The 3 tried and true ways to grow your ecommerce company

Guest Author 19 February 2019

There’s a flood of information to be found online on how to grow your ecommerce business. It can be overwhelming and disheartening. But here’s the good news: if you look closely, you’ll realize that these tips, tricks and hacks all fall into one of three categories:

Increase the number of customers
Increase frequency of purchase
Increase transaction value per customer

Yes, there are only three true ways to grow a company, and we’re going to explore them in this article. Stick with us to find out what they are and how all that information you find online relates to them.

1. Increase the number of customers

Makes sense, right? The more new or first-time customers you get, the more you must be selling.

But how do you convince a potential customer to buy your product when they’ve never heard of you before? How do you even reach potential customers and tell them that your product is out there and it’s exactly what they’re looking for?

1.1 Market Research: Understanding your Buyer Persona

Buyer Personas are semi-fictional representations of your ideal customers based on market research and real data about your existing customers. The more detailed, the better.

Don’t be afraid to be specific and very detailed in narrowing down your ideal customer. The better you know your buyer personas, the better you can target them with your marketing measures, and the more effective your campaigns will be. That’s why you should look into opting for “the hard work” instead of automating everything from the start – you will learn faster, and you will need to learn.

Less is more, here. If you manage to define your specific buyer persona and adjust all your communication to fit this customer, you’ll be more successful than businesses who are trying to make everyone happy.

Here’s how you define your buyer persona.

1.1.1 Ideal number of buyer personas

First, you should figure out how many different buyer personas you need. Yes, for a lot of ecommerce businesses it makes sense to have more than one buyer persona, depending on what products you’re offering.

But here, also, less is more. Keep your number of buyer personas as low as possible. We suggest to stick with just two. One buyer persona as a representative for the 20% of your customers who are responsible for 80% of your revenue (ever heard of Pareto? We’ll explain more closely in chapter 1.4 Market your Bestsellers) those are your high-spending customers who are big fans and really love your products.

The second buyer persona captures the rest of your customers. Sometimes you can create a third buyer persona to cater to a very specific niche.

1.1.2 Collecting ideas

Collect the data of your existing “best” customers, then brainstorm ideas to make your buyer persona come to life. Take the following aspects into account:

Goals: Which goals does this persona have, personally and professionally?
Dislikes: What does the persona dislike, what disturbs them?
Fears: Which fears and apprehensions shape the persona?
Challenges: What are challenges or problems the persona is facing?
Information procurement and media behavior: Which media does the persona interact with, where are their “watering holes” at which they get their information and news?
Private interests and hobbies: This complements the picture you’re creating of your buyer persona.

Summarise your ideas with clear bullet points, give the persona a name and add a fitting portrait photo to make the persona as realistic and relatable as possible.

Here is an example of a buyer persona:

1.1.3 Update and optimize

At least twice a year, put your buyer personas through their paces to see if they’ve changed. Because buyer personas aren’t static – they can change over time. Possible transformational influences could be their media behavior or information procurement. Or maybe you and your product have changed and you have to adjust your buyer persona accordingly.

1.1.4 Create campaigns around the buyer persona

Now you have a detailed picture of a very specific person in mind whenever you’re planning and creating campaigns and content. This will make the implementation of your marketing strategy so much easier, because your readers and recipients of your marketing measures will feel as if you’re speaking directly and specifically to them.

1.2 Marketing: Build a sales funnel

In ecommerce, and especially in marketing for ecommerce, everyone talks about “The Funnel”. It’s this magic word that marketing experts refer to and nod sagely at when it’s dropped. But even ecommerce veterans often don’t actually fully understand how a sales funnel works, not to mention the newbies who have no concept of what it is.

First, let’s start with what it is.

1.2.1 A filter and an automated salesman

If set up right, your sales funnel filters your ideal customers out of the millions of people surfing the internet at every second of every day. It filters out the people that are going to luuurve (or are in desperate need of) your product.

And then it presents and shows off your products – and your shop – to these people to the point where they can’t resist clicking that “Buy” button. Ideally, it does this more than once.

A sales funnel

makes potential customers aware of your shop and products,
piques their interest,
helps them make a decision and
take action.

1.2.2 From stranger to visitors – Make them aware of you

Over 55% of the world has access to the internet. That’s over four billion people. And your job as online-shop owner is to find the fraction of those four billion people that are potentially interested in your product. Somehow, you have to find those people and pique their interest enough to visit your website.

You have to turn strangers into visitors of your shop.

There are many ways to do this. Here are the popular ones that have proven themselves time and again:

Run Facebook or Instagram Ad Campaigns targeted towards your buyer persona(s) or, later, lookalike audiences
Run Google Display Ads or Product Listing Ads with Google Ads (formerly Google Adwords)
Be active in forums and Facebook groups where your ideal customers hang out
SEO-optimized blog or video content that solves a problem or answers a question of your ideal customer

These measures generate traffic to your shop.

1.2.3 Visitors to interested parties – Pique their interest

It’s highly unlikely that you’ll hook a stranger, whose curiosity you piqued enough to take a look at your store, into buying one of your products right then and there. There are a lot of boundaries that a first-time visit simply won’t overcome, the biggest of which is trust.

