture where consumers now expect any self-respecting outlet to have an on-line store and delivery service, it is hard to imagine a time when 24/7 shopping was not available.

 'E-Commerce' as it has become known is the process of using ICT to support Business Activities. By allowing connection to customers, suppliers and the market place as a whole, organisations can gear up their sales and market reach with a relatively small outlay. E-Commerce was shown to have increased by an impressive 25% between 2008/09 (Office for National Statistics). 76% of Businesses in the same year had a website with many of them providing E-Commerce options to their customers, either as their primary route to market or as a subsidiary to a high street operation.

The rise of this new form of commercial interaction has stemmed from a drive for customer convenience and rapid service. In theory a well designed retail website will allow a customer to browse full details of a product, compare the prices on the entire market with a simple click, and place an order to be delivered at a time convenient for them.

Unfortunately however, all is not rosy in the garden of on-line sales. There are a wealth of considerations which need to be addressed in order to satisfy the customer and unfortunately many contenders are falling well short, often resulting in their ultimate demise.

Many E-Commerce websites are plagued by poor design. Considering the budgets behind such projects,and the importance of getting it right, you might expect on-line offerings of some major players to be flawless. As one of Britain's biggest supermarkets Tescos presents a clinical and cluttered home page followed up with some pretty customer login facilities. Similarly I don't know who told BHS that scrolling 90's-style neon was a good idea...

It also appears that many organisations who have taken the E-Commerce plunge also struggle with the fundamental logistics of the operation. Stock management and delivery as promised are fundamental elements which the retailer must get right if they are to offer any real benefit over simply visiting a high street store for the same product. Unfortunately however many retailers seem to be caught on the back foot all to often, leading to delivery delays and frustration. A quick search of customer forums yield all sorts of discontent. Recent experiences with both Mobile Fun and TotalPDA would lead me to join the rabble after some seriously poor delivery experiences.

Fundamentally the convenience and value of shopping on-line are all too often marred by the lottery of selecting a product sight-unseen, and the crossing your fingers whilst you hope the product turns up. I would hope that this will not always be the case, as with more and more commerce moving to the Internet, we deserve better.

The Spread of Information Poverty

The digital world is marching on, and most are happily jumping on board and enjoying the benefits of a more connected lifestyle with everything from smartphones to Oyster cards. Being of a (reasonably) new generation myself I have enjoyed growing up with this kind of technology along with my peers.

Mobile Phones, Game Boys, broadband, and digital cameras have all been born in my lifetime, and frankly every new product brings a certain degree of schoolboy-like excitement as I join the clamber to have the first go on the newest gadget or sign up for yet another life-altering on-line service.

However there is a divide forming in our nation, and across the World. Known as the Digital Divide it has gained press in recent years as the gulf has widened. Whilst some of us revel in digital harmony, others are becoming more and more disconnected in relative terms. Recent figures suggest that around 25% of UK homes still do not have an internet connection. In an age where the internet can facilitate thousands of daily activities we are beginning to face a new social conundrum, that of Information Poverty.

Broadband and many other technologies which facilitate the flow of daily consumable information are relatively cheap, and could be be funded monthly by diverting the funds from a few spared pints in the local. I do not believe it is the cost of technology which puts many off, but a fear of its complexity and bizarre nuances. Resorting to IT as a first port of call is something that has become ubiquitous in the younger generation during their studies, and the older generation as a powerful Business tool. Those who have not yet made the jump tend to reside in the more mature age groups, or those in less close affiliation with education or dynamic places of work.

Technologies such as the 'Basic Phone' have found a niche in the market for those wanting to forgo the hurdles and guessing games of modern, feature rich mobiles, instead simply making calls and staying connected. This opens up what many would consider a basic right for telephone access, to a market of older people or those who struggle to learn complex software. Similarly a software house has recently released a package aimed at helping those who are older or have memory problems to interface with a simplified yet functional daily planner in digital format. This helps them to harness the power of digital organisation which many of us now rely on.

