March 22, 2021
MT Channel Experts Roundtable: New Tools, Ad Types, and More to Win the Rest of 2021
If you speak to ecommerce retailers, or their marketing managers, you could be forgiven for thinking that Jeff Bezos is joining Attila the Hun and Vlad the Impaler among the least liked people in history. While it’s true that Amazon’s low prices and aggressive advertising are putting pressure on independent ecommerce sellers like never before, that doesn’t mean there isn’t opportunity for you. What it does mean is that you’ll need to better understand your business and invest in the proper infrastructure to get on the best footing to compete.
Are you still working off an ROI goal that you’re “pretty sure” is profitable? That might have cut it in the past, but your competitors (and Amazon especially) know exactly how much they can spend on marketing to turn a profit. They’re not just looking at cost of goods sold, but also repeat purchases, lifetime value, and even virality for each product. Once you understand how much you can profitably spend on marketing for each product or brand, you can make sure to squeeze every bit of revenue out of your marketing program. Otherwise, you risk limiting revenue production and losing out on profitable sales because you didn’t invest the marketing dollars to drive them.
It used to be that an ecommerce website could make thousands of dollars per month with just a small investment in SEM and SEO and almost no other marketing. In today’s more competitive marketplace, you need to fire on all cylinders. Increased investment in high-funnel brand awareness efforts like display marketing and Facebook ads are necessary to drive net new traffic to your business. You also need a solid remarketing and email marketing program to convert that traffic into revenue. Today’s sophisticated shoppers look for deals across multiple sites, so don’t hesitate to offer new visitor discounts and other promotions to seal the deal, especially if you see a high rate of repeat purchases.
Online consumers have so many choices today that even seemingly minor inconveniences can cost you a significant amount of purchases. Does your website look old and untrustworthy? You should make updating it a priority. Is your shopping cart failing to provide a great user experience for your customers? Either update it, or watch as your potential customers buy from Amazon with one click instead. If your Google Merchant Center feed isn’t allowing you to precisely target individual products, then consider professional feed management to maximize impressions for your top products. All of these investments will cost money in the short term, but they will allow you to squeeze additional revenue out of your inventory.
It’s increasingly difficult to compete online by providing low prices and fast, free shipping, so you need to understand what your value propositions and your target market are. A few years ago, running a free shipping promo was an effective way to generate extra sales. Today, Amazon Prime users get free shipping for all purchases — and everyone has Prime.
A common delineator here is customer service. Can you offer great customer service and easy returns? That alone will put many consumers at ease and make them more likely to pay a small premium for your product. In other cases, product quality, ongoing service or warranty, or setup and installation assistance can distinguish you from anonymous sellers elsewhere.
I buy a lot of running shoes. And while I know there are hundreds of websites dedicated to selling me running shoes at the lowest possible price, I still buy about 50 percent of my shoes in my local shoe store. Why? Because I like getting information from fellow running enthusiasts, I can try on the shoes and jog around the store, and I learn about upcoming races and other events that might interest me. If you sell a product directly to consumers without providing additional value, then don’t be surprised when your customers have no brand loyalty and jump ship in search of a better deal.
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