Which one do you prefer? Escalators or stairs? And what does this question have to do with E-Commerce? Or improving yourself?
From brick and mortar to Amazon. The most difficult change vendors tend to struggle with when they start trading with Amazon (Wayfair, eBay, etc) is similar, to when you choose between stairs and escalators. Whilst we prefer and advise you to take the escalator, it’s important that you know which one works for you and what the consequences of the choice may be. Here’s why.
When talking to some fellow Hawkers, many arrived in the “e-commerce world” from running catalogue businesses and/or trading with brick and mortars, no matter if it’s small, medium-size enterprises or large multinationals. This means a key change that these organizations, as well as individual stakeholders, need to acknowledge, then go through, is the topic of this post: choice of mindset (e-commerce or brick and mortar).
Even though both industries are based on the same ground stones – getting products from the factory to the end consumer, the “how I do it” has changed.
The most important quality any stakeholder can have when performing a role in an e-commerce setting is the “e-commerce mindset”. Having it vs not having it has proven to lead to different decision making and, not surprisingly, very different outcomes for the sellers/vendors. Having the right mindset is like trying to go up to the top of the Empire State Building climbing stairs or making the journey upon escalators/elevators. Climbing them will bring you to the top, as they are stairs after all. Escalators, however, will save you both energy and time, and you can invest that time and energy into something else, like admiring the view or taking selfies, as opposed to arriving there exhausted and trying to catch your breath. Make sure when you make a choice, you ask yourself if it’s the most fit for use or not.
We found when observing our clients that came from the brick and mortar or catalogue world, they are still using the old school mindset when approaching most e-commerce business challenges. And most of the time they are not mindful of it. What we would like to raise your attention to is: solving e-commerce challenges by utilizing brick and mortar mindset is taking the stairs but expecting not be exhausted by the time you reach the observation deck of the Empire State Building. It’s unlikely to happen. Unless, of course, if you are a world class athlete. Then it’ll be fine.
“I’ll just ask a favor/call up my buyer/vendor manager/account manager and they’ll get it done for us…” “I’ll just negotiate a better deal by convincing xyz.” Both sentences are fit for use in a brick and mortar world. Less so in an e-commerce setting.
Automation, driven by the need for scalable businesses, and less touch from humans is the main change area the 2 mindsets collide most often. The catalogue/brick and mortar mindset believe in human interactions and our clients from that bucket naturally demand more face time or calls compared to our clients with more e-commerce mindset. The first group believes in convincing/negotiating/charming someone into a deal vs optimizing the numbers programmatically in a way that works for both vendor, retailer and customer.
In the brick and mortar world, buyers can be convinced by emotions and so different decisions may be made. The programmatic world of Amazon breaks everything down eventually to yes’ and no’s blacks and whites and so that the computer is able to understand as well: ones and zeros.
This concept proves to be difficult to consume for many. Humans are naturally favour conversations and decisions to be more grey than black and white. That makes it more acceptable for our consciences: “I win but so do you…” “I’m being fair as I gave away some in this deal”. A computer however does not possess emotions or conscience. Therefore, grey decisions are never made. Seemingly to the sellers yes, but what really happens is this: the decision fully satisfies the algorithm on the retailer’s side which ultimately makes it black or white for them.
If you’re an FBA seller, have a look at the shipping fees: it’s clearly stated how much you’ll pay based on the dimensions and weight of your item. No grey areas: the item falls into a precisely defined category and Amazon’s going to bill you for it after it ships. Black or white, it’s either one category or another so that a computer can programmatically plan with it.
As the above-described scenario is how all e-commerce marketplaces make decisions the best answer for sellers and vendors is to build up a knowledge base and suite of supporting tools that backs into that mindset. If Hawkers want a quick journey to the observation deck of the Empire State Building, the best fit for use solution is the escalators or elevators as opposed to climbing the stairs.
That example implemented into the world of e-commerce decision making is to learn and use the same mindset that is the most fit for purpose. Brick and mortar mindset will serve you best in the brick and mortar world. Algorithms, programmatic thinking and precision will get the job done in e-commerce.
The best is: it’s something you can both teach and learn. The reason why it’s key to have it is because vendors and sellers having the right mindset arrive sooner to the right conclusion and make the most rewarding decisions sooner and more often. Remember that choice in the beginning of this article. Are you a stairs or an escalator guy? We believe the escalator is a better fit for what its task is.
