Blog on business, strategy and digital transformation

Online business for those who do not know how to do online business

There is no denying – online business has become a very important area of every single business.

The business situation related to the currently prevailing coronavirus pandemic made many companies realize that the future should be taken into account much earlier than they previously thought. We are talking about the future in the form of the need to diversify its activities and focus on the increased development of both areas: online and offline.

Unfortunately, today’s market situation shows this clearly. The losses resulting from the closure of offline activities could to some extent be made up for, if only in time these companies became more interested in entering online business. And who knows if it would be possible to make up for these losses with interest.

Is there a problem? Let’s build some online business

A friend recently told me about the situation he is dealing with in the company he works for. The company has both online and offline activities.

Except that it works almost exclusively offline. The company makes profits from there and invests in there. Even though they say every now and then that the future is online – seems, they don’t care at all. They invest primarily in offline activities, and they cut costs in online, hoping it to work out somehow.

How short-sighted it is – I don’t need to say. But to the point.

The company employs many salespeople focused on selling offline services. Now, however, with the advent of the coronavirus and related restrictions, this part of the business has collapsed. Heavily. Some sellers, however, showed some cleverness and said: if offline does not work today, we will sell online. So they went to their clients and told them: you should sell online, you should have some online business!

Is it going to work? Absolutely not. Why? Because these poor customers don’t even know what that means.

Online business is not an offline business

Business off the Internet is completely different from the business on the Internet. It’s hard to compare a shoe store in some mall in Berlin, Germany to a shoe store on the Internet. What connects them? Assortment. And absolutely nothing else.

To switch from an offline business to an online business, it is not enough to sign a contract with a hosting company. It is not enough to buy a domain. It is not enough to put an online store on this hosting, which everyone will be able to view after entering the website address in the browser. No, it is a different creation that has its own rules and requires a separate approach, and often also – developing a separate business strategy.

If I were to switch my traditional offline company to online business or I would like to make it an efficient offline & online hybrid, I would start from scratch:

Talking to someone who knows how to build an online business

It cannot be overestimated. I know that it may seem that no one knows more about my business than I do. Well, yes, but … online business is not the same business. However, we are talking here about building a second business of equal standing, next to the one we already run.

And let it not be one of those big international consulting corporations. In this exercise, it’s not about someone big and famous getting a stamp under the recommendation report. This is an actual project that we are going to implement. It is worth making an appointment for a coffee with a few people, trusted and experienced in the subject of online business and ask for advice. Ask them: who it is worth the meeting, which company is worth to work with. It will not necessarily be an obvious answer. The non-obvious ones may ultimately turn out to be much more interesting.

Change manager for a transformation project

I am not a fan of appointing a project manager as a person responsible for changes at the level of the entire organization, for transformation projects. First of all, because such projects require something more from this manager than the usual projects do.

Transformational projects are projects that require a galaxy of various types of skills, both soft and hard. In projects of this type, the manager has to convince doubters about the rightness of the change, he has to make them believe in the sense of this change and its profitability. With these types of projects, a lot of work has to be done before the actual start of the project, during its duration, and after its completion. It is necessary not only to implement the change / project, but also after its implementation, lead to the consolidation of this change in the entire organization, and often also further changes or optimizations that could not be foreseen at the earlier stages should be introduced.

What’s more, in the case of such a large transformational change in the organization, you should show everyone around, and above all – to every single employee, that we approach the change seriously and permanently. And this can only be done by introducing the person responsible for the new area into the management structure of the entire company.

How to name an organization that has only people who care about the offline part of the business in the management structure? Offline business. What should be the name of an organization that has only people interested in the online part on the board? Online business. How to name a business that is called a hybrid because it has the competence to be such, but only people interested in the offline area are on the board? An offline business that pretends to be interested in being a hybrid.

Organization transformation plan and educational path

Every good change manager should create a plan for the entire transformation. And follow it. It seems quite obvious.
However, what is a little less obvious, and no less important, is the development of the entire educational path for the employees of the organization, and often for its clients. But more on that below.

