"Let's Put the Products Online and See If They Sell"

For many years, eCommerce was, depending on who you asked, the cherry on top or the ugly duckling of the company — the channel accused of "stealing customers" from other distribution channels. Companies knew neither how to handle this new channel, nor even where to place the eCommerce team, which very often boiled down to a single "Swiss army knife" manager leaning on the company's internal or external resources.

Under marketing? In the retail team? In IT?

I've even seen an eCommerce team sitting under Finance at times. Why not — at least you'll have less of a fight to get extra budget!

Fortunately, this once-touchy subject has evolved a great deal, and eCommerce is now treated like any other distribution channel — arguably given even more weight, given the margins it generates in some sectors.

The eCommerce strategy that used to be "let's put the products online and see if they sell" has turned into a genuine strategy, integrated into the company's overall strategy and decided at the highest level — in executive committees and other "ExCos."

eCommerce Is the Small Business Inside the Big One

As I used to say, "I run the small business inside the big one." You have to keep in mind that eCommerce is a genuine small business in its own right — and some eCommerce revenues would make plenty of SMEs with double-digit turnover turn pale.

That's why it's essential to set a real strategy that then breaks down into an action plan. And an action plan is in no way a strategy.

How many times have I seen and read action plans calling themselves "eCommerce strategy"… Wrong, not good, even dangerous. You won't get a second chance.

If you come across agencies pitching you an action plan as a strategy, run. They simply don't know what they're talking about.

So What Actually Is an eCommerce Strategy?

An eCommerce strategy needs to clearly define a few points, some of which will feel like stating the obvious — let's go through them anyway.

• Which products are we going to sell on this channel? (This can vary depending on whether the company/brand has its own sales site or sells on a marketplace.)
• To whom? Do you really know your customers? Your customer segments? Even the ones you're not addressing yet? There may be opportunities there.
• When? This might sound trivial, but even if the site is open 24/7, there are still periods to prioritize: seasonality and holidays (summer, winter, Christmas, back to school…), specific events (sales, fashion week…), events tied to the eCommerce sector (Black Friday, Singles Day…), events tied to the company's own sector (trade shows…), the product's life cycle (launch, "cash cow," end of life, overstock…). All these timing elements need to be factored in, and they're specific to each industry.
• How? Have you defined your pricing and promotions based on the channel (owned site, marketplace, telesales…), on timing, and on marketing levers (affiliation, SEM, social…)?

Does this remind you of marketing's 4 Ps? Yes, that's the point: Place, Price, Product, and Promotion. In this case we even add a fifth P: "People" (the "who are we selling to").

This strategy has to be your bible, your reference point whenever you have a question. That's why the more detailed it is, the fewer pitfalls you'll run into when applying it — i.e., in the action plan.

Starting From People, or Starting From Products

You can start from people: you have customers, or you've identified customer segments — including one not yet addressed — and you find products for them. Then you build your plan.

You can also start from products: you list the products and/or ranges you want to sell, without necessarily having to sell everything, and you find customers in the target audience with an affinity for your products. Here too, you build your plan — which will necessarily look different than if you'd started from customers.

It all depends on your company's DNA and its management. But that decision is in your hands.

Talking to Every Part of the Company

It's essential to talk to all stakeholders, not necessarily in this order:

• Products, to gauge the opportunity of selling certain products over others.
• Marketing, to fit into the overall strategy and multiply your firepower, or simply to align on the brand guidelines to follow.
• Sales, to lay out the promotional plan and avoid shooting yourself in the foot.
• Support, because you will inevitably get feedback and questions from your audience, before or after the sale.
• Finance, because you need a P&L to measure your activity and its profitability.
• Logistics and supply chain, with maybe the opportunity to create product exclusives and ensure smooth end-to-end logistics.
• IT, who will co-sign the integration of your plumbing into the gas factory that is the ERP.
• HR, because at some point you're going to need people.
• And senior management, who will be watching you closely!

