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Top 5 Tips to Get Started in eCommerce

Looking to get started in eCommerce, or looking for advice on an eCommerce marketing strategy (seo, referral marketing, social media)? Download this whitepaper for helpful advice on 5 areas to work on immediately!

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Top 5 Tips to Get Started in eCommerce

  1. 1. E-COMMERCE MADE SIMPLE: GETTING STARTED ◊ Top 5 Tips for Successfully Starting Your E-Store | |
  2. 2. E-Commerce Made Simple: Getting Started Top 5 Tips for Successfully Starting Your E-Store TABLE OF CONTENTS Introduction..........................1 Tip #1: Boil Down Your Idea & Know Your Niche ..... ...................................................2 Tip #2: Test, Test, Test! .......5 Tip #3: The Power of Online Advertising .............7 Tip #4: Get Social ...............9 Tip #5: Incentivize Your Customers and Build a Referral Network ..............11 Conclusion ..........................14 The world of e-commerce is rapidly expanding, and presents huge opportu- nities for today’s retailers, both big and small. Companies like Amazon and eBay are doing better than ever, while many big brick-and-mortar stores are struggling to keep up. In fact, Forbes estimates that U.S. e-commerce will generate $262.3 billion in sales this year. By 2017, they estimate that there will be $440 billion in sales. There are many benefits for both the retailer and the consumer when it comes to selling, or shopping online. Selling online requires minimal startup costs, and your store is open for business 24/7, completely unconstrained by time or geographic location. Customers are increasingly turning to the internet and their mobile phones to make purchases, rather than heading to the nearest store. More and more businesses are expanding online – everything from grocery stores to clothes to furniture can now be bought and sold over the internet. Even products that weren’t traditionally sold online in the past are now doing so, as con- sumer trust with the online platform increases. Supercharge Your Online Business With Referrals Page 1
  3. 3. 2013 was the first year we saw online sales actually outdo brick-and-mortar sales on Black Friday weekend, a perfect example of how the world, and consumer behavior, are changing. The world is moving online, and the longer you wait to start your store, the more competitive the e-commerce space will be. But with so many existing competitors and potential pitfalls in the world of e-commerce, it can be tricky to stand out from the crowd and run a successful store. So how do you, as a retailer keep up? And what’s the best way to take advantage of this booming industry? We’ve compiled a list of the top 5 tips any small business needs to know to successfully start (and run) their e-store. Tip #1: Boil Down Your Idea & Know Your Niche The key to a successful e-com- merce store is defining your market niche as clearly as possi- ble. Probably the most common mistake people make when starting their online business is trying to be everything to ev- eryone, and jumping in to set- ting up their e-commerce store before they have even decided what they’re going to sell. The most successful e-com- merce stores know their niche. They have thought through and chosen the product or products that they specialize in and which specific segment of the population they are selling to. Unlike brick-and-mortar stores, which can get away with selling just about anything under the same roof (see: Walmart, Target, or your local drug- store), small e-commerce stores seem untrustworthy when they try to be the retailer of a wide variety of products with no common link between them. Supercharge Your Online Business With Referrals Page 2
  4. 4. Online customers want quality and reliability. If you only sell photo frames, for example, customers are more likely to trust that you are specialists in photo frames and provide high quality ones. That’s not to say you can only sell one kind of product in your store. A pho- to frame store might also sell prints, photo albums, and even other kinds of home décor and wall art. But probably not groceries. As long as there is a logical thread tying together the items in your stop, you’re within your niche. The second challenge in defining your niche is defining and choosing the right target audience for your store. You may initially think that everyone on the web will be lining up to purchase your products, but in reality not everyone will. Your job is to identify the people who really want or need what you’re selling. In order to effectively target these people, you’ll need to build your store for them: essentially using the look and functionality of your store in addition to its products to attract potential customers. Rifle Paper Co., an online store selling decorative cards, stationary, and tech accessories. “Online customers want quality and reliability.” Supercharge Your Online Business With Referrals Page 3