Implementation of a transformation plan towards online business; from top to bottom

The first thing that shows that an organization wants to change is introducing changes at the management board level of that organization. This was already mentioned above.

However, what is no less important is to share this vision with the next levels in the company. From top to bottom. From the management board to regular employees. The term online business should enter the blood of every single employee at different levels of the organization.

And again – we start with the board. Because one person on the board interested in building an online business is definitely not enough. This vision must be passed on to subsequent board members – people responsible for the: product area, marketing, sales, finance, M&A, operations, HR, etc. Why? About this at the end of the article.

Once the management is infected with the vision, we go down a level. To the next levels, to deputies, directors of directors, directors of divisions, programs, departments, team leaders and, over time, for every single employee who works for the success of our organization.

B2B, B2C, online business, hybrid business

Once these basics are in place, we come to the specifics. And although the details are obviously dependent on many factors, industries, specific cases and should always be considered case by case, there are some more general details that are worth quoting here.

Because depending on whether the business is a B2C or B2B business, and whether I intend to switch my current offline business to an online business, or whether I intend to build a hybrid business, the next steps may slightly differ from each other.

If I would have a B2C business

Depending on what my goal was, I would use one of the strategies below.

Transforming offline business into online business

I would dismiss all salespeople and hire marketers in their place or hire an external marketing agency and spend the money saved on the advertising budget (online, of course).

Hybrid business instead of offline business

The situation is a bit more complicated, because you should keep the sellers operating in the offline business (in the worst case – look for some savings in this area), and at the same time you should hire at least one person responsible for the online area; hire as it should be a person on site who infects other people in the organization with his work. One person, because one person directly responsible for this area is needed, and at the beginning one person should be enough, because the rest of the work can be transferred to an external specialist agency.

If I would have a B2B business

Again, depending on the specific goal, two different approaches would be possible to implement here.

Transforming offline business into online business

Resellers are needed both in the purely offline business and in the online business. Hence, the options are two:

In both cases, offline marketing must shift to being online or should be replaced by people specializing in online business-oriented marketing.

A transformation towards a hybrid business

Personally, I think this is the most difficult of all four models listed here. It requires transformational changes both in sales and marketing.

Marketing is even safer and simpler, because we only change the form of promotion, medium, way of reaching, indicators. This can be done, for example, in the case of a hybrid business for B2C business.

However, selling is more difficult. On the one hand, it requires traders responsible for offline sales, and on the other hand, traders responsible for online sales. On the third and fourth side, it requires teaching the offline trader to sell online and vice versa.

What does an offline merchant need to learn to act as an online business merchant? Again, go ahead. I will have to write about what an online trader has to learn in order to sell offline.

In this model, however, there is another very interesting issue that cannot be omitted at this point. For an offline merchant to successfully sell online, his client must also be properly educated. I assume here that this client has also been only offline so far, and suddenly wants to enter the Internet.

And this is perhaps the most important in all of this. The success of the entire transformation and the entire model depends on it. Because here it is not only necessary to persuade the client to sign the contract. He should also be taught to do online business.

Do changes have to be permanent? On the board, for instance?

Finally, an extremely important matter. A matter that cannot be forgotten not even for a moment. Remember when somewhere, a few hundred words ago, I mentioned that you should hire or appoint a change manager who enters the board to show how important this transformation is for the entire organization?

So let’s go back to the definition of change manager. Change manager is the person responsible for the change. He is the person managing the change, planning it, he is the person directly responsible for making the change happen and for it to be permanent among all employees of the organization.

And when it does? Then the change manager responsible for this transformation is no longer needed. If he did his job properly, he infected the management board with his vision so that no member of the management board responsible for area X would think about this area without including online in it.

So is such a change, in the form of a board member responsible for the transformation towards a hybrid business, a permanent change? Should such a person be in this organization for longer?

Not necessarily. It may or may not. When the change in the organization takes place, its role may very well end there.

Do you need more information? I think that you will also be interested in remote work and doing business remotely. After all, building an online business, remote work and transforming an offline business to the internet has a lot in common.



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