Operating an online Ecommerce store is no simple task. Whether you have a few sales a month or hundreds every day, challenges are faced and obstacles need to be overcome.
From creating your first ecommerce marketing/sales strategy or studying the finer points of inventory management, there is a lot to do survive, let alone thrive.
Luckily, the wider eCommerce community is large, and, for the most part, willing to help each other out.
We’ve teamed up with some industry influencers and asked them some simple and not so simple questions.
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What’s the most effective marketing strategy for ecommerce business from the start: paid or organic?
Richard Lazazzera from A Better Lemonade Stand explains.
There are a few really great marketing strategies for new ecommerce businesses that work really well, depending on your budget and experience.
If you have the budget and willing to put in the work, Facebook Ads can be an incredible source of traffic and sales for many entrepreneurs. If the budget doesn’t permit, or endlessly tweaking images and ad copy isn’t your thing, content marketing can give you a huge push if done correctly.
In particular, using a channel like Reddit to share content, stories, experience and answer questions within your niche.
Richard shows the revenue that Reddit can generate for an eCommerce brand in this article.
- Find something on par with your experience and budget.
- Create content and put it in where the best possible eyes will see it.
Next up, we spoke to Luiz of Luizcentenaro.com.
What are some of the most important do’s and don’ts in optimizing a website for sales?
After running thousands of A/B tests on eCommerce sites there is a formula to conversion rate optimization. No matter how high your conversion rate is, every site can be improved to create a better user experience and ultimately increase their conversions, revenue and profits.
It’s important to do user research.
Dig into your demographics and discover who your best customers are and optimize your site for them.
Zack Notes, Senior Product Manager from Uncommon Goods, goes a step further and talks to his customers.
It wasn’t until these in-depth customer surveys that Uncommon Goods discovered most of their customers are buying gifts and not for themselves.
If you don’t have a budget for this you can use tools like Hotjar for free and you’ll have access to heatmaps and website recordings.
Now that you’ve done user research you might be eager to get your A/B test going but don’t neglect statistics.
Don’t stop running a test too soon, don’t assume correlation implies causation. If you are using tools like Optimizely, they have hired Statisticians from Stanford University to work on their Stats Engine.
Before Optimizely marketers, designers, developers, strategists would run A/B tests and call tests winners/losers without reaching a valid sample size. Their tool might tell them a variation is up 30% but the result isn’t statistically significant. With Optimizely Stats Engine we can all do what we love doing, and “peak” at A/B test.
Especially when I run A/B tests on my eCommerce store Hammock Town since the store doesn’t have millions of unique visitors, getting data faster is super important especially for time-sensitive tests such as Black Friday/Cyber Monday.
Now since you have done your user research and you are predetermining your sample size or using a tool like Optimizely’s Stat Engine. You’re ready to test.
Now there are 2 ways to test, you can test exploratory designs based on user research then refine the best designs through iterative testing. Don’t waste time with tests that don’t move the needle and do always have tests ready to go in your testing roadmap/pipeline.
Every day that you aren’t testing you are losing out on a learning opportunity.
Want more tips from Luiz? Here’s a fantastic roundup of Ecommerce tools he’d gladly pay double for.
- Do user research – either by talking to the customer or using tools.
- Pay close attention to your statistics and use a valid sample size.
- Always have a test being planned or being executed.
The personalisation of a buying experience has been a hugely influencing factor in recent times.
We’ve asked Paul Rogers of Vervaunt how personalization affects conversion rates.
I’d say that overall, I don’t think there are many secrets – it’s just about getting the technology right (the platform, operational systems and the underlying infrastructure) and then getting your online store in front of the right people / potential customers.
The eCommerce platform is the obvious one – as in order to achieve growth, you need to be stable, able to scale and continue trading through peaks, create new functionality and retain a highly usable front-end experience.
Efficiency improvements in back-office systems can enable a business to grow as much as a new eCommerce platform or customer acquisition strategy.
On the marketing side I think it’s about building a strong brand and investing on that side of things, which will inherently drive organic growth in other areas too, defining and targeting audiences effectively via paid acquisition channels and then being able to retain customers and promote relevant repeat purchase options based on what you know about your customer base. Other merchants may also rely more on marketplaces, resellers, aggregators etc – which can also be vitally important in generating volume.
I think the only other thing that applies across all industries is the need to understand the customer and what’s happening across the business – in terms of acquiring new customers, on-site behaviour, customer lifetime value/repeat purchase rates etc and the growth numbers themselves.
- Use an eCommerce platform that can expand alongside you and is not restricting you.
- Establish a strong, well-defined brand image and know your target audience.
