eCommerce used to be considered the great equalizer, it was a strategy that could be used by small businesses to beat the vast resources of large businesses. Then Amazon arrived followed by thousands of other businesses. Competition returned. eCommerce is still a powerful sales channel for businesses, but they need to employ better eCommerce strategy to compete. This article outlines 7 eCommerce strategies that any business can use to capture more sales.
Imagine standing under the burning light on a stage in front of millions of people and being asked… “please spell the word…pneumonoultramicroscopicsilicovolcanoconiosis.” The sweat beads up on your forehead as you try to desperately think what this word even means much less how to spell it! This is how it feels when the average businessperson is asked to define their target market! I know; I have been there; not in the spelling bee, in trying to define my target market. Incidentally, in case you were wondering this is a real word. According to Wikipedia, it is the longest word in a major dictionary. Not taking this simple step of defining a target market is a surefire way to ensure your eCommerce site is a dismal failure.
Businesses hate to define a target market! They moan, “But e-v-e-r-y-o-n-e can use our product.” This may be true but trying to communicate with everyone is both expensive and extremely time-consuming. Hence, most marketers tell you to define a target market and find your niche.
A place in which this logic seems to be woefully lacking is the Internet with eCommerce sites. Far too many people have been sold the bill of goods because it is cheap and easy to do that setting up an Internet business is the next “get rich quick” opportunity; they are told it is easy and fast profits will follow. These misinformed people go out and set up eCommerce sites selling t-shirt, books, music, bumper stickers, electronics, and other items to make a buck…and they fail!
The bottom line is there are simply too many of these vanilla eCommerce sites out. They are extremely easy to find and search, especially with services like Google Shopping, which will literally search out the lowest price of anything your heart desires. Because there are so many of these sites out there the chance that someone will find your site are slim.
If your site is also a vanilla site, the chances you will land a sale are also slim; unless you have the absolute lowest price. Simply competing on price is the last refuge of a desperate and uncreative marketer! Combine these cold hard facts with the fact that your competition is one click away and you have a recipe for a mediocre eCommerce site at best.
What is the budding Internet entrepreneur to do? Here are a few guidelines to get you going in the right direction.
7 Competition Proof eCommerce Strategies
Tightly Focused Niche Market
The first step you will need to do is create a buyer persona. If you are selling T-Shirts create ones that target people with specific interests. For example, if you create shirts with political phrases on them, they should be targeted to either Democrats or Republicans, or one of the other flavors out there such as Libertarians, Green Party, etc. If you sell books, what is your subject area? Non-fiction or fiction? If non-fiction is it business, art, architecture, etc? If it is business, is it management, marketing, sales, etc. Whatever you are selling you must appeal to a very tight select group and offer a depth of products that would appeal to them.
Don’t overlook this key idea. There are riches in niches. Selling products that are difficult to find (even in an era of Amazon) or specialized to a specific interest. For example, I once came across a site that only sold vanilla beans to make your own vanilla. It had different type beans from all over the world and detailed profiles on each bean, types of flavors, uses, etc. It also had several articles on how to use their products. I think you will have to agree an eCommerce site based solely around selling vanilla beans is a focused niche!
I also came across a site that only sold swords. The swords were from all different time frames and styles all over the world. Many were from medieval Europe and several were from Asia. Not only was every sword carefully detailed how it was made, history, where it was from, etc. but the owner of the site even did videos on each type of sword doing various “cut tests” where he would chop through a variety of materials showing the strength and durability of the blades while illustrating their cutting prowess. I am not sure what the market size is for swords, but I am pretty sure whatever it is this site had captured most of that niche.
The bottom line is that the more specialized you can make your niche market the better your eCommerce strategy will be. You wan to select a niche that is large enough to be profitable, but specialized enough that you can compete better than anyone else in.
Wide Breadth and Depth of Product
Once you know your exact niche then you need to find ways to carry the most products (preferably unique) for that niche possible. If it is books on sales than you need to aggregate the largest number of sales books possible. If it is T-Shirts, then offer a variety of styles with prints and phrases that others don’t have. In today’s market, this is very difficult to do, especially on the Internet, but it is worth it if you can get it right. Admittedly in a world with Amazon selling ANY item that can be purchased somewhere else will be tough to compete on because Amazon will be the first stop of so many people. It is better to have a unique product that is not available anywhere else to truly compete well.
Going back to my vanilla bean or sword example above; both sites had a wide breadth of products and information about those products within that narrow niche. That allowed people that were interested in that specific product to shop for all the alternative styles/types of products and get detailed information about each one. We refer to this as content marketing. To compete in a world that has Amazon in it will require great content that only you can provide. Part of your eCommerce strategy will be based on creating this fantastic content.
Helpful Organization of Products
Once you are successful in creating a tight niche and creating the broadest and deepest offering of products for that niche you should create a very intuitive organization for that site. For example, if you offer books on sales why not organize them by schools of thought on sales or B2B sales vs. B2C sales. You could even rank them by books on prospecting vs. books on actual sales.
