Faced with decreased consumer spending and declining brand loyalty, eCommerce businesses are searching for ways to boost their efficiency to meet their goals. We asked five eCommerce experts to share their number one tip for optimizing an eCommerce business.
1. Determine the total cost of ownership for your tech
Customer acquisition costs are skyrocketing, and brand loyalty is tenuous. To continue to grow, eCommerce brands must extend customer lifetime value (LTV). The best way to do this is through subscriptions. Ordergroove data shows that, on average, subscribers have an LTV that is three to four times great than one-time purchases.
Brands with a subscription platform or homegrown solution should examine the total cost of ownership of their tech. There might be inefficiencies dragging down your ROI. For example, homegrown solutions require significant dev work to maintain and additional software to operate at their peak. You can free up your resources by migrating to a dedicated subscription solution.
As for brands with a subscription platform, reexamine the solution’s pricing model to determine if there are any hidden costs in dollars and person-hours. Some subscription platforms charge merchants a transaction fee each time a consumer purchase a product. It might only be a few cents, but it adds up quickly. When analyzing your person-hours, pay special attention to your SKUs. There are subscription platforms out there that force merchants to keep duplicate SKU catalogs, meaning whenever they want to add or update a promotion, they must do it in two places. It’s a huge time suck for your subscription team.
2. Harness the power of AI
The brands that grow the fastest this year will be the brands that harness the power of AI.
Between ChatGPT, Notion’s new AI feature, and all of the tools we’re seeing pop up, it’s clear that AI will only continue to grow. Start now, find a few AI tools that interest you, and just have fun with them. Because the longer you wait, the harder it’ll be to catch up.
From generating ad creative and copy to elevating your customer experience with personalization and 24/7 chat, AI is affecting all areas of a brand’s organization. In this age of digital disruption, brands that prioritize AI will not only be able to survive but thrive.
3. Deliver a better customer experience
Make customer experience your moat.
Improving customer experience, as a concept, is evergreen. What continues to evolve are the tools and the technology to help make every aspect of providing a better experience easier, more automated, more data-driven, and ultimately more delightful.
How your customers feel about your company is your biggest competitive advantage, influencing buying decisions, loyalty, word-of-mouth referrals, and reputation. Take advantage of the technology and data your eCommerce forefathers of the early 2000s would have killed for.
4. Prioritize your secondary analytics
Take a look at your secondary analytics. Everyone is looking at their main metrics like conversion rate, cart abandonment, bounce rate, etc. But go a step further. For example, look at how many pages are traveled on average before leaving your site, then fire a personalized exit offer one page before for proactive retention.
This kind of analysis can provide a more nuanced understanding of not only your customer behavior but also fill in gaps in the customer journey you didn’t even know you had.
5. Focus on your referral and loyalty programs
My number one tip for optimizing an eCommerce business today is to ensure that your tech stack integrates with each other so that you can automate and personalize your referral and loyalty program. For example, if you’re rewarding customers for everyday actions, like subscribing to emails or texts, ensuring that you can track those actions with your email service provider and loyalty platform and reward customers at scale is key.