Five Things To Know About Starting Your E-Commerce Business
There’s a major shift happening in the world of commerce, and it’s leveling the playing field for innovative and forward-thinking entrepreneurs all over the world.
Retail stores are being forced to shut because of changing consumer spending habits, coupled with a global pandemic that has forced many retail stores to adapt by moving online or die.
Building any new business is challenging, so in this article, I want to share my top five tips for building a successful E-Commerce business.
- Take action & get started: As someone who was once a complete novice, I can tell you that building your store is a lot easier than you think.
Platforms like Shopify are designed for non-technical experts like myself with zero coding and website design skills. Shopify has an awesome drag and drop feature which allows you to customize how you want your store to look and feel. It also has its incredible app store that allows you to choose apps to enhance the look, feel, and functionality of your store.
You can choose to sell your own products, but many sellers source products from other suppliers and perform a dropship model so that they avoid the hassle and risk of holding inventory.
- Drive targeted traffic to your store: Now that you have your store set up and populated with products, it’s time to tell the world about your new business.
Before you begin, I advise that you install website tracking via Google Analytics and the Facebook pixel at a minimum. This allows you to gather data on your website visitors and run remarketing and create custom and lookalike audiences.
The first type of traffic is organic traffic. Organic traffic is visitors that land on your website as a result of unpaid (“organic”) search results. Examples include blog posts, social media marketing, and search engine optimization.
The first store I created was a dog brand. I made sure I was omnipresent across all social media channels and I posted three times daily to build a following using the most common hashtags.
The main reason I saw a lot of success was because I went a level deeper. Instead of targeting all dog lovers, I targeted each sub-niche like Husky, Dachshund, Pitbull, and German Shepherd. Every breed had a different personality and I was able to target specifically those traits.
The other type of traffic is paid traffic. I recommend focusing on one advertising platform at a time. The most common traffic source for E-Commerce entrepreneurs is Facebook Ads. It allows you to target very specific audiences on Facebook and has a huge database of over two billion users.
- Raising the average order value (AOV): The next tip is to focus on the average order value. This is calculated by dividing the total revenue by the number of orders. So let’s say you have a customer that is about to purchase or has just purchased a husky-themed hoodie. We can present to them a second offer where we can offer more of the same, or present them an offer for a similar item at a discounted price.
In my case, I would offer a second hoodie at half price, or offer a smaller priced item like a baseball cap. The main goal is to raise the average order value which in turn will allow me to spend more money to acquire the customer and outbid my competitors that are seeking the same type of customer.
I personally prefer post-purchase upsells over pre-purchase upsells because they do not interfere with the buying experience. A confused buyer is a non-buyer.
- Email marketing: Now that you are beginning to build an email list of subscribers, social media follows, and buyers, it is time to turn your email list into a strong monthly money-making machine.
The reason why email marketing is so powerful is that you have already acquired the lead and/or customer and you can begin to create powerful flows and segments to ensure you get the best open rates and deliverability.
In my case, I was able to segment my email list into VIP customers, last 90 day engagers, repeat buyers, and even segment my subscribers into different lists of dog breeds. This allowed me to send very specific email campaigns based on how each user was tagged in the email system.
A good metric is $1 per email subscriber. So, let’s say you have an email list of 10,000 people, it should produce $10,000 per month in email revenue if done correctly.
- Build a real brand: Many new store owners do not treat their business like a real business. They ship products that are of inferior quality, many of which are poorly made, and have long shipping times usually from China.
As you can imagine not only do customers dislike this and will never buy from the seller again, but the seller also runs the risk of chargebacks and refunds, and even possibly losing their merchant processing account.
Find great suppliers that ship fast, build customer satisfaction and loyalty, and only sell products that you yourself would feel comfortable with.
It is far cheaper to retain existing customers than to find new ones. Over time your customers will become your best marketing resource
Eventually, you want your store to be a valuable asset, that you can sell down the line, or attract more investors to scale it to new levels. A perfect example of a company that followed the brand route from day one was GymShark.
If I could leave you with a final take away it is to find a niche you are passionate about. Research the market to see if there is enough demand for what you intend on selling. You can perform a simple keyword search on Google and see how many brands, products, ads, and websites exist.
Let’s say you love Yoga, it’s a hot niche right now. You can easily sell yoga mats, straps, blankets, blocks, bolsters, chairs, or meditation cushions.
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