Launching an eCommerce store is fairly straightforward, but building one that will actually make a profit is a whole different story.
Just like with any other venture, setting up an online shop poses many different challenges. There is so much information to sift through, and calculations to make. To be successful, you need a business plan and a carefully considered eCommerce strategy. However, that’s easier said than done.
There are wonderful guides out there that can help you make a strong start – like this one. These can teach you how to conduct proper keyword research and optimize your product pages. And what is more, they can give you tips about how to prevent performance issues (like shopping cart abandonment) and improve all the right areas.
But what if you are doing everything by the book, and still, no one is buying? How come your eCommerce strategy is not performing the way you expected? And is there a way to fix this before it’s too late?
In this blog post, we’ll discuss the five reasons why your eCommerce strategy isn’t working, and give you actionable tips on how to turn it around.
So without further ado, let’s get right into it.
1. Your Target Market Is Too Broad
As a business owner, you might feel pressured to launch a product that appeals to a wide audience in order to ensure more sales. However, in your determination to succeed, you risk losing sight of your goals.
Like it or not, you can’t satisfy the shopping needs of everyone, and you certainly don’t have to. To avoid falling into this trap, it’s better that you concentrate on a specific niche market, and obtain a clear understanding of that target audience.
How to Narrow Down Your Market and Find Your Niche?
Defining your target market may help you narrow down your competitors, improve your SEO strategy, and build a community of loyal customers and brand advocates.
To determine what your niche is, you can start with answering the following questions:
- What kind of problems can my business help solve?
- Who are the people who would benefit from this?
- What demographic categories do they fall into? (Age, location, occupation, interests, etc.)
- What values do your customers appreciate?
- How can my business win their trust and loyalty?
2. Your Social Media Engagement Is Low
Social media plays an integral part in any eCommerce strategy. It allows you to increase brand visibility, build brand awareness, communicate with your audience, and, ultimately, generate more sales for your business.
However, just setting up a social media account is not enough. You need to be proactive and create a buzz around your business, so users can learn more about your brand and feel compelled to buy your products.
Measuring your social media engagement provides you with valuable insight into how well your brand is resonating with your audience. You can find out whether your content speaks to them, if your product works for them, and, most importantly, whether they will buy from your brand again and recommend it to others.
How to Increase Your Social Media Engagement?
When a user interacts with your brand online – by liking, commenting, and/or sharing your posts, it shows that they are genuinely interested in what you have to offer.
Here are a few things you can do to keep them engaged and build a strong relationship:
- Set Clear Social Media Marketing Goals. This will generate more leads, build loyalty, or increase word-of-mouth.
- Share Interesting Posts Regularly. By drawing up a social media calendar, where you post regularly, you can create content that also helps strengthen your relationship with your followers.
- Keep Up With Relevant Events. Events are a great way to bond with your followers. No matter if it’s an official national holiday, or a special day like World Dog Day, if it’s relevant to your business and what your brand stands for, make the most of it.
- Work With Micro Influencers. If you are looking for influencers to collaborate with to build and/or strengthen brand trust, then partnering with micro influencers are a great choice. They have a very close relationship with their followers and are often considered to be experts in their niches.
- Try Social Commerce. Want to shorten and simplify your sales process? Set up a shop on your social media account and make it easier for shoppers to buy directly through your social media account with just one click.
3. Your Website Isn’t Optimized for Conversions
Having people visit your website is exciting, but what’s even more amazing is convincing them to convert. If your reports show good monthly traffic but rather low revenue, it’s a sign that you need to revisit your eCommerce strategy and better optimize your website for conversions.
The first step to boosting your online store’s conversions is to define what those look like and set a benchmark of what a good conversion rate is for your business.
Generally, a conversion happens when a person makes a purchase. Therefore, a conversion rate is the percentage of people who visited your page and bought your product.
According to Statista, the average global eCommerce conversion rate is about 2.17%. To determine your benchmark, you need to keep in mind the types of products you’re selling, the location of your target audience, and the device they are using most often to shop online.
How to Improve Your eCommerce Conversion Rate?
