“Let’s put the products online and then we’ll see if they sell.”
For many years, e-commerce was either the cherry on the cake or the ugly duckling of the company that "stole customers" from other distribution channels. Companies did not know how to deal with this new channel, nor did they know where to place the e-commerce team (which very often consisted of a "Swiss army knife" manager who relied on the company's internal or external resources).
In marketing? In the retail team? In IT?
I've even seen an e-commerce team in Finance sometimes...Why not. At least we'll have less to fight for to get an additional budget!
Fortunately, this hot topic has evolved and e-commerce is now treated like any other distribution channel (or even considered a little more in view of the margins generated in certain sectors).
The e-commerce strategy, which was to "put the products online and then we'll see if they sell", has turned into a real strategy integrated into the company's overall strategy and decided at the highest level, that is to say in the management committees and other "Comex".
“E-commerce is the small business within the big one”
As I used to say "I take care of the small business in the big one", we must keep in mind that e-commerce is a real "small" business (and yet there are e-commerce turnovers that would make the smallest SME with a turnover in 2 figures pale).
This is why it is necessary to establish a strategy that is broken 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 that called themselves e-commerce strategy… BIIIIP, wrong, not good, even dangerous. You don't come back in the second week.
If you come across agencies that talk to you about action plans for strategies. Run away! They simply don't know what they're talking about.
So what is an e-commerce strategy?
An e-commerce strategy must clearly define a few points which, for some, will seem to amount to stating the obvious, but here are a few reminders:
What products will we sell on this channel? (And this may vary if the company/brand has its own sales site or if it sells on a marketplace)
Who? Do you really know your customers? Or even your customer segments? And even those that are not currently addressed? Opportunities…
When? Yes, it might seem silly, but even if the site is open 24 hours a day, 7 days a week, there are still periods to favor: seasonality and holidays (summer, winter, Christmas, Back To School, etc.), special events (sales, fashion week, etc.), events related to the e-commerce sector (Black Friday and other Singles Days), events related to the company's sector (trade fairs, etc.), product life (launch, "cash cow", end of life, or overstock), etc. All these timing elements must be taken into account and are specific to each industry.
How? Have you defined your pricing and promotions based on the channel (own site, marketplace, or even telesales, etc.)? Based on the timing (all the aforementioned periods? Based on the marketing levers (affiliates, SEM, social, etc.)?
Does this remind you of the "4Ps" of marketing? Yes, that's what it's made for! Place, Price, Product and Promotion. We even add a 5th P in this case which is "People" (the "to whom we sell").
This strategy should be your bible, your reference when you ask yourself a question. This is why, the more detailed the strategy is, the fewer pitfalls you will have in applying it (see the action plan).
You can start from people:
You have customers (or for example you have identified customer segments, or even a segment not yet addressed) and you find products for them. Then, build your plan (I will talk about it later).
You can also start from the products:
You list the products and/or product ranges that you want to sell (without necessarily having to sell EVERYTHING, let's be clear) and you find customers in the target with an affinity for your products. Similarly, you build your plan (which will necessarily be different than if you start with customers).
It all depends on the DNA of your company and its management… But here, this decision is in your hands.
It is therefore essential to speak to ALL parts of the company, and not necessarily in this order:
Products to measure the opportunity to sell certain products rather than others
Marketing to integrate once again into the global strategy and increase the strike force, or even simply agree on the brand guidelines to follow
Sales to flatten the promotional plan and avoid shooting yourself in the foot
Support because inevitably you will have feedback and questions from your audience, before or after the sale
Finance because you need a P&L to measure your business and its profitability
Logistics and supply chain (with perhaps the opportunity to create product exclusivity and ensure that end-to-end logistics operate smoothly)
IT of course, which will co-sign the integration of your plumbing into the gas factory that is the ERP
HR because you're still going to need people at some point or another
and the General Management who will monitor you closely!
This is with the aim of establishing links with all stakeholders.
Imagine that the product and/or supply chain part does not provide the volumes needed for online sales? Well, you will never have enough products to sell to reach your sales targets.
If Finance is not in the loop and does not establish a P&L, you will never know the profitability of your “small business”.
One last thing? If support does not establish a process in accordance with logistics for product returns from e-commerce, your customers will send you the products, which ultimately they no longer like, directly to the head office (true story).
Good luck finding your little ones!
