The start of the year brings new energy and vitality for many online merchants. Many of them are looking to jump start sales, trim expenses and otherwise grow and improve their businesses. For ideas to help merchants will all of this, we spoke with a seasoned ecommerce expert. He’s Lin Shearer, a senior marketing manager with ProStores, a leading ecommerce platform. He spoke with us in this “Quick Query”.
PeC: What ideas do you have for ecommerce merchants to jump start sales for the new year?
Lin Shearer: “One of the best things you can do right now is to give your store a makeover. I’m not talking necessarily about the look and feel, the design of your store, but about little improvements that can really go a long way to convert more browsers to buyers. To do that, there are three areas I think you can focus on to drive those conversion rates up. First of all, get shoppers to trust you. Second, get them interested. Third, keep it simple.”
PeC: So, how do you address each of those?
Shearer: “To inspire trust, ask yourself if your online store make shoppers feel comfortable doing business with you. Does your store look professional? Again, you don’t need a fancy design necessarily to inspire trust, but you need to deliver a professional appearance and experience. So, no missing images, correct spelling, and good product descriptions will go a long way in that regard.
“Second, be transparent. If you have third-party providers like dedicated SSL certificates, Better Business Bureau badges, any kind of verifiable third-party reputation builders that you can display on your site also go a long way in showing potential buyers that you’re a safe place to shop.
“Finally, another idea that I think is getting a lot of popularity is customer reviews. You can show people that you’ve got an existing customer base that shops from you and provided some feedback on the products you sell. That can go a long way as well. One of our own ProStores’ merchants, CurrySimple.com, actually improved their conversion rate by more than 50 percent, quarter over quarter, the end of this past year just by adding product reviews.”
PeC: Are those reviews searchable and spiderable by search engines?
Shearer: “That’s the additional benefit of having that content there. Those reviews are searchable, and it can help you generate frequently updated relevant content that search engines love. If you can create more of that through product reviews, all the better.”
PeC: What ideas do you have to cut expenses and save money?
Shearer: “Any business can benefit from taking a look at costs. I think small businesses, especially, are taking a hard look at that. I think one of the best areas for you to focus on would be to get smarter about inventory, to really understand what your customers are buying, what’s selling the best, and carry that, and if at all possible, only that. In this economic climate I don’t think we could afford to go deep across a broad product catalog. We saw quite a number of our customers streamlining their inventory this past holiday season and we expect that to continue.
“Also, look at expanding your relationships with existing customers. I think the product reviews we just talked about are a good example there. It costs much less to sell again to an existing customer and sell more to an existing customer than it does to go out and try and attract more new customers. So, really look at building on what you’ve already established.”
PeC: Would that be through additional inventory, or will it be for enhanced cross-selling opportunities?
Shearer: “Yeah, absolutely. The way that CurrySimple was able to drive that kind of increase in conversion rate was they had repeat customers, but there were certain products that they just won’t buy. They would come back specifically for something they had bought before and wouldn’t look at other products. Well, once they added the product reviews, that then lowered the perceived risks of those buyers for buying a product they’ve never tried before if they saw somebody else had tried it, then they were more comfortable buying that. So, just by doing that, he was able to get people to expand what they were buying from him.”
PeC: Does CurrySimple moderate those reviews? How does that work?
Shearer: “Typically with that solution, you do have the opportunity to go in and look at the reviews that people are putting up there. Now, they’re about CurrySimple’s products, so I don’t know that it has a whole lot of incentive to only put up the good reviews. I mean if it puts up only the good reviews, then if somebody gets a product that they’re unhappy with, then it doesn’t do him any good in the end. My understanding is that a lot of buyers perform their own filtering on things like that and make a decision about whether the review is reputable or credible. Again, it seems to be working for CurrySimple. Authenticity is key there.”
PeC: Do you have any other thoughts about marketing channels or marketing ideas that merchants may not have considered over the last year or two?
Shearer: “I think everybody is talking about social media. It’s actually in line with cutting costs, as well. It will take up more time, but I think if you’re smart about it, we’ve seen a number of examples where you can both cut costs from things like expensive paid search and that type of thing and also expand your customer base.
“For example, another ProStores merchant, Exquisitecanes.com, actually cut out paid search altogether. They were very smart about the way they engage through social media and began to drive business that way. They’ve got a Facebook fan page and they interact on Twitter, but they didn’t just go in there and just start putting up promotional offers and things like that. They really went out and were genuine about establishing relationships with groups that had common interest in them, that were in line with their product line; and then once they cultivated a relationship, they then were able to put out special offers for people in the groups and drive people to their store that way.
“Social media is easy except in the sense that it does take up your time. But, if you’re smart about it, I think that’s a good way to go for this coming year.”
PeC: What trends do you see occurring in ecommerce in 2010?
Shearer: “I think the economic climate is still going to be a factor. I think we’re starting to see some things turn around and as a matter of fact, the good news was this past holiday season, was that brick-and-mortar was essentially flat. Online sales grew by about 6 or 7 percent. ProStores merchants’ sales are right in line with that trend and, in fact, are growing faster than ecommerce overall right now for a variety of reasons. They’ve identified a good niche product, selling at highly competitive prices, but still at a profit. So, we expect our merchants to continue to be able to grow their online business.
“Also tied to the economy, typically, recessions are drivers of entrepreneurial activities. So, that same dynamic that is allowing our existing merchants to expand, and we expect to see more people looking to make their own opportunities by starting an online business or as a brick-and-mortar store bringing that business online and growing their business that way.”
PeC: What are your top three ecommerce ideas to help merchants as we start 2010?
Shearer: “First of all, I’d say focus your business. We see a lot of merchants trying to sell a broad range of products and our most successful merchants really have a strong focus. I think the two examples I’ve already talked about are great examples there. So, really, being smart about your inventory, taking a look at the 80/20 rule that most of your revenue, 80 percent of your revenue is probably coming from 20 percent of your product line, and really take a look at focusing, finding a niche and then promoting that niche.
“In line with that, the second thing I would say is get into social media, but be smart about it and do it right. Engage with your people that have similar interests, not as somebody there that simply sell to them, but really look to establish real relationships with them and I think you’ll find from that you’re able to bring in new customers.
“Finally, think like a buyer. Give your store a makeover. Small merchants in particular get very caught up in the store as kind of an extension of who they are and have a very specific vision of what the store should look like, but beyond look and feel, beyond design, really go through your store and think like a buyer. Inspire trust. Again, tell your story. Let them know who you are and keep it simple.
“So, focus your business, give social media a try but be smart about it, and think like a buyer and give your store a makeover.”