Growing your online store involves more than hope or random acts of marketing. You need a strategy, a framework, and processes you can iterate on. By the end of this article, you’ll have a solid ecommerce growth framework that will propel you closer to your goals.
Most of my clients want to make more profit but don’t quite know the path to get there. They might have scaled to $1m in revenue but getting to $3m or $5m seems like a real stretch.
Without a plan, goals, and regular measuring progress, you will continue to do the same actions and get a similar outcome as you’ve always had. You likely can’t work more hours each day, spend money hiring a large consultancy firm, or remortgage the house to spend on marketing.
So you need another way to grow and develop your business that aligns with your original purpose for starting the business. You need an ecommerce growth framework!
The good news is creating a plan that will get you from where you are to closer to your end goal is easier than you think. The tricky part is holding yourself accountable to the plan and adjusting your actions when you have market feedback.
Within this ecommerce growth framework are the steps I use with my clients to help them develop their business in line with the goals while staying focused and on track. If you feel you’ve hit a plateau or need a fresh wind of motivation, this article will help!
Stage 1: Laying the Foundation (Strategy)
There are a ton of myths and half-truths around strategy, and too many to counter here. The top 2 myths are that strategy is something you do once and that it’s the process of aiming to destroy your competitors.
I have strategy plans for the business and my life. I review both monthly and tweak them based on market feedback. The idea behind reviewing them is self-reflection, self-accountability, and to celebrate progress towards the goals.
The aim of having a strategy is to find the narrow spot where in the market your business can excel. It’s not a zero-sum game where you’re looking to destroy the competition. Instead, it’s about finding how you can win the game you’d like to play.
Your strategy plan should:
- Define the end goal and starting point
- State the time scale given to reach this
- Your resources
- What weaknesses you have
- Any new opportunities
- How you’ll measure progress and when
At the heart of planning a strategy for your online store is data. You need to know the basics, such as traffic, conversion rate, average order value (AOV), and customer lifetime value (CLV).
Next, you need to forecast what numbers you need to hit to reach your goal. These should be stress-tested to ensure you understand how slight shifts (e.g. a drop in AOV of 10% or if the conversion rate increases by 5%) will impact the outcome.
Again, strategy is the process of plotting how you’ll win at the game you choose to play. It’s NOT playing any game and hoping for a defined outcome.
Stage 2: Talking To The Right People (Marketing)
After figuring out the game you want to play and how to win at it and putting together some numbers, the next step in our ecommerce growth framework is to talk to people in your target market.
It’s easy to hide behind a computer or only use other people’s research (tertiary sources), but you need to talk with potential clients. You’ll learn what products they’ll buy, where they hang out, and what they don’t want from you. All of which will inform your marketing!
Marketing is a strategic process. You can’t blindly follow your competitor, your mate down the pub, any old marketing agency or consultant! You need to use the tactics and channels that will help you reach your ideal customer; and at a sensible cost.
You could decide your ideal customers are larger men who are 30 to 50 and want comfortable fitting clothes. You could spend a lot of cash on Meta adverts without much traction or you might find that an influencer campaign results in a better ROI, more awareness, and sales.
Part of marketing any brand is understanding what resources you have, how you can best deploy them, what channels/tactics to ignore, and how you’ll measure the impact you’ll have.
Stage 3: Keeping Them Coming Back For More (Retention)
Most businesses need returning customers to keep afloat and have the cash to grow and that’s the next stage in our ecommerce growth framework. Customers rarely return without a strong reason and prompting.
You’ve probably experienced buying a product from a business that arrived late or wasn’t well packaged or visiting their store only to be greeted by a bored-looking assistant. If you’re anything like me, you have a load of these stories! You probably won’t be placing another order quickly!
Of course, the opposite is true. You had a great buying experience that you keep raving about the company to your friends. Over time, you might forget the business’s name unless they keep in contact with you.
It doesn’t matter if you have a positive or slightly negative experience as over time, if the brand keeps in contact, you might be persuaded to buy from them again.
