Starting an ecommerce business is no easy task. From setting up your website to optimizing your supply chain, it seems there are hundreds of things to consider in the early days. And truthfully, there are.
But that’s not to say this always-on pace should continue forever. With the right strategies in place during launch, it should be much simpler to navigate the changing world of ecommerce in the future. In fact, the more you build up your strategies today, the more efficiently your business will run tomorrow.
The difference between success and failure in the industry has a lot to do with your ecommerce strategy. Prepare your brand for a successful launch by learning more about ecommerce strategies, what they can do, and how to design one of your own.
What Are Ecommerce Strategies?
Ecommerce strategies are interconnected plans that drive your business operations. There are three major ecommerce strategies to consider: product strategy, customer relationships, and corporate considerations. Each of these must work together to ensure the best possible outcomes for your brand.
Let’s explore these three major ecommerce strategies and their structure in greater detail.
Product Strategy
Product strategy comprises inventory management and development. It requires you to take a bird’s-eye view of some major processes, including:
- Development research. Who is in charge of the research portion of your products? Will it be primarily accomplished in-house or by a third-party organization?
- Product orientation. What type of customers are interested in your offerings, and how are they viewed in the market? You may want to rely on a two-by-two matrix or a SWOT analysis to navigate the planning process better. This understanding shapes how you present benefits to specific audiences on your product pages.
- Inventory supply chain. How do you plan on sourcing products, and how sustainable will this method be long-term? Does your structure have enough adaptability to handle disruptions? Understanding your supply chain helps you negotiate better terms, anticipate reorder timing, and maintain quality standards.
- Line of products. Consider the entire scope of your product range. How extensive do you want your catalog to be? Are you planning on multiple varieties with customization options (e.g. t-shirts with different logos) or expansion into related categories (t-shirts, shorts, etc.)? Even if plans aren't finalized, think about whether you'll grow your offerings or maintain your current selection.
- Product viability. Are your products evergreen, meaning they remain relevant all year long? Or will they be limited-edition or seasonal? Perhaps you'll want a mix of both to increase sales during different events or holiday seasons.
Customer Relationships
Building a strategy for managing customers is imperative for tracking the complete path of the buyer's journey. There are many important things to consider along the way, including:
- Target market. Who is the audience your brand is trying to reach? You may want to create user personas detailing your customers' specifics, including their demographics, ages, income, and psychographics.
- Company branding. How do you want to present yourself to customers? Think through all elements of this, including your company logo, brand voice, and business name. What principles does your company embody, and how will shoppers recognize this? What emotions do you want people to experience when interacting with your brand? Maintaining uniform messaging and visual identity across all touchpoints creates meaningful connections with your audience.
- Sales channels. How do you plan on accomplishing the customer acquisition process? Where will you connect with your target audience? This could be anything from social media to email marketing.
- CX and UX. Consider the impact of your customer experience and user experience. Do you have everything in place to wow your buyers, including great customer service and an accessible website?
- Customer retention. Is there a specific frequency at which customers should order from your company? How will this impact your sales and profit margins in the future? Retention often gets overlooked but it’s extremely valuable. Convincing someone familiar with your brand to purchase again is typically easier (and cheaper) than attracting completely new buyers.
Corporate Considerations
While you may not feel your ecommerce company is large enough to worry about corporate relations, the fact is that every brand needs a detailed process for communicating with business entities. This strategy should consider:
- Shareholders. If your brand decides to go public, how will you manage your shareholder relations? How many investors do you want, and how will you communicate with them? Additionally, do you have a way to repay stakeholders over time?
- Financing. How much capital does your business need to get started, and how much will it need to grow over time? Where will funding come from? Options include loans, investment capital, personal savings, customer pre-sales, or crowdfunding. Operating businesses also need financing plans for placing large supply orders or meeting seasonal demand spikes, requiring careful cash flow management.
- HR. If you have at least one employee at your business, you’ll also need a solid HR strategy. How will employees get their benefits, and what benefits should they include? Can they ask for PTO, and what will be the procedure for this? Will you require documented processes for hiring, firing, and promotions?
