Online Business Expansion Proposal
Online Business Expansion Proposal for Herbal Solutions Herbal Solutions is an herb shop located in Riverton, Utah that researches and formulates herbal remedies to combat health problems and improve the physical, mental and emotional wellbeing of its customers. The business conducts its operations from a home office, with clients visiting the location for consultations with the herbologist as well as to purchase the prescribed herbs. Currently, the shop has a very little online exposure which, the owner believes, has stifled its growth and potential for success.
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The purpose of this paper is to evaluate the viability of the business in an online environment, analyze the competitive landscape and propose online marketing strategies to help the business expand its reach and grow its customer base. A1 . Viability of Product or Service in an Online Environment Herbal Solutions does not currently have a dedicated website to sell their herbs and promote their consulting services. The business’ only online exposure is through a Facebook page which is grossly inadequate for the purpose of conducting ecommerce primarily because it lacks a product catalog, a shopping cart and an lectronic payment system.
The business’ current marketing activities depend solely on word-of-mouth advertising. Although this has been the source of most of the sales conducted by the business, it has proven ineffective over time in growing their exposure and customer base beyond a few family members and friends. The quality of the herbs offered by Herbal Solutions is substantiated by the fact that more than 80% of their ongoing sales come from returning customers.
With such a good product and a loyal customer base, the business will miss an enormous opportunity for rowth if they do not expand into an online environment. This expansion is not only necessary for continued success, but crucial to the long term survival of the business. In determining the viability of Herbal Solutions in an online environment, one must consider whether the products or services being offered by the business lend products, learn why they need it and be able to purchase it instantly.
Since the business generates a majority of its revenue from the sales of its herbs, having a website will help the business expand its footprint beyond its physical location, ncrease consumer awareness of the products and services being offered, control the cost of growth and drive targeted web traffic to the business. The potential pitfalls of delving into the online realm include a tendency to expect sales to increase without any significant effort on the part of the business owners.
Although going online exposes the business to potential customers worldwide, targeting web traffic to a particular website is a very complicated and sometimes expensive task. Without appropriate guidance from experienced web marketing professionals, it is very likely oing online may not generate enough revenue to Justify its cost. Another potential challenge is the online competitive landscape. The more herb selling websites there are online, the more difficult it would be to differentiate and attract potential customers to this particular one.
Finally, the success of an online business dependent in many cases on how high its website shows up in web searches. Since this business is entering the online realm a little late, it would take significant search engine optimization effort to get it to appear in the top ten search results for the eywords it plans to target. A2. Current Online Competition There are a fair amount of websites that complete directly with Herbal Solutions. The following table will analyze three of its competitors based on the following criteria: 1 . Ecommerce 2. Social Media 3.
Customer Relationship Management (CRM) 4. International Consideration. Company Social Media CRM International Consideration The Spice House Yes No The Herbalist Buy Herbs Online Herbal Solutions like all its listed competitors has a social media presence established through a Facebook page. Of all the companies listed, the Sprit, Mind & Body shop has the fewest likes on Facebook with only 59, which signifies that it’s reach online is quite limited. On the other hand The Spice House has 8213 Facebook likes, The Herbalist has 3184 Facebook likes and Buy Herbs Online has 595 Facebook likes.
Although the number of Facebook likes does not necessarily depict success in social media influence and exposure, it can be used to gauge whether a company is generating the online conversations necessary increase the customer base of the company. An evaluation of Herbal Solutions’s Facebook page clearly shows a lack of interaction between the company and its customers. Also, many of the posts on the page have nothing to do with the core business of the company, which signifies a lack of a messaging strategy. With respect to ecommerce, all the listed competitors of Herbal Solutions have a website with a shopping cart.
This feature allows potential customers to discover the products being offered by the companies and to purchase them online with a few simple clicks. Not having a website with ecommerce capability severely limits Herbal Solutions’s ability to reach potential customers with its products and services and puts the company at a great disadvantage to its ompetitors. With respect to a CRM system, all the listed competitors of Herbal Solutions have websites with login capabilities which allows returning customers the convenience of not having to reenter all their details when making future purchases.