A word of advice, take the time to write your playbook with the processes, the tools to use and the people responsible for ecommerce in the existing teams if you cannot create a complete ecommerce team….for the moment. This will come with profitability.
Well, that's it: you know more about your sales channel, how it should work from end to end, which products will be put on sale, what the sales objectives are and if possible by product line, direct or indirect online channel (marketplace), who is responsible and who acts/decides at all levels of the organization.
You have written your strategy and your playbook which all stakeholders can participate in and refer to, or even challenge in a while to rectify the situation if necessary, refine it, and complete it.
You have your lighthouse (no, not "on" the lighthouse). You can define your action plan.
The action plan
You're lucky, you detailed your strategy correctly.
It's time to move on to the action plan starting with the design of the site but before that, it is important to establish a sales plan and how this is reflected in terms of marketing and merchandising.
Customer experience
A subject dear to my heart. The customer experience is the result of every interaction that the customer will have with you. He will get an idea of your brand through:
marketing,
points of contact that he will have with the company, directly or indirectly,
of the quality of the products,
services rendered,
of the quality of the site
…
You will be observed in detail! And "(r)etail is detail"
I have written many Linkedin posts on the subject and if you want to read them, the references are at the end of the article.
Follow the white rabbit
The consumer is not going to come to your e-commerce on his own. You will have to bait him and I will talk about this below.
He also doesn't go to your e-commerce site to buy a product but to have a "purchasing experience".
My good sir (or my good lady), we no longer go to a restaurant for lunch or dinner but to have a culinary experience (and that includes the welcome, the service, the atmosphere, the payment, ... even the "good" digestion of what you have eaten!).
An e-commerce site must take into account almost exclusively this customer experience and you will constantly analyze and refine this customer experience from end to end because the customer is king. And this king is especially just a few clicks away from competitors (and this is even more true on a marketplace).
I'm not going to hide it from you, but it's in your best interest to surround yourself with UX (User eXperience) specialists to design your website, like an architect who will present you with plans showing spaces, having functions, all embellished with a decorative line and a path (customer journey) limiting the points of friction to achieve your goal which is... to sell? NO! Which is to satisfy your customer .
This site must therefore provide a “top-to-bottom” customer experience in line with your brand DNA!
Merchandising is an integral part of this customer experience and we will take care to reserve spaces for "highlighting" products cleverly distilled during the customer journey to elegantly influence purchasing behavior but also to meet sales objectives (ranges, products, seasonality, promotion, etc.) and according to your sales plan.
I won't go into detail about A/B testing or real-time personalization, but know that we are doing wonders today in terms of technology, but I want to hammer home again that your goal is to SATISFY YOUR CUSTOMER .
This merchandising will therefore be adapted according to the products to be sold which will have been “marketed” by the different levers to which you will have allocated a budget.
The “basic” equation
There too, I spoke about it at length in one of my blog articles (or even on Linkedin).
Traffic X conversion X average basket = $$
This is the “basic” equation. Why basic, because it does not take into account customer satisfaction which is the ultimate goal.
Traffic and I should say qualified traffic because it is useless to encourage people who are not in our target (or a segment possibly interested in our products but not yet addressed) to come and buy on our e-commerce site. It is a waste of money and time.
So it is obvious that you need to focus on potential customers.
Am I breaking down an open door? Yes yes yes, we will talk about it again when you are short of traffic and you want to use all the "wrong" means to increase your traffic (to the detriment of your conversion).
It will be smarter (and more profitable) to focus on satisfying your existing customers (ah, you see that we don't take it into account in this equation, our customer satisfaction ?!).
I will not talk about customer acquisition techniques, but it will be important in your sales plan to include the levers to activate with their associated budget as well as the merchandising to deploy on your site.
Hello Excel to make a nice "bed sheet" with all these details. But if you are good and if you ask me, I will send you my working files that I have been using for 2 decades.
Surround yourself with experts . Digital marketing has become highly professionalized and you need to have marketing "killers" in your corner of the ring because your competitors will give you no quarter.
They will help you choose the levers to activate (SEO, SEM/SEA, Affiliates, Social, Conversational, CRM, etc.)
Conversion or the art of convincing a customer that this is the product they need.
Obviously, the more affinity the product has with the customers you are targeting, the easier it will be to convert them.
Merchandising, the ease of finding products and purchasing (the User eXperience for those who follow), but also the offer (price and promotion included), the quality of the product sheet and its information, ... all these elements relating to your site (the "Place") will be your allies in finalizing the sale.
