Starting and operating an ecommerce business can be a little daunting. What will you sell? How will you sell it? How will you market? Which tax laws apply? It is so daunting that it may help some would-be entrepreneurs to think about ecommerce like a game of football.
Many sports or activities could, no doubt, make a good analogy for running an ecommerce business. But in the United States, football has been the single most popular professional sport for 30 consecutive years, according to a January 2014 Harris Poll. Some 35 percent of the adults say it’s their favorite. That sort of familiarity and popularity makes football a good tool for comparing something familiar (the sport of football) with something less familiar: how to successfully start and run an online business.
Here are six ways ecommerce is like American football.
1. You’ll Need a Game Plan
Hall of Fame football coach Paul Brown is credited with many of the innovations that make the modern game so popular in the United States, including the development of game planning.
In its infancy, football was played without a real plan. The quarterback, ball in hand, would scramble around hoping for his opposing team to make a mistake. When they did, he’d do his best to capitalize on it. A particularly savvy quarterback might take something he’d learned on one play and apply it on the next.
But Brown planned every aspect of the game. His teams came up with plays developed not just to reactively respond to weaknesses in the other team, but also to proactively take an advantage. Brown was one of the first coaches to use film to scout opposing teams and analyze plays.
In the book, Browns Scrapbook: A Fond Look Back at Five Decades of Football, author Chuck Heaton quotes a 1986 magazine article, “Paul Brown didn’t invent the game of football. He was just the first to take it seriously.”
Ecommerce should also be taken seriously. Start with a traditional business plan that includes specific business goals, an explanation of why those goals are reasonable in the context of the market, and a description of the steps required to achieve those stated goals.
An entrepreneur that takes the time to seriously and thoughtfully create a business plan is going to be much closer to success than someone running around, business in hand, looking for an opportunity.
2. Every Player Has a Special Job
A football team can generally be divided into three groups: the offense, the defense, and special teams. Within these groups there are many position players, including the quarterback, running back, wide receiver, tight end, tackle, guard, and center — and that is just the offense.
Similarly, there are many roles to be played within an ecommerce operation. There will need to be a person in charge of setting goals for the business. Someone will need to devise marketing plans to help achieve those goals. Someone will need to order products and monitor margins. There will need to be a logistics person responsible for optimizing in-bound shipping from suppliers. Someone will need to take care of order fulfillment. And there will need to be a customer service representative. And the business will need an accountant to help keep track of it all.
In the beginning, a sole proprietor might have to do all of these things. But these are distinct jobs that should be specialized as the business grows. In fact, even from the beginning, it can be a good idea to outsource some of these tasks.
For example, hire an accountant, consider using a fulfillment service, start with an easy-to-maintain website.
3: The Game Is Made Up of Many Plays
Team Rankings, a sports statistics site, tracks how many plays each National Football League team runs in a given game. With this data, the service ranks teams based on their average number of plays per game.
At the time of writing, the Indianapolis Colts were leading the league in this category, averaging about 74.4 plays per game. Given that the regular season includes 16 games, the Colts are likely to run 1,190 plays before the playoffs.
Very rarely will a single one of these plays win a game or make for a winning season. Rather most of the time, individual plays contribute to the overall trend, which in turn tends a team toward success or, perhaps, failure.
Success in ecommerce is also about many incremental interactions or plays. It is unlikely that one particular sale, one particular blog post, and one particular management decision will make or break the business.
Rather each customer experience, each marketing tactic, and each business decision collectively builds the company.
Thinking about a business as a series of plays may help entrepreneurs in two ways. First, each individual play needs to be thought out and executed as well as possible. Second, when one play fails, remember that it was just one play in a long game.
4. It Is a Long Season
If you think the game is long, consider the entire season.
Just as a football game is made up of many plays. The football season is made up of many games.
This season, as an example, the first preseason game took place on Thursday, September 4, 2014. The Seattle Seahawks beat the Green Bay Packers 36-to-16. The 49th Super Bowl, at the end of the season, will be played on February 1, 2015 at the University of Phoenix Stadium in Glendale, Arizona.
That is a span of 150 days from the first preseason game to the NFL championship game. Along the way, every team will suffer defeat and enjoy victory. And ultimately, each team’s aim is to last the entire season and appear in that final game.
Ecommerce is also a long-term endeavor. In a very pragmatic sense, businesses and business owners must do what is necessary to survive. But very often, the best way to survive is to choose to look at a business in the long term. It is better to postpone a sale or profit, if that sale or profit would make the business weaker or in some way devalue its unique selling proposition.
As an example, a seller of luxury products that regularly offered deep discounts and coupons, would soon be a discount seller. Similarly, a discount seller that boosted prices to earn a bit of extra margin, would no longer be a discount seller.
Make business decisions that will put the business in that championship game.
5. Ultimately, It’s All About the Fans
In 2013, the NFL and its 32 teams earned almost $10 billion. What’s more, the league has stated that it expects to reach more than $25 billion in annual revenue by 2027. The minimum wage for players in the league is $375,000 a year. So what is the source of all of this wealth and money? The fans.
As mentioned above, football is the most popular professional sport in the United States. Monday Night Football, one of the league’s most important television events, is the single most popular show in the country, and it offers advertisers one of the best demographics. DirecTV, a satellite television provider, recently agreed to pay $1 billion per year for NFL game rights because of how popular those games are with DirecTV customers.
For ecommerce the lesson is that it is more important to make fans than it is to make individual sales. A loyal customer, who returns three or more times, will likely spend five times as much as a new customer on each order, and will also be worth much more than a new customer over time. Also, loyal customers are less expensive to market to.
6. It’s Alright to Have Fun
Finally, football is fun to play and watch. So too should an ecommerce business be something you enjoy.