When he lands on your store for the very first time, this stranger from faraway internet lands has no idea who you are, what you stand for, whether your product is good and holds its promises, or whether you’re just out for a quick buck and ready to rip him off. It’s a bit like dating; you wouldn’t hand over your credit card to someone you just met, right?

No – you want to get to know and trust that person first. If that person demanded you hand over your credit card right now, you’d run for the hills.

Which is how any stranger feels when he visits your shop for the first time.

But you did draw them to your landing page and convinced them to leave their email address, which means something about you and your shop piqued their curiosity. Something they saw in your ads or content drew them there. Whatever you offered on that landing page made them decide to give you a second glance.

Now you just have to nurture their interest. You have to turn a lead / subscriber into a qualified lead.

You do this by putting yourself and your products in front of them regularly. Remind them that you’re there, that they liked what you offered enough to leave their email address.

How do I do this, you ask? We recommend two ways:

Retargeting (or remarketing) via Facebook, Google and Instagram
Email-Marketing with drip campaigns

Want to create the best email drip campaigns for Ecommerce stores? Get started with Follow-Up Emails by CM Commerce.

You can use retargeting via Facebook, Google and Instagram, as well as a welcoming email marketing series to put your shop and products in front of your first-time visitors repeatedly, while building trust in and recognition for your products.

So it’s okay if they haven’t actually bought anything at this point.

1.2.4 Interested party to paying customer – Help them take action

In the next step, you want to convince them to actually buy the product. Turn that qualified lead into a paying customer. The goal is for them to click “Add to Basket”.

They will only do this if they trust you and you’ve managed to remove all doubts about you and your shop. They’ve gotten to know the product, but now you have to convince them of your shop and its authenticity.

Effective trust-building measures you can take include:

Interact with your visitors as much as possible.
Let your personality shine, where appropriate.
Offer proactive customer support.
Reduce risks wherever possible.
Highlight your product’s benefits in the description, not just its features.
Highlight your product’s unique benefits; this gives you the competitive edge.
Optimize your “About” page.
Offer time-sensitive discounts.

Remove all trust barriers by implementing these measures and you’ll make it easy for them to add your product to their basket.

1.2.5 Customers to regulars – Entice them to come back

Animating your first-time customers to buy from you again is easier and costs six to seven times less than acquiring entirely new customers. So never forget to appreciate your existing buyers.

Order features your customers will love

Of course, for them to even consider buying with you again, you must first give them an excellent user experience. Amazon has set the bar here, and set it quite high, but if you want your customers to come back with a smile, make sure their first order goes off without a hitch and offers the following goals:

Order Processing within 24 hours
Delivery within 2 days
Easy and foolproof return process

Once you’ve convinced them of your shop’s merit, there’s one underestimated approach you can implement that will have them returning soon and with enthusiasm.

Optimize the receipt

Receipts are as much a part of buying online as the check at a restaurant dinner. What many people don’t know: A study we conducted on the matter in 2015 confirmed that receipt emails are opened up to four times more than other marketing emails.

The chances of your customers seeing your goodies and taking advantage of them are three to four times higher in your receipt emails than any other emails you send out on your marketing campaign – so make use of them.

To supercharge your Ecommerce receipts, get CM Commerce Receipts for free. And to double your receipt conversion rates, try CM Commerce Premium, which includes Product Recommendations. Start your 30-day free trial now to find your perfect fit.

And if you want to know more about how to build and optimize your sales funnel, check out our extremely detailed article here.

1.3 Extend your market reach

There are so many ways (and wheres) to buy almost any product, online or off, that you won’t find all your ideal customers on just one channel, unless maybe you’re selling to an incredibly niche audience. So the more channels you utilize to sell your products, the easier it is for your customers to find you.

Some popular channels to consider are:

Your own webshop
Global platforms like Amazon, eBay, or Google Shopping
International markets

Each of them has its own pros and cons.

1.3.1 Your own webshop

Your own webshop is instrumental in getting long-time, loyal customers that come back because they like your concept, your product, your brand. Your own webshop offers something Amazon, eBay and Co. often can’t: a personal touch.

1.3.2 Global platforms

While developing your brand can be tricky on Amazon, eBay, Google Shopping and Co., they do offer something that a fledgling webshop – or often even well-established ones – can’t: reach and traffic.

These global platforms have become so vast and well-used, that they’re often the first sites people turn to when looking to buy something. So they’re great for locking in those new customers – if your competitors don’t snatch them up first.

1.3.3 International markets

If your product is a hit in your country, chances are that people in other countries will like it, too. This opens up a world – literally – of new potential customers, though of course it also brings its own set of challenges, starting with language barriers, over different trade and tax laws and regulations, to a whole new level of costs that comes with it.

1.3.4 Offline and retail

Sure, you’re an ecommerce store, but that doesn’t mean your product won’t be bought in brick-and-mortar stores. Distribution is a whole new kettle of fish here, though, and that’s only after you’ve managed to get an offline store to pick up your product.