Creating a Winning Ecommerce Strategy
As you can see, the questions involved in developing an ecommerce strategy can be overwhelming at best. However, they are absolutely critical for ensuring your approach (and resulting strategy) is airtight.
Thankfully, asking all these questions won’t make your plans overly complicated. Ecommerce strategies are interconnected at a basic level, making it easy to approach each vertical using a similar framework.
This framework can be broken down into four steps: personal values, target markets, goals and visions, and prioritization.
Here’s how to create a holistic ecommerce strategy using each of the four:
1. Choose Your Personal Values
A well-thought-out strategy is perhaps the most important element of ecommerce success—but it can’t be done well without the compass of your personal values.
The vast majority of your ecommerce strategies should be sculpted by what you believe in. Ask yourself: what do I want to achieve, and why? How will this impact how my business is operated or make money in the long run?
Let’s look at an example. You believe in giving back to the community. Therefore, you want all of your materials to be locally sourced, meaning you only partner with neighborhood brands. Because of this, shipping may take longer—so you provide customers with additional education and resources. Your price point must be higher to offset the premium you’re paying for content and local partnerships, directly affecting your subscription model.
As you can see, realizing your personal values will help you make better decisions regarding day-to-day business operations.
2. Familiarize Yourself With the Target Market
If you haven’t already, start getting to know the audience you’re selling products to. This involves conducting research that evaluates who they are, what they believe, and why they prefer your brand. Remember that the more defined your target market is, the easier you can make efficient decisions regarding your customer journey.
Apart from generalized market research, it may be a good idea to perform surveys or run small focus groups. These allow you to ask intimate questions about the efficacy of your brand, including how customers feel about certain changes, sales channels, or even packaging decisions.
3. Develop Long-Term Goals And Visions
Once you have the bones of your ecommerce strategy together and have validated your initial product through customer research, it will be time to develop a far-sighted plan for growth and development.
You don't have to be a master orator or a wordsmith to build a solid vision statement. Just start with the basics:
- Where do you see your business, brand, or product five, 10, or 20 years from now?
- What needs to happen to take your goal from pipe dream to reality?
- What KPIs do you need to measure success? Define your key results.
If you need additional KPI ideas, try starting with customer acquisition costs, customer lifetime value, and revenue growth rate. As you expand, you may want to key into more specific metrics, such as churn or retention rates.
Don't forget to map your vision statements to the SMART goal framework (specific, measurable, achievable, relevant, timely). For example, you might want to offer five new product lines that complement your major USP within the next 10 years.
4. Build a Prioritization Timeline
With so many goals whirling about at once, getting started on a strategy may feel like a monumental undertaking. To start without feeling overwhelmed, it’s imperative to categorize your goals from most important to least important.
There’s no right or wrong way to accomplish the prioritizing process. However, you may want to evaluate your goals from an objective standpoint. Which one should be completed first to assist all other goals? If possible, try looking at things from a problem-first perspective. Determine your biggest pain point, then work on goals that directly address it.
Start Mapping Your Ecommerce Strategy Today
The best ecommerce strategy is one that continues to evolve as your business does. As you grow, don’t be afraid to rework older strategies to create the most positive outcomes for your business. Update older mission statements that don’t currently align with your brand, and cut out subpar goals to replace them with even better ones.
As you continue refining your planning and development phases, remember that today’s most efficient businesses are unafraid of strategy changes.
Ecommerce Strategy FAQ
What is an Ecommerce Strategy?
An ecommerce strategy is a set of interconnected plans that guide and drive your online business operations, covering everything from product development to customer retention and corporate financing.
What Are The Three Major Areas Of An Ecommerce Strategy?
The three major strategy areas are: Product Strategy (inventory, development, supply chain), Customer Relationships (target market, branding, retention), and Corporate Considerations (financing, HR, shareholders).
What Is A Key Starting Point For Creating An Ecommerce Strategy?
A key starting point is to clearly define your personal values and align your business decisions—such as product sourcing, pricing, and shipping—with those core beliefs.