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Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Tue Aug 21 2012 12:29:50

Do Smaller Merchants Have Any Advantages over Retail Giants?

By: Ina Steiner
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Small merchants may have been the first to embrace the Internet as a vehicle for selling goods, and may have been nimble enough to adapt to the constantly-changing landscape, but today, retail giants have strengthened their online - and mobile- presence, and have focused their sights on marketplace selling as well.

The question is, how do online sellers compete against the pricing and marketing powers of the retail chain, big brands and manufacturers? How does a mom-and-pop retailer stay in business, when there's a WalMart down the street?

We'd like you to put your "consumer cap" on and think about what makes YOU purchase from a small seller versus a big brand? When you're shopping online, what determines where you ultimately make the purchase? Is the tipping point price? Service? Principle? Something else?

We don't want to influence you - think of all the factors that sway you when making your purchases. We may follow up with a survey to quantify which of those factors are most important, which can help you determine if you're providing the experience shoppers are looking for to make them purchase from you!

Reading EcommerceBytes Blog: Do Smaller Merchants Have Any Advantages over Retail Giants?
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by: mylifeisgood This user has validated their user name.
       
Tue Aug 21 12:42:36 2012
Price Price...Could care less about how long it takes on shipping. If we need it that fast we go to our local shopping center.
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by: bellafabric This user has validated their user name.
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Tue Aug 21 13:02:49 2012
Small online merchants can offer individual service that large retail stores cannot. I found this several years ago when ordering clothing from Chico's. Two pair of $70 pants came in a USPS Priority tyvek mailer with one piece of tissue and an invoice copy. Are you kidding? As a student in the 70s I had a PT job at Niemen Marcus in shipping and gift wrap. Products and fashion were packed for presentation.  Mail order  packages included several pieces of tissue leafed through a garment to avoid wrinkles in shipping , bubble (or peanuts), double boxed china and stemware, ribbon, a thank you card/envelope and invoice with the name and contact info of the salesperson. Simple and elegant. Etsy sellers are known for their packaging and presentation. Big brands no longer have the customer care, unless you're buying from a top drawer retailer. It's so easy for a small online retailer to offer excellent service with presentation.  
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by: mylifeisgood This user has validated their user name.
       
Tue Aug 21 13:17:57 2012
@bellafabric

Nice but all that tissue, ribbon although being elegant you have to keep in mind that it adds to the cost of an item and most people shop by price.

If I paid a couple of bucks more and got a box of ribbon and tissue I wouldn't be that impressed. People are buying online for ease not for fancy tissue and ribbon.
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by: Digmen1 This user has validated their user name.
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Tue Aug 21 14:50:24 2012
I think a lot depends on what your are buying.

Eg I wouldn't buy a technology item from an online seller I would prefer to buy from a bricks and mortar seller that has online selling, purely for the service and warranty issues and the guarantee that you will get what you ordered (eg not a fake etc).

And as the large chains go online it is going to get harder for smaller sellers to get access to stock as the large sellers cut supplies off to them.

But of course the smaller sellers will be able to offer lower prices, as the big stores are not going to undercut their in-store prices.
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by: bellafabric This user has validated their user name.
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Tue Aug 21 15:00:04 2012
@ mylifeisgood

I believe most people shop by value.
The past seven years I've managed to take advantage of very good, yet simple, packaging products offered through b&m retail liquidations - amounting to dimes and quarters, not dollars. It's a matter of how (and to what cost) you value your customers and business. One of those values, for me, is product presentation.

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by: JustTheFacts This user has validated their user name.
       
Tue Aug 21 15:14:58 2012
Price and convenience is why I buy online.

As for packaging.  Keep it simple.  Don’t add more than I need nor not enough to get it safely.

I actually get ticked when I get all of the fancy wrap because I know I am also paying for it, not just in weight but for the materials.

Although I do not have the need to have a personal connection from everyone I buy from, I find buying from Amazon, COLD, distant and I really have no idea who I am really buying from.

