How to Lay a Great Foundation for a Profitable eCommerce Business

How to Lay a Great Foundation for a Profitable eCommerce Business

The year 2020 saw a significant shift in the growth of eCommerce. According to the UNCTAD report, the online retail sales share increased from 16% to 19% in 2020. Thereby, giving rise to fierce competition for the retailers in attracting and retaining customers. 

With eCommerce giants like Amazon, Walmart, and others providing attractive shopping deals to customers,  growing eCommerce businesses are finding it difficult to overcome the following challenges.  

  • The rapidly-growing eCommerce brands are giving tough competition to existing retailers, making it tough for them to reach out to their target audience.
  • The growing customer expectations in terms of product deliveries and personalized experiences play a major role in influencing customers to stay loyal to brands.
  • The rising cost of new technology implementation, such as augmented reality, artificial intelligence, and machine learning.
  • The growing cost of shipping orders and returns to ensure a great customer experience.

Although these challenges seem to be daunting, many eCommerce businesses are trying their best to excel in this competitive scenario and start a strong brand.

For example, Bloom & Wild, a letterbox flower delivery business headquartered in London,  delivers a wide variety of flowers packaged in standard letterbox-sized packaging to customers. The team leveraged the latest technology and predictive analytics to become a market leader in flower delivery service.

Similarly, HelloFresh is another eCommerce business that delivers meal kits containing pre-portioned ingredients to let customers cook a fresh meal at home. The eCommerce retailer relies heavily on social media marketing for scaling its business. They have leveraged influencer marketing to reach out to women, their primary target audience.

So, what is it that these brands are doing to garner success?

The answer is a strong foundation for eCommerce success. 

Let us understand how to lay a great foundation for a profitable eCommerce business in this article.

4 Steps to Build a Strong Foundation for Ecommerce Business

Building a strong foundation for eCommerce business involves streamlining the operations and marketing processes. Let us understand how you can leverage these functions for your eCommerce brand.

#1. Foster Good Relationships with Manufacturers

Improving relationships with suppliers and manufacturers plays a significant role in enhancing customer service as well as boosting the efficiency of the order fulfillment processes. It provides businesses with much-needed support and prepares them for successful business expansion.

Here is a step-by-step guide business can follow to foster better relationships with manufacturers.

  • Choose the right manufacturers and suppliers whose business values and goals match yours.  Remember, to maintain good relations with the manufacturers. Study the operational processes followed by manufacturers to understand the manufacturing timelines.
  • Communicate with the manufacturers on regular basis on scaling up the manufacturing processes while identifying the challenges and bottlenecks. 
  • Provide timely feedback about the manufacturing processes, supply chain as well as product quality. Miscommunication and misunderstandings can adversely affect business operations. 
  • Remember you are a customer of the manufacturers so focus on being a good one. Maintain proper records of the products and invoices and send out the payments on time.

Follow a strategic approach to managing relationships with manufacturers. Gain inputs from stakeholders, manage processes and operations, as well as plan future business initiatives seamlessly.

#2. Plan Supply Chain Management Activities

Creating smooth and seamless supply chain processes helps businesses achieve desired operational excellence. With a proper supply chain plan in place, businesses can tackle failures in operations, such as machinery breakdowns, raw material shortages, irregular weather conditions, and other bottlenecks without disrupting the overall manufacturing performance.

Here are a few proven strategies businesses can follow for effective supply chain planning.

  • Take a look at the number of orders to understand the balance between the supply and actual requirements. This will help you create the best plan to meet the growing product demands.
  • Based on the supply analysis, leverage modern technology to forecast the demand for the goods. By doing so, businesses can stock the inventory based on the demand trends.
  • Design the production process by understanding the consumer demands and the manufacturer’s production capacity. 

For example, Amazon strengthened its relationships with logistics providers to facilitate better deliveries in a developing country like China. 

#3. Invest in the Right Tools

Right tools coupled with the right processes can improve team productivity and overall business operations. It helps businesses automate repetitive tasks, speed up manual processes, and fulfill orders faster.

Here is a list of tools businesses should consider investing in.

  • Website builder – A platform to design an eCommerce website without any hassles.
  • Customer support software – A platform to collect, respond to, and organize customer support queries on a unified platform.
  • Chatbot software – A bot builder platform to build smart chatbots to attend to the customers’ queries via live chat. 
  • Hosting provider – A service provider to make the website serve content and be available on the World Wide Web. 
  • Email marketing software – A software to send out regular emails and engage customers and leads in conversations to influence their purchase decisions. 
  • CRM software – A software to store information about customers and leads and build lasting relationships with them. 

You can also refer to this article for more detailed information about these tools.

#4. Develop a Foolproof Sales and Marketing Strategy

Marketing is one of the strong pillars for the success of strong eCommerce brands and is required for sustainable business growth.

It is no longer restricted to websites and social media networks. In addition to setting up a strong digital presence, brands need to assess their inbound marketing strategies to influence potential customers into buying the products. 

A successful marketing campaign should be able to give you incredible results.

  • Your website is the first point of contact with customers. Therefore, optimize your site for usability and responsiveness to ensure it offers a seamless user experience.
  • Optimize your website for SEO. Find out the keywords you want the business to rank for and rework the website content accordingly. Remember to add quality content that offers value to the readers. 
  • Create email collection pop-ups or opt-ins to build your email marketing list. Leverage personalized email marketing to reach out to the buyers and convince them to buy the products.

    For example, you can connect with customers who have abandoned products in the cart via emails. A study by Moosend revealed that 45% of cart abandonment emails are usually opened by customers. 

In addition to marketing, sales processes also play a major role in the success of eCommerce brands. Plan out an efficient sales funnel that focuses on both attracting new customers and retaining the existing ones. 

  • Identify the challenges customers face and resolve them by providing genuine information. This will create awareness about your products and help potential customers discover them. 
  • Dive deeper into the customers’ problems by telling them how your products can simplify their lives. Here you can leverage retargeting ads, social media ads, and other PPC campaigns to reach a wider audience.
  • The next step is persuading customers into buying the products. This can be done via abandoned cart emails, product recommendation emails, and other marketing campaigns.
  • Lastly, engage with customers via meaningful conversations to build strong relationships. Providing excellent customer service to take your eCommerce business to the next level.

Summing Up

Growing a successful eCommerce business cannot happen overnight. It takes a lot of hard work and investment to reap the fruits of success in eCommerce. By following the above steps, you 

will be able to set the right foundation to build your business and see the growth you are aiming for.