Can small retailers compete nationally on the Web? | Ask Red Rokk

By Ed Munro
Marketing & Communications Consultant
Red Rokk Interactive

Contributing Writer

Q: Do you have a good example of local small business that is effectively competing against national online and big box retailers?

To answer this question, the Red Rokk team reached out to a local business with an e-commerce website to discover its keys to success. We chose Hardware Sales, a family-owned retail outlet began as a dynamite supplier in 1962, and has grown to become one of Whatcom County’s most successful retailers.

Through customer loyalty and diversifying their offerings into rentals and office furniture, the McClellan family’s Hardware Sales retail outlets prospered and successfully competed when The Home Depot and Lowe’s arrived on the scene by focusing on reliable and knowledgeable customer service, as well as stocking the right selection of products.

By late 2008, when the economy went into recession, Hardware Sales remained in good shape because of its business diversification and because of its ongoing commitment to superior service.

Today, the e-commerce business for Hardware Sales resides in a big warehouse tucked away in Ferndale, north of its Bellingham retail location. Steve Douge has managed Hardware Sales online sales as its e-commerce director since 2007 (in fact, it was his online hardware business the McClellan family bought out). He runs a 13-person operation that expertly manages, tracks and fulfills all the online orders.

Meeting “big-box” competition online

Douge credited his online success to his team’s quick turnaround and the ability to offer products across three online platforms that include hardwaresales.com as well as e-Bay and Amazon.com.

“We’ve found that customers have certain website preferences when shopping for tools and hardware items, so the ability to offer a wide selection of our products on sites like Amazon and e-Bay in addition to our own website has been a big part of our success,” Douge said.

Although they may never admit it, the big box retailers actually have little incentive to sell products online. The reason, as reported in Marketwatch, is that “beyond generating additional sales, the company (The Home Depot) also wants to use the Internet as a marketing medium to help build customer loyalty and feed store sales.”

Also, many customers now use their smartphones to go out “showrooming,” where they will view products on store shelves, then cross-reference them with online competitor’s prices before making a purchase.

Making checkouts fast and easy

For any e-commerce website to generate consistent traffic that converts to sales, certain elements are required.

From a layout and functionality perspective, customers expect an e-commerce website to include easy navigation with high-resolution product pictures (ones that can increase in size and be seen from different angles). They also want to be able to find all product-related information with an easy-to-read shopping cart button.

Overall, providing a fast and convenient checkout process involving the fewest clicks possible while always displaying the total price is crucial.

Other keys to success

The design and ease-of-flow across an e-commerce website is just as important as search engine optimization, also known as SEO, that makes sure people find the site.

In addition, many e-marketers are now able to see who is visiting their websites, where they can spot abandoned shopping carts and quickly follow-up with a friendly email.

The ability to track and view how customers use a website actually works. Studies show that more customers return and complete their sale when reminded by a reminder email.

Being prepared for sales growth is crucial for every e-commerce marketer. The importance of being able to fulfill orders in a timely manner cannot be understated.

In fact it’s the other half of Douge’s operation, and probably the area that sets HardwareSales.com apart from its competitors. Inside the 33,000 square-foot warehouse, there are 10 long aisles with 26-foot-high racks holding more than 8,000 items at any given time.

“The key to our ongoing success is the Lean program which has increased our overall productivity tremendously,” Douge said.

The importance of “Lean”

Lean is the increasingly popular efficiency program that streamlines how people organize their workspace, whether it’s a warehouse, manufacturing floor or an office space.

Saving time and being well-organized—by using what’s known as the “5S program,” sorting, straightening, cleaning (sweeping), standardizing and sustaining the process— increases efficiency dramatically when the system is implemented and maintained correctly.

It’s also about staff members embracing a new mentality where the idea of constantly focusing on ways to improve becomes the norm.

Listen to your employees

While touring the warehouse amidst a swirl of activity, Douge pointed to a pair of pallets used for stacking outgoing packages.

“In addition to our Lean program, we have often found that it’s the little things that can have the biggest impact,” he said. “For instance, by simply color-coding these two pallets (purple for FedEx and yellow for DHL) we have saved time and reduced human error by a significant margin. And the beauty of it is, this idea came from one of our staff members.”

The takeaway: Always be open to listening to what employees have to say. Their ideas count!

In addition to Lean procedures in the warehouse, Douge’s team has also phased in the same program for the front office by arranging desks to save space, fostering collaboration and cutting out a lot of physical movement.

When added together, these kinds of changes under the Lean program improve Hardware Sales’ ability to serve its customers and effectively compete against any online or brick-and-mortar competitor.

Having trouble effectively reaching your target market?  Let us answer your questions about marketing, advertising, website design and development, social media, SEO or anything else related to the promotion of your business. Send questions to the Red Rokk Interactive team by email at info@redrokk.com. We look forward to hearing from you!

Ed Munro is a marketing and communications consultant at Red Rokk Interactive, a marketing and advertising agency located in Bellingham. The company specializes in developing high impact campaigns that create awareness and drive sales. Columns from the Red Rokk Interactive team appear on BBJToday.com on the first Tuesday of every month. Red Rokk is online at www.redrokk.com.

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