It has ZERO personality. Plus they do not have enough pictures; you have to scroll down to find the BRIEF description.

Amazon does not make it easy to figure it out WHO you bought from.  I do not feel like I am in someone’s store, I feel like I am in a giant WAREHOUSE on my own.

Even buying on other branded sites it at least feels more personal.

Although I buy more from Amazon than I do on ebay, I almost never buy more than 1-3 items at a time.

I do like how ebay has sellers with literal stores.  It is more personal even if you never have a need to contact the seller.  Heck, I am not even sure how to contact an Amazon seller, so if I do not know or understand something I go elsewhere.

However, my goal is to shop with Mom and Pops regardless of price, well within reason that is.  I am tired of the box stores eating up and spitting out the mom and pops.  Besides, as seller if we do not continue to support the mom and pops, there will be no customers for us because they will have no jobs or money.  And we all know that working at the box stores does NOT afford people to buy much.

We may save a few bucks on the purchase but we LOSE big time on our own sales.  Then pretty soon we will not even be able to afford the box store items.

So remember, the next time you have to decide whether to pay an extra few dollars at the mom and pop verses the box store, ask yourself, “how MUCH will this couple of dollars COST ME in the long run?”
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This user has validated their user name. by: basset
       
Tue Aug 21 16:17:42 2012
Price & Convenience.

First of all, I HATE going to malls & most free-standing big box stores. I don't like the traffic, parking lots, safety issues, price of gas used, etc..... I just don't like the atmosphere anymore, not even during holidays. Especially during holidays.  

I've had great online grocery & everyday household product purchase experiences with both Walmart and Amazon. If those two go head to head and duke it out - watch out! Locally, I have a fondness for ethnic markets. If a small seller online could create a great ethnic market experience, I'd check it out.

Entertainment? I hate going to the theatres & LOVE streaming video. I can wait to see a blockbuster. These days most American movies aren't worth the price of tickets.

I DO like smaller stores like TJ Maxx, Marshalls, Tuesday Morning, Ross and the like. BUT, to me these stores can be like going to a flea market. You NEVER know what you will find. Some are kind of messy, others more orderly. I have found items like great hand soap & kitchen wares for great prices at these places, then I can never find it again.

Which leads to online buying. When my never-to-be-found again hand soap runs out. I'm online at eBay,  etc.. trying to find more. If I find it, it is usually a small seller that has it.

Personally, I don't care about it being delivered at warp speed (I like the tracking tho),  fancy packaging or tissue wrap on online purchases - it just goes to the landfill & those are full enough. The seller can recycle packing materials for all I care. I only care about getting the item intact. I DO like the green re-use, recycle factor that can be possible with online purchases.  That being said, I am hypocritically guilty of helping fill those landfills as a seller because I do use tissue paper (one sheet!) & new shipping bags on the pre-owned items I sell.

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This user has validated their user name. by: iheartjacksparrow
       
Tue Aug 21 18:24:07 2012
I'm another person who doesn't want a lot of ribbon or extras in my packages. A while back I was making a purchase in a mall store, and the clerk started putting all this tissue paper in the bag. I told her to stop, that I didn't want it. She seemed surprised that anyone would not want their purchase looking beautifully presented when they got home.

I also shop online because of convenience. I don't drive, and while I can bribe people to drive me places I need to go, it's less stressful to have things delivered to the house. Price is always a consideration. Also online you can find just about anything in the world for sale; not so in local stores.    
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by: Susan Averello This user has validated their user name.
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Tue Aug 21 18:36:09 2012
So many things are only sold by small stores for crafts/art that without the small online shops - I'd be stuck in the rut of Michaels slim pickings.
The same can be in any niche area. Most items aren't available any where but these small online shops.
Even handmade jewelry - I love it and can't get it in person. A craft show once a year wouldn't help and that's hit or miss
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by: Digmen1 This user has validated their user name.
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Tue Aug 21 19:09:35 2012
Most thigns I have bought from online stores are specialty technology stuff.

