The world of eCommerce has had a game-changing year. No matter what people say about growth before 2020, it was when the COVID-19 pandemic that people truly shifted to a digital-first mindset. In eCommerce, that means all sorts of positive opportunities for growth. It means new customers are seeking digital products and services first. After all, the world outside is still partially shut down.
This represents a tremendous number of opportunities for eCommerce outlets. At Shopanova, we’ve noticed them ourselves. But how can eCommerce succeed in a rapidly changing environment, and what does it look like when you do? Here are our thoughts:
How to Think About Expanding Your eCommerce Business
Here’s a simple question. What do you think it takes to double your business?
When you look at the individual variables involved, it might seem like a lot. You’d need to double new customers coming in. You’d need to double your average order values. You’d need to double how often those customers bought from you.
But if you actually ran the numbers, you’d be surprised. For example, if you increased your number of customers, your average order price, and your customer purchase frequency by just 25% each, your revenues wouldn’t go up just 25%. They would double.
This means that you should seek out any opportunity you can to optimize one of the following:
- Average order value (AOV). Think about implementing new strategies to increase the average size of each order. If you don’t already have cross-selling and up-selling integrated into your cart, there are plenty of applications for platforms like Shopify that already do this. You might also consider adding volume discounts to encourage customers to order more. Upsells and cross-sells are also two important tools here. Nowadays, you’ll see a lot of apparel brands run offers like, “Spend $100 and get a free mask.” A mask is a fairly cheap way to encourage customers who may be spending $70-$80 to add one more product to their shopping cart before they check out.
- Build the lifetime value (LTV) of each customer. This is where email marketing can come in handy. What if you were to send your top customers exclusive offers? A limited first-run on a product gives them exclusive “first dibs” that makes them feel like an insider. Before you create a new offering, don’t forget to market to your existing customer base. If you deliver on quality customer service, you’ll build LTF and long-term loyalty from these customers.
- Consider adding subscriptions. If you want to increase the lifetime value of each customer, you might consider creating a subscription for your product if it doesn’t already exist. What do you have to offer that you can have people sign up for quarterly, rather than yearly? Can you create discounts and “upsells” based around these subscriptions? If so, you’ll likely increase the average order value as well as the frequency with which customers purchase from you.
Practical Tactics to Succeed in eCommerce
Now that we’ve tackled what it means to grow an eCommerce business in the new year, let’s focus on some practical ways to make it happen.
Create a clear vision of where you want to go.
It sounds obvious, but you’d be surprised at how few businesses sit down and clarify their vision for the future. This is the guide you should create to help inform other decisions. For example, if you do want to double your revenue, then you know what you have to do to optimize your average order values. Clarifying your goals helps you create smaller, more digestible goals that give you a practical guide for the future.
Build a healthy business structure from day one.
As you add customers, you’re also going to have to scale your business. It’s tempting for many eCommerce outlets to think “well, we can handle that when we have more customers.” But the truth is, you can’t scale a bad business. You can only scale a scalable business, which means focusing on the right tactics from day one. Build a healthy business structure! Ask yourself if your employees genuinely like working for you. Ask yourself if your employee onboarding process is simple enough to add more employees when you have to.
Learn to delegate.
If you’re doing things right, it means that your eCommerce shop is starting to grow. Unfortunately, there are only so many hours in the working day. At some point, a successful company has to learn how to delegate tasks to other people—especially those who are more qualified to optimize those tasks.
It might sound difficult at first, but delegating can be a fast way to ensure that your company is capable of sustaining growth. Growth, after all, isn’t only about driving revenue up. It’s about making sure that the revenue stays there. And you can only do that if you eventually hand over some of the reins to people who know how to keep revenue moving.
Make the New Year Work for Your eCommerce Business
2021 represents a completely new opportunity in eCommerce. People more than ever trust the Internet when it’s time to make a purchase. The only question is, are you going to have your company positioned to take advantage of new, enthusiastic customers?