Although this feature may appear simple, it has a positive effect on returning customers by not placing obstacles in their purchasing path. Also having a CRM system allows the companies to monitor various marketing and purchasing trends which enables them to tailor promotions and other incentives to individual customers or to customer groups. The Spice Store and The Herbalist allows users to sign up for weekly newsletters on their home pages which is an excellent tool to keep customers apprised of any promotions or deals being offered by the companies.
Maintaining a good CRM system is necessary for success in an online environment and Herbal Solutions’s lack of a website with these capabilities puts it at further disadvantage to its competitors. None of the companies listed had a visible international strategy. It was not apparent on any of the websites reviewed that products could be shipped or delivered internationally. For companies seeking to do usiness online, targeting the international market is a decision best made on an individual basis.
Although international expansion has the potential to increase profits exponentially, it comes with challenges that are often difficult and expensive to handle especially in the case of selling products purported to improve health and cure disease. One must consider international and even country specific regulations that might either restrict or prohibit the sale of the products being offered by the company. All in all, Herbal Solutions is at a great disadvantage to its competitors in its nline at this point.
In order for this business to be successful online, a thorough marketing analysis must be conducted and a marketing strategy developed and implemented so a clear path can be drawn from the date of its online debut to the point of profitability. A3. Online Marketing Suggestions and Strategies According to the Medicinal Plant Working Group, the market for medicinal herbs is an estimated 3 billion dollar a year industry, with more than 60 million US consumers taking herbal remedies on a regular basis (Natures Healing Pharmacy, 2012).
The use f herbal remedies has doubled over the past few years among the elderly who are increasingly choosing natural and holistic solutions over pharmaceuticals according to Moshe Frenkel, MD, an assistant professor in the Department of Family Medicine at the University of Texas Medical Branch at Galveston. Proper customer targeting is necessary to ensure any marketing strategy is reaching the intended customer group. Since staying in good physical health is the primary concern of most aging adults, they should be considered the prime demographic for Herbal Solutions’s marketing efforts.
Hence, in determining a viable marketing strategy for Herbal Solutions, it is important to consider this aging demographic and to target them appropriately. Since Herbal Solutions has little online presence, all marketing strategies employed initially by the business must be geared towards rapidly increasing consumer awareness of the business and its products and services. The following marketing strategies will provide the necessary Jump start to get the business growing online.
Online Press Release Online Advertising Search Engine Marketing Pay-per-click Advertising A3. 1 Online Press Release An online press release is a formal way to inform potential customers of the launch ofa business online. It is a way to tell the world what the business is about, what products and services it offers and how consumers can access them. By publishing a press release, Herbal Solutions will be able to appeal directly to its target market, conveying to them the reasons why they should visit the new website and what they can expect to see when they get there.
A press release will also allow Herbal Solutions to create a positive online perception about the business and will serve as he foundation upon which the business can build its online identity. With respect to potential customers, an online press release will give the most positive image of Herbal Solutions and, if distributed properly, will draw the amount of attention the business needs to start growing its customer base online. Since the press release will include a link to the business’ website, it will serve as the first tool to direct traffic to the website.
The reason a press release if appropriate as a marketing tool for Herbal Solutions is the fact that it can be distributed widely across the internet but ore importantly, can be targeted to the intended customer groups the business seeks to attract. A3. 2 Online Advertising The primary goal of a business debuting online is to attract potential customers to its website. Online advertising is one of the fastest ways to accomplish that goal. Online advertising comprises placing advertising on search engine results pages, like YouTube and many myriad more ways.
As a business trying to carve its way on the World Wide Web, online advertising will enable Herbal Solutions to reach potential customers where they are online. By targeting the advertisement to the proper demographics, the business will be able to drive traffic to its website which will lead to purchases of the products and services offered. Placing advertising strategically on multiple websites and tagging them appropriately will also increase the number of back links to the business’ website which will positively affect its placement in search engine results.
A3. 3 Search Engine Marketing Search engine marketing is a technique that allows businesses to tie their advertisements to the search results generated by search engines like Google, Bing nd Yahoo. For a business with a new website, this marketing strategy is an excellent way to overcome the challenge of not showing up high enough in organic search results to be seen by potential customers. It takes time and significant search engine optimization effort to move a website up in organic search results.