Eg lights for my camera or batteries etc, the stuff you can buy in my local city 100,000 and is hard to find. Hard drives and graphics boards that once again our local store hardly stock and have little or no choice and high priced. (Just for putting it on the shelf)

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by: JoyfulA This user has validated their user name.
       
Tue Aug 21 21:40:57 2012
Biblio has a setup where sellers offer discounts (mine is 10%) to other sellers, which in many instances makes it my first choice for book buying.
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by: Digmen1 This user has validated their user name.
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Tue Aug 21 22:03:06 2012
Just to correct two major typos (I'm always in a hurry)

Most things I have bought from online stores are specialty technology stuff.

Eg lights for my camera or batteries etc, the stuff you can't buy in my local city 100,000 and are hard to find. Hard drives and graphics boards that once again our local store hardly stock and have little or no choice and high priced. (Just for them putting it on the shelf)


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by: ViiVa This user has validated their user name.
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Wed Aug 22 01:08:49 2012
Many small retailers are not putting effort in making their stores presentable, inviting and modern. Without a good storefront, savvy consumers will not step in to browse, least to buy anything. It will also help if the small retailers have online presence with good social media credibility.
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by: NullApps This user has validated their user name.
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Wed Aug 22 04:04:19 2012
This isn't from the consumer's perspective but from the seller's.  Quick updating.

On eBay and Amazon small merchant can quickly update all their listings in a matter of seconds or minutes but a large merchant will take hours or the entire day due to rate limiting.  It doesn't matter how many employees you have or how fast your servers are.  The marketplaces themselves will always be a bottleneck.

This is also true about pricing on marketplaces.  Marketplaces like eBay and Amazon throttle the number of calls made to them.  This means that a small merchant can easily have all listings kept competitive on quick intervals but giants like Buy.com simply cannot compete on the same timescales.  If they did they'd tear down the entire site in the process.
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This user has validated their user name. by: Tula
       
Wed Aug 22 14:25:51 2012
I love shopping. I used to love wandering the malls, spending hours checking out all sorts of merchandise. I actually found it stress-relieving to be able to just turn my brain off a bit and poke through "stuff". Now, though, I have arthritis and can't walk or stand for very long, so that kind of takes the fun out of fit. Most smaller stores don't have shopping scooters and only a few big ones, like Target, do (I haven't bought my own yet). So now I do most of my shopping online.

Like others, my preferences depend on what I'm buying. I buy almost all of my electronics online and for that stuff, I stick to the retailers with the best reputations. They aren't always the biggest, but they're the ones that are well-known in the industry for quality and good prices (Tiger Direct, Newegg, Mwave, etc...). I do price comparisons and will buy from the one with the best price on the gear I want. Most of what I buy in areas like computer components is higher-end stuff you just won't find at BestBuy or most other B&M retailers. Amazon does frequently have some of these items, but not always and not always at the best prices. I get frustrated with their listings because many sellers don't put enough detailed info, like on the specialty sites and sometimes, you can't even tell if it's refurbished vs. new (I don't buy refurbs if I can help it).

It's the same with a lot of other niche areas. I buy kitchen/cooking stuff from some specialty sites because they're often the only ones who have what I want. Amazon is a good place to find some of that stuff, but they aren't always the cheapest, especially for third-party sellers.

I generally don't care about super-fast shipping times unless I'm buying electronic items for repair (like if my computer crashes and I need to fix it asap) or if it's the holidays and I need something at the last minute. Otherwise, I can wait. I like cheap/free shipping, but I do my price comparisons with total overall prices, so as long as it comes in as the cheapest, I'm fine with it.

I agree with the others that I don't care much about fancy packaging. It's nice, but I don't want to pay extra for it. What I do want is quality packaging that protects my items. Don't be shipping me a hard drive in an envelope or bouncing around in a box with little or no packing materials. I also want packing slips, since I often need these for tax purposes. Yes, I can save online order receipts, but it's easier to stuff a packing slip in an envelope of file cabinet. I've found a lot of smaller sellers don't provide these and that's one area that could use improvement. Not to mention, they're passing up potential advertising space by giving me details of their business and other sites where they may sell.

