The economy is constantly in flux — but that doesn’t mean your eCommerce store can’t weather all the storms and keep growing. Fluctuations in the economy mean there are exploitation opportunities in many new growth areas.
On the flip side, it’s forecast that there’s a 96% risk of a recession next year — meaning that the economy is finely balanced. While customers are currently in a buying mood, a recession can rock the eCommerce world.
All this means the challenge of ensuring your eCommerce business continues to grow requires you to stay on top of the trends, pay attention to the details, and execute the right changes.
In this article, we’ll share the best ways you can ensure your online store thrives in 2023.
Top 5 Ways to Ensure Your Online Store Thrives in 2023
- Keep your costs down
- Target loyal customers
- Diversify your product offerings
- Increase customer order fulfillment satisfaction
- Leverage user-generated content (UGC)
1. Keep Costs Down
Online stores will not only face a fight with the economy from time to time. They’ll also face a fight with new and emerging competitors and eternal battles with market leaders like Amazon.
It makes sense to ramp up the expenses to keep up with the competition. However, to give your online store a chance to grow, it’s better to cut costs where you can — without selling yourself or your customers short.
Here are some examples:
Regular returns can be damaging because you’re still paying for the shipping and losing out on sales. Make sure customers know what they’re getting.
Take the time to write accurate product descriptions and add clear photos. Give customers longer to make a return because this can make them think twice before going through with a hasty recovery.
Get a better price from suppliers
It’s worth trying if you can clinch a discount with your suppliers. Whether this is possible depends on your current relationship with them.
But if you’ve got a silver tongue, use it to cut a good deal. For instance, you could make bulk orders/larger purchases or agree on longer payment terms in exchange for a lower price. Shop around, too — are there suppliers that are offering better prices?
Tighten your marketing budget
Look at the ROI of your current campaigns and find which avenues are working for you and which are definitely not.
For example, while it’s well worth implementing a social media campaign, you might find that some social channels are redundant.
It’s the same with geo-targeting — should you target specific countries and ignore others? Scrap the low ROI routes and pump your money into the high ROI marketing channels.
2. Target Loyal Customers
If you can increase your customer lifetime value, you will always have customers despite a volatile economy.
Even if customers experience a dip in their purchasing power, that doesn’t mean they’ll stop shopping online altogether — it just means they’re more likely to stick to brands they already know and trust.
What’s more, statistics show that, in the long term, it’s cheaper to retain loyal customers than constantly seek new ones.
One of the most obvious ways to retain existing customers is to create a loyalty program that rewards them for their repeat purchases.
You can add several tiers to your program or include a points program that allows them to rack up points anytime they buy a product from you. Over time, you can redeem these points for cash or discounts.
You can reward your customers anytime they refer a friend or family member to your store. You should build lasting relationships with them via regular newsletters that keep them in the loop about your store.
Attach customer reviews and testimonials to your emails as social proof and add them to your website.
Just like LotusBelle does:
And if you’re not sure what it is that would make a customer loyal to you, create surveys and polls and find out what they love (and maybe don’t love) about your store.
3. Diversify Your Products
Product diversification is a solid eCommerce growth tactic because it can help to plug the gaps and sustain cash flow when certain products aren’t selling.
And it does happen: one day — unexpectedly — the demand for your biggest-selling product drops. Then what?
The more products you sell, the more you safeguard yourself against an economic disruption that could cause sales to plummet when a particular product suddenly stops being popular/needed.
Take a look at your biggest competitors and see what it is that they’re selling and you’re not. What are they achieving sales with? You can use a tool like iSpionage to find your closest PPC rivals, which can help point you toward your competitors and what they’re selling.
Dropshipping is worth exploring if you're looking to diversify your product offerings. By partnering directly with a supplier and selling their products in your store, you can offer a wide range of items without worrying about storage or inventory management.
When a customer makes a purchase, you simply order the product from your supplier at a wholesale price, and they handle the shipping directly to the customer. It means you can sell various products without the upfront costs and risks associated with traditional inventory management.
Drop shipping can be a cost-effective way to expand your product line and increase revenue.
