Ecommerce is the new frontier of business, with countless opportunities for expansion, growth, and innovation. It’s a world that waits for no one, moving at a pace that is dizzying, exciting, and occasionally intimidating. To maintain a competitive edge in this dynamic landscape, it’s essential to set good and actionable goals.
Setting good goals for your ecommerce business will help you focus on what is important. Without clear objectives to aim for, you may find yourself trying many different strategies and ultimately getting nowhere with them. That is why the goals you set should be right in line with the type of ecommerce business you want to build.
However, all business goals are not created equal. Some goals work well for some types of businesses but don’t work well with others. Because of this, you must set the right goals for your ecommerce business. Here are 8 of the most important ones you should consider setting.
Increasing Website Traffic
This should be an obvious first goal. And, a primary goal for any online business. Yet, many ecommerce entrepreneurs are overly concerned about the design and functionality of their site without working on people actually visiting their online store.
Every ecommerce business aspires to increase its website traffic. More traffic means more potential customers and a higher likelihood of conversions. This goal can be achieved by implementing an effective SEO strategy, which includes keyword optimization, link building, and content marketing.
Having a blog on your site that provides useful, high-quality content can attract visitors. Using data analytics, you can identify which marketing channels are driving the most traffic to your site and then focus more resources on those channels. For an online business, increasing traffic should be a major goal for its first year in business. However, it should also be an ongoing goal that businesses pursue throughout their existence.
Boosting Conversion Rates
Increased traffic doesn’t guarantee improved sales. Your ecommerce site needs to convert visitors into buyers efficiently. Effective product descriptions, professional photography, easy navigation, and a smooth checkout process are all part of creating a site that converts.
To boost conversion rates, ecommerce businesses should employ high-quality product images and persuasive descriptions to sway purchase decisions. The better looking and sounding the products are, the more likely your visitors will purchase.
Next, incorporate customer reviews to boost credibility and trust. Honest reviews act as social proof of the claims you made about your product. Be careful, however, to use real reviews. Fake reviews will cause you to lose the trust of potential visitors if they spot a fake.
Also, and this is one of my pet peeves, simplify the checkout process. A complicated checkout process gives your customer more time to change their mind and may add to any doubts they had about purchasing from you in the first place.
Enhancing Customer Retention
Acquiring new customers is often more expensive than retaining existing ones. By many estimates, it costs ecommerce businesses $45-$50 to acquire a new customer. This is 5 times more than retaining an existing customer.
Therefore, ecommerce businesses should prioritize customer retention. One way to enhance retention is by creating a personalized shopping experience. For instance, recommend products based on past purchases or offer personalized discounts. Excellent customer service, including prompt responses to inquiries and quick resolution of issues, also goes a long way in retaining customers. A loyalty program can incentivize repeat purchases and foster customer loyalty.
Expanding Product Offerings
By expanding the types of products available in their store, ecommerce businesses create the possibility of growing revenue as well as their customer base. There are several different ways you can expand the products you have to offer on your ecommerce platform.
First, you can collaborate with other manufacturers or vendors to diversify your product range. This could involve dropshipping, where products are shipped directly from the manufacturer to the customer, reducing overhead costs. Also, you can incorporate personalization by offering customizable products. This can increase customer engagement and loyalty.
Diversifying and expanding your product range is a strategic move for growth. It can help attract a wider audience and increase your market share. However, businesses must ensure that new products align with their brand and meet the needs of their target market. Market research and customer feedback are vital tools to ensure that new product offerings will be successful.
Improving Profit Margins
Improving profit margins is a key goal for any ecommerce business. In fact, that should be a goal for any business. However, one advantage of the ecommerce business model is the potential to reach profitability and scale is greater. Because of the potential, improving profit margins should not be a goal ecommerce entrepreneurs put off. Here are some ways to increase your ecommerce margins.
- Optimize Product Pricing- Strategic pricing is key. Regularly review your pricing strategy and compare it with competitors. Offering competitive pricing without compromising too much on profit can increase overall sales, and therefore total profit.
- Reduce Overhead Costs- Any reductions in the costs of running the business will improve profit margins. This might involve negotiating better deals with suppliers or reducing the costs of shipping or packaging. You may even switch to a more affordable hosting company.
- Upsell and Cross-sell- Upselling encourages customers to buy a more expensive version of the item they’re viewing, while cross-selling recommends related products. Both strategies can increase the average transaction value, boosting your profit margin.
- Introducing Higher-margin Products-Find related products for your site. When upselling, try to point customers to those specific products.
- Private Label Some Products-Consider developing your own private label products. This allows you to control product quality, increase brand recognition, and earn higher profits.
- Implement a Customer Loyalty Program- This can increase customer retention and the frequency of purchases. Rewarding customers for repeat purchases encourages brand loyalty and increases the average customer lifetime value.
Needless to say, improving profits is a crucial financial business goal. However, for ecommerce businesses, this goal can be obtained more quickly than many other types of businesses.
Building a Newsletter List by Offering Discounts
A newsletter is a powerful tool for ecommerce businesses. It allows direct communication with customers and provides a platform for promoting new products, sharing news, and offering exclusive discounts. Offering discounts or other incentives for signing up can increase newsletter subscriptions. Segmenting your newsletter audience based on their purchasing habits and preferences allows for personalized communication. This will help in boosting engagement and conversions.
One of the best ways to do this is by offering a discount even before your customer makes their first purchase. Be sure to have a pop-up subscription form on your website. The pop-up should appear after your visitor has been on your site for a set period of time. Also, it should be an irresistible deal that they can take advantage of right away.
Eventually, you will have an email list that is made up of customers who love to shop on your site and love a good deal. Ultimately, these are the customers you can target when running a sale or launching a new product.
Reducing Cycle Times
Efficient operations are vital for ecommerce businesses, and reducing cycle times – the time it takes to complete a business process – is an important goal. This could involve streamlining the order fulfillment process, improving inventory management, or automating customer service processes.
Reducing cycle times not only makes your business more efficient but can also enhance customer satisfaction by speeding up delivery times and resolving customer issues more quickly. While this is a non-financial business goal, it does have an impact on ecommerce business’s bottom line in the long run.
Lower Shopping Cart Abandonment Rate
The shopping cart abandonment rate is the percentage of customers who add items to their online shopping cart but do not complete the purchase. It is an important metric for ecommerce businesses as it directly impacts their conversion rate and revenue. High cart abandonment rates can mean issues with the website design, checkout process, or product pricing. All of which can deter customers from completing their purchases.
To lower shopping cart abandonment rates, you should first simplify the checkout process. Focus on minimizing the number of steps required to complete a purchase. One way to do this is by reducing the number of forms to fill out and streamlining the payment process. Ultimately, the goal is to make it easier for customers to complete their transactions. The easier it is for them to buy, the more likely they will purchase.
Another good idea is to implement a progress indicator on the checkout page. The indicator should show customers how far they are in the checkout process. Doing this can help reassure customers that their purchase is progressing which will reduce the likelihood of abandoning the cart.
Also, consider implementing a guest checkout option. This is an option that allows customers to complete their purchases without creating an account. I know that I’ve abandoned numerous shopping carts due to needing to create an account just to purchase something that is available on Amazon or another platform where I already have an account.
Setting clear, well-defined goals is crucial for the success of an ecommerce business. By implementing these strategies and continuously monitoring performance, ecommerce businesses can stay ahead of the curve and continue to grow and thrive.