e-Commerce success depends on having an effective strategy. This blog is part-1 of a 2-part series that identifies and explains six key factors for your e-commerce strategy.
At the most basic level online and traditional retail have the same goals – providing consumers with access to your products and convincing them to buy them. However, once you scratch the surface differences quickly emerge between the channels –product content versus physical product, search results versus shelf-placement, and 24-hour availability versus store location and limited opening hours.
Push vs Pull
Fundamentally, the move to e-commerce changes the channel model from ‘Push’ to ‘Pull’ and places a lot more responsibility on brands to deliver Perfect Store performance to support their products online. At a key account manager level, many of the differences may seem nuanced, but brands that develop a tailored e-commerce strategy, and evolve the strategy over time-based on feedback and data, are better positioned to succeed in the fast-growing e‑commerce channel.
More advanced organizations may already have fully defined strategies and metrics, with all appropriate assets (e.g., content) ready and accessible in a single digital asset management (DAM), content management or product information management (PIM) system. For others it’s not too late to start developing an effective e-commerce strategy, and following the eStoreMedia e-Commerce Perfect Store Framework to evolve and improve it over time.
eStoreMedia has worked with numerous brands and product manufacturers to help them create and execute their online channel strategies. These usually start with six key parameters. They might seem straightforward, but each needs careful consideration, and ongoing measurement to ensure success.
We cover the first three in this blog below – Portfolio, Pricing, and Content – but come back next week when we will complete the set with Search, Ratings & Reviews and iMedia:
In many categories products that sell off-line do not necessarily perform equally well in online retailers. So in planning your online portfolio you need to analyze what could be your e‑commerce ‘best sellers’, rather than simply mimicking what sells offline. The channel can also be an opportunity to broaden brand portfolios with unique items and first-to-market NPD.
Factors that might affect your choice of items for the online channel could include packaging, shelf life, size, consumer engagement, etc. For example, consider packaging solutions that are e-commerce ready, or products that could ship in their own containers. At this stage, it’s also worth looking at your competitors, including third-party suppliers, to understand what they are doing with respect to assortment. Are they providing unique bundles or variations that sell better online?
Pricing strategy is always a balancing act. You want to maximize your average selling price, while ensuring there’s scope for the pricing structure align with promotional activity at a brand level. Online individual product profitability comes into play – you want to ensure your pricing policy weighs your own, and the retailer’s ability to make a profit on each product in the channel. However, now more than ever the eventual sales price of your product in an online store is determined by the online retailer’s choice of pricing algorithm.
The challenges are further complicated by geography. In North America where minimum advertised price (MAP) agreements are common, brands can – in theory – intervene if a retailer sells their products below the MAP threshold. However, even in the US, enforcing MAP across competitive marketplaces such as Walmart and Amazon isn’t easy, while In Europe, brands need to have a hands-off approach when it comes to influencing retail pricing.
From an e-commerce strategy point of view, a good starting point is identifying and listing the expected price/price range per product that delivers on your profitability and promotional goals. As you monitor price changes on a daily basis to understand how pricing fluctuates over time, you can work with retailers on individual items where profitability is at-risk.
Content is king online, and as such having a plan to deliver effective, engaging and adaptable content needs to be a central plank of your online strategy. Product landing page content is central to product discovery (driving online store search results), shopper reassurance & conversion (in place of physical product), and brand awareness (web search results, first moment of truth).
Great content can be the key differentiator for your products – the right combination of keywords, imagery, videos and product descriptions to help consumers understand what they are buying. Some key online content considerations to add to your e-Commerce Strategy content checklist could include:
- Does the content effectively communicate my product’s benefits for time-pressed consumers?
- Does it clearly differentiate my product from competitors?
- Is it complete? Does it answer all the questions a consumer might have?
- Is the content fully aligned with wider brand messages & visuals?
- Is it adaptable to different platforms (desktop/mobile), and online retailers?
- Will it deliver high-ranking search results in online store search, and wider web search?
The development, maintenance and distribution of product content for the e-commerce channel, is one of the greatest challenges for brands in the current retail environment. As such, your e-commerce strategy should also include plans and goals around how to create, manage, host, approve, change and distribute your e-channel content efficiently.
e-Commerce Perfect Store Framework
The planning considerations above and in part 2 of this series, are central to the eCommerce Perfect Store Framework. The Framework is designed to support brands at different levels of e-commerce maturity and readiness, and it is outlined in depth in two ebooks – The e-Commerce Perfect Store Framework for brands, describes how to design your e-commerce strategy, and the Perfect Store execution playbook How to Succeed in the e-Commerce Channel