Any optimizations you make to your online store should have the same end goal – to boost your eCommerce conversions. In particular, they should help you understand what might prevent people from making a purchase, what website features seem problematic, and what needs to be adjusted in order to encourage visitors to buy.
Here is a list of key areas to focus on:
- Improve Your Product Pages. Make navigation intuitive, product images should be high-quality, and your SEO should have product friendly descriptions.
- Leverage Personalization. Use site retargeting to show visitors relevant personalized content and offers.
- Optimize for Mobile. When designing your site, use a responsive theme with mobile-friendly layouts. Make sure your site loads fast, content search is optimized and marketing campaigns are mobile-friendly.
- Collect Customer Feedback. When a customer puts items in their cart, but leaves the page without making a purchase, send them an email asking why. Once you’ve collected the results, analyse them and consider how your prices, product-market fit, and competition influence buying decisions.
- Troubleshoot Common Errors. Use analytics tools to examine your bounce rate, the average time people spend on page, and your site’s SEO performance. Make sure to set up alerts within your analytics tool to monitor external factors that can affect behavior in your eCommerce store.
- Reduce Shopping Cart Abandonment. Consider different strategies which encourage customers to finalize their purchases. These can include keeping a visible cart, supporting multiple ways of payment, implementing a 2-click checkout, offering guest checkout, ect.
4. Your eCommerce Business Model Isn’t Working
If you have an amazing value proposition, but your current eCommerce strategy brings in negative numbers, it might be because you’ve picked the wrong business model.
When launching an online store, chances are that you will fall into one of the four main categories: business-to-business (B2B), business-to-customer (B2C), customer-to-business (C2B), customer-to-customer (C2C). Each has its pros and cons, and you can even operate in more than one simultaneously.
The important thing is to be aware of what kind of transaction you’re going for – who do you want to sell to and what kind of business you want to have. Knowing which categories you fit into is essential for understanding the opportunities and risks, as well as finding the best ways to target and service your customer’s needs.
How to Choose the Right eCommerce Business Model?
When choosing a business model for your eCommerce strategy, start by exploring different types of online stores you want to create.
You can start by answering the following questions:
- What Types of Goods Do You Sell? Physical, digital, or service?
- Who Are You Selling to? To individual customers, businesses or both?
- How Are You Going to Deliver Your Product? This will depend on whether you sell products or services, and there are plenty of options to explore.
5. Your Pricing Strategy Is Off
Price is one of the most important factors for eCommerce success. Yes, it would be amazing if customers based their decisions solely on important features, benefits, product quality, the ease of ordering, and customer service. However, in reality, more often than not, people look for maximum value at minimum price.
To ensure your business can generate a good amount of profit and has a strong eCommerce strategy, it’s essential to implement the right pricing strategy.
How to Pick the Right eCommerce Pricing Strategy?
No matter the size of your company, there are three factors that will always affect how you price your product – costs, fair price (the minimum price you can charge while covering your costs), and relative price (a reasonable price compared to other similar products).
Once you’ve calculated these, you need to evaluate different pricing options and choose the one that would fit your business model best.
Here are seven categories to explore:
- Cost-Based Pricing. Add up all your costs and set your profit margin.
- Competitor-Based Pricing. Calculate the average selling price of your competitors’ products, and set your profit margin based accordingly.
- Value-Based Pricing. Set your price based on the customer’s perceived value of the product and the competitive environment.
- Dynamic Pricing. Base your pricing strategy on demand, timing, and fluctuations in competitors’ prices.
- Bundle Pricing. Group similar products together for a discounted price.
- Loss-Leader Pricing. Offer products at a lower than Recommended Retail Price (RRP) price to increase customer interest.
- Price-Skimming. Launch new products at a high price to create a sense of exclusivity and attract buyers that have a strong desire to buy, then lower the price over time to attract the next and subsequent layers of the market.
Setting up an online shop and ensuring that everything goes according to plan is easier said than done. There are so many things to consider that could go wrong. From targeting a market that’s too broad to choosing a business model with a pricing strategy that is off. ,
Fortunately, we can help you discern the possible reasons why your eCommerce strategy might not be working and set you on the path to success.
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