It is exciting times for those of us riding the technology bandwagon, but as the digital society begins to take over, we have a duty to make sure people are not unwittingly left behind.

Business icon or celebrity sell-out?

This week has seen the eagerly awaited return of the Apprentice to our screens. We can expect much of what we know in terms of candidates and challenges. There will be the cocky few who are 'All mouth and no trousers' and will likely be claiming job-seekers after week 3, the frankly ludicrous candidates who don't really know what day it is let alone how to run a Business, and the usual post-production mastery that makes the unfortunate moments even more cataclysmic.

One notable difference in this series is that the contender will be competing for an investment to start their own Business. The infamous Lord Sugar will be handing out cash to one of the hopefuls in order for them to go out and "make it on their own" like he did. Having watched many of the series of the Apprentice I don't think there has been single episode where reference has not been made to the humble origins of selling scrap out of wheelbarrow which was said to be the foundation of Lord Sugars current Business empire.

And then of course there is the favourite of TV channel Dave, The Dragons den. A good few minutes at the start of every show is devoted to a flowery and grandiose description of the Business Moguls who occupy that hallowed warehouse and dash dreams for a living.

I am all in favour of the increased interest in Entrepreneurial endeavour and Business awareness which these shows and their patrons have instilled. However I have a worry for the future.

Every time a new series is commissioned, and every time a show producer needs a new edge to the programme, our patrons are called upon to provide new intrigue and entertainment. For instance the arsenal of pithy one liners currently sported by Lord Sugar which has clearly been in diligent preparation since the last series. Our Dragons are likewise coerced into making good TV by being conspicuously bullish and somewhat highly strung. However I simply don't believe they would be sitting on succesful Busienss empires if their on-screen persona was the one they started out with.

Ultimately these figureheads need to be careful their genuine Business acumen is not forgotten in a sea of rating-chasing and post production wizardry. How will history remember Lord Sugar? As a trusted advisor to the government on all things Business, or as a quick-witted yet stationary nay-sayer who will forever be silohetted in front of a pale blue boardroom?

The Great British Discount Challenge

As we are regularly told, times are hard. With negligible recent GDP growth and increasing threat of unemployment, the sound of belt-tightening is a common one in households across the nation.

In conventional thinking one solution to limitations in domestic cash flow is to earn more. You could sign up for more hours or start a small home business to supplement your income and oil the wheels of your household spending. Alternatively you could opt to forgo luxuries and keep your income the same, leaving a little more in the pot for the essentials.

I propose to you a third option. Recently a number of my yearly renewals have come up on Insurance, breakdown cover, mobile contracts etc. With this combined overhead looming I set myself a challenge, to screw down every supplier and see how much I could save. I have written before about gestures of placation from UK companies in order to keep us customers sweet, and it seems that you just need to know the right buttons to push. Thus far I have saved/reclaimed £650 from 3 phone calls. By no means am I claiming to have a Derren Brown-like talent for suggestion, but spending less is easier than you might think.

An example. Recent call on RAC breakdown cover for 2 drivers:

Me: "The account holder has been a member since 1981, £135 seems too much"

RAC: "Let me see what I can do"

(prepare myself for a 'computer says no moment')

RAC: "How about £70 for the same package"

Me: ".....that will be fine"

It seems retailers and service providers have a 'break glass in case of difficult customer' option, which is to slash their profit margins to close the deal. Mobile phone contracts are the prime example of this behaviour, next time you come up for renewal, look that loosely-suited shop attendant in the eye and ask him to halve the line rental and give you double the cash reward up front. My bet is the result will be at least one or the other.

It is simply about asking more. The Pareto Principle has been used to suggest that 80% of a companies revenues come from 20% of their customers. This is what organisations bank on, cash cow customers who happily accept the first price. 

So why don't you try and join me in the challenge next time your renewals come up. And yes, I will graciously accept a cheque for 5% of everything you save.