In the era of omnichannel marketing strategies, big data, and sprawling international supply chains, building a successful ecommerce business from the ground up can seem overwhelmingly complex. But when you cut through all the noise there are three essential building blocks that can help nearly any online brand set their business up for success.
And those building blocks all center around the ability to measure the efficacy of investments in your brand, according to Dan Jeong, who heads up tech business development for Buy with Prime and has more than a decade of experience helping ecommerce businesses grow.
“When I talk to small business owners, there’s one thing I always lead with — if you can’t measure it, you can’t improve it,” Dan noted.
Measurement, customer experience, and product quality are the building blocks upon which many profitable online businesses rest.
#1 How to get your measurement right
At nearly every stage in the process of running a business, establishing data-driven benchmarks can be crucial for success. Data relating to orders, inventory stock, and website visitors change as you grow, and benchmarks can help you stay up with ever-changing shopper behaviors. But for most small and mid-sized businesses who might not have a dedicated e-commerce manager on staff, getting a firm handle on key data points can help pave the most direct path to growth.
“When you spin up your business, the number one thing to do is get really sharp on what your measuring,” Dan says. “You want to be super dialed into the profitability of each of the items you’re selling, looking at your website analytics and the monthly traffic that you’re getting to your site, and monitoring your bounce rate.”
By keeping close track of your cost of goods and profitability, you’ll know exactly how much margin you have to make strategic bets on potential growth drivers, including investments in search ads and marketing to attract shoppers to your site. Once you have a baseline for the monthly pool of potential customers landing on your site and the volume of sales that traffic generates, you can hone in on one of the most important measurements of all: your conversion rate.
Like ancient Rome, all roads to growth flow through your conversion rate. You might find your conversion rate falls in the range of 2-4%, but the details behind those numbers can vary greatly. With your core measurements and benchmarks in place, you have better visibility of what and how to drive more revenue—in the form of conversions.
#2 How to get your site right
As Dan notes, many small business owners get frustrated when they don’t see the returns they expect on an ad spend. “It all goes back to the customer. You’re spending all this money on ads, you’re getting your impressions out there, and you’re having a certain number of people click those ads. But when that customer lands on your website, what are they doing? Look at your conversion rate. If it’s low, there’s probably an issue with the customer experience (CX) flow on your site.”
A good way to think about CX is putting yourself in your shoppers’ shoes. “A lot of the websites I look at have a terrible customer experience,” Dan says. “If you were a customer going to your website, what would you want to see? What product category are you in? What makes your brand unique? What makes me want to choose your brand? If you can’t tell your brand story effectively and land that message through your site (and consistently across channels), then no matter how many advertising dollars you spend, you’re never going to be able to convert customers at a scale to grow your business.”
Beyond clearly defining your brand, it’s important to adopt a strategic view on improving your customer experience. The simplest way to start is with plug-and-play ecommerce providers like Shopify and BigCommerce, which have plenty of useful tools and solutions for selling online.
Down to every last detail, there’s always something you can do to boost your CX—and ultimately your conversion rate—from tweaking layouts and copy to swapping in better product images, or even changing button colors and placement.
Staying up to date with industry trends is also very important. You can follow the latest best practices and strategies that deliver proven CX results, including our own Buy with Prime and Amazon Pay report commissioned from the Baymard Institute on key optimizations to increase conversions on your ecommerce site.
But also keep in mind that effective optimization can be linked to experimentation. A/B testing is a mechanism that puts your data measurement and benchmarks to use, so you can objectively tell which changes to your CX design drive the most conversions. Testing can give you the hard data you need to make informed decisions about what messaging, images, colors, fonts, layouts, and checkout flows work best to turn those hard-won site visitors into actual customers.
#3 How to get your product right
No matter how great your customer experience, the quality of your product is always going to play a significant role as a sales driver. “What feedback are you getting from your current customers on ways they’d like to you improve your products?” asks Dan. “The third pillar for success—beyond getting your measurement down and building that customer experience—is continuing to evolve your product.”
Positive, authentic reviews can have a significant impact on sales, and sites that display ratings and reviews generally can have higher conversion rates. Dan says that shoppers want social proof of quality, and they consider product reviews from real people to be more trustworthy than merchant content. Ecommerce merchants can display Reviews from Amazon next to the Buy with Prime products on their sites as a means to establish customer confidence and brand credibility.
“Zugu, an iPad case brand I work with, is one perfect example,” says Dan. “Product quality is the reason they’ve been able to rise to the top in their category. They leveraged all their customer feedback. If you look at their product and how it’s evolved and improved over time, it’s incredibly impressive. They have something like 27,000 five-star reviews on Amazon alone and are consistently in the top ten for iPad cases because they focus so much on the customer experience and implementing feedback on their product. And because of it, they’re a mid-market brand that’s pushing more units than some enterprise-level brands.”
Get 1, 2, and 3 right before making any major strategic moves
For small and midsize ecommerce businesses, measurement, user experience, and product are what can put you on solid ground for growth—the sturdy legs that allow you to stand and walk before you run.
“They’re absolutely the most important things,” says Dan. “Establishing the right benchmarks so you can track the performance of your business, and building a compelling user experience are key ways to help you make good decisions about other elements of your business such as marketing or advertising.”
If you’re a smaller merchant trying to get to the next level, leverage all the free tools at your disposal—social media in particular—to get your brand name out there while you develop your CX. “If you don’t have a great website just yet, you can continue to work on that, building out great product images and descriptions, adding fresh content, testing out landing pages—while you post across your social channels. Use those free tools before you start spending advertising dollars to send traffic to a website where the customer might have a bad experience.”
When it comes to data and technology, Dan cautions that when you’re just starting out, don’t try to take on too many tools as they can more a distriction than an aid.
“As you continue to scale your business, you’re going to have more automation tools and software thrown at you to make your life easier. But as you build out your tech stack, that’s going to eat into your margin,” he says. “That’s how a lot of businesses go under—they have all this complicated technology and all these different data sources to monitor, which can get super complicated for a small business owner. If you can remove all the silos as you’re scaling in those early stages and just get honed in on measurement, that’s my primary recommendation for profitability.”
That said, the greater your scale, the greater the complexity inevitably gets. Eventually, you might want to maximize the average revenue generated by your shoppers over their entire relationship with your brand. The more returning customers you have and the more they spend when they’re on your site, the better your chances for growth.
Ecommerce success might not always be as easy as one, two, three — but getting these three building blocks right can set you on the right path.
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