  5. 5. These two online stores are not only selling very different products, but are targeting two very different audiences. Figure out the need for your product or service by thinking about what prob- lem it can solve. Refine your target market by identifying who has bought your product/service already. If your product or service is brand new, it might be a good idea to look at what your competitors are doing to gain insight. To help you narrow down your audience, we recommend answering the following questions: • What are the features of your business, products or services? • What are the benefits of these features? • How do the benefits help the user? • How does your target market shop? • What is the typical age and gender of your target market? Do they usually have children? What is their average income and education? • What are their common interests? Supercharge Your Online Business With Referrals Page 4
  6. 6. • Is your target market comfortable with online? What web and offline marketing methods engage them? Try to make as few assumptions about your audience as you can. Don’t just“fill in the blanks”. You should engage with your potential customers and conduct as much research as possible beforehand. Through testing and experience, you can also tweak and refine your target audience later on. (See Tip #2) Tip #2: Test, Test, Test! On that note, don’t be afraid to change when you find that something isn’t working. The worst thing you can do is put all of your eggs in one basket, and continue even when it’s proven to be failing. Successful busi- nesses, stay flexible, test, and find tactics that work. Test different target audiences, product ranges, marketing strat- egies, store promotions, store layouts, etc. Often, great discov- eries are made by accident. If you don’t test new and different possibilities, you risk missing out on great opportunities. And that means missed profits. The best way to test is by altering only one factor at a time. This allows you to measure results in the most accurate way possible. If you change multi- ple elements at once, you won’t know which factor to attribute the results (positive or negative) to. Some more examples of elements of your e-store to test include: • The home page design • A “Featured Products” category • Compatibility with various internet browsers “Don’t be afraid to change when you find that something isn’t working.” Supercharge Your Online Business With Referrals Page 5
  7. 7. • Mobile-friendliness • SEO (Search Engine Optimization) • Social media advertising campaigns • Various special offers and promotions • Different product price points • Product filters such as sorting items by colors, size, type, price, etc. • An “add to wish list” function • Buttons to share items on social media • The ability for users to write their reviews on product pages and rate items • Detailed product descriptions • 360 degree product views • Videos of products • Keyword search of products • Multiple delivery options • Multiple payment options, including PayPal • Free delivery, or free delivery over a set dollar amount When you set up experiments, you want to have a good idea of what to measure so you can define success. Here are some of the key metrics you’ll likely use and the key pages on which you’ll likely track them. SUCCESS: (noun : sek’ses) - The correct or desired result of an attempt Supercharge Your Online Business With Referrals Page 6
  8. 8. Tip #3: Understand the Power of Online Advertising Online advertising is a great way to get the word about what you do out there and to get more traffic to your store. This can include e-mail mar- keting, display advertising (includ- ing web banner advertising), SEO, SEM, and mobile advertising. More than 22% of all advertising spending is spent on the internet. In just two years, from 2011 to 2013, the revenue generated from on- line advertising has increased by more than 31 billion dollars - with the largest platform by far being Google Adwords. It’s estimated that by 2016, online ad spend in the US will have doubled since 2011, reaching $67.4 billion year (13.7% compound annual growth). And that’s a conserva- tive estimate, given the increases in the effectiveness of online ads in the past few years, and the decline of print media. Supercharge Your Online Business With Referrals Page 7
  9. 9. Just like other forms of advertising, online advertising frequently involves both a publisher who integrates ads into their online content, and an ad- vertiser, who provides the ads to be displayed on the publisher’s site. If you decide to go the online advertising route, here are a few commonly used terms you should be aware of. There are three main ways of pricing online media: CPC, CPM, and CPA. The difference between the three is which deliverable the publisher and marketer agree to bill you on. As you’ll see, the pricing structure often reflects who has the bargaining power, as well as the quality of the product. CPC – Cost-Per-Click. This is a performance-based metric, whereby the pub- lisher only gets paid when a user clicks on an ad. CPM – Cost-Per-Mille (Mille is Latin for “thousand”). In this structure, the price is based on 1000 impressions. Most