Going deeper into the ecommerce marketing forest, we find that it’s important to pick and choose your acquisition channels carefully. Some work better than others. But what’s the most important acquisition channel that people should focus their marketing efforts in 2018? We asked Drew Sanocki of Nerd Marketing.
‘Your best source of future customers is your past customers.’
Much lower cost of acquisition and higher lifetime values. Most retailers don’t do enough on the retention side”.
Customer retention really does matter. The likelihood of you selling to a previous customer is almost 70%, whereas your chances of getting a sale out of a fresh face hovers between 5%-20%.
Yotpo discusses some of our favourite retention techniques, including content marketing. Increasing your content marketing means you reach a wider audience, but you also remain in the forefront of the mind of your existing customers.
Drew has some more great insights about branding over on his blog.
- Know the value of recurring customers and why they bought from you the first time.
- Communicate with each one of your customers individually.
- Give your customers an incentive to buy from you again.
KPI’s are a powerful feature most online sellers overlook as their goal is to just sell more. How much more? How much more what? By what date? These are questions that a well measured KPI can solve. But how do you create that KPI? James Gurd, from Digital Juggler, explains.
The most important decision is to agree which is your primary growth KPI – for example, is it the number of acquired customers, or revenue, or margin? You can’t grow successfully without knowing how success is defined and having realistic goals and objectives against which to measure performance. The growth KPI you set depends on the commercial goals of the business – are you a startup looking to build a big audience, or are you looking to monetise an existing audience whilst continuing to increase acquisition numbers?
The next step is to put numbers to the goals and objectives. “We want to increase customer acquisition” is meaningless unless there are targets to chase. “We want to acquire 1,000 new buying customers per month for the next 6 months” sets a tangible target to go after.
Once you have agreed on the target, you now need to build a media model that determines the investment required to achieve these numbers. Start by pulling data from existing analytics tools if you’re already trading – look at KPIs relevant to each channel, for example for paid media you’ll want to look, at a basic level, at ad impressions, click rate, clicks, cost per click, media cost, transactions, conversion rate and average order value.
You now need to factor in feasibility – how realistic is it that you can scale to this volume of new customer acquisition by this channel? There’s no point basing growth projections on channel plans that aren’t achievable. You should avoid a high-risk model whereby you’re entirely dependent upon one channel; if that channel turns out to be poor performing or the volume isn’t there, your growth targets are bust.
You need to find a blended approach so that you use a mix of marketing channels to spread the risk, each with its own cost per acquisition and investment plan. You can then pilot new marketing campaigns, monitor KPI performance and tweak your investment based on results. If one channel is flying and you’ve not exhausted the marketing potential, push more of your budget there.
But be careful – always keep an eye on your primary growth KPI. Don’t get carried away with channel level performance if at an aggregate level it’s taking you away from your growth measure e.g. Paid media might be smashing new customer acquisition out the park, but it’s super low margin and impacts profitability and cash flow.
- Establish what part of your business you want to grow and how to measure that growth.
- Make sure that your goals are measurable and realistic.
- Adjust things accordingly, but don’t lose sight of your overall goal.
Website optimization and email marketing go hand in hand to create one of the most powerful marketing combos around. We spoke to Pamela Hazelton of pamelahazelton.com to establish which auto-triggered emails are the most important.
– Abandoned carts, but only when a significant amount of time has been spent shopping. Some shoppers add items to the cart just to see the ship costs, entering their contact info to reach the all-important ship method selection page. This quick and simple action shouldn’t be confused with the intent to purchase. Try to use rules that also look at time spent finding products and a true start of the checkout process.
– Follow up emails that ask for feedback and customer reviews. Most stores send these too quickly, so they’re often ignored. Follow up emails should be sent at least two weeks after delivery, and should not only invite the customer to share his thoughts but should also provide key information on how to contact the company with any issues. Clear ways to reach out help cut down the number of reviews written in haste.
– Customer account creation and update. These simple emails verify that the action was successful, and also serve as a reminder to revisit the site should the shopper be called away from the site.
– Email newsletter signup. If you’ve been offering an incentive to sign up to your newsletter, this is the email to put it into.
Pamela has even more insights on getting the most from your email marketing.
- Don’t overdo automated emails.
- Send them at times when they can add value to the customers buying experience.
Darren from selfstartr has some advice about growing in scaling – a problem everyone faces multiple times.
My advice is to be ruthless with your advertising. Don’t just settle for quick wins. Be aggressive with advertising that will have a long-term impact. Buy exposure everywhere your customers are: Facebook, Instagram, blogs, forums, websites.
