Don’t Be Fooled – Ecommerce Is Harder Than It Looks

Most companies who approach us for marketing for their ecommerce websites expect that they’ll set up their ecommerce site, allocate a small marketing budget, and sit back and watch the cash start rolling in.

Our response to this sort of expectation is always the same: A warning that it is not going to be that easy. In our (extensive) experience, very few online shops actually make money, and most of the ones that do are supported by an offline store as well. This is not to say that you can’t make money online, but the expectation needs to be tempered with the understanding that this needs to be a long term commitment.

If you are serious about selling your product or services online, then there are a lot of things that you need to take into consideration.

Think Like A Shopper

How many times have you looked in the window of a retail store, or walked in and and walked out without purchasing anything? Probably hundreds of times. Well, the same applies to an online shopper.

In fact, if anything, the likelihood of buying something online is even lower, as there are thousands of other shops waiting to sell you the same or similar products just a mouse-click away. In a bricks and mortar retail environment, it’s not quite as easy to find an alternative right then and there, and the caution that many potential users feel about buying online, with the potential for fraud etc. won’t be present either.

Online, visitors to your site might just be browsing what’s available with no intention to buy, or they might be interested in buying, but are just using your site to research a product or to compare prices. The fact is that most of the visitors to your online store won’t buy anything. If your site manages to convert 1% of visitors into actual sales, then the truth is that your online store is doing very well indeed. (This also has an impact on your marketing budget of course, but we’ll get to that a bit later.)

See How It Works

If you own, or are planning to build, an online store, then it’s critical that you begin by actually going and buying some things online yourself. Think about all the little things that annoyed you during the process, and what prompted your decision to buy from one online store rather than another.

It’s not important for you to understand how the store is built. Afterall, you’re not a contractor or a shopfitter. But it is critical to experience and understand how people shop online, if you’re planning on running an online store.

When we shop online, we’re fickle. We’re easily led astray from the task at hand, from our objectives and our intentions. To successfully sell online, you need to be an online shopper yourself, and use the experience to help build your shop.

Buy A Product From Your Own Store

Over the years, we’ve assessed hundreds of online stores, and we’re constantly amazed by how little thought appears to go into building the majority of them. There are a lot of reasons for this, but we won’t go into them here. Suffice it to say that a successful online store needs a well thought out process and user experience if it hopes to do well.

To really understand how your own process works, arrive at your own site as though you were a customer.

Is there enough information on the product, and is the information easily available? Does the site answer your questions about the product, the delivery options, and the terms of the sale?

Would you buy this product from yourself? Do a few searches on Google looking for the same or similar products on other sites, and evaluate their process. Would you rather buy the product from them? Do a price comparison between your site and others. Compare delivery costs and options. Are you offering the best deal?

Now add the product into your own basket. Are you able to navigate easily to the relevant page or do you have to search for it? Use your credit card and get the product delivered. Experience what your client experiences. Not only will this put you in your client’s shoes, but it will also help you see how well your couriers or other outsourced service providers work for you.

Don’t Be Too Invested

If you were personally involved in the building of the site, and feel that you are too close to it to have a truly objective view, then ask a friend or colleague to go through the process for you, until you feel ready to buy a product yourself.

Liaise During The Delivery Process

The two key reasons for buying something online are convenience, and price. Remember that the way to succeed in this is not to focus on what suits you, but rather to pay attention to what suits the customer.

If someone buys a product that needs to be delivered, then liaise with them during the entire process keep them up to date on the progress, and deliver as quickly as possible. If for some reason you can’t make the promised date, then let them know immediately. If you can, then let them know everything is on track. If you want people to keep coming back, then you have to do what you say you are going to do, when you say you are going to do it.

Go The Extra Mile

As we’ll cover briefly a bit further on, in most cases the first sale to any given customer via an online store will not cover the cost of acquiring a new customer.

That means that it’s essential to do whatever it takes to ensure the best possible customer experience, so that people who do buy will buy from you again, and even refer their friends.

People buy from businesses they trust and that means that it’s important to be transparent. As discussed previously, keep in constant communication with your clients. If there is a problem, let them know you are on top of it, if things are going well, let them know that too.

If you can do something different, then do it, whether it’s free wrapping paper for gifts, a handwritten card, some mention of the last order, or a coupon for a future purchase.

The key is to think out of the box. Remember, you’re just one of a thousand sites that a customer can use without ever leaving their chair. Do whatever it takes to keep the customer happy, and coming back for more.

Keep Them As A Customer For Life

What are you doing with your customer information? What strategy have you got in place in order to sell them additional products? How do you educate your customers? What are you going to do with the visitors to your website that don’t buy? How do you get customers to refer? These are some of the many questions you should be thinking about with your online store.

Keeping in contact with your customers is key to the success of your online store. It costs money to get a new customer, so keeping existing customers is crucial. That means that you have to make sure you have a retention strategy in place to keep re-engaging the customers you already have.

If a customer has bought once from you and had a great experience, there’s a chance that they will buy from you again. But they have to remember you. And they have to know that you have (or might have) the product that they’ll be looking for in 4 months time. This is where your retention strategy is critical.

The Cost Of A Sale

Comparative shopping is both a blessing and a curse of online shopping. It’s a blessing for the customer, because it’s so easy to compare prices. But it’s a curse for the site owner, because in this price conscious day and age, it’s all too easy to lose a potential customer from your site when they find the same product cheaper somewhere else.

That means that it’s important to ensure that you have competitive pricing on your site. If potential customers consider your offering to be expensive, they’ll be quick to try and find a better price elsewhere.

In general, we’d assume that your gross profit is between 10-35%. What makes this important is that in many cases, the cost of your marketing may be more than your gross profit.

So, if for example you make use of Google Search Advertising, which is one of the least expensive ways of driving new visitors to your website, and only 1% of new visitors to your site buy something, you will probably be losing on your first sale on most single items, as your marketing cost will be cancelling out your profit and more.

If people buy multiple products of course, which may be less likely online, then your chance of profitability increases.

These factors all go toward showing why there is far more to successful ecommerce than simply setting up an online shop. To make it work, you need to make sure you understand and embrace the right strategy.

The right product, at the right price, from a store that is easy to use, supplies the right information, and goes the extra mile to make sure that the customer is happy is a strategy that will go a long way toward increasing your chances of running a successful online store.

Track It All

One of the great benefits of ecommerce and the digital retail environment is that so much information is available to help you determine what’s working, and what’s not.

Google Analytics is a free service available through Google that allows you to track which types of online advertising generated the most sales.

It can help you understand how people are behaving on your site, and even identify if there are problems with it.

Tracking your data, and acting on it, is crucial to making your online strategies work. But there’s so much to say about effective tracking that that’s going to be the topic of a different article.