Whatever you do, test any products before you go full tilt with them. You could run a Google AdWords campaign to validate your offerings and take pre-orders.
It will ensure that when you do diversify your products, you’re still selling items that your customers want.
If, on the other hand, you sell just one product, you can still focus on iteration and improving your offering, as well as communicating your message to customers so that they believe in it as much as you do.
4. Increase Customer Order Fulfillment Satisfaction
Timely order delivery is a critical aspect of customer satisfaction, and failing to meet this expectation can result in losing loyalty and business.
Therefore, it's essential to prioritize efficient and reliable shipping processes to retain your customers and maintain a positive reputation.
What’s more, statistics have shown that while almost 50% of customers will gladly wait two days for their delivery, the number drops by nearly half for customers who must wait 3–4 days.
What this means is that faster delivery leads to more satisfied customers. Which in turn equals more growth for your store.
Improving your eCommerce fulfillment is an easy way to boost customer delivery times. It is streamlining your supply chain operations with better inventory management — so you pack, ship, and deliver orders on time.
eCommerce fulfillment covers everything from where you source your products to where you store them, process them, and get them to your customers.
If you’re struggling with rising costs, including freight rates, you could work with a 3PL (Third Party Logistics Provider). A 3PL partner will take care of your warehouse operations for you.
When orders come in, they will utilize ELD mandate transport and tracking tech to ensure your orders arrive at their final destination on time, thereby improving customer satisfaction.
Other options include a 4PL, which covers even more than a 3PL and manages the 3PL for you so that you’re free to focus on the core aspects of your business.
It's a brilliant idea to partner with ethical suppliers who use sustainable packaging, too. It’ll go a long way toward enhancing your brand’s reputation and boosting customer loyalty in a world where over 60% of customers say they are concerned about the planet's future.
If you go down this route and adopt other eco-friendly practices, communicate your sustainability efforts to your customers.
Alternatively, you could fulfill your orders, in which case you’d need to minimize your shipping zones, slash the time in transit, and find other cost-cutting measures like investing in inventory management software to avoid overstock and understock.
5. Leverage User-Generated Content (UGC)
Research shows that 97% of people read customer reviews before purchasing.
So while you should find ways to add more customer reviews to your store, user-generated content is also worth exploring.
UGC is content that your existing customers create. It could be a video of them using your product, Instagram Stories, blog posts — and more. The idea is that your customers flaunt and promote your brand for you.
There’s not much you need to do except encourage more UGC!
Here are some tips:
Offer an incentive
While some customers who love your brand will create UGC without an incentive, others might need one. Think of a cool, relevant incentive (such as gift cards) to encourage people to create content for you.
You could run a UGC campaign on Instagram and use a unique hashtag that customers must use to create and post their content.
It makes their UGC easy for others to find. For example, online clothing retailer Asos used the hashtag #AsSeenOnMe, where customers could take photos of themselves wearing outfits they’d bought from Asos.
The hashtag allowed Asos and other customers to find them, while the pics showed everyone what Asos’s clothes look like on real people.
Once you’ve got your content, make the most of it. Email it to your customers, post it on your social media channels, and let people know what they’ll gain if they create UGC too.
Make sure to moderate all content
Not all UGC will be suitable — some will align with your brand values, and others won’t. Ensure a team member who knows your values looks at all UGC before posting anything in your name.
Economies fluctuate, but online stores can take advantage of opportunities no matter what is currently happening.
Online stores have bucked the trends before and thrived during economic downturns. Those who pay attention to the right things, such as trends in customer behavior and understanding what your customers want at all times, will continue to thrive.
Regardless of what is happening outside of your control, the important thing is building long-term relationships with your customers via on-time deliveries, social proof, and customer loyalty tactics.
The more customer-centric your online store is, the more you can grow in today’s economy.
Alex Selwitz is the Director of SEO for Red Stag Fulfillment, an eCommerce fulfillment warehouse born out of eCommerce.
He has years of experience in eCommerce and digital marketing. In his free time, Alex enjoys playing guitar and learning about new trends in the digital world.