I think the most frequent shopping I do with smaller sellers is when I buy handmade or vintage stuff. I used to buy tons of vintage items on eBay, but I have bought very little lately. Now I use ArtFire and Etsy for most of that. They have lots of unique items you can't get most other places and sometimes if you can't find what you want, you can get something custom made that way. A couple years ago, I was looking for something unique - oversized rolling pins for my brothers, who love to cook, but have big hands and have trouble using most rolling pins because they're too narrow. I couldn't find anything big enough, but located someone who actually makes them by hand and ordered custom-made oversized pins (5" in diameter) for them. The guy was terrific and provided exceptional service and a quality product. He kept me updated as to his progress and schedule and shipped them well-packaged and in time for Christmas. This kind of thing is where the smaller sellers can really shine.

Areas like electronics and such are really hard for the little guys to compete on price and variety of product, anyway, so I find it best to stick with the big guys for that stuff. When you deal with more specialized or niche items, though, the smaller sellers can offer a lot more in terms of service and knowledge of the product than the more generic larger retailers. For those sorts of items, price can be much less of an issue. In my rolling pin example, price was really a non-issue, since what I wanted was simply not available anywhere else, but I found the pricing I did get was quite reasonable for the amount of work that went into it and the quality of the end product.

Sorry for the long babble, but this issue isn't as simple as "I only shop by price or by free shipping." There are a lot of factors to take into account :-)
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by: Moonwishes This user has validated their user name.
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Wed Aug 22 20:39:02 2012
I also shop on line for things due to arthritis and difficulty getting around. Just today a lady from my church came and helped me get groceries. So I'm definitely not one to be able to walk around to shop. I don't mind shopping on Amazon and if possible will give my business to a 3P seller. Depending on what I look for on line it depends on if I shop small business or large. The best prices for unmentionables is the name brand on line store. I just wish they would stop sending me catalogs. Now that ticks me off about the bigger stores. You shop online and they think that it is open season to innundate you with catalogs and more catalogs that hit the burn pile the minute they get to the house. Price matters to me because I am on a limited income, but even more is finding the item I'm looking for. It was the probelsm that sewers had in locating sewing patterns that they had seen featured in magazines that got me selling sewing patterns on line. At this point we have over 8000 different ones listed and that is only a drop in the bucket of ones that could be listed. But I give personal service, can answer sewing questions coherently since I too am a sewer and many of my customers like to chat via email so they get very personal service from me. Not necessarily the lowest prices as my time is worth something as well. I cringe when I see a pattern for sale like I did the other day for 76 cents on Amazon! Why is the seller even bothering. When fabric stores have pattern sales as loss leaders it is to drag customers in for the fabric, thread and notions as well. But an individual seller on Amazon isn't going to get multiple sales from the same buyer all at the same time. From my store, I once sold 27 patterns in one crack from a woman. She liked my selection and the shipping discount I gave. So I guess with me it comes down to selection, service and friendliness.

I won a contest a few months ago. I wrote the small on line seller of the item I won how thrilled I was with their product, I blogged how thrilled I was and wrote the sponsoring company how happy I was to win. Would I tell anyone about this company again? No, because they never even responded back to my email with even the simplest "thanks for your kind words". Crazy thing is I'm even more thrilled about it the more I use it, but I guess they don't need the testimonial. It felt very cold to me and that is something I don't like about small sellers, is I expect friendliness and will move on if I don't get it and they never know why the person doesn't shop there again.
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by: Digmen1 This user has validated their user name.
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Thu Aug 23 18:34:52 2012
Some very interesting comments above.

I need to read them all again.
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by: Mr. Me This user has validated their user name.
       
Fri Aug 24 11:55:56 2012
eBay doesnt seem to think so :)


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