Using search engine marketing will allow Herbal Solutions to pay for its placement on the first page of search engine results thus increasing exponentially the number of potential customers who will see and act upon the advertisement. Search engine marketing lso allows for targeting based on the search terms entered by the user. This means that by selecting the right keywords Herbal Solutions will be able to reach its intended audience with the precision required to make the advertisements effective in driving traffic to the business’ website.
Another advantage of search engine marketing is that it is relatively cheap compared to other forms of online marketing which would be beneficial to a business that is yet to reach profitability online. A3. 4 Affiliate Marketing Affiliate marketing is a marketing strategy that allows businesses to reward people ho refer potential customers to them. Usually, a reward is only given to the affiliate if their referral leads to a desired action which could be a sale, sign up or any other action deemed valuable by the business.
Affiliate marketing can be very advantageous for a business debuting online because it relieves the pressure on the business to conduct its own marketing activities by sharing that responsibility with affiliates. The risk to the business is minimal if the affiliate marketing platform being utilized is secure and contains the tracking capabilities to ensure its integrity. Using ffiliate marketing will give Herbal Solutions the time and ability to focus on the more challenging marketing strategies while allowing others to help spread the word about the business.
Another benefit affiliate marketing has over other forms of online marketing is the fact that Herbal Solutions only has to pay the affiliate when a desired action occurs. In this particular case, they only have to pay affiliates when a purchase is made by the user they referred. So the business only pays out when it receives money. A4. Social Media Integration One of the ways to create a web presence and increase exposure online is to employ ocial media techniques in the execution of an online marketing plan. Social media marketing comprises the use of blogs, wikis, social bookmarks, social networking sites, social tagging, etc. o create awareness of the products and services being offered by a business. Social media marketing enables businesses to market its products and larger customer base. Social media marketing also allows for more granular targeting of potential customers which ensures that marketing messages get to the right demographic. It also provides businesses with real time data as to the ffectiveness of the marketing strategy, which can be an extremely valuable asset in determining whether a particular technique is working positively for the business. As has been stated above, Herbal Solutions already has a Facebook page.
Facebook is the largest and most successful social network to date. Having a following on Facebook is crucial for a business whose primary goal is to reach potential customers with its products and services. Facebook allows businesses to target the right demographic with precision and hence has the potential to increase the web presence of the business exponentially. To maximize the effectiveness of Herbal Solutions’s current Facebook page, it is imperative that a coherent and consistent marketing message be conveyed to potential customers who visit the page.
The page should be geared to answer three important questions: what the business is about, why the customer needs the products or services being offered and how they can obtain it. This will ensure that customers don’t get confused as to the purpose of the page. Also, the Facebook page must be employed as a tool to drive traffic to the business’ website, which is where the purchases needed to sustain the business will take place. Another social media marketing outlet that lends itself to the core business of Herbal Solutions is Pinterest.
Pinterest enables businesses to draw awareness to their products by allowing them to pin product images to an online notice board which can then be shared among friends and users of the site. Herbal Solutions can leverage Pinterest to drive traffic to individual herbs by pinning images of the herbs on Pinterest and then linking those images to the product purchase pages of those herbs. Using Pinterest has the potential to generate the internet buzz needed to increase the business’ web presence and grow its customer base.
Another social media marking tool that has the potential of increasing consumer awareness of Herbal Solutions is Twitter. Twitter enables businesses to build an online following and provides an easy platform for disseminating information to current and potential customers. Using Twitter to communicate regularly to communicate regularly with customers will help Herbal Solutions keep current customers coming back to the business. Also the retweet feature of Twitter will enable current customers to share the business’ messages to friends and followers which will increase the online reach f the business.
Herbal Solutions is in its infancy online. Going online in a well- organized fashion will enable the business to begin to expand its reach beyond its physical location. It will enable the business to reach the thousands of potential customers needed to substantiate the viability of the business in the long term. Works Cited Medicinal Herb Profile. (2012). Retrieved from http://www. agmrc. org/commodities_products/specialty_crops/herbs/medicinal-herb- profile Natures Healing Pharmacy. (2012). Retrieved from http://www. nps. gov/plants/medicinal/plants. htm