An E-Commerce Readiness evaluation is a systematic environment analysis based on selected aspects of successful E-Commerce distribution. The E-Commerce Readiness score calculated from this environmental analysis provides an instant overview of the degree of maturity of a company’s sales-related online activities in comparison to their competition and taking into account their target group. As can be seen in Figure 1, the following five areas of analysis are used to determine the overall score.
Figure 1: Areas of analysis included in the E-Commerce Readiness Score
- 1) Online brand visibility: Comparison with competitors in regard to various metrics of online brand presence and online visibility, such as Sistrix, Alexa Page Rank, Google search volume, number of backlinks, etc.
- 2) Online marketplace distribution maturity: Investigation of the extent to which the online marketplace channel (e.g. Amazon or eBay) has already been tapped by the company and its competitors.
- 3) Third Party eRetailer distribution maturity: Investigation into the extent to which the Third Party eRetailer channel (i.e. online pure player, online retailer) has already been tapped by the company and its competitors.
- 4) Direct Sales & Affiliates distribution maturity: Investigation into the extent to which the Direct Sales & Affiliates channel (i.e. a company-specific eShop and referrals to online distribution partners) has already been tapped by the company and its competitors.
- 5) Customer affinity for online channels: Analysis of the extent to which the company’s target group has sufficient affinity for online channels and the extent to which there is online demand.
The first four areas of analysis are always carried out in comparison with the competition. Since, by definition, the fifth analysis area is the same for all competitors in a certain industry – since they are all pursuing the same target group – it is placed in comparison with other industries. All five areas are scored between 1 (worst value) and 10 (best value). Once all areas have been rated according to this scale, an overall E-Commerce Readiness score is calculated.
From this overall E-Commerce Readiness Score and the scores from the individual area, the first points of action for successful E-Commerce distribution can be derived. These should then be prioritised as part of an E-Commerce distribution strategy and translated into concrete measures.
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Markus Fost, MBA, is an expert in e-commerce, online business models and digital transformation, with broad experience in the fields of strategy, organisation, corporate finance and operational restructuring.Learn more