4 Tips for Building a More Profitable Online Business
In the highly competitive and rapidly changing world of e-commerce, it’s vital for retailers to stay on top of the latest trends so as not to be outdone by competitors. What follows are four tips for merchants to help them increase sales, enhance customer relationships and, ultimately, build a more profitable online business.
1. Streamline operations with enhanced shipping controls. According to a May 2011 comScore report, 61 percent of consumers will consider abandoning a purchase if free shipping isn’t offered. It’s important for retailers to negotiate the best shipping rates and work with vendors for incentives. Offer diverse delivery options to meet consumers’ needs and expectations.
With product returns costing U.S. retailers nearly $14 billion per year, it’s imperative to have a clear returns plan in place as part of your overall shipping strategy. This will greatly improve customer satisfaction and retention, reduce costs, increase operational efficiency, maximize the value of goods sold, and minimize the impact of returns on profits.
2. Expand your business with multiple storefronts. Multiple storefronts allow retailers to expand their business by tailoring different sites to different consumers. These storefronts may have entirely separate products, brands, customer databases, checkout and payment methods, shipping options, and so on. Determine the best setup for multiple storefronts by considering all business possibilities, including search engine optimization, navigation, usability and the shopping cart. Have one back-end system that can handle the logistics of each site at the click of a button to efficiently manage these storefronts.
3. Stay competitive with repricing options. Being able to reprice an item in response to an external stimulus — e.g., a competitor’s price or inventory availability — can provide retailers with a substantial advantage and an increase in sales velocity. Rather than perform the laborious task of repricing by hand, use an automated tool to alter the price of an item on a marketplace without the guesswork, integration hassles or manual data import/export.
An automated tool also permits sellers to alter pricing strategies. They can now simultaneously perform other tasks such as managing inventory and monitoring supplier availability that commonly affect how repricing is handled.
4. Reporting tells the whole story. Reporting is typically comprised of four components: dashboards that show performance trends, statistics and graphs; reports that provide summarized lines of a period of time; structured raw data, which provides the ability to extract verifiable, actionable data; and business intelligence, which interactively massages data to “tease out” relationships and trends. Don't make guesses that could dramatically affect your business. Reporting tools help you get the most out of your data, enabling you to make intelligent business decisions.
There's a difference between Google Analytics and business intelligence. While Google Analytics provides reports with some data, it doesn't provide the ability to interrogate that data. True business intelligence provides a mechanism for retailers to develop consistent, data-based business decisions with operational capabilities so they can quickly take action. The result is wasted spending is eliminated and sales increase.