E-commerce is growing at an unprecedented rate all over the globe. In 2018, global online retail sales amounted to 2.8 trillion U.S. dollars and projections show a growth of up to 4.8 trillion U.S. dollars by 2021. The e-commerce industry is escalating at a rapid pace, and it is up to e-commerce business owners to take advantage of this growth. If you’re looking for ways to grow your e-commerce business, here are 5 essential ways to increase your e-commerce revenue.
1. Repeat customers matter
Online retailers tend to pour most of their resources on strategies that bring in new customers but not to get them back to purchase again. Instead of focusing all your efforts on customer acquisition, you should work on your customer retention strategy.
First, repeat customers spend more on each purchase. According to Adobe, revenue generated by one repeat customer is equivalent to revenue generated by five new customers. Second, repeat customers spend more at key times. The average shopper spends 17% more per transaction during the holiday season, but the repeat customer spends 25% more per transaction during the holiday season. Finally, repeat customers are more likely to shop with you again and again. After one purchase, a customer has a 27% chance of returning to your store. If you can get that customer to come back and make a second and third purchase, they have a 54% chance of making another purchase.
Repeat customers are the key to a profitable business. So, build relationships with them. Keep in touch. Send them emails or messages whenever you have a new campaign. Be personal in your approach and send them greetings on their birthdays. According to Hubspot, a customer with an emotional relationship with a brand is much likely to become a repeat customer than those without an emotional relationship.
2. Don’t let product returns eat into your revenue
An excessively high number of online returns is one of the biggest problems of the e-commerce industry today. In 2018, total online retail sales in the U.S. were about $517 billion, but the returns amounted to a massive $156 billion, accounting for 30% of all sales. There is no doubt that online product returns will eat into your revenue. What’s more, online retailers might lose repeat customers if they aren’t happy with the returns process.
A great solution for reducing product returns is to record your packing process before each item is shipped and send recorded videos to your customers. Customers who receive packing videos before their products arrive are less likely to return for a few reasons. First, your customers will appreciate the transparency and be more likely to trust your brand. Second, there seems to be a deterrence effect on return frauds when there is clear evidence that your product or shipment had no problem. According to Return Logic, online retailers who use packing videos see a 40-50% decrease in their product returns.
Fulfillment solution companies like MARQ offer an easy way to record videos for free.
3. Mobile-friendly shopping is the new trend
Smartphone ownership is growing rapidly in recent years. 81% of Americans now own smartphones, up from just 35% in 2011, and they spend 4 hours on average on their smartphones every day. With the growing popularity of smartphones, mobile shopping has become a new trend in e-commerce. A study from Google showed that mobile-friendly shopping experience was a key factor in purchase decisions, with 72% of consumers indicating that a mobile-friendly website made them more likely to buy products.
There are 3 different ways to provide a successful mobile-friendly shopping experience for your customers.
First, increase page loading speed. According to Kissmetrics, a 1-second page delay could cost you up to $2.5 million in lost sales every year. Second, personalize the shopping experience on mobile. According to PwC, 25% of millennial shoppers say that their mobile shopping experiences could improve with personalized offers. You can ask for permission to access your customers’ personal information and their geographical location. This helps you understand their buying behavior to offer personalized incentives and experiences that the customers are looking for.
Finally, simplify your website’s navigation on mobile. You should offer a simple navigation experience so that your customers do not get lost on your webpage on their tiny mobile screens. You can provide a search box to customize the navigation for users, use the easy-to-read fonts and allow customers to go back to the homepage when clicking your logo.
4. Use social media to build relationships with your customers
Social media has become an incredible marketing tool for e-commerce businesses. According to BigCommerce, 75% of customers have bought something online after discovering it on social media.
In order to use social media to increase your revenues, you should first create content that resonates with your target customers. By addressing a particular challenge, pain point, or topic of interest for your target customers, you are telling your audience that you understand them, and you care about their needs. Next, you should tell your customers what to do (called call-to-action) in your post. If you have a clear call-to-action, such as “order yours now” at the end of your post, it will dramatically increase your conversion rate.
5. Don’t let your customers abandon their carts
Cart abandonment is a big problem in the e-commerce business. The average e-commerce store loses over 75% of its sales due to cart abandonment. You can easily increase your e-commerce revenue if you can reduce your cart abandon rates. There are the two most effective ways to reduce cart abandon rates by higher than 80%.
First, fully disclose costs. The biggest reason for cart abandonment was an unexpected cost that appears at checkout. Transparency is valued highly by digital shoppers, so the best course of action is to state all costs from the outset.
Second, offer guest checkout. In 2018, 28% of shoppers abandoned carts because they had to create new accounts at checkouts. Customers want to do things quickly and have instant results, so you should make guest checkout available.
As the proud owner of an e-commerce store, you’re probably looking for tactics that help you increase your revenue. If you follow these 5 essential tips to boost your revenue: focus on repeat customers, provide mobile-friendly experience, reduce product returns, utilize social media, and reduce cart abandon rates, your e-commerce revenue will rapidly increase.