Top Challenges and Priorities Our Clients Are Facing in 2016
It’s hard to believe we’re halfway through 2016! If you’re like most ecommerce store owners you’ve experienced a mix of success stories and challenges so far this year.
We wanted to find out from our own clients what’s working and what’s not and hope you can learn a thing or two from your fellow online store owners. After surveying our customers we found the top challenges and priorities they are working on in 2016.
Top Challenges for Ecommerce Stores in 2016
Challenge #1: Thinning Margins
Growth does not come without it’s challenges for most ecommerce companies. Our clients say one issue they are trying to overcome is thinning gross margins as a result of their growth.
While paid advertising is working best for our beauty products client, the store owners say ad costs continue to creep up as more advertisers bid against the same audience.
Challenge #2: Mitigating Risk
Managing an ecommerce business is a roller coaster ride most days and does not come without risk. We wanted to find out what specific risks stores face and how they overcome them.
Our client that sells beauty products is self funded and feels the most risk from being cash strapped. Accurate data on margins and revenue is critical to sustainability.
Glew’s client in the healthcare and lifestyle sector is vulnerable to outside forces in the industry. Company leaders say they go beyond and above what is required in terms of regulation in order to mitigate risk.
Challenge #3: Store Growth
Our store owners point to several strategies that factor into store growth. Email and word of mouth marketing is the number one driver of growth for one of our clients. While another, a beauty products company, says paid advertising is working best for them.
External forces in the regulated industry of healthcare related products had an impact on one of our clients. Less restrictive regulations and evolving public perception were both contributing factors to their growth.
Top Priorities for Ecommerce Stores in 2016
Priority #1: Product Profitability
The profitability of products and orders is the main focus and goal of most of the store owners we surveyed. Every dollar especially counts for one of our clients who is self funded.
Insight into profitability is enhanced with Glew, giving company leaders a better understanding of revenue, gross margin, most profitable products, and cost of goods sold.
While turning a profit is important, one store owner says most of their time is spent focused on the quality and development of the products they sell.
Priority #2: Customer Connections
The ecommerce clients we surveyed all agree that spending time connecting with customers is among their top priorities.
One store owner has dedicated customer service reps available to answer customer questions and improve the customer experience.
Another online retailer uses call centers to make sure 90% of their clients are contacted at least once a month.
Glew’s customer insight data is useful in this area, helping clients identify at-risk customers and other segments of buyers who could benefit from personal outreach.
Priority #3: Precise and Effective Marketing Strategies
Email marketing tops the list of effective outreach strategies for the online stores we interviewed.
The marketing team at one online store uses Glew to segment and target customer groups with personalized campaigns. The personalized outreach has made a big difference in engagement rates and conversions.
Glew’s insight into purchase behavior and frequency, lifetime value potential and VIP customers help online stores target their outreach with extreme precision.
Priority #4: Measuring Success
When it comes to defining success, store owners are obviously keeping a close eye on sales and revenue numbers, but customer acquisition is top of mind for most.
That’s in line with the norm. Stats on shopper acquisition show ecommerce stores devote 80% of their spend attracting new customers.
As we march into the second half of 2016, our clients plan to use more of what Glew has to offer in order to boost profits and grow their customer base. One of our customer’s is looking forward to using the predictive analytic features in Glew to calculate future Lifetime Value (LTV). Understanding and acting upon this insight is proven to increase profit margins and reduce marketing spend.
We want to hear from you!
There is perhaps no better resource to learn ecommerce strategies for success than fellow store owners. Where have you found success so far in 2016? What tools or strategies have you used to overcome ecommerce challenges? We’d love to hear from you in the comment section below!