publishers prefer to bill on im- pressions because it is an inventory based product, rather than a perfor- mance based product. CPA – Cost-Per-Acquisition (or Cost-Per-Action). In this pricing structure, the advertiser only pays for media when it results in a sale, or conversion against their sales goal. Impressions – In the context of online advertising, an impression is a measure of the number of times an ad is seen on screen, whether or not it is clicked on. Conversions – One of the most important parts of a paid campaign is its conversion rate. Essentially, the conversion rate is the number of visitors performing the desired action, whether that is buying a product, filling out a form, or some other goal of the web page. SEO – Short for Search Engine Optimization, SEO is a methodology of strat- egies and techniques used to increase the amount of visitors to a website by obtaining a high-ranking placement in the search results page of a search engine. Supercharge Your Online Business With Referrals Page 8
  10. 10. SEM – Search Engine Marketing is the wider discipline that incorporates SEO. SEM includes both paid search results (using tools like Google Ad- Words or Bing Ads) and organic search results (SEO). Ad Network – An advertising network is an online business that specializ- es in matching up advertisers to websites looking to host advertisements. Advertising networks work as brokers for both suppliers (sites with content that can host ads) and buyers (the advertisers). Though online advertising can be highly effective, it has many drawbacks. Not only does it require a lot of time, knowledge, and expertise, it’s also expensive and finicky. You can pour thousands of dollars into a Facebook advertising campaign or Google AdWords campaign and not get the results you’re looking for. It takes years to gain the skills and experience needed to properly run effective digital advertising campaigns, and many small busi- ness owners can simply not afford to spend the time or money. Tip #4: Get Social When running a business online, you might think that your products can speak for themselves and that you don’t need to worry about social media. But in today’s world, social media is not only a great tool, it’s a necessary one. LIKE: (noun : laik) - A Facebook function which allows users to show their apprecia- tion for content Supercharge Your Online Business With Referrals Page 9
  11. 11. These days every successful brand has a social media presence, whether it’s on Facebook, Twitter, Instagram, Pinterest, LinkedIn, Youtube, Google+, or even Tumblr. The main social media platforms you should consider harness- ing are Facebook and Twitter, since they are the most popular and have the largest user base. Social media allows you, as a business owner, to do free or paid promotion for your store and its products. A social media strategy, particularly paid advertising and an engaging content strategy, can be an effective way to target audiences and drive traffic to your site. In addition, it’s also a great way to get word-of-mouth momentum started, one of the key methods of launching a new site or business to success. Social media allows businesses to see customers engage with their brands in real time and empowers them to help shape the conversation. It’s a great way to let customers know about new products, special promotions, and live updates in the event of a site crash, product coming back in stock, etc. Studies show that clicking an ad on a social media site is often the first step towards a sale, rather than the last. Because of this, advertisers are under- valuing social advertising by as much as 116%. Soya Darabi, co-found- er of Zady, preaches the importance of listening to customer feedback. “Mod- ern brands must embrace two-way communication online, there’s just no question,” she says. “It’s about remaining nimble to consistently learn from our customers, and to benefit from their sincere interest in helping us grow.” After granting a customer’s request (via instagram) that Zady begin selling dog gear, the items flew off of shelves. “We can’t emphasize enough how listening well and using the appropriate channels to do so can help your business expand.” Supercharge Your Online Business With Referrals Page 10
  12. 12. Nathan Stoll, CEO of Luvocracy, shares another example of how social me- dia word-of-mouth can have a “snowball” effect: “We discovered a conversa- tion on Twitter where a Luvocracy member asked her most-trusted beauty blogger to join the site. She wanted to start shopping all of the great rec- ommendations her favorite blogger was making every day. She successfully got [the blogger] to join, and she quickly became ‘addicted’ to the experi- ence. It’s exactly how we want members to come into our community.” While a social media presence is important and can provide many oppor- tunities for your e-commerce store, you should note that focusing on social on its own isn’t enough. Many factors go into e-commerce success, and putting all your eggs in the social media basket would be misguided. Social media should be a strong aspect of your brand, but it shouldn’t constitute your entire business plan. Tip #5: Incentivize Your Customers and Build a Referral Network Anyone who has Amazon Prime will testify to the fact that incentivizing customers works. Whether the offer is a promotion, discount, or loyalty program for VIP customers, providing little extras for your customers can increase word-of-mouth promotion and build positive brand affinity in the minds of your customers. INCENTIVIZE: (verb: in-sen-te-vīz) - To provide a reason to do something or work harder Supercharge Your Online Business With Referrals Page 11
