Analytics, Mobile, Social Media and Digital Marketing Strategy
According to Lisa Gevelber, VP of marketing at Google, advertisers who target their marketing efforts by demographics risk missing up to 70% of their potential shoppers. Instead, marketers should look at micro-moments and customer intent.
Ok, now I’ve got your attention, let’s step back a bit. What does intent mean and what does this all have to do with Google Analytics? And what the heck is a micro-moment?
In this series I want to give the benefit of my experiences as both a traditional and online retailer and more recently (well 10 years!) as an ICT Specialist who has worked with numerous “bricks and mortar” and ecommerce businesses.
In the last installment (see ecommerce 101) we looked at getting started and explored some of the questions that need to be considered before thinking about starting to trade. In the second of the series I’d like to explore a key component of any online business and that is the development of your digital strategy.
The term “Digital marketing” is regularly bandied around, but what does it actually mean? For many it comprises of no more than Search Engine optimisation, but with the rise (and rise) of social media, Google may well not be the first port of call for any potential customers – latest research says that 60% of web browsers first engagement with your brand will be somewhere other than your brand’s website. As Google moves inexorably towards more and more personalised search results, achieving that coveted #1 position for your brand’s website becomes increasingly challenging. The old rules of “nuke your website through seo and they will come” no longer stands. It’s now more about a “blend” of activity across a variety of digital mechanisms – all working in harmony to achieve the desired results.
So, where do we start? Some considerations:
Who are your customers?
Simple, you’d think, but if I had a £ (or $!) for every time I’ve heard the response “everyone”, I’d frankly have a lot of £’s (or $’s)! Even the most all encompassing retail range has key customer groupings – whether that be for the entire range (if a niche area) or for a subset of the range (for more “variety store” retailers). It is important that time is spent developing personas for these customers – Are they male or female? What age? What type of job do they do? what ‘s their lifestyle? Where do they hang out online? How do they want information delivered to them? What’s the style of delivery that will engage them? How do they buy? There are plenty of articles on the web about persona development and how to go about it. By doing this you for your (eg top 3) customer personas you’ll have a clear idea of what makes them “tick” and as a result how they are likely to engage and what they are likely to engage with.
Who are your competitors and what can you learn from them?
This area of research is too often omitted. You can learn a lot of very valuable lessons – both good and bad from researching your competitors. This phase will help to inform your positioning within the market place.
How will people get to your website? (what’s your inbound marketing strategy?)
Getting traffic to your site is key and you need to define how you will engage with the market and entice them to your offering. For more information have a look at the Web Analytics World article here.
What are the key performance indicators against which success will be measured?
As with any business you need a set of metrics against which you can measure your success. The “blunt” ones are traffic to the site and conversion to sale, however certainly for an ecommerce store you also need to consider margin, spend per head, basket value, customer retention, value of “dead stock” etc
What do you want to achieve and how will you know when you’ve been successful?
This is an interesting one and something I fell foul of on my first ecommerce site back in 1998 – I was so tied up in adding new product to the site, trying to be the most definitive in the market place that I’d lost sight of the fact that my original goal was to make as many profitable sales as possible. What I hadn’t realised was that I was achieving this goal from less than 20% of the catalogue and that if I factored in the additional time to source, photograph and add the other 1600 items, then my profitability was shot! What I’m trying to say is – have a goal and aim for that. Don’t lose sight of it and make sure that you test all your assumptions/ actions against it.
What channels should you spend your money on and in what proportion?
An interesting one and one where I’m starting to see a ground-shift. Overblown websites are a thing of the past as people require information in a flash. Social Media also has its part to play with “traditional” web content now being deployed across a wider digital estate, with traffic then being delivered back to the site for conversion to sale. Again, this is a huge subject and not one I intend to go into here, however what I would say is that in my recent experience, of total online marketing budgets, less is now being spent on the website as more is being devoted to social media. So just consider this before blowing all your money on the best website in the world ever – it may not be your customers preferred choice for first engagement.
Consider PEST (Political, Economic, Social, Technological) factors
As part of any ecommerce build you need to consider the territories you want to target and what impact that will have on your strategy. Multilingual sites and local hosting/ SEO is a given for businesses that want to develop overseas markets, however, far fewer businesses consider the variants in the Social Media space in countries throughout Europe, let alone the rest of the world. You’ll need to consider the language and tone used, different design and user experience requirements, shopping behaviours in different territories etc. eConsultancy has a useful guide on the subject of the Internationalisation of eCommerce .
The other key consideration is the product – what sells in one territory and is seen as the height of fashion – is not necessarilly the case in another territory – eg you only have to go on vacation somewhere where there are multiple nationalities to realise that fashion tastes vary dramatically across the world!
Summary
It is important to realise that the answers to these question will impact on everything from the technical build of your site to the resources you bring in to manage marketing, your online spend allocation etc. The findings from many of these questions particularly around customers and competitors should actually serve to validate your business (by establishing market size, reach and commerciality) as well as shape up a digital marketing strategy tailored to reach and service a target customer base.
