Reports from industry experts like Magento are filled with positive stats for ecommerce retailers—across the board, business is booming! Consumers spent a whopping $517 billion online at U.S retailers in 2018 (up 15% from the previous year), and some projections show the potential for a total growth of 45.7% by 2023 for U.S. based ecommerce. If you’re building an online business, those reports are great news, right? But dramatic growth comes with new challenges in the ecommerce space. The biggest one is how your brand can stay competitive and cultivate loyal customers without undercutting your margins in online price wars. Today, we’re here to talk about three key tactics for staying competitive beyond price: content marketing, the unified customer journey, and loyalty programs.
The Problem of Price
Because it’s possible to order almost anything in just a few clicks (and we mean anything—from your favorite jeans to fresh produce to a new mattress!), online shopping is more appealing to consumers than ever. But the profusion of buying options means that ecommerce is constantly becoming more competitive and price-driven, too. Behemoths like Amazon, overseas manufacturers, smaller brands venturing into the ecommerce space for the first time—everyone is vying for the attention of online shoppers, and there’s no better way to make a splash than with ultra-competitive pricing.
While brand loyalty was once a major success factor in traditional brick-and-mortar retail, consumers now site price as the biggest differentiator for most purchases. Online shopping is largely transactional; potential buyers search for a product, find the lowest price, and make a purchase with little concern for the brand behind the sale.
This shift in consumer behavior has led to what many industry insiders view as a no-win situation of incredibly competitive pricing with razor-thin margins. As a merchant, you might feel that it’s impossible to make a profit—or make an impression on your customers—in the current environment. However, savvy retailers are finding new ways to engage with price-conscious customers without jeopardizing their financial future.
What Customers Want
The latest reports on the state of ecommerce show that customer expectations are higher than ever. Along with low prices, consumers want seamless interfaces across all channels, lightning-fast shipping, and exemplary customer service. In other words, customers want a simple, highly personalized experience—which can work to make an impression that’s just as strong as an unbelievably low price.
When you find ways to engage with your customers that go beyond price, you also gain valuable data that can shape your brand’s ecommerce strategy. Some predominantly online stores, like Everlane, Tie Bar and Bonobos, have pulled away from the pack by providing a uniquely impactful and engaging customer experience. Here’s how you can join these industry leaders in forging long-term customer relationships that extend past a single transaction.
Content Marketing and Customer Engagement
Content marketing has been an ecommerce buzzword for some time now, and it remains one of the most important non-transactional methods of customer engagement. Sharing high quality blog and social media posts, product stories, insider tips, employee profiles, and other value-add content encourages customers to engage with your brand and your products beyond price comparisons.
Everlane is a great example of successful content marketing. The clothing retailer creates on-site content that dives deep into its ethical guidelines—like sustainable manufacturing and transparent pricing—to underscore how the brand stands out from the crowd and why its prices may seem high compared to some other clothing companies. Through rich content, Everlane builds a relationship with each customer that goes beyond a single transaction and provides justification for less competitive pricing.
As shoppers engage more deeply and consistently with your brand’s content, you’ll be able to collect valuable customer data and build an increasingly customized experience to meet those heightened expectations we mentioned above. You can tailor email marketing to repeat customers based on their previous selections, offer content-focused follow-ups after a purchase, send triggered emails to individuals who have browsed without purchasing, create targeted social media ads, and much more. These additional touchpoints in turn offer opportunities to gather even more data and foster further engagement, creating a positive cycle of relationship building.
The Unified Customer Journey
Even though customers are shopping online more than ever, they still care about the offline elements of their shopping experience, too. Many retailers, particularly those new to the ecommerce space, forget about what comes after a customer clicks “Complete Purchase.” From shipping notification emails to returns management to customer service, every stage of a customer’s journey can help your brand surpass the competition.
In this age of free shipping and same-day delivery, customer expectations for what happens after a purchase are higher than ever. Low prices and slick website design will quickly lose their appeal for consumers who face delayed shipments, rude customer service agents, an unforgiving return policy, or a sea of bad reviews when they search for your brand.
A unified customer experience is rooted in details. Think about your brand’s aesthetic and core values, and then make sure those elements are represented across every customer interaction. That might mean customized packaging, automated shipping emails that are designed to match your website, or specialized training for your customer service representatives to make sure they’re meeting your brand standards. Like content marketing, these thoughtful touches create a more personal relationship with your customers, adding brand value that lets you avoid dramatic price cuts.
Finally, customer loyalty programs are a remarkable tool for building strong customer relationships. If you’re a smaller retailer or one that’s new to the ecommerce space, you might think discount-based loyalty programs are too expensive—but there are lots of options for high-ROI reward programs! Structuring a loyalty program with thoughtful, brand-appropriate perks can make your customers feel appreciated and encourage repeat purchases. (We’ll dive more deeply into the possibilities for rewarding customers in an upcoming post.)
Using the methods above, your brand can find creative ways to engage with your target audience and build loyalty without falling into the trap of price competition. Ready to start growing customer relationships that rely on much more than price? Stay tuned for our deep dive into ecommerce loyalty programs, or talk to us about our innovative strategies for online retailers.