The goal: build ties with every stakeholder. Imagine the products and/or supply chain teams don't plan for the volumes needed for online sales — you'll never have enough product to hit your sales targets. If Finance isn't in the loop and doesn't build a P&L, you'll never know the profitability of your "small business." And if support doesn't set up a process aligned with logistics for eCommerce returns, your customers will send products they no longer want straight to headquarters — true story. Good luck sorting that mess out afterward!

One piece of advice: take the time to write your playbook, with the processes, the tools to use, and the people responsible for eCommerce within your existing teams, if you can't build a full eCommerce team just yet. That will come with profitability.

You now know much more about your sales channel: how it should work end to end, which products will be put up for sale, what the sales targets are, who's responsible, and who acts/decides at every level of the organization. You've written your strategy and your playbook, which every stakeholder can refer back to and which you'll be able to challenge down the line to correct course, refine, or complete.

You have your lighthouse. You can now define your action plan.

The Action Plan

It's time to move on to the action plan, starting with the site design. But before that, it's important to set a sales plan and see how it breaks down in terms of marketing and merchandising.

Customer Experience

A subject close to my heart: customer experience is the result of every interaction a customer has with you. They'll form an impression of your brand through marketing, through the touchpoints they have with the company (directly or indirectly), through the quality of the products, the services provided, the quality of the site…

You will be scrutinized down to the last detail. And retail is detail.

Follow the White Rabbit

Consumers won't just show up on your eCommerce site on their own — you'll have to lure them in. And they're not coming to your site to buy a product, but to have a "shopping experience." We no longer go to a restaurant just to have lunch or dinner, but to live a culinary experience — one that covers the welcome, the service, the atmosphere, the payment… right down to how well you digest what you ate!

An eCommerce site has to take this customer experience into account almost exclusively, and you'll never stop analyzing and refining it end to end, because the customer is king — and that king is, above all, just a few clicks away from your competitors, which is even more true on a marketplace.

You have every interest in surrounding yourself with UX specialists to design your site — like an architect presenting plans with spaces, functions, a decorative through-line, and a customer journey that limits friction points to reach your goal, which isn't to sell… no! It's to satisfy your customer.

Merchandising

Merchandising is an integral part of this customer experience. You'll want to reserve spaces to showcase products, cleverly sprinkled throughout the customer journey, to elegantly influence purchasing behavior while also meeting sales targets (ranges, products, seasonality, promotion…) in line with your sales plan.

I won't go into the details of A/B testing or real-time personalization, but know that technology works wonders today. I do want to hammer the point home again: your goal is to satisfy your customer. This merchandising will therefore be adapted based on the products to be sold, which will have been "marketed" through the various levers you've assigned a budget to.

The Basic Equation

I've talked about this at length elsewhere, but here's the basic equation:

Traffic × Conversion × Average Order Value = $$

It's the "basic" equation — basic, because it doesn't factor in customer satisfaction, which is the ultimate goal.

Traffic — or rather, qualified traffic. There's no point in enticing people who aren't in our target (or a segment that could be interested in our products but isn't addressed yet) to come and buy on our eCommerce site. It's a waste of money and time. It's therefore clearly important to focus on potential customers. Am I stating the obvious? Yes, yes, yes — we'll talk about it again once you're short on traffic and want to boost it by any "bad" means necessary (at the expense of your conversion). It will always be smarter — and more profitable — to focus on the satisfaction of your existing customers.

It will be important, in your sales plan, to include the levers to activate along with their associated budget, as well as the merchandising to roll out on your site. Surround yourself with experts: digital marketing has become highly professionalized, and you need "killers" of the trade in your corner of the ring, because your competitors won't show you any mercy. They'll help you choose which levers to activate (SEO, SEM/SEA, affiliates, social, conversational, CRM…).

Conversion, or the art of convincing a customer that this is the product they need. Obviously, the more the product aligns with your target customers, the easier it will be to convert them. Merchandising, the ease of finding products and buying (UX, for those still following along), but also the offer (price and promotion included), and the quality of the product page and its information — all these elements tied to your site (the "Place") will be your allies in closing the sale. A/B testing techniques will let you pick the best customer journey and merchandising proposition to win these potential customers over. There's a wealth of tools out there, many now boosted by artificial intelligence, that do the heavy lifting for you. A chatbot, or even better, a real human offering live advice, is reassuring for the customer — especially if they don't know much about the category (personally, I'm hopeless with drill bits or screw and anchor sizes… my basement looks like Swiss cheese as a result).