If you are an expert on your products you can come up with innovative ways to group and categorize them that add a lot of value to your customer experience. You can create an organization that isn’t necessarily easy to do for companies like Amazon. Amazon does a good job organizing material by author and subject matter, but not by particular schools of thought on something or other ways to organize the material in ways that make it easy for people to shop and find books they were not aware of in that space.
Offer Additional Value
In the catalog world, there are catalogs that are called “Magalogs” which is a combination between a catalog and a magazine. It has both products and information (articles) in it. Do the same with your web site. Can you build information around your product offering by having current news about your products or market? Create articles and other pieces of useful information, not simply a listing of products. For example, if you are selling books on sales you would have articles either yours or others (with permission to use) that have been written on sales posted for people to read.
You might offer a blog on the subject or forums for people to discuss the subject of your products not necessarily the product itself. If you sell T-shirts on politics then your content and forums would be discussing those political ideas that are represented on your shirts, not the shirts themselves. You must be an expert on not only your product, but also the interests, information, and market that surrounds your product; information that makes your product exist in the first place. One medium for great content is video. Many eCommerce businesses make video a key component in their eCommerce strategy.
Track Purchase Patterns
Once you start making sales be sure to do a good job tracking what customers are buying. Offer more of that same type of stuff. In addition, by keeping this type of information you can offer customers similar products as they become available. Tracking is a key strategy in being able to boost order size and frequency over time.
This can be extremely complex and require large databases of information like Amazon, but it can also be done much more simply by creating a simple 8-10 category segmentation and putting people in one or more of those categories and tracking their purchases. This will offer the ability to improve your targeting for future promotions of products. It won’t be quite as powerful as Amazon’s system, but it also won’t be as expensive either. Simple systems can have big effects on repeat business.
Build a Loyalty Program
Any marketer or salesperson worth their salt will tell you it is much easier to sell to an existing or past customer than it is to find and sell to a new one. Using that logic, you can create reward programs, specialized promotional offers, contests, and many other creative ideas to bring customers that have already bought from you back to your site to buy again.
I have purchased from several eCommerce sites where once my purchase was fulfilled, I never heard from them again. After a couple of months, I can’t even remember where I bought it. A well built and consistent loyalty program will solve this problem. Part of your eCommerce strategy should be devoted to figuring out ways to get customers to return over and over and hopefully buy more each time.
Create an Affiliate Program on Steroids
Most affiliate programs are totally lackluster at best. An affiliate simply signs up and gets a few introductory emails and a link they post on their site with a logo. They are pretty much left on their own to try and make money with this affiliate program. Be different. Create a program where you create sales ideas, specialized content, marketing campaigns designed for your affiliates to use with their audience. Communicate with your affiliates regularly with a specialized eNewsletter directed to just them. Give them ideas on how to use your program to promote you and hence make more money for themselves.
A responsive opt-in list of customers and potential customers can be one of the most valuable assets a business can have. A key to any eCommerce strategy should be having a large email list. Building a list will take time and resources, but it is worth it. I recommend developing a lead magnet to start gathering names for your list. Once you start building your list be careful how you use it. Don’t SPAM them every week with emails asking them to buy, if you do they will quickly unsubscribe. Instead, offer them useful information, articles, links to videos, and resources. If you do this you can also advertise, but don’t go over board.
eCommerce Strategy is about Basic Business Concepts
Consider this, when someone buys a McDonald’s franchise, they are given a complete system for doing business. McDonald’s corporate office creates marketing campaigns, training systems, products, and other things designed to do one thing…make their franchisee’s as much money as possible. If the franchisee makes money so does McDonald’s corporate. Help your affiliates help themselves and, in the process, help you.
Despite all the claims to the contrary starting a business on the Internet is like starting a business anywhere else. It takes dedication, creativity, sweat, blood, and some tears. Creating an eCommerce site can be a very exciting and lucrative business, but if you make the mistake that all you have to do is throw up a mediocre web site with some products that everybody carries and wait for the cash to roll in you will be waiting a while. Like digging a goldmine, if you never pick up a shovel and start moving dirt and continually looking for the gold you will never get rich.
Look for ways to build unique experiences for your customers. Use creativity to build ideas and promotions others don’t use. Constantly innovate to stay ahead of your competition. Think of ways to utilize, combine, and build on these steps in your own eCommerce site and you will realize more sales and more profits. It is a lot of work to implement these things, but the work and creativity you put into your business and your site will put you leaps and bounds ahead of your competition.
If you want your business to expand your market by using eCommerce or you want to start an eCommerce business you should understand the basics of an eCommerce site and work with an eCommerce consultant that understands the ins and outs of eCommerce strategy including how to build the site and more importantly give you the strategy to run the business successfully. Setting up an eCommerce site is easy running it is a different story altogether.