In my latest article, I discuss 5 key decisions needed to drive growth within your business. Read more.
Looking to new opportunities in the year ahead, in my previous post, I asked "Does your business have the E-commerce growth mindset?". In it, I looked at 5 key investment decisions to drive growth and promised to drill down into some of the latest techniques. So in this article, I'll look at some of the options for innovation across the retail customer lifecycle touchpoints shown below.
1. Governance
This is your foundation for growth. Governance is about asking questions about how you manage your resources needed to develop strategies and put in place the right action plans, budgets, martech and KPI dashboards to test, learn, refine to support growth.
It's why we focused on mindset in the previous article, since strong leadership is needed to ring-fence time and direct teams and agencies to enable planning and experimentation as suggested by the '70:20:10' rule that I'll cover in the next section.
The challenge of management for E-commerce marketing today is that there are so many opportunities to grow awareness of your brand and follow-up on initial interest, that it can be easy to miss out on the opportunities to remind and persuade people interested in your product to buy. Consider the Verto Analytics research on the number of customer touchpoints on the path to purchase.
In this buying scenario, where Justin is looking for headphones, a staggering 375 touchpoints were involved including generic and long tail searches, YouTube reviews and many retail and brand website interactions on mobile and desktop before final purchase on desktop.
To me, this complexity shows the importance of having an "always-on" communications plan to maximise the chance of persuading a buyer to purchase based on their previous interactions. It also implies the need for technology assistance using Artificial Intelligence to assess the opportunities to advertise or send reminder messages and then to focus on the most relevant. We'll look at some examples of this in the next section.
2. Media
The 70:20:10 rule is a useful "rule-of-thumb" for thinking about how to find growth from online media investments.
You should focus 70% of investment on sustaining and improving the high volume, high ROI activities. 20% should go into looking to optimise or reallocate budget from less effective media and 10% should be reserved for trialling new techniques such as innovations from the platform providers or techniques that a company hasn't tested before. You can think of these investments as both paid media investments and the time spent in optimisation or in the case of owned and earned media content production and distribution.
In 2020, some recent innovations from the platform providers to consider include:
Google introducing Shopping Ads within Gmail
Using Instant Experiences or Facebook Custom audiences to increase retail loyalty
Improved support for natural language search queries
Reviewing the opportunity of Google Discover in your sector
3. Experience
Driving growth through improvements in user experience again requires the right mindset for innovation and experimentation. Within online retail, AB testing has proved more popular than in many other sectors since improvements to the design, layout and messaging on different page types is so effective in delivering improvements.
Across the customer journey there are many alternative Persuasive design patterns that can be tested from how the online value proposition of discounts, delivery and returns is explained through to social proof from reviews, recommendations and endorsements. Scaling up the number of tests can help drive growth, but may eventually be subject to diminishing returns once optimisation has been made. Of course, improving the experience in terms of download speed is also a key factor, with many websites still failing to load within Google recommended times.
Once page layouts and journeys have been optimised, the biggest growth opportunities are around improving the relevance of product recommendations and promotions through online merchandising. Selecting the best Artificial Intelligence solutions using machine learning to make recommendations based on historical transactional data is a key concern for many retailers at the moment. It's challenging since many vendors claim an AI solution, but the algorithms vary in sophistication, manual intervention may be required and changes to merchandising processes will be required.
Given the complexity of many retail sites, with tens of thousands of products being commonplace, future scalable solutions to drive growth will optimise across these products and different pages types to maximise profit. They also need to take long-term seasonality and shorter-term changes in product preference caused by promotions into account.
This example of an exposure strategy from Apptus shows what is possible where an A/B test can establish the effect of switching exposure strategy across a site. Metrics for conversions, revenue, and profit can be monitored through the test period and predictions of the impact of a strategy switch can be made and visualised.
4. Content
Within E-commerce, it is the category and product content and related user generated reviews that is critical in attracting visitors to a site and encouraging them to purchase. So, the techniques to increase persuasion and relevance we have just covered are most relevant in this section.
Traditionally, relevance is achieved by sequencing product lists using a range of techniques. A benchmark of the top 50 global e-commerce brands showed that the most popular online merchandising techniques to offer customer choice include:
- What’s new (86%)
- Themed seasonal areas or collections (54%)
- Top sellers (40%)
- Trending now (18%)
- Top-rated products (13%)
So, the balance between these forms of recommended content and bundling can be tested too.
Beyond product content, the role of blogs and customer magazines in driving growth should be considered too. This form of content can have a big role to play if it can drive customer engagement and also support organic search through acquiring links and through intelligent internal linking strategies.
5. Messaging
Within my simple breakdown of digital marketing activities, messaging refers to email, social media, push notification and on-site chat interactions that Gartner call "conversation marketing". While many retailers have run tests and offer Chatbots, I haven't seen a single example of where the use of this technology has significantly boosted sales growth.
So within the messaging techniques its social media, email marketing and where mobile apps are involved mobile notifications that are most important to review for growth opportunities. Today, the greatest traction in social media can be gained through paid media, so what we recommended about innovating with techniques like using customer lists for targeting is relevant here.
Typically, for e-commerce businesses, email marketing is the third most important channel after organic and paid search for driving retail sales. So, the biggest opportunities are in making email marketing work harder. This may involved AB testing and personalization for the customer newsletter which can now link to the AI-based personalization techniques that we discussed previously. There are also options to improve the many automated programmes as suggested by this lifecycle chart focused on email touchpoints:
For example, you may have one or two welcome emails, but they aren't personalised or adding additional emails based on response to the first emails received could be added.
I hope I have prompted some ideas for growth-driving techniques that you could review. There are certainly no shortage of options and new options are becoming available all the time for those who are agile enough to exploit them.
If you'd like to chat more about driving growth within your business, get in touch with our experts today.
