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The Secret Amazon Pricing Strategy to Crush the Competition

Wrong pricing, fake reviews or just bad customer service can kill your Amazon adventure faster than you think.

To many, this makes Amazon complicated, but…

Your pricing strategy on Amazon must be dead simple, and lead with the customer in mind.

Your goal is to generate as many sales as possible, get authentic product reviews and provide the best customer service to your Amazon customers.

In this chapter, I will detail the exact strategies we used to build our private label brand KAVAJ from scratch in 2011.

Further, I’ll give you insight into our approach to pricing on Amazon.

We are selling our products solely as a marketplace seller via Amazon (Europe, USA, Japan) and have sold more than 500,000 KAVAJ products, making more than $19 million in revenue.

Before we begin, always remember your ultimate goal:

You want your products to be within the top three spots on the first page of the search results for your most relevant keywords.

amazon pricing strategy

Example: Organic Search Results on Amazon.com for “iPad case genuine leather brown”

Further, you want to build a long-term brand on Amazon which will result in Amazon promoting your products throughout your product detail page.

In the KAVAJ example below you can see the effect of building a brand on Amazon.

In the “Customers who bought this item also bought” section, Amazon will automatically promote all your other products.

how to price on amazon

Example “Customer who bought This Item Also Bought”

Take This Book With You

This full guide (all +17 chapters and +50 experts and their insights) is more than 35,000 words. That’s a lot to read on a screen.

So don’t! Download the guide below to print it out, take it with you, and start selling more on Amazon.

Download Now

3 Steps to Selling Successfully on Amazon

1. Optimize your product detail page.

The basics just aren’t very good.

Before you even start thinking about generating traffic, putting any marketing budget to work, or refining your Amazon pricing strategy, you have to do the basics.

On Amazon, this means you have to optimize your Amazon product detail page for Amazon’s organic search results.

The vast majority of sales on Amazon happen through search and more than 70% of it on page one of Amazon search results.

So, it’s best to spend time optimizing your products for Amazon’s search.  

Bryan Bowman details every aspect on this topic in his part “A Seller’s Guide to Amazon SEO.” Make sure to read that first.

2. Set your prices for Page One on Amazon.

If you get your pricing wrong, you will either lose money or won’t sell anything.

Setting the right price on Amazon doesn’t have to be that hard for private label products where you don’t have any competition on your Amazon product page.

In general, there are two variables you need to consider for every single product you sell on Amazon.

  1. You want to be profitable (Find your lowest price)
  2. You want to maximize profits (Find your highest price possible)

First, you need to consider all of your costs, and what your prices would be for you to be profitable on Amazon with those costs included.

You need to calculate your floor price.

Second, your price must be competitive related to your most important search terms to get your product on page one of Amazon search results.

More than 70% of sales on Amazon happen on page one of organic search.

No one will find and order your overpriced product on page 23.

How to Calculate Your Amazon Floor Price:

To operate in the green, you need to know all your costs, take all of them into account, and then determine your price floor.

You can find below the list of costs which you have to take into your equation.

Product Acquisition Cost
  • Shipping
  • Customs
  • Payment wiring
  • Amazon Commission
  • Amazon FBA Fees
  • Customer Return Fees
    • On all returns, Amazon keeps 20% of the original commission as a return fee
  • Your own returns-related fees (return shipping, disposal and product write-offs fees)
  • Variable overhead allocation costs

There are also category-specific costs which you need to consider. For example, if you sell clothing, Amazon will charge you FBA fees related to customer return shipping costs.

How to Find Your Upper Price Floor:

Forget about overpricing your product! Amazon will tell you your upper price floor.

Always remember, your ultimate goal is to have your products ranked on page one of Amazon search results. This is where the magic happens, and you can really sell volume.

However, it is one thing to get your products to page one with deep marketing pockets (e.g. deep launch discounts, giveaways or a big Amazon Sponsored Products budget), but you want your product to stay on page one and generate sustainable, profitable organic sales.

To get your products to stick on page one, you must consider the competition around you.

This is easy to evaluate. Just search your top three keywords for your product and review the pricing of the search results on page one.

Now, answer this question: are your prices within a reasonable range of the prices you find there?

From our experience, you can be 20% more expensive than the highest price on page one of search results.

For example, the highest price you can find on page one is $40. Your upper price floor thus should be $48.

If your price is higher, you will most likely never make it to the top of Amazon search results.