Because attaining accurate and insightful information on all of this is so vital for success it’s important to realise the importance of bringing in specialist help in these planning stages (unless you possess all of the relevant skills yourself). For example – When researching customers and competitors this requires interrogation of Google data, in-depth commercial competitor analysis, an assessment of competition vs opportunity in the search space, Adwords search and display network analysis related to space in question etc. It also requires a wider digital analysis in the space to determine key influencers, authority sites, an analysis of the social landscape etc
When it comes to Analytics you will need help to determine an analytics strategy which can deliver insights and actionable information. Tracking traffic and conversion to sales is not enough. Multiple insightful metrics such as engagement levels, visitor segmentation and tracking success of different traffic sources etc can all provide useful actionable information. With advanced analytics tools you can often link to publishing capability to dynamically display more relevant information to users based on their referral path to your site, their behaviours on your website etc.
Next time, we’ll look at how to specify your eCommerce requirements.
Read Part I of Chris’ eCommerce Series: Getting Started
In this series I want to give the benefit of my experiences as both a traditional and online retailer and laterally an ICT Specialist, who has worked with numerous ecommerce businesses of all shapes and sizes.
So what is ecommerce?
A stupid place to start you may ask, however the definition of this term is wide and varied and whilst it has become to mean selling “things” (mainly products) electronically, in actuality it covers the whole gamut of online trading – from marketing, selling, delivering, managing and everything else besides (see Wikipedia who say it much better than I could). This is relevant because in my experience many potential businesses see the “selling” part as the be all and end all of ecommerce without due consideration for all that that entails (just think of any traditional “bricks & mortar” business – it’s so much more than just “selling stuff”).
Why go online?
The web opens up the opportunity for businesses to specialise in niche areas and find potential purchasers of that product from all over the world. It also provides the opportunity for more main stream businesses to gain customers from a wider catchment than just their traditional “bricks & mortar” outlets. They see the web as a relatively low cost way of doing this.
Is there a market?
Great ideas are subjective. As such making the decision to develop or source a product to sell online needs to be based on more than gut feel. The beauty of the web is that you can gather so much data to aid your decision making process. This 
market research is absolutely essential in order to validate your ‘gut feeling or convince you the idea is a no go.
So what sort of market research are we talking about – Proper digital market research
Based on all of this tangible data you should be in a far better position to answer the key question – is there a market?
If it’s a completely new ideas, product, service and there is no competition online then it woudl be advisable to consider market testing before investing large amounts of money in a web build.
Think, Plan, Do, Review
Planning is key. This may be an extension of an existing business or it may be an entirely fresh venture – either way, having a plan with Goals, Targets and costs is key to success – as the old adage goes – “failing to plan is planning to fail”.
Have realistic expectations
“I expect to sell £1M of goods off of my new website but only want to spend £500 on a site and have no money for marketing”. A true story. Whilst there may be examples across the web where a business has managed to achieve this, it’s pretty rare. Whilst the cost of entry is considerably lower than more traditional retailing routes, there’s still a cost of acquisition.
Choose your route to market
Many business I meet who want to start trading online go straight for the bespoke ecommerce build or shopping cart plug-in, as it’s what their developer told them to do. Maybe as a way of testing the water you should look at selling your products through someone else’s site? Through Amazon? Through ebay? Or through one of the many Pay as You Go Cloud based ecommerce solutions. You don’t have to go down the full blown ecommerce platform from Day 1, particularly if cash is tight.
What products?
I come across businesses all the time that see great potential for their product, but haven’t properly researched the market eg selling fresh food products; selling alcohol outside of the UK, high value products sent through normal post, selling concrete ornaments over the web, where the carriage was twice the price of the product! You get the idea!
How do I set my price?
One of the areas I’ve seen considerable growth in since the recession is manufacturing businesses wanting to develop their own route to the customer as well as their traditional route of selling to the wholesaler/ retailer. This can be fraught with danger – you don’t want to upset your traditional market by under cutting them, in some instances you don’t want to sell the same products at the same price. Obviously not an issue for a retail only concern, however you still have to get your pricing right. Typical retail pricing in the UK market is cost (e.g. £10) x 2.4 to give you retail including VAT (£24) – i.e. 100% (from £10-£20) markup or a 50% margin. This is all well and good, but there’s a whole bunch of considerations:
Obviously different business areas work to different margins, typically online businesses work to lower margins – it just depends on the market you’re in, so lots of research is required!
How will I fulfil the orders?
Back to the £1M of turnover off of a £500 website example above. Even if you could manage to achieve this, do you have the infrastructure and personnel in place to fulfil? After all that’s a lot of infrastructure. It’s also an awful lot of traffic to the site which means serious investment in SEO and Social Media. In the example, it was a £20 product with an average anticipated spend of £50 – so that’s 20,000 orders – or 385 a week and with the seasonality of the product it could well have been that 10,000 of those orders came in the golden 8 weeks up to Christmas! That’s a lot of picking, packing, invoicing etc. And if you haven’t got the systems to handle this, it’s an impossible task! You could consider a fulfilment house, of which there are many, including Amazon fulfilment, who, for a fee, will handle it all for you.
How will I generate the traffic?
Also, the traffic required to generate 20,000 orders, even at a very generous 5% conversion to sale (the average is 2% or less and for most ecommerce plays it’s under 1%), you’ll need to drive 400,000 visitors to the site per year (8000 a week) and that’s a lot of time and effort!
Next time, we’ll look at considerations when developing your strategy.