How To Use E-Commerce to Survive a Recession

About the author: Dan Cannon is the Lead Web Applications Developer for Nicasio Design and Development. Nicasio provides web based solutions for both individuals and businesses. Nicasio owns and operates the E-Commerce solution NicE-Comm.

With all of this talk about recession you may be asking yourself what you can do to weather the storm. Fortunately if you are running an E-Commerce website you are in prime position to outperform other sectors of the economy. This is true for several reasons.

1. Low Overhead
As an E-Commerce merchant you have the ability to incur low overhead costs. During a recession, one of the first things a business will try to cut is overhead costs. Typically you can get by with only paying your hosting and ISP bills each month. Taking into account the normal cost of a brick-and-mortar store which includes rent, utilities and the salary for an employee to always be present you are already ahead of the game as an E-Commerce merchant during a recession.

2. Better Consumers
Consumers are buying online now more than ever. Once upon a time buying a product online was a ‘fly by night’ affair. You usually knew nothing about the vendor you where using and you may or may not receive the actual product you bought. All of this has changed now. E-Commerce is recognized as a legitimate business now. And with the cost of gas, large mall crowds, and people having less money to spend, more and more people are turning to E-Commerce websites for their shopping needs. With all of this recession talk, people are turning to e-commerce to get more bang for their buck.

3. Ability to Quickly Adapt to Market Conditions
As an E-Commerce merchant that manages their own store you have the ability to quickly adapt to market conditions. You have no red tape to go through other than your own. If a large retailer offers a sale on one of your top selling items, you have the ability to quickly and easily match or beat the competition. This allows you to remain competitive with other online retailers. It also allows you to take advantage of this recession in a way that traditional businesses may not be able to.

OK, now you know why you are in good position to survive a recession using your E-Commerce business. Now you may be asking yourself what you can do to not only survive a recession, but to also *PROSPER* during one.

1. Embrace Advertising and Marketing
During a recession it is almost instinctual to cut spending, but spending a little bit extra money intelligently during a recession can have a very positive impact. As other businesses may be cutting back their advertising budgets to pay their overhead costs you may be able to advertise in mediums that where once too expensive. If a radio or TV station isn’t selling enough advertising at their current rates they will most likely be lowering their rates to meet market conditions. This means you may be able to reach an audience that was once unreachable. This will help drive customers to your store during the recession, but it may also make people come to you *AFTER* the recession when they have more money to spend.

2. Push Products People Need
People are still buying even during a recession. However, they are buying more necessity items than luxury items. If you run an online electronics system for instance you might want to try to feature items people need on your home page and landing pages. So take off that large featured ad about your new $3,000.00 Gaming Computer and post a new ad highlighting the laptop batteries, cell phone batteries, printer cartridges, and laptop power cables. These are items people are going to NEED to buy. People are not going to go without their cell phones or have a printer with no ink in it.

In short, think about your customer’s mindset as you decide which of your items to promote.

3. Keep an Eye on the Competition
Knowing what your competition is doing will allow you to remain competitive. If someone else is offering a sale on one of your best selling items then match it if that is feasibly possible. Remaining competitive is one of the main reasons you can use e-commerce successfully during a recession.

4. Adjust to Market Conditions Quickly
This goes with point 3. If you need to adjust your prices, product descriptions, keywords, or advertisements to remain competitive then by all means do it. As an E-Commerce merchant you have the ability to stay ahead of the curve (or at least on par). You can change your prices and advertisements on the fly so make sure you take advantage of this versatility.

There are obviously other ways you can use the versatility of E-Commerce websites to survive a recession, but the bottom line is you have a chance to outperform many other areas of the economy if you play your cards right.

If you want to break into this exciting industry and are interested in setting up your own E-Commerce website, Nicasio Design & Development can help. We offer several different solutions for all budgets and industries. Please visit our NicE-Comm Site or our demo store for more details.

We can also help you with your current E-Commerce website. Give us a call at (912) 292-1716 or use our online contact form.

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