Average order value (upselling, cross-selling, good/better/best, threshold promotions…). One "easy" way to increase your sales is to steer your customers toward higher-value (and pricier) products. Upselling (pushing toward a pricier but better product) and cross-selling (adding accessories, services, and/or additional products that have nothing to do with the original purchase) are two well-known techniques for pushing consumers to grow their basket.

Another technique is to present a "good-better-best" comparison and run a promotion on the "best," with the gap between "good" and "better" kept small — so "better" acts as a stepping stone toward "best." Another one? If you're lucky enough to make made-to-order products (like computers), you can also push customers toward the higher-end component (even with a steep discount on that component, the overall price reduction will only shave off a few percentage points). You get a strong message — "50% off the top-tier processor" — with only a few percent off the overall price of the machine. Conversion guaranteed.

Little trick: even if you don't offer made-to-order products (let's stick with the computer example), you can have a "fake configurator" (like Apple does, for instance). Just say the top-tier processor is 50% off, and apply the corresponding percentage discount to the whole configuration featuring that discounted processor. Job done: you keep a strong message on your promotion — "50% off the top-tier processor" instead of "5% off the top-tier configuration."

There are still plenty of other promotional tactics worth testing with your customers to find out which ones work best: thresholds (triggered above a certain amount), € or % off, on the basket or on the product, free shipping… Conversely, in the very high-end/luxury space, you won't see discounts on brand sites. Ever. At Leica, for example, it would be the opposite: prices go up twice a year, as is common practice in luxury (Chanel bags keep climbing, to the point you wonder if they're trying to find out whether there's life on Mars). Brands in that space tend to prefer other indirect online channels, or the "refurbished" segment so dear to Apple, to sell off end-of-life stock or B-stock (returns, unsold inventory).

So you now have your action plan built around the basic equation, but there are still plenty of other parameters you can adjust: delivery options, payment methods, associated service levels…

One last remark: the process for building this action plan is identical regardless of the sector or industry your company operates in. Whether you sell clothing, shower pipes, or IT equipment, this is the method to apply. Well, it's one that works, at least. The customer experience that flows from your eCommerce strategy, on the other hand, will be unique to your sector — even your brand — because you don't talk to someone buying screws the same way you talk to someone buying a Rolex… even if it's the same person. They don't expect the same shopping experience.

Building Customer Loyalty — Why Does It Matter So Much?

Simply because loyal customers will be your brand's and your eCommerce site's best ambassadors. A happy, satisfied customer will readily promote your products and your brand. They'll come back to buy from you, and they'll convert again even more easily. A prospect who looks into your brand will read customer reviews — hopefully satisfied ones — which will help convince them that buying from you is the right choice. A nice second effect: lower-cost customer acquisition.

These satisfied customers need to be pampered. Keep the relationship alive with them, keep the "conversation" going, and not necessarily to sell them more products. Sometimes it's just about giving them information on your progress, your new products, or asking how things are going with what they bought. Don't hesitate to offer them promotional deals, or even discount coupons to use whenever they like — having, of course, first analyzed repurchase frequency so you can reach out at the right moment with the offer that seals the deal. You can also invite them to something completely different: a Grand Prix, a wine tasting… anything is possible, and there are agencies that specialize in this, such as TLC Worldwide.

Data and Its Analysis: The X-Ray of Your Business

There's no point launching into online sales without good data collection and analysis tools. Nothing — absolutely nothing — should be planned or implemented without analyzing the impact of your actions. Of course, you'll need to learn how to swim in the ocean of data without "over-analyzing" it, which risks paralyzing you.

And one more piece of advice: change one thing at a time. Otherwise you'll have no way of knowing the impact of that change if you're fiddling with every knob on the mixing desk at once.

Want to Go Further?

I could talk for hours about the action plan and everything you could do to improve your business, but it would be a lot more fun to discuss it over coffee. Get in touch — we love challenging conventional wisdom!