  13. 13. One example of this is Everlane – an online retailer that stresses transparen- cy. Founder Michael Preysman says that the company got the ball rolling by rewarding its very first customers. “We emailed our friends and family and said, ‘Hey, Everlane is launching in five days — here’s what we are. Invite 50 friends and you get free shipping for life.’ And we had 600 people invite 50 friends. In total, we had 60,000 sign up in five days,” says Preysman. The power of building a network of referrals cannot be stressed enough. With all the responsibilities that come with building and running an e-com- merce store, creating a solid marketing strategy is often the last thing on your mind. But what if you had a tool that could harness social media and referrals to your advantage, and use them to supercharge your e-commerce business? A tool that brought in tons of new customers without you having to lift a finger? Did you know? • 65% of new business comes from customer referrals – New York Times • People are 4X more likely to buy when referred by a friend – Nielsen • The Lifetime Value of a referral customer is 16% higher – Wharton School of Business • 83% of consumers are willing to refer—yet only 29% actually do – Texas Tech What is Forewards? Forewards is a tool that’s designed to “just work”. It’s so easy that even the busiest shop owner can run and maintain a high impact referral program, by harnessing your biggest brand advocates: happy customers. Research shows that people are four times more likely to buy when referred by a friend. Forewards helps you create a network of positive referrals online and through social media. The average adult Facebook user has 338 Facebook friends. Imagine if just one of your customers referred your e-commerce business on their Facebook. Even if only half of their friends saw the post, and half of those clicked on it, that’s 85 more people checking out your products, all from one customer. “The power of building a network of referrals cannot be stressed enough.” Supercharge Your Online Business With Referrals Page 12
  14. 14. These mentions make a difference. Up to 75% of shoppers say that they have been influenced to make a purchase by social media. Forewards pro- vides a fast and easy way to spread positive-word-of-mouth by asking for these recommendations and rewarding those who do. Equally important as asking your customers for referrals, however, is how you ask. You’d be amazed at what a difference simply using a different headline or choice of words makes. Unfortunately this sort of thing even takes marketing professionals years to master. Forewards lets you choose from a selection of pre-designed, pre-written incentive options all proven to be highly effective. This is one of many reasons Forewards works so well – it does the thinking for you, so you can continue to do what you do best. Learn more at: ”Up to 75% of shop- pers say that they have been influenced to make a purchase by social media.” Supercharge Your Online Business With Referrals Page 13
  15. 15. Putting it all Together Selling online presents huge opportunities for retailers, but e-commerce businesses that want to stay a step ahead of the curve need to be ever-evolving, just as the online marketplace is. By continuously listening to your customers, keeping up with the latest trends, analyzing metrics, conducting vigilant research, staying up-to-date with emerg- ing technologies, and using ef- fective marketing strategies, your business will stand out from the competition. Improve the experience for your users by experimenting with new tools and making tweaks in real time. The happier your customers are, the hap- pier you will be in the end, too. “There is no e-commerce, there’s only com- merce,” says Luvocracy CEO Nathan Stoll. “Instead of using a megaphone, use an inside voice and talk to the customers who already love you and tell them why you love them. Or change your product so they do.” Just remember that being ready to sell is just the starting point. You will also need to know how to help you potential audience find you, make sure that they are able to use your website once they arrive and be sure you make them happy enough to keep coming back. An online store is a busi- ness, and no business is as simple as pushing a big green button that says, “Now I’m rich!” But with these 5 tips and tricks, you are well on your way to being successful. The journey can be just as fun as the results! Supercharge Your Online Business With Referrals Page 14