There are two things you have to do to grow your business firstly retain and nurture your existing customers and secondly find and acquire new customers. The essence of competing successfully often comes down to being unique, delivering excellent service and staying connected to your customers.
In today’s The Business of eCommerce Podcast we are thrilled to welcome
- Becci Harrison of Fishers of Newtownmountkennedy
- Sarah O’Connor of Holly and Willow
- Robert Shields of The Cope Donegal
- George Allen of Feel Good Bikes
- Anne Marie and Eimear of Wild Atlantic Wicks
Holly and Willow and Wild Atlantic Wicks are two new ‘Pandemic Babies’ brand new businesses that tell a story about the importance of doing something new and unique to attract new customers
There are many candle providers out there but Wild Atlantic Wicks by creating candles with wooden wicks and using Irish Language names and quotes as a core part of the product have successfully launched their range of natural candles direct to the consumer and also through gift outlets.
Holly and Willow, a 100% online business delivering high-quality Faux flowers wreaths and arrangements, something that was not readily available in the Irish market. Building on previous experience and capability in the wedding flowers business they launched this offering at a time when we were spending more time in our home environments and looking for ways to brighten them up. Producing an excellent product is always a good start on the road to success.
Traditional Retailers Like Fishers and the Cope have a different set of challenges but also advantages to deal with. On the plus side, these are businesses that are part of their respective communities with loyal customers and customers who are used to getting excellent service. But those customers expect to be able to engage with their favourite businesses digitally also. They want that to be seamless, if you know them personally when they walk through the door then they also expect you to recognise them when they arrive at your website. Strong customer loyalty programmes, offering the full range of products and having that experience well integrated with all the existing systems in the business is crucial to success. Testing, learning, and improving are all key parts of bringing those existing customers with you on this journey and not losing them to some other digital outlet.
The pandemic has seen a boom in cycling and a shortage of supply, so finding new customers might not have been a recent issue, but now that things are returning to some sort of normal, how does a business continue to grow once competition begins to return to the market. Service is a constant but sometimes that service is delivered by what your website says and not just what you do. Can you build product pages that truly help a customer choose the right product for them and that they trust enough to part with the asking price which can be as high as €5000?
When you put these threads together and you are looking to see how you measure these in your eCommerce management system – there are two key metrics you have to consider and measure to make sure your eCommerce business will be successful in the long term – they are Average Order Value and Customer Lifetime Value.
These are really important to understand and know because as well as telling how well you are doing in retaining and nurturing your existing customers they also determine how much you can afford to invest in marketing or advertising to acquire new customers and sales.
So for brands and merchants who are selling products at the lower end of the price range – they have to be very efficient to ensure that their traffic in the first instance converts well but more than that to succeed in the long term they have to focus on programmes to increase the Order value whether that is volume discounts or bundle deals for example.
eCommerce advertising is generally on a pay per click basis, but the cost to acquire a new customer is your cost per click multiplied by your conversion rate of those clicks to a sale. Put simply if the cost per click is 50 cents and your conversion rate is 5% then every new customer you get is going to cost you €10 euros. If they only come once and buy one product for €20 euros then there is a pretty good chance that is not profitable. If on the other hand you do a good job of nurturing that customer and they come back and buy 4 products at €25 for the next three years then that €10 resulted in €300 to the business – a much better position. The trick is turning as many of these new customers into repeats and very often businesses don’t focus enough on that. So email campaigns, Loyalty programmes, and being very focused on engaging the customer after the first purchase are the route to success.
On the other side of the equation if I’m making a €5000.00 purchase online then I want to be assured that I am making the right choice. So in that case maybe the right place to focus on is getting a good conversion rate and really making sure I answer every possible concern or question a customer might have on my product pages. You have to be clear and transparent in showing how you are contactable if there is an issue, what your policies are, and demonstrate an excellent level of service. This is where we are seeing the growth in areas like video reviews and explainers embedded into product pages to make this experience so much better.
Enjoy the listen as we talk to our guests about their challenges and successes in this space.