A/B testing techniques will allow you to choose the best customer journey and merchandising proposition to attract these potential customers. There are a plethora of tools, notably boosted by Artificial Intelligence, that will do the work for you.
A chatbot or even better, a human who advises you live, is reassuring for the customer, especially if they don't know much about it (personally, I'm useless with drill bits or screw sizes and associated dowels...so my cellar is a Swiss cheese).
The average basket (upselling, cross-selling, good/better/best, threshold promotion, etc.)
An “easy” way to increase your sales is to direct your customers towards high value-added (but also more expensive) products.
Upselling (pushing towards a more expensive but better product) and cross-selling (i.e. adding accessories, services and/or additional products that have nothing to do with sauerkraut) are two well-known techniques for pushing consumers to increase their shopping cart.
Another technique is to present a "good-better-best" comparison and to promote the best, the gap between the good and the better being minimal (and therefore this better is used as a "stepping stone" to push towards the best).
Yet another? If you are lucky enough to make custom products (like computers), you can also push to buy the top component (even with a big promotion on the component, the overall price reduction will be only a few points). You have a strong message (50% off the top processor), with only a few % off the overall price of the machine. Guaranteed conversion.
Little tip, even if you don't make custom products (let's always take the example of computers), you can have a "fake configurator" (like Apple for example). Just say the top processor is -50% and make the corresponding % reduction on the overall configuration with this discounted processor.
There you have it: you keep a strong message on your promotion. “50% off the higher processor” instead of “5% off the higher configuration”.
There are many other promotional tactics that you will need to test with your customers to find out which ones work best: threshold (those that are triggered from a certain amount), € or % off, on the basket or on the product, free delivery, etc.
Conversely, on the very high end/luxury, you will not see discounts on brand sites. Never.
At Leica, for example, it would be rather the opposite. Prices are increased twice a year, as is the case in luxury goods (Chanel bags keep going up, making you wonder if they want to know if there is life on Mars).
We will prefer other indirect online channels or the "refurbished" part dear to Apple to sell end-of-life or B-stock (product returns, unsold items).
So you have your action plan on the basic equation but there are still multiple parameters that you can modify like delivery options, payment methods, associated service levels,...
Just one last note: the process of creating this action plan is IDENTICAL regardless of the sector or industry in which your company is located.
Whether you sell clothes, shower hoses or computers, this is THE method to use. Well, it's one that works.
On the other hand, the customer experience that results from the e-commerce strategy will be unique to your sector, or even your brand, because you don't talk to someone who is going to buy screws like someone who is going to buy a Rolex... even if it's the same person. They don't expect the same purchasing experience.
Building customer loyalty . Why is it so important?
Quite simply because they will be the best ambassadors for the brand/e-commerce site.
A happy and satisfied customer will easily promote your products and your brand. He will come back to buy from you and he will be “reconverted” even more easily.
A prospect who will inquire about your brand, will read customer reviews and hopefully, satisfied ones. Which will finish convincing him that buying from you will be the right choice! Second Kiss Kool effect for lower cost customer acquisition.
These satisfied customers must be pampered, cherished. You must maintain the link with them, continue the "conversation" and not necessarily to sell them your products. Sometimes just by giving them information on your progress, your new products, to ask them how it is going with the products they have purchased,...
Don't hesitate to offer them promotional offers, or even discount coupons so they can buy whenever they want (you will obviously have previously analyzed the frequency of repurchase to come up with a communication at the right time with the killer promo...).
You can also invite them to something else: invitation to a Grand Prix, a wine tasting, ... everything is possible and there are specialized agencies like TLC Worldwide .
Data and its analysis : an X-ray of your business
It is pointless to start selling online if you don't have good data collection and analysis tools.
NOTHING , absolutely NOTHING can be prepared or implemented without analyzing the impact of your actions.
So obviously, you will have to learn to swim in the ocean of data and not over-analyze your data, which risks paralyzing you.
"I told you not to touch!"
Oh and then, just a little advice, change ONE thing at a time. Otherwise you will have no chance of knowing the impact of this change if you start touching all the buttons on the mixing deck!
I could talk to you for a long time about the action plan and everything you could do to improve your business, but it would be nicer to discuss it over coffee!
You know where to reach me if you're interested!
In the meantime, here are the links to my little posts:
Happy reading!
