Running an e-commerce business can feel like you’re constantly on the move. Every month, there seems to be a shiny new technology solution that retailers and brands absolutely need to invest in if they want to stay competitive. Whether it’s the latest logistics software or the hottest artificial intelligence tool, for retail startups and small businesses, the risk of missing out on a hot new tech trend can be overwhelming.
However, to better position themselves for future growth and ensure their technology investments generate a real return on investment, brand decision-makers should put FOMO aside and think about how an external consultant would do. Only by looking at their business through an external vantage point can leaders better identify which systems are working well and which are the problem areas, and then choose the solutions that make the most sense for them. Sometimes this can mean downsizing rather than investing in additional technology, reducing unnecessary platform features, unifying multiple existing solutions, or even outsourcing some tasks to reduce costs, increase efficiency, and scale faster.
Additionally, while it’s tempting to get distracted with new solutions targeting every aspect of an e-commerce business, brands are better served by focusing their technology investments on the three pillars that matter both today and in the long term: fulfillment, growth marketing and sales channels.
3 key areas retail decision makers should focus on
Here’s how to address these three areas, which are key to thriving in today’s e-commerce environment and increasing customer lifetime value (LTV):
1. Optimize fulfillment to build loyalty and convert one-time buyers into lifelong customers.
Consumers have grown accustomed to near-instant gratification when shopping, so delivering orders on time, efficiently and reliably is non-negotiable today. A Survey 2022 by delivery platform FarEye found that 85 percent of online shoppers will not shop with a retailer again after a bad delivery experience. That means getting the last mile right is key to LTV. But shipping and fulfillment costs can quickly erode profitability, not only with deliveries, but also with product returns, which customers also expect to be hassle-free (and often free).
To ensure they deliver a great customer experience without overspending, brand leaders should think like consultants, ensure their shipping and fulfillment logistics are digitally controlled, and compare fulfillment providers shipping and service costs. They must bear in mind that the optimal solution may not always be the least expensive, or even a single solution. It should be the best for each product, which may mean that the brand needs to use a combination of shipping providers. In all cases, the best solution will be the one that allows the company to operate efficiently at scale without sacrificing quality service for its end customers.
2. Develop a data-driven growth marketing strategy.
To get the most ROI from their ad spend and link promotions to inventory and fulfillment, brands must execute a disciplined, data-driven growth marketing strategy. Growth marketing combines digital strategies such as content marketing, search engine optimization, email and video marketing, user experience (UX) analysis and more into a single, holistic, funnel strategy conversion rate, and creating an effective one requires data tracking and analysis. Revenue, acquisition and customer metrics such as conversion, LTV, engagement, retention and bounce rate can help reveal stumbling blocks in a brand’s customer journey and highlight areas for improvement. For example, if site traffic is high but conversion is low, a brand’s UX likely needs more attention than its ad buying.
When it launched its new product line, beauty company bareMinerals wanted to increase its social media presence and drive e-commerce sales. The brand partnered with a specialist in growth marketing solutions to create a multi-channel strategy that successfully engaged consumers on Facebook, Instagram and Pinterest. Ultimately, the strategy resulted in a 17% increase in customer time spent on the bareMinerals website, a 25% increase in the brand’s share of voice, and a 25% decrease in cost per click (CPC).
3. Optimize each sales channel.
While it’s tempting to invest – or invest more – in selling on Amazon.com, Walmart and other large online marketplaces, there are so many other sales channels where brands need to be present that it can be difficult to know how to invest and manage . the shopping center Optimizing sales, marketing, merchandising, services, logistics and more for multiple channels is complex and expensive. Rather than dealing with these complexities in-house and leaving potential profits on the table, brands are often better off partnering with a technology provider that can manage all of these sales channels through a unified hub.
Adidas used this strategy to improve conversion and customer satisfaction while optimizing their ads, CPC and ROI. By partnering with a marketing solutions provider, Adidas was able to increase its online presence and easily review the cost and revenue of each product across all sales channels to ensure that its most profitable products appeared first in shopping channels.
By looking at their e-commerce businesses as an outside consultant would and focusing on three key areas, brands can set themselves up for success regardless of the latest retail technology fads. Fashion solutions come and go, but creating and executing solid satisfaction, growth and channel marketing strategies will help brands grow today and prepare their businesses for the future.
Tony Puccetti is the Director of Delivery for cart.coma fulfillment and contract logistics provider that helps complex B2B companies and D2C brands simplify supply chains and drive growth.
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