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Tips & Guides — 26 May 2022
6 tactics for competing with eCommerce market leaders
eCommerce is one of the most appealing industries to take a niche in. The flip side is that you need to compete with enterprises that have already taken a big piece of this cake. Luckily, the right marketing strategies can help you solve this problem. Let’s dive in to learn how to take the teeth out of this competition and win your market share.
With increasing internet adoption and a number of digital buyers, eCommerce has been growing perpetually for the previous eight years. The Covid-19 pandemic outrage with multiple physical store shutdowns accelerated the eCommerce adoption rate to double digits. As a result, in 2020, the value of sales in this sector surpassed $4.2 trillion.
This surge led to an influx of new businesses and the expansion of online retailers and marketplaces. Though the eCommerce market is filled with various startups, shops, and platforms, customers tend to favor the industry giants. In the US, the online shopping adoption leader, the market share of Amazon and top retailers, including Walmart and eBay, surpasses 70%.
Globally, the share is lower but still prevailing – 57% of customers worldwide shop exclusively or mainly on marketplaces. The remaining market is occupied by multiple SMBs, which have two possible strategies to keep their heads above the water. The first one is adopting marketplaces as a sales channel; the second is differentiation and strife to take place under the Sun.
Joining a marketplace may come across as a winning strategy. However, some eCommerce businesses operating on marketplaces face challenges and roadblocks. They report the hindered access to meaningful data, high commissions, lack of ownership, and other barriers that potentially cause the disease in revenue.
On the other hand, going head to head with industry leaders is a tough call. Still, a small eCommerce retailer or brick-and-mortar store that decided to expand online can stand a chance of winning over new customers and building its audience. The key is to provide the customer experience eCommerce giants couldn’t deliver and adopt new technologies and digital marketing strategies.
Navigating a highly competitive industry requires thought-through tactics to strike a chord with potential customers and keep them engaged with your brand or business. In this part of the writing, we’ll unpack six of them.
A vast share of eCommerce sales occurs accidentally. Modern consumers rarely discover specific products when exploring eCommerce sites intentionally. 70% of online buyers shop while engaged in other activities, e.g., surfing the Internet or scrolling through social media. If your brand is not where your customers are, you risk losing a great deal of sales.
To help online shoppers discover your brand and hook more prospects, you need to offer them a convenient shopping experience without leaving their favorite platforms.
The surefire way is to take on social commerce – over 3.6 billion people worldwide use social networks. The most-used platforms, Facebook, Instagram, and Pinterest, not only accumulate the broadest audience but also offer a robust set of shopping tools, allowing you to sell in feed, stories, live streams, and so on.
Review websites are another way to get your eCommerce business in front of potential customers. Though they do not have a built-in shopping functionality, their importance shouldn’t be downplayed. A vast part of consumers browses through such resources before buying a product, which tells about their significant influence on purchase decisions.
The number of smart devices is perpetually growing, so customers often start their buyer journey on a smart speaker or phone and finish it on a laptop. eCommerce platform Criteo found out that clicks or research on mobile preceded 30% of all desktop transactions.
Online stores need to allow a seamless transfer between various devices to boost sales, as 81% of buyers want frictionless cross-device shopping. And “frictionless” means that a customer can proceed with the checkout process with a new device on the same step they stopped on the previous gadget.
Hassle-free switching between devices may be achieved by storing customer data in the cloud and linking it across platforms. However, nurturing a customer and warming up their desire to purchase shouldn’t be overlooked. Employ thoughtful and timely marketing activities, such as email and push notification reminders, social media and Google ads, and other retargeting options.
The pandemic and related economic challenges made global shopping behavior less conservative. Since the Covid-19 pandemic started, 36% of the US buyers tried a different brand, and 33% switched a retailer or way of shopping. Moreover, most of these consumers are eager to continue incorporating new brands into their shopping routines.
This desire to test something new may be a great chance to increase the customer base for brands and retailers. To nail it, online businesses need to provide better value as a great chunk of shoppers consider it the main reason to switch to a new brand.
