In the latest instalment of our 2020 Back to Work Tips series, Helen Parker of The Wholesale Forums discusses setting up your business for the long term rather than getting distracted with short term fads:
Make sure your business is protected from fads and volatile marketing platforms
If 2019 taught us anything – it was that one of life’s guarantee is uncertainty. Whilst the markets hope that the commitment to Brexit will stabilise and boost the economy, we are still living in the aftermath of GDPR, new data and credit card regulations, the disruptive growth of the FinTech market, the privacy and hacking investigations, and the ever ongoing emergence of new products to sell online, product booms and then resultant legislation.
At The Wholesale Forums, where a large number of our members have been in the business of online selling for decades – our community manager Erik describes fads in the following way…
“Over the years I’ve become more and more cynical about the ‘next big thing’ – any fad to me basically the next bandwagon for people to jump on thinking it will make them a millionaire. I’ve seen this be anything from Vaping Products to Free Facebook Advertising. Not to say you shouldn’t take advantage of an opportunity, but you also don’t want to put all your investment and energy into something that can be taken away by someone else”
– Erik, community manager, The Wholesale Forums
So the main areas to specifically watch out for are:-
Just walking into any trade show in 2019 it was clear that the CBD boom – otherwise known as the “Green Boom” is fully under way. But as with all products trends you need to be careful of 2 big things:-
- How distributable the product is now and in the future. Using CBD as an example, there are a lot of products out there but as Bloomberg reported in October 98% of online CBD sellers are non-compliant with regulations. There is no doubt the authorities will catch up with manufacturers and as happened with vape products, fridges, cigarettes, and even Ribena, as an industry is assessed by science and health bodies – a product can easily be very suddenly be unattractive or even banned.
- How ‘fashionable’ the product is now and in the future. Think Pokemon Go, think Loom Bands, think Pet Rocks, think Fidget Spinners… the history of retail is littered with products that you can’t move for seeing one month and the warehouses are full of immovable stock the next. The chances are if you’re seeing something everywhere all of a sudden and hearing about the volumes sold, unless it’s a superstar product or you are very lucky, the opportunity to buy in volume at a good price and sell through at a huge profit has gone.
A problem for the 21st century is the ability for a social media platform such as Facebook/Instagram/Pinterest/YouTube to be a free marketing tool, and for marketplaces like eBay/Amazon/Etsy to be an easy way to market, whilst this is amazing and allows online sellers to access the global marketplace in a way never imagined before at a relatively lost cost – never forget that these platforms can make changes whenever they want.
As many businesses have discovered over the years, an algorithm change on Facebook or Amazon can destroy your sales overnight, and they have no commitment to you to make your product sell amongst their thousands of sellers. Whilst we can all moan about this, what is the best way to protect yourself? Spread your bets
Without causing yourself a logistical nightmare (and there are plenty of businesses to help with this) put your products on multiple platforms and market on multiple channels – let yourself catch the pockets of success and be protected against the volatility.
So good luck to all the online sellers in 2020, and in making sure you are the retailers who can take advantage of the opportunities out there – remember global e-retail sales are predicted to be $4.8 trillion by 2021, so there’s plenty of pie to go around – so long as you can set up your business so you are certain that you don’t need to be certain!