3. Keep your prices stable, with exceptions.

To build customer trust and a sustainable long-term brand on Amazon, keep your prices stable.

There are, of course, exceptions.

  1. The number one reason for price deviations is to increase your sales rank, which results in more organic sales later.
  2. The second reason for price cuts is cross-selling your products, which in the end also results in better sales rank for all products included in the cross-selling promotion.

Usually, this means cutting your prices close to break-even or below profitability. This is most often done during new product launches.

My company deviates from our standard prices mainly in the following contexts:

  • New Product Launches
    • We offer 15% launch discount for all customers
    • We offer up to 50% price cuts for repeat customers on our email list
  • Cross Selling
    • We offer up to 40% discount for bundles sales. e.g. If a customer buys an iPad case, he will get a 40% discount for an Apple pencil case
  • Black Friday or Other Holidays
  • Stock Clearance
    • In case you have overstock, this can help get rid of your overstock. It can also revive a dead product.

Finally, before you even think about cutting prices below profitability, always keep in mind that you will only have fun (i.e. be successful) selling on Amazon once you can generate organic sales with a decent profit margin.

How to Drive Traffic to your Amazon Products

Without traffic, there are no sales. Just listing your product on Amazon and hoping for traffic and sales is not enough to be successful.

Today, you need not only the organic traffic on Amazon, but you need to drive traffic from external sources to your Amazon product page.

Paris, here we come… (A Case Study)

Not long after leaving Amazon to start my own company, my team and I had a brilliant marketing idea. We were so convinced that it would work that we boarded a plane from Germany to France.

Before we left, we printed off thousands of flyers and planned on handing them out in front of the Apple store in Paris. We knew that tons of people would be standing in front of the store waiting to get their new device, and we knew that we would have a captive audience.

We gave away every single flyer that we brought.

People genuinely seemed interested in our product. They liked the design; they liked meeting us as the creators, and we had several promising conversations that we believed would turn into sales.

When we got home to Germany, we were eager to check our dashboard for sales. We logged in and were totally shocked. We had sold just one case.

JUST ONE.

We immediately knew we had to change our strategy to drive traffic to our products.

Here are our the three key strategies we are using today to drive most of our traffic to our Amazon product pages.

1. Build an email list.

An email list is a great way to boost your sales at product launch.

  • We use our list to send our customers directly to our new product pages on Amazon.
  • We also give them a discount code for the purchase of the products and often see a good jump-start on sales from that.

As a seller on Amazon, you might be wondering how you can build a list since you don’t get the real email addresses from customers and also are not allowed to write them for marketing reasons.

Begin with these three, easy-to-implement ways to start building your own list:

  1. Add a sign-up field on your website, like a newsletter sign-up, an ebook download, or the like.
  2. Communicate your newsletter sign-up option on your social media channels and on your packaging.
  3. After your sale at Amazon, you can send one email to your customer. Point them to your newsletter sign-up page in this email.

Our current tool of choice is ConvertKit, which has a very easy-to-use interface and allows us to easily tag our customers and build individual newsletter campaigns.

2. Place targeted Facebook ads.

In 2014 we shifted a big part of our external ads budget from Google to Facebook.

Today,  Facebook Ads are our most important external paid traffic source.

On Facebook, you have multiple advertising options, and you don’t need an existing fan base for that.

The great thing about Facebook Ads is that you can define your target audience and create a post which will show up directly in a user’s Facebook feed.

For example, for our new iPhone 6 cases, we created a target audience for women between 30 and 35 with kids younger than 3 years AND an interest in photography.

We generated awesome results from these ads.

We only had one issue with our Facebook Ads: we could not tell if the ads were profitable.

We spent one-and-a-half years developing analytics with quantified markets.

Today, it is impossible for us to imagine doing business without analytics –– and now you have the opportunity to use it as well!

Working with this Amazon conversion tracking tool catapulted our Facebook marketing performance into entirely new dimensions. The bottom line is that with analytics, you finally know whether:

  • Your Facebook advertising is worthwhile
  • You are really addressing the target groups that buy your products on Amazon
  • Your advertising is actually generating revenue

3. Use Amazon Sponsored Product placements.

Amazon Sponsored Products is by far the fastest way to get your product on the first page of Amazon search results.

Amazon Sponsored Products work similar to Google AdWords, where you bid on search terms.

