Online profitability is harder than ever before. And your business’ ecommerce growth strategy needs to adapt.
Primary drivers like Facebook and Google have become more competitive, more expensive, and more crowded. As a result, many of us are experiencing reduced return on ad spend (ROAS) compared to previous years.
Headlines signaling the end of DTC’s golden era — if it ever really existed — crowd the ecommerce-trends landscape.
Worse, rising customer acquisition costs and increased operational overhead shrink profit margins: threatening to undo hard-won victories.
This email from one of our ADmission members captures the struggle perfectly:
As owners, operators, and co-journeyers, we are deeply empathetic to how imposing the challenges can be. The good news is…
We’re here to give you a clear strategy to grow your ecommerce business in 2020.
If you’re coming from our Shopify Academy Workshop, we’ve put together this guide as a companion piece. It contains everything we covered and more.
Start by grabbing the Ecommerce Growth Strategy Template and following the Instructions (READ FIRST) to connect your ecommerce store’s Google Analytics:
Then, either keep reading for the full breakdown or jump ahead to the specific video tutorial you’re most interested in applying to your online retail business.
What makes us uniquely qualified to help you solve these problems?
First, we’re not a performance marketing agency. We are an agency that builds brands.
Second, more than just building other people’s brands, our own brands under the 4x400 banner grew an average of 400.56% this year alone.
Third, we also run an online Facebook Ads training program and ecommerce community. Since launching ADmission in early 2019, it’s grown and nurtured +75 business owners, employees, and freelance marketers.
These three anchors into the ecommerce world give us an unmatched view into what makes brands succeed.
And, we’ve boiled it down to a simple, actionable formula…
For all its uncertainty, ecommerce success can be distilled into a single formula with only three metrics:
There’s no other way to increase your revenue than to affect one of these three variables.
How do we turn this equation into action — namely, a holistic business strategy coupled with ecommerce marketing campaigns that impact your bottom line?
Action begins with visibility.
If we can get insight into the current state of these metrics, we can develop an ecommerce strategy built on the metrics that represent the most immediate available impact.
The first thing you need to do is make a copy of this Sheet.
Follow the steps in the Instructions | READ FIRST tab to connect your ecommerce website Google Analytics data:
Once connected, the Template will allow you to track:
We know you’re inundated with ideas about how to improve your business. And that it’s overwhelming to decide which of them to act on.
That’s why we have a tab to compile a backlog of ideas to affect each of the metrics. Take note of every idea, every tweet that you read, every article that you find … essentially anytime an idea comes to you, add it:
Prioritize by the “first things” principle.
At the start of each week, we look at our backlog of available opportunities to affect these metrics. From there, we itemize the most immediate available impact from the entirety of our list. We call it our “first things.”
Think of this entry point as a framework for problem solving like fixing a car.
If someone told you their car was “broken” and asked you to solve the problem, it would be very difficult to know how to actually solve the problem – because cars don’t break. Instead, alternators fail, filters get clogged, battery dies.
Something specific goes wrong. And something specific is needed to fix it.
Similarly, if someone says “my business is broken,” it’s framed as an inactionable problem. Only when you identify its high-quality versus low-quality component parts …
… can you build actionable items against specific metrics:
In fact, we can get incredibly specific with each one.
The number one mistake we see merchants make is spending a massively disproportionate amount of time and money on visitors. Especially paid social media marketing.
Go to Google Analytics, pull your traffic breakdown by channel, and lay it out like we have below.
You should be driving new customers and returning customers (your target audience) to your online store across every channel available:
Why? Because a diverse traffic breakdown is a healthy traffic breakdown.
This might include somewhat underutilized methods like content marketing as well as tried-and-true digital marketing strategies (e.g., building your email list, social media marketing, looking to influencers for new product launches, fixing cart abandonment, or adding personalization to key entry points).
All that is wise, but it’s not the next tactic…
Did you know: the entire globe is within (cheap) reach?
The truth is, your future customers are everywhere.
Watch me do this step by step in the Global Targeting Tutorial:
Unnecessary purchasing friction is the single biggest threat to increase sales and expand your customer base. Customers want a fast shopping experience and an equally fast checkout process.
Slow load times cause $213B opportunity cost of friction in the U.S. Worse, 84% of U.S. Shoppers surveyed are unlikely to shop with a brand again after a poor experience.
And, 47% of customers expect a webpage to load in 2 seconds or less. Potential customers on mobile devices are a bit more patient, but not by much — and definitely not when they move toward checkout.
It’s simple: Speed equals conversion rates. Conversion rates equal increased sales.
Don’t get confused: always prioritize page speed over site speed. And don’t necessarily start with your homepage.
Not all pages on your website are made equal. Some of them are loading faster than others. And some are getting far more traffic.
The key to diagnosing your site speed health is about understanding the speed of your individual pages.
First, identify where most users are going on your website. Volume represents opportunity. Then, determine how individual pages on your website perform relative to the average.
Having a blazing fast website is more important than having a website with lots of things on it.
Once you know your individual page speed issues, take action.
To improve the overall speed of your website, the key is to look at that individual page as the area of greatest opportunity.
Here’s a quick way to adjust collection pages inside Shopify:
Or, if the issue is a product-description page (PDP)… again, load less things! In many cases, your customers aren’t seeing much of the content on the page anyway — which scroll-depth tracking can make clear:
Using these tools, you can identify what portions of your pages aren’t useful or even viewed at all by website visitors. This is especially important for visual-heavy industries like ecommerce fashion and online cosmetics. Then, eliminate heavy items that are slowing down your website.
Lastly, let’s talk about...
Truthfully? Here’s how we feel about it: 👎🏻👎🏻👎🏻
Lifetime customer value (LTV) is an average of how much a customer is worth to you over their lifetime. But, nobody can wait a lifetime to realize cash.
That’s why we’re introducing the...
30, 60, 90 day customer values are the most important metric you are not currently tracking.
Within this data lies your Cash Multiplier — your 60-day customer value.
(60 may not be the right number for your business. It could be 30 or 90, depending on your SKU set, your average consumption rate, AND your cash flow. The point is to pick a time window that you can affect and that you can afford to wait for.)
Determining your 30, 60, and 90 day customer values is a process. But don’t fear, we’ve created an in-depth video training to help you do it step by step.
Even better, you can improve your cash multiplier before you know what it is.
Don’t over emphasize new visitors in your formula for growth, instead turn your attention to existing customers.
Print out your entire post purchase email flow and tape it up on the wall. This serves a tangible reminder of how important improving the value of your existing customers is and their potential impact on your cash multiplier.
Now, isolate every email that gets sent within 60 days. Take the data from these emails and create a backlog of ideas to improve the results!
Always remember to sequence your opportunities by volume. Open rates on order confirmation emails average at 80%. Knowing this…
Bonus Tactic: Add a one-hour, time-sensitive offer to your order confirmation email to drive urgency for your customer to purchase.
Now that you know the formula, have entered your numbers into the Ecommerce Growth Strategy Template, let’s summarize the five tactics:
Plus, the bonus: Add a one-hour, time-sensitive offer to your order confirmation email to add urgency for your customer to purchase.
Ecommerce business growth isn’t a mystery. It’s the direct result of marketing efforts governed by data.
As much as it may not feel like it at times, you are in control. Your business can and will grow!
Just remember, whether you’re a small business operating one ecommerce site or a large merchant with multiple ecommerce stores across different geographies:
V x CR x LTV = $ (always!)
Solve for each of these variables and you will solve for growth.