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Can marketing hurt e‑commerce businesses?

The phrase “if some­thing seems too good to be true, it usu­al­ly is” is a com­mon one, and even applies to the world of elec­tron­ic com­merce. Whilst week­end sales might be good for con­sumers, as well as online adver­tis­ing cam­paigns intend­ed to boost sales by offer­ing ludi­crous dis­counts, the truth is that such tac­tics can often back­fire gen­er­at­ing a set of cir­cum­stances that can dam­age both high street and online busi­ness­es. Week­end crowds, long lines at the reg­is­ter and under­staffed depart­ments give con­sumers a very bad shop­ping expe­ri­ence, and online deals are not exempt either – par­tic­u­lar­ly if a rush of traf­fic crash­es the site’s check­out system.

The groupon effect 

The “groupon effect” is an exam­ple of this. This sees aggres­sive mar­ket­ing cam­paigns — which have been set in motion with­out ade­quate prepa­ra­tion or real­is­tic man­age­ment of expec­ta­tions for the busi­ness own­er or the shop­per — send­ing sales into over­drive. The prob­lem is that a shop can end up being over­whelmed by the sud­den del­uge of con­sumers who arrive in order to redeem a group coupon.
This can lead to the busi­ness receiv­ing very poor online reviews instead of the sales boost and increased brand recog­ni­tion that had been the intention.

Unde­sir­able outcomes

When a firm’s main focus is on grow­ing sales at the cost of oper­a­tional har­mo­ny, it could mean you end up doing your busi­ness more harm than good. Pos­si­ble ram­i­fi­ca­tions include the likes of undue stress and strain on the organ­i­sa­tion, with employ­ees hav­ing to scram­ble to meet demand; more time and mon­ey hav­ing to be spent on rep­u­ta­tion man­age­ment and pub­lic rela­tions; pro­duc­tion suf­fer­ing due to inad­e­quate resources and out­dat­ed equip­ment; bad reviews for both the prod­uct and the com­pa­ny; and an increased amount of waste caused by the dis­pos­al of dam­aged goods result­ing from rushed pro­duc­tion. There might also be a drop in cus­tomer ser­vice rat­ings and qual­i­ty con­trol result­ing in the brand being tarnished.

The good news is that with just an ounce of plan­ning — such as coor­di­nat­ing with the e com­merce man­ag­er, the web con­tent man­ag­er, the e com­merce ana­lyst and col­leagues from oth­er depart­ments – a cri­sis can be pre­vent­ed, result­ing in a suc­cess­ful mar­ket­ing cam­paign after all.

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