If a person is searching on Amazon for your product, you can buy an ad relative to those search terms, and your offer will appear next to the best results.

The great thing about Amazon Sponsored Products is that it is very easy to set up. You can do it in a matter of minutes.

We did realize pretty early in the process, though, that even in a simple interface, you have to manage your account carefully and regularly to avoid an exploding marketing budget.

There are two main reasons for this.

  1. First, Amazon is continually improving the algorithm, meaning your successful campaign today will lose money tomorrow.
  2. Second, the competition on your ads is getting tougher as more sellers enter the marketplace. Amazon has also opened the sponsored products program to Amazon Retail clients.

I recommend either having someone in-house watching your campaigns very closely or working with MarketPlaceClicks, who is managing our account for us.

4. Point all product links to Amazon.

You might ask:

“Why should I send my customers over to Amazon if I already have my own website?”

The number one reason is that your ultimate goal is to be on the first page of the search results and, if possible, in the top three listing. This is where the big money is made, not by a single sale on your site.

Apart from our website, we point every link on Facebook, Twitter, YouTube, Instagram, our blog posts and our email newsletter to one specific Amazon product page.

Expert Tip

You can build high search engine ranking for your own online store through content marketing and influencer outreach work to gain backlinks from relevant, high-quality sites.

5. Get your products in the hands of bloggers and Youtubers.  

Youtube is the second biggest search engine in the world.

It’s really good to have a ton of reviews about your products on there so that you show up first in search no matter where they search for you.

Remember, Google owns Youtube.

Choose the Youtubers and bloggers who fit best with your product and brand, and offer them free review samples.

Here are few tips for outreach:

  • Be sure to word your outreach genuinely, and help solve a problem for their audience.
  • Know that they receive tons of these emails regularly.
  • Keep a running list of who you are reaching out to and who responds.
  • Use this to build yourself an influencer list.

If you give your products away for review, only give them your top-selling product.

Put all your eggs in one basket.

Remember, you want to have this product in the top three of the first page of search results, so you have to ensure that all the traffic is going to that one product.

6. Maximize your product packaging.  

Every case we ship includes a small booklet and two business-card-sized inserts with 10% discount codes for customers to give their friends or use on their next Amazon order of a KAVAJ product.

Customers are telling their friends about us and they’re buying more cases for themselves.

We also use our best customer testimonials to build trust.

We put our best quote on the outside packaging and, for our most important products, we include a customer case study inside a small booklet.

7. Create effective Google Ad campaigns.

We spent a lot of money on Google in our early days. However, Facebook Ads and Amazon Sponsored Products totally changed the game.

Today, you should use Google AdWords as follows:

  • Focus on brand name: Focus your efforts on your brand name and the most specific keywords in the long tail. We get most of the traffic from Google from people searching for our brand “KAVAJ.”
  • Focus on long-tail keywords: In the long tail, we only create very specific campaigns for our products, which must include the device name, the material, and the color. For example, those words that are keywords to our product, phrases like “iPad Air 2 case leather black.”

How to Get Real Product Reviews

Without product reviews, you won’t sell anything on Amazon.

The amount and the quality of reviews are the most important aspects of your reviews to increase your conversion rate.

Unfortunately, only 1 out of 100 customers writes a review.

Here are a few ways to increase your number of authentic product reviews.

WARNING

Before getting into the details, this subject requires a quick warning, as Amazon is currently cracking down on sellers buying fake reviews.

Never mess with Amazon.

  • Avoid review clubs and excessive giveaways, which do not comply with Amazon’s Terms of Services (ToS).
  • Don’t give away a free product in exchange for an Amazon review.

Your goal should be to build trust with your customers and a long-term brand on Amazon.

Even if the customer is leaving a disclaimer that he got the product for free, it will hurt your product and there is a high chance that Amazon will either delete all those reviews or even suspend your seller account.

This is what you should do instead.

1. Email your customers after purchase and ask for reviews.

You can use tools like Feedback Genius to automate this process.

  1. Send the email a few days after the purchase.
  2. Ask in a neutral way and don’t force them to leave a positive review.
  3. Provide a direct link to the review page, as a lot of your customers have probably never written a review before.

You can also use this opportunity to make sure the product was delivered correctly and give the customer a chance to tell you about their experience (good or bad) so you can make the most of the interaction and build lifetime brand loyalty.

2. Use “wrong” positive seller feedback to get product reviews.

People often confuse seller feedback with product reviews.

Unfortunately, the often really good product feedback is not very visible for other customers.

selling-on-amazon-29

Review your seller feedback regularly for people who actually provide positive product feedback and ask them via email to also write a product review.

3. Comment on reviews.

Everything on the Amazon product page is public.

In particular, the reviews and comments sections will be read by almost all future customers. This is your chance to stand out.

Be sure to comment on any negative product reviews or on reviews where a customer has a question. This is your opportunity to build trust and increase your conversion.

Further, many customers who initially gave your product a negative review might even change it for a positive one because they are grateful that you cared about their issue.

selling-on-amazon-30

4. Ask customers who email you for feedback.

The easiest way to get product reviews on Amazon is by simply asking customers who tell you how much they love your product.

Whenever you receive an email, a customer service call or positive feedback on your social media channels, just ask them politely if they are willing to share their experience with other customers on Amazon.

How to Provide Outstanding Customer Service

You can’t do anything wrong if your Amazon customer benefits. Amazon itself is the most customer-centric company in the world. They expect the same standard from you as a seller.

Your best marketing tool on Amazon today will be outstanding customer service.

Your goal should be to create a “wow” experience which will help spread word of mouth.

To explain, what I mean by “wow” experience, I want to share a success email we received:

selling-on-amazon-31

We not only exceeded his expectation but we “surpassed anything that I could have expected!” In the end, he helped us fix the issue by sending us images and he will recommend our iPad Pro cases to his management team.

This how you turn a negative into a positive.

1. Start your customer service on your Amazon product page.

This is the place where all your customers start their customer journey, read reviews, ask questions, check out your seller feedback and finally click the “Add to Cart” button.

I recommend implementing a daily routine for your product pages including the following actions:

  • Comment on negative product reviews and offer instant help
  • Answer questions in the Q&A section
  • Manage your seller feedback actively

2. Answer your customers fast and be generous.

The 2nd pillar of your customer service is email. You must answer all emails within 24 hours or faster and strive to resolve every customer service issue in a single communication.

I recommend to apply the following four principles:

  • Answer all emails within 24 hours
  • Provide a solution in your first reply
  • Make it simple for your customer
  • Be generous

3. Be responsive on your social media channels.

Your customers will talk about or to you and they expect you to engage with them on their favorite social media channel.

We recommend using Facebook and Twitter as your first customer service channels. You can exceed expectations here and “wow” your customers if you reply to all questions within an hour.

We also recommend creating a FAQ section on your website that answers common questions. Finally, offer an easy-to-use contact form on your website.

How to Go International on Amazon

One final note on your Amazon strategy: this entire process works the same worldwide and the potential is huge.

More than 300 million active customers are waiting for you.

As a German company, we started out in Germany, which is still our biggest market.

With Fulfilment by Amazon, it has never been easier to sell your products worldwide. You can see screenshots below of one of our iPad cases, which we sell in the U.S., U.K., Germany and Japan.

Amazon.de: KAVAJ iPad Air 2 Case Berlin cognac

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Amazon.com: KAVAJ iPad Air 2 Case Berlin cognac

selling-on-amazon-33

Amazon.co.jp: KAVAJ iPad Air 2 Case Berlin cognac

selling-on-amazon-35

Next Steps for Your Brand on Amazon

What are you waiting for?

Selling on Amazon worldwide has never been easier. Apply the Amazon pricing strategies mentioned in this guide and get started.

For the final time, always remember that your ultimate goal on Amazon is to get your product on page one of Amazon search results to benefit from the organic sales of the massive Amazon customer base.

From our eight years of experience, the best way to achieve this is to focus on generating sales, getting authentic product reviews and providing outstanding customer service.

Most importantly, GET STARTED TODAY and TAKE ACTION NOW!

Want more insights like this?

We’re on a mission to provide businesses like yours marketing and sales tips, tricks and industry leading knowledge to build the next house-hold name brand. Don’t miss a post. Sign up for our weekly newsletter.

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Amazon &How To Sell Online &multi-channel &omnichannel David Venne 17 Dec 2017 Comments Off on The Secret Amazon Pricing Strategy to Crush the Competition

Amazon Selling Pitfalls Even the Savviest Sellers Forget [Infographic]

So you’re up and running as an Amazon seller, and you think you’ve figured out the Amazon marketplace. The good news is, if you’ve made it out alive (and profitably) through your first holiday shopping season, you’re doing well.

But, there are a number of issues that even large or long-term Amazon sellers don’t figure out.

Selling on Amazon is endlessly complex, with traps that even veterans fall into.

I’m pleased to unveil the pitfalls to you now –– but like a child who thinks she’s figured out how a magician does a trick, you still will need to work hard to avoid the common problems many sellers encounter when they start selling on Amazon.

Knowing these will at least set you up to be more aware of where those pitfalls might be hiding. Use the infographic to help visualize the issues and read through exactly how to solve them in the article below.

Take This Book With You

This full guide (all +17 chapters and +50 experts and their insights) is more than 35,000 words. That’s a lot to read on a screen.

So don’t! Download the guide below to print it out, take it with you, and start selling more on Amazon.

Download Now

Tax Setup

It’s a little shocking how many sellers never set up state tax collection options on Amazon, thinking that Amazon somehow automatically takes care of all sales tax issues from sales on the Amazon marketplace.

It turns out nothing could be further from the truth.

While Amazon is happy to collect state sales tax for you (for a small fee), it’s up to every seller to indicate in which states it wants Amazon to collect tax, and to manage the remittance of the taxes to the appropriate tax jurisdictions across the country.

There are many tax remittance services available for online sellers, but the seller ultimately has the responsibility of paying its taxes.

Here are a few services that can help:

  • Taxjar.com
  • Avalara.com
  • Taxify.com
  • Vertexsmb.com

While a seller may choose not to collect state sales tax (choosing to absorb that as a cost of doing business), the responsibility of remitting the tax is not optional.

A seller can designate its account to collect state sales tax in particular states.

Unfortunately, however, Amazon’s default when setting up new listings is to designate each SKU as having a no-tax label, which can overwrite the seller’s general request to collect state sales tax across all of its catalog.

Set your taxes up right the first go around

My advice is to, immediately upon signing up a new seller account, go into the Settings –> Tax Settings, and designate not only in which states you want Amazon to collect state sales tax, but also set the “Use default Product Tax Code” setting to “A_GEN_TAX.”

Amazon typically defaults to A_GEN_NOTAX, where no tax is being collected.

While the seller may offer products that warrant a slightly different tax rate, that level of tweaking can follow later.

If the seller is using Fulfillment by Amazon (FBA) and isn’t proactively collecting state sales tax in all of the tax-collecting states where Amazon has fulfillment centers, it won’t be long before the seller accumulates tax liability from having incurred tax nexus by way of FBA inventory being stored – even briefly – in these states’ fulfillment warehouses.

Pro Tip

Each FBA seller should invest in a tax consultation with an online seller tax consultant to understand the responsibilities and potential liabilities of using FBA.

Profitability

Too many sellers focus on top line sales numbers rather than bottom line profits.

“I want to sell $1MM/year on Amazon” or “If only I could get to be a $10MM/year seller on Amazon.”

Honestly, other than ego and maybe a few volume discounts, there isn’t much long-term benefit to being a big, but not particularly profitable seller on Amazon.

Focus on bottom growth and account for all costs upfront

I’d much rather see any seller grow its bottom line profits year-over-year much faster than its top line sales.

That typically requires a SKU-level understanding of profitability, incorporating overhead and indirect costs into each SKU’s profit calculation.

This includes certain less-than-obvious Amazon fees, and product write-downs/write-offs.

While I’ll discuss this matter much more in a subsequent chapter, it’s important to focus on those parts of your catalog that make you money and shed those parts that don’t make you money.

Stop averaging everything out, and looking only at your overall sales numbers and margins.

Start thinking about every SKU you sell on Amazon as having its own P&L, its own market forces, and its own level and types of competitions.

Such an approach has helped many a seller rationalize its catalog, focusing on bottom line growth ahead of all other financial goals.

Fulfillment by Amazon

Fulfillment by Amazon – commonly referred to as FBA – is exactly what it sounds like. You send your products to Amazon’s warehouses and they pick, pack and ship your items to meet their strict shipping and delivery timelines.

The Issue with Co-Mingled SKUs

There are a number of problems here, and I’ll start with the use of co-mingled “stickerless” SKUs.

As mentioned in a previous chapter, a seller has the option of sending product into FBA without having to provide SKU-level stickers on each unit.

Such stickerless inventory has the potential to get mixed in with the inventory of other FBA sellers of the same SKU.

Then when a customer places an order from one FBA seller, Amazon pulls the most convenient inventory, even if that inventory isn’t actually the inventory that the seller sent into FBA itself.

And, if other sellers have sent in counterfeit product or used-condition product that they are trying to pawn off as new-condition product, now the seller with this new sale may get itself into trouble with Amazon for selling problematic product to a customer.

Amazon responds when customers complain about product quality –– and the heavy lifting falls on the individual sale-level brand.

At roughly $0.20/unit for Amazon to sticker items or whatever a seller’s own warehouse costs are, we see the costs of stickering FBA units as far lower than the implied cost of having one’s seller account suspended for apparently selling counterfeit co-mingled product to a customer.

Stickerless v. Stickered Inventory

The other complicated issue around stickerless vs. stickered FBA inventory is when a seller designates its account to be stickered.

By default, each new FBA account starts off as stickerless.

When a seller creates a shipment of product to send to Amazon’s fulfillment centers, that stickerless designation will be applied to the seller’s SKUs and will remain forever going forward with that SKU.

So, if the seller wants its FBA product to be stickered, the seller has to change the default setting before creating its first shipment to FBA.

Otherwise, the seller will have to create a duplicate stickered offer on the same product listing.

We’ve seen many sellers not get this sequencing right, leading to situations where they think they changed their account to stickered, only to discover that certain SKUs remain stickerless because they were initially sent to FBA before the whole account got switched over to stickered.

If in doubt, flip everything to stickered (not co-mingled) immediately upon turning on FBA (but before creating the first FBA shipment). Or contact Amazon Seller Support to get clarification if any SKUs in your catalog are unknowingly stickerless.

Bottom line: when you start off, make sure you read up on how to sell on Amazon FBA so you don’t fall victim to these pitfalls.

Repackage Unsellable Customer Returns

Next, Amazon defaults every FBA seller’s account to enabled for “Repackage Unsellable Customer Returns.”

This means when a customer returns an FBA order, if that product’s packaging is damaged, Amazon may apply its own packaging to make the unit resellable.

Unfortunately, it’s not unusual for customers to see this Amazon repackaging as potentially an identifier of counterfeit or used product, resulting in a customer complaint or even an infringement against the seller for selling used-condition product as new-condition product.

Unless you sell your product in a generic polybag or generic cardboard box (with no logos on the packaging), I suggest turning off this repackaging feature immediately, and handling all repackaging yourself to ensure only the highest-quality product (with proper packaging) is presented to Amazon customers.

The Amazon Seller’s Solution Provider Directory

Optimize your return flow by connecting with an Amazon solutions expert. For a full list of recommended experts, visit our Amazon Solution Provider Directory.

Listing Optimization

There are a number of sources of data available within Seller Central that can be used to improve the listing quality of your catalog.

For many sellers, the process of building and optimizing listings is a one-time deal, as they understandably turn their focus to other operational matters.

1. Use the Sponsored Product Ad campaign reports.

A significant opportunity, however, lies in using the reports from the Sponsored Product ad campaigns.

In these reports, you can see the exact keywords that were connected to Amazon customers buying your products.

By examining these reports periodically (specifically for automatic targeting campaigns), you’ll find that there are keywords leading to sales that you never anticipated being effective.

Lifting those terms directly into your generic keywords will improve the SEO discoverability of your listings.

I encourage sellers to repeat this process every three months to make sure that customers’ behavior specific to certain words haven’t changed.

And with the generic keyword capacity for words now much larger than ever before, there is room to add many more keywords and get click benefit through SEO rather than paid efforts.

2. Include answers to previous product inquiries on your product page.

It’s also worth paying special attention to the inquiries that you get from Amazon customers.

If customers are asking product-specific questions, newly addressing these issues in your product detail page content is likely to improve customer conversation over time.

For too many Amazon sellers, the customer inquiry process doesn’t include an indexing of questions and answers back to specific SKUs, thereby causing a seller to lose out on known product clarifications or embellishments that are needed.

3. Ask for the category listing report.

I’m a big fan of the “Category Listing Report,” a report available in the Inventory Reports section, but only when requested through Seller Support.

This report will recreate your product listings’ flat file, making it much easier for you to identify any data gaps in your listings (including missing bullet points, generic keywords, improper tax codes, etc.).

While you request this report for only a finite period (i.e., seven days, 30 days), it’s worth pulling this report at least quarterly to make sure your product listings contain all of the necessary data you believe they should.

Boost Your Product Rankings

Read our chapter on optimizing Amazon Search to get more tips on boosting your product rankings.

Operations

And now the biggest category of all.

Managing the operations of an Amazon seller business is the most time-consuming part of every seller’s day.

Too many sellers don’t focus on the right activities, leading them to work too hard to make Amazon money.

1. Returns.

Do you have a clear process for handling returns efficiently?

Do you have a way of testing or grading returns, upgrading packaging where needed, and recovering as much revenue as possible by making these items sellable again on Amazon (or some other channel, as needed)?

For too many sellers, handling returns is something done at the end of the month when they have time, rather than something that is managed strategically through analytics and continuous improvement.

Yes, returned products aren’t likely to be 100% recoverable as new condition products.

However, if you carefully track the return rate of each SKU, the recovery rate of each SKU (i.e., what proportion of expected new-condition revenue you actually recover from each SKU), and which products are most likely to be returned damaged by customers, you can identify which products you need to remove from your active catalog.

You’ll also identify with which products and brands you may need to negotiate a returns allowance with your suppliers/distributors/brands.

Once you have this data in hand, you’ll likely be surprised to discover just how much financial loss you incur because of high return rates and high write-down/write-off costs.

Some of the best sellers on Amazon know, for each SKU, exactly where to sell returned products to get the highest recovery rate.

It’s worth talking with other sellers to figure out if you are unknowingly leaving a lot of money on the table by mishandling returned products, or if you are appropriately managing returned products as a core part of your overall seller business.

2. Duplicate Listings from competitors.

Duplicate listings on Amazon can be an effective way for competitors to divert traffic away from your product listings back to theirs.

It’s worth, at least once a quarter, to search the whole Amazon catalog for duplicate listings of your items.

If you find other listings of the same products, consider filing tickets with Seller Support to get duplicate listings merged.

And, if the duplicate listings were created maliciously by sellers using incorrect data (e.g., irrelevant UPCs or incorrect brand names), it may be worth also filing tickets reporting violations against those sellers.

I have seen far too many sellers confused about why their sales are dropping on top-selling items, only to find that the sales are being diverted to a duplicate listing newly created by a coy competitor.

3. Inventory management skills are required.

Inventory management skills require constant refinement on Amazon, whether it’s actively addressing soon-to-be stale inventory or rebalancing products based on changing customer preferences.

While I see most sellers ramping up inventory levels for the holiday shopping season, few sellers stock up enough products to cover most of January as well.

Often this leads to unnecessary stock-outs caused by higher than expected demand in December or inadequate time to replenish in early January when your suppliers are closed for the holidays.

Either way, I like to see sellers planning their holiday shopping inventory levels in such a way that they potentially overstock a little bit for January and February, thereby giving themselves a little bit of breathing room in December, January and February.

Such an approach is especially relevant for products that are expected to continue to have some meaningful sales after December.

4. Test-buy your competitors.

Test-buying your competitors’ products on Amazon is a very easy way to figure out what your competitors are up to, regarding how they package product, how they follow up through email to customers, and how they handle customer returns (if needed).

While you and your competitors may be selling the same products, there are likely some aspects of your competitors’ overall offering that you can learn through periodic test buys.

5. Plan for Pricing and Procurement.

Finally, with so many changes to competitors and prices on Amazon, I have watched too many sellers be slow to plan how to evolve their catalogs over the next three to six months.

Sellers should, at least once a month, focus a few days on the procurement of new selection, as some portion of their existing catalog will likely become unprofitable or below an acceptable margin threshold, leading to a need for better use of capital on other product selection.

This is particularly the case for resellers that don’t have exclusive sourcing relationships.

It’s only a matter of time before some competitor with a lower margin threshold starts selling the same product, and makes your offers unsellable.

While a brand may think it has decent control of its distribution, Amazon is a very efficient marketplace for gray-market or diverted product to surface, leading you to find that you have to cut your prices just to match some new entrant.

For private label sellers on Amazon, remember that that your product sales successes on Amazon are an invitation for the next private label seller to copy your product and make a lower-priced version; so keep evolving and stay nimble.

The active catalog you have today isn’t likely to be as profitable or relevant in 6 to 12 months from now.

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Amazon &How To Sell Online &multi-channel &omnichannel admin 16 Dec 2017 Comments Off on