Giveaway products in exchange for mentions and links. I know people will say that’s “Black Hat SEO” – you know – the buying links stuff. But I say that’s good marketing. Follow Or NoFollow if possible customers are there, I’m buying that link!
Darren’s advice is continued in our favourite blog of his, starting an ecommerce business from scratch.
- Be relentless when getting your name out there.
We put the following question to Giles from AquireConvert.
There is no silver bullet to scale an ecommerce business, for different niches it requires different approaches and with different timing. The 3 things I see holding true again and again for long-term sustainable ecommerce business are as follows:
- Customer Understanding
If you don’t understand your customer and their needs and wants you will fail. To understand them you have to talk to them and improve upon the products currently offered in your niche. You do this through customer development interviews.
Once you understand your customer you can accurately research the keywords they use to find information or products to fulfil their needs or desires. Without a strong foundation of ‘free’ traffic every month from Google, it becomes very expensive to acquire customers, killing your margins in the long run. The key to success in SEO is staying very niche and creating and more importantly promoting content for backlinks.
- DPA Ads on Facebook
After you’ve established yourself in your niche in terms of SEO, it’s time to capitalise on the traffic. Most people will leave the site without buying, bring them back and get the conversion with dynamic products ads on Facebook.
- Know what your customer wants.
- Use what you know about them to optimize your SEO plan.
- Leverage your current traffic and start using Facebook Dynamic Product Ads.
What will be the most important trend in e-commerce for 2018?
“I think we will see a significant increase in the number of smaller ecommerce merchants using AI to provide better shopping experiences,” says William Harris of Elumynt.
AI is currently being used in a lot of high-end ecommerce sites. Mostly they are used to customise your browsing and buying experience based on your history. Tailoring suggestions to you mean you are more likely to commit to a purchase.
Amazon is also using AI to dynamically change prices of certain products depending on the online sales of the same product, elsewhere online.
“These tools are getting more affordable which gives access to brands that are smaller to compete with the giants on terms of 1:1 personalized shopping”, explains William.
Other ways that AI is being used to change the ecommerce industry is with imagery. Instead of having to type out what the desired product is, one can simply upload a photo. Visenze is pioneering the ‘visual tech’ AI and Craves are an online retailer using it.
While the technology is still in its infancy, it will soon be affordable for some medium-size ecommerce brands.
Here’s Eluymnt’s article that’ll help you get stuff done: How to work a 100 hour week – and not die.
- While A.I. is still out of reach for most merchants, learn what it can do for you and follow it closely.
Multichannel selling is one facet of online sales that is underused by most small retailers. 64% of buyers are more likely to commit to a purchase if the brand has a presence over multiple channels. Therefore, we asked Mike Ugino from Sellbrite, At what size should a small online retailer start selling in multiple channels?
As soon as you can handle what it requires. If you’re doing 0-10 orders per month currently, you should continue learning your primary channel until you can grow that to 50 orders. Only then does it start to make financial sense to consider expansion.
Adding a 2nd (and 3rd, 4th, etc.) channel means re-thinking your fulfilment process. Ideally, you want to ship all orders from a single interface, since you’re probably a one-person shop and need to be as efficient with your time as possible so you can keep growing the business.
Once you’ve determined how you’ll ship, you’ll need to think about inventory management. Preventing overselling items between your channels is essential, as that can cost you your sales channel selling privileges.
But remember, every new channel is a new business and should be researched and optimized. Go slow, and don’t try to do too much too quickly!
By the way, we love this Sellbrite article about why your ecommerce brand needs to use more video.
- If your monthly sales are reliable and consistent, consider expanding over multiple channels.
- Make sure your fulfilment process and inventory management can handle the extra sales.
- Spend time researching which channel is best suited to your product.
Steve from mywifequitherjob was nice enough to share some insights about a hard lesson he learned.
The biggest mistake in growing my online store was not having systems in place to bring visitors back to my site. The average conversion rate for an ecommerce store is 2% which means that most stores are missing out on 98% of their sales. In addition, customers rarely buy on their first visit and often require 4-8 touch points before they decide to make a purchase.
As a result, you need systems in place to bring the customer back over and over again until they are ready to buy. Today we use email, push notifications, Facebook and Google Retargeting and Facebook Messenger to remind customers to come back. This allows us to maintain mindshare for our brand until customers are ready to pull the trigger.
- Have as many ‘touch points’ as possible with your customer to build trust and familiarity with them.
We hope you’re leaving this blog feeling educated, empowered and excited to go and shake up the way you operate your online store.
Let us know what you thought about our professional’s tips! Any other tips you’d like to add? Let us know in the comments below!