One of the ways to win over the former eCommerce giants’ clients is to offer them killer deals and spread the word about these offers across various communication channels. Try to focus on the most credible sources of information – bloggers and social media influencers. Millennials and Gen Z, who prevail among online shoppers, trust tips from these opinion leaders almost as much as friends’ advice.
The downside of customers’ eagerness to give a shot to new shopping behaviors is the higher possibility of leaving your brand or website for something else. Building loyalty becomes the bedrock of getting sustainable profits and competing with leading eCommerce companies.
The obvious tactic is to constantly nurture your clients by sending them alerts or emails with discount codes or new items in stock. Also, you may retarget them using Facebook dynamic campaigns or Google ads. These methods are effective for cross-selling complementary products or showing the running-out-of-stock goods to provoke FOMO.
Subscriptions are another way to bind customers to your eCommerce store. The subscription model does not necessarily imply sending the sauce of the month. Instead, you can offer a bargain on the goods consumers would need regularly. For instance, if they bought dog food once, suggest they subscribe to regular delivery and save $3 on each pack.
Good old loyalty programs with discounts, gifts, and unique offers are also not losing steam. To squeeze every bit of value from them, think of ways to hook clients on your loyalty program. Get inspiration from Starbucks. The brand rewards customers for interacting with its mobile app and making specific quests, such as visiting a coffee shop three days in a row. This tactic makes Starbucks a go-to place and keeps shoppers interacting with a brand.
Business owners operating in highly competitive environments tend to do everything solo. This approach has more flaws than it seems at first sight – attempts to embrace every business process in such a complex undertaking may result in poor service and growing expenditures. In contrast, making connections with others may provide positive results.
To achieve excellence, try to build a collaborative ecosystem of partners. It may include developing supply chains with specific companies exclusively to get the best deals from them. Great potential is rooted in partnerships with technology providers; they can help you improve the customer journey, offer new convenient payment methods, or provide more efficient delivery and return options.
Finally, you can make your clients your best allies by offering them a referral program. The latter implies rewarding participants for recommending your goods and services to others. It helps you cut costs on advertising and brings in the most loyal new customers – buyers driven by referrals are more likely to shop from a retailer regularly.
The eCommerce industry is rapidly changing, as well as the modern world in general. Strategies that once have shown efficiency are not carved in stone – an online shop needs to experiment constantly to stay competitive.
Perpetual innovations are what have turned Amazon into a market leader.
Look at what your competitors offer to their clients – if done right, adopting and tweaking the best tactics may benefit your business and blow rivals out of the water. At the same time, you should keep exploring your customers’ behavior, needs, and pain points to turn them in your favor when it’s time.
One more bulletproof strategy is to monitor global technology trends to get some inspiration. For example, you may notice that the number and adoption of connected home devices have been steadily increasing for the last decade. All these smart TVs and fridges are emerging touchpoints with your prospects that may become great sales channels one day.
Applying the tactics listed above may be challenging for medium and small businesses. Building multi-channel presence and promotional activities, keeping prospects and customers engaged, and running persistent experiments drain marketing budgets and human resources. Yet, there is a way to implement all winning strategies at a low cost – partner or outcome-based marketing.
Imagine that others do all the heavy lifting of promoting your eCommerce business across various platforms and advertising channels; you need to pay only for the delivered results. This is how partner marketing works in a nutshell.
Relying on the outcome-based principles, you can work with the following categories of partners:
Partnerships can help you drive traffic to your eCommerce website, generate sales, incorporate new promotion channels and techniques, and experiment with advertising formats. The best part is that you pay only for the results, whether impressions, online store visits, or purchases.
You may easily spot the underperforming promotion channels and tactics and change them for more efficient ones with good software at hand. That’s what makes partnerships an outcome-based way of promoting an online business.
Want to explore other benefits of outcome-based marketing, learn how partnerships can help you win the competition in eCommerce, and master the best strategies? We have prepared the informative guide “Outcome-based marketing. Why partnerships should be at the top of your strategy”, which will give you all the answers.
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