All that being said, your ideal customers might not be present on all of the possible sales channels, and expanding to them all at the same time would entail more time and cost than most businesses could tackle. So if this is your strategy to acquiring more new customers, our recommendation is to focus on one at a time.

1.4 Market your bestsellers

Ever heard of Vilfredo Pareto and his Pareto Principle? Basically, this principle (also known as the Law of the Vital Few or the 80/20-rule) says that 80% of effects come from 20% of causes.

This can be applied to almost any cause-and-effect situation. In regard to ecommerce, it goes like this:

20% of your products are responsible for 80% of your sales.

So if you’re selling five products, one of them is bringing in 80% of your revenue, while the rest together generate the other 20%.

That one product is your bestseller. It’s what customers like best or need most out of your basket of offerings. Meaning there will be other people who love this product most, too.

So your bestsellers are the ones you should be focusing your marketing measures on.

1.5 Abandoned Cart Recovery

It happens often that potential customers add an item to their cart, but then abort the order process and never click the “buy” button. This can have several legitimate reasons, but in the end it just means that the customer never buys the product.

With a series of automated emails, you can encourage the customer who abandoned his cart to pick the order process back up and click “buy”. These emails should contain a direct link to his cart to make the completion of his order as comfortable as possible.

Recover abandoned carts with the following automated emails:

30 minutes after the cart was abandoned you ask the question if the customer needs assistance in the order process. Does he have questions? Did something not work?
3 days after the cart was abandoned, you offer a special treat, for example a discount voucher, free accessories or faster delivery.
7 days after the cart was abandoned, inform the customer, that his cart will soon be deleted. People don’t like to lose things, even things they haven’t bought just yet.

At CM Commerce, we’re experts at abandoned cart recovery! We’ll help you set up smart campaigns and track your progress to recover those abandoned $$.

2. Increase frequency of purchase

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Now you’ve got everything in place to have those new customers rolling in. But what about the people who’ve already bought from you? What happens if you show them some love?

Actually, a lot of amazing things! Because selling to already existing customers is a lot easier than selling to potential ones. Existing customers have already bought your product(s), which means you know they’re interested in what you’re selling.

They’ve also already experienced how you operate and that you’re trustworthy – another sales barrier overcome without even trying.

All you have to do with existing customers is make them come back for more. More of your products, more of your shop, more of you. Make it easy for them do business with you again and again and again.

We know a lot of ways to do that.

Offer discounts, like buy one, get one free or 10$ off your next purchase. Set up automated anniversary-, birthday- and seasonal discount coupons.
Create a loyalty program, for example by offering 10 loyalty points per 1$ spent in your store. The more points they collect, the more discount they get on the next purchase.
Improve and optimize your customer service. Customers will come back if something goes wrong with their order, if you customer service was top notch and handled things well. A well-oiled customer service can also intercept a lot of problems before they arise.

3. Increase the transaction value of a customer

By default, the number of units sold will go up if you are able to increase your number of clients and their frequency of purchase. But you can increase this number even further if you either

sell more than one product to the same customer, or
sell more units of the same product.

Either of these approaches will increase the transaction value of your customer, meaning you can make more money from a customer you’ve already convinced of your shop and products. It’s a lot cheaper than acquiring a whole new customer.

3.1 Increase the number of products sold

If a customer bought one of your products, they might like or need another one. So why not provide another product that serves or helps them, that solves a problem or need, or upgrades the product they bought?

If you’re selling smartphones, you can offer fitting casings for those phones. Or the matching purse to a handbag someone just bought. Make your customers aware of these matching, related or upgrading options by:

Upselling. When a customer buys a product, suggest an upgrade or add-on to it.
Cross-selling. Encourage your customers to buy related or similar items they may like, based on what they’ve bought. On Amazon, that’s the “frequently bought together” or “customers who bought this also bought” section.

We go into more detail on up- and cross-selling in this article.

Let’s look at this more closely with an example. If a customer buys dog food, and you manage to cross-sell a high-margin dog toy along to him at the same time, not only will you have made more money on the one purchase. You’ll also have saved in delivery costs, since you can send it in one package.

3.2 Increase the number of units sold

Some things are often bought in bulk, for example office supplies, socks or t-shirts. This means you earn more money with each purchase and you save on shipping, which is often the single biggest cost driver after the actual product.

So give your customer incentive to buy more than one of a product. Offer discounts for bulk purchases, like “buy 2, get 1 free”, or “1 for $3, 10 for $25, 20 for $40”.

If we stay with our dog food example, that could mean your customer buys two bags of dog food at a 10% discount instead of one. Again, you’ll have made more money on a single purchase and saved in delivery costs.

Either of these two approaches will increase the transaction value of a customer you’ve already acquired and don’t need to pour money into marketing for anymore.

Let’s recap

To grow your ecommerce company, you need to sell more. To sell more, you can either increase the

number of customers,
frequency of purchase, and
transaction value of per customer.

Your job is to find the right mix for your business by implementing the measures described in this article one by one, testing, refining and optimizing. CM Commerce can help you automate and optimize your sales in a myriad of ways. Click here to find out more about our features and how they will support your business.