3 Underground Strategies to Improve ANY Shopify Store’s Profitability
Creating and running a sustainably profitable e-commerce DTC brand in 2021 is a challenge.
Ad costs have risen across popular social advertising platforms like Facebook and Google. CPAs are rising. And the cost to drive traffic to your website seemingly increases with each passing year.
Competition is more fierce than ever now that more businesses are ramping up their digital marketing and advertising efforts to capture attention and customers. There is a sea of competition for your potential customer’s eyeballs and wallets.
Despite the challenges many brands will face in 2021, there are ways to offset the challenges ahead.
We have compiled three potent but underutilized AOV and LTV-boosting strategies that you can implement for your e-commerce brand as soon as today to give your brand an unfair advantage over your competition. Here they are:
- Reduce friction in the sales funnel to boost conversion rate.
The more steps a customer must make to make a purchase on a website, the lower the conversion rate.
We want to make sure that we make buying easy for the customer.
Amazon.com is a great example of this. For example, Amazon stores customers’ payment and shipping information from previous purchases so that customers do not have to re-input their information again to make future purchases. Some purchases can also be made instantly by clicking on the “Buy Now” call-to-action (CTA) button on a product page (usually featured below the ‘Add To Cart’ CTA button).
For e-commerce businesses hosted on Shopify’s eCommerce CRM platform, stores can reduce friction by simplifying the buying process.
A few ways this can be done include:
- Sending traffic from paid social advertisements directly to a product page or a custom landing page tailored to a specific marketing message for a specific product offer INSTEAD of sending traffic to a homepage or collection page. For example, if you have a specific Valentine’s day promotion for a deodorant self-care offer (i.e. Native) or a bone broth gut health reset offer (i.e. Kettle & Fire), create specific ads and landing pages tailored to this messaging.
- Removing pop-ups and external links on the custom landing page or the product page. Having extra popups and external links (ex. Social media icons) can distract buyers from focusing on learning more about your product offer and continuing further down the sales funnel. The goal of the product or landing page is to move your potential buyer closer to the next step (ex. Adding the product to their cart).
- Adding post-purchase upsells and cross-sells. Having upsells and cross-sell pop-ups can distract visitors from continuing down the eCommerce sales funnel. However, implementing post-purchase offers in the backend after a buyer completes their purchase is a way to seamlessly transition into offering upsells and cross-sells. This allows you to offer your newly-acquired customers exclusive offers, bulk discounts, or whatever offer complements the product(s) initially purchased. A great example of a potential upsell is to sell MORE of the same product your customer just purchased. Overall, this boosts your AOV and LTV (and profitability).
2. Offer a subscription.
Continuity and monthly recurring revenue give your business some assurance that people enjoy your products and brand. They provide stability for your growing business and are a huge customer LTV booster.
Subscription offers are abundant for those who sell consumer-packaged-goods (CPG) like cosmetics, skincare, supplements, or food. Simply offering an easy to opt-in 20% discount for a monthly subscription of these types of product offers can entice customers to go with the subscription instead of the one-time purchase. In turn, this will likely increase LTV and customer brand loyalty for your business quite considerably.
While not every product offer is subscription-friendly, there are creative ways to still offer a subscription on your store.
Consider what Amazon does with their strategy for implementing a subscription (i.e. Amazon Prime). How can you do the same?
Could it be a membership subscription to exclusive limited-edition offers and giveaways?
Could it be a subscription to an exclusive membership information website (ex. Bone broth recipes and health & wellness video training programs)?
Could it be access to a community of like-minded individuals in the same niche or passion that your product offer or brand is based on (ex. A private golfing Facebook group for a golf clubs brand like Bomb Tech Golf)?
Could it be access to faster shipping and exclusive discounts (ex. Amazon Prime)?
Let your creative juices flow and see if you can come up with a subscription offer of your own to boost your store’s AOV and LTV.
3. Sell information products.
We covered this slightly in the previous paragraphs above. But it is worth mentioning again since so few brands are using this strategy. These can be bundled with your core physical product offers to create unique irresistible offers your competition does not have.
A HUGE benefit of selling information products (or digital products in general) is the nearly ZERO to a low minimum cost of goods (COGs) usually associated with these products. Many can be made one time and sold over and over with very little overhead. No inventory, no warehousing, no limit to how many can be sold at any moment in time.
Information products can range from a digital whitepaper pdf, an ebook (or a physical book), or a full-fledged video training course on a specific topic that is relevant to the niche your store is in (ex. If you run a dog ecommerce brand catering to new dog owners, you may consider selling a dog video training course for new dog owners).
They can simplify and solve a specific problem for your customers in an organized and concise fashion too.
BONUS: Try adding an information product as a post-purchase upsell or cross-sell.
SUMMARY: If you’re looking to get an edge on your competition and be able to acquire more customers profitably in 2021 as your eCommerce store continues to grow, consider working on increasing your AOV and LTV.
Three ways you can do this are:
1) Reducing the friction in your sales funnel to increase conversion rates.
2) Adding subscription offers.
3) Selling information products.