Email is the classic channel for retention marketing, but the subject is much broader than that. But we have a ton of other options, including text/WhatsApp messages, loyalty programs, exclusive in-person or virtual events, and push notifications.
You can also build a community around the problem you solve by allowing customers to share their experiences, issues, and solutions. Over time, having a strong community that identifies with your business will pay dividends.
You can look at referral programs where customers can save money, add loyalty points, or access exclusive perks by bringing you more customers. These strategies can be the quickest way to grow your customer base.
Stage 4: Finding More Sales (Growth)
With the basics in place, the next stage in our ecommerce growth framework is to think about growth. Most people forget that it’s an irritative process and try to stumble upon a magic formula for growth!
Another common problem is adopting a “growth at any cost” mindset. We’ve seen this with Uber, WeWork, Twitter, and many other tech start-ups. Growth at any cost is fine if you have a financial backer with deep pockets, but isn’t possible if you’re using your own overdraft!
It’s best to pursue growth as long as it’s profitable and sensible, but not at any cost. Remember, to feed yourself next month, you need to make a profit this month!
So, how can you grow your online shop?
There are two levers we can pull. First, we get existing customers to return, which we’ve covered above. Second, we can convince more people to become customers.
To find more potential customers, we need a clearly defined target market. We also need to collect and analyze data to make better decisions and ensure we’re using our resources efficiently. Part of this process is talking with existing and potential customers to gather insights.
We can reach them by spending on marketing. It could be Paid social, PPC, stands at popular events, or investing in SEO. You could also explore new sales channels such as marketplaces or pop-up shops.
Another option is to expand the product range, as this will drive more customers from both groups to your store. Plus, the more products you offer, the easier it becomes to upsell them!
Using This Ecommerce Growth Framework In Your Business
If you’re like me, you read a lot but quite often blogs miss the mark on explaining how to execute the ideas they cover. Here are the steps to follow to get started on the four stages.
Stage 1: Laying the foundation
Your strategy plan should be an A4 page or two. It doesn’t need to be the size of war and peace! But it should cover the basic figures:
- What is your ultimate goal for the business?
- How long do you have to reach it?
- What system will you use to measure progress?
- Why should people buy from you (and not your competitor)
Keep thinking about these questions as you build your business and revise your strategy document in line with what you learn. Don’t see it as a tick box exercise you do once. It’s a living plan that requires regular attention.
Stage 2: Talking to the right people
To win at the game of marketing, you need to carefully select which marketing channels you’ll use. They’re not on every social platform or running ads on every available option while improving their SEO and trying to land coveted PR opportunities.
Instead, they research where their ideal customers hang out and spend time, effort, and money appearing on two or three of these channels. By only running a few marketing tactics, you can ensure your efforts move the needle and that you don’t get lost in the sea of other brands.
Stage 3: Keeping customers returning
Similar to carefully selecting marketing channels, building a retention system involves choosing one or two channels. You can’t run email, push notifications, text messages, loyalty programs, and events, all at once. So you need to narrow your focus to one or two options.
Email marketing still makes a lot of sense, even for online stores targeting younger consumers. With an older customer base, a loyalty scheme might be ideal! Again don’t try to be everything to everyone!
Stage 4: Finding more sales
Growing your business involves getting existing customers to spend more and finding new people to buy your products. To do both of these, at scale, requires having systems in place. Without systems, you can’t grow.
Think of a system as a machine that produces a predictable outcome. You start with raw materials at one end and expect a certain output at the other. Running the machine are cogs, a conveyor belt, and other components.
There will always be ways to optimize the machine for better performance, such as oiling a cog or changing a component for one that moves faster or is cheaper.
Once you have built a system to get new customers and keep them returning, you can ramp them up with more marketing spend, additional product lines, and better delivery options. There will still be plenty of opportunities to tweak and refine your systems as you grow and develop the business.
Take Action!
The first step in all ecommerce growth frameworks is to Take Action! You can take an hour today to begin building your strategy plan or documenting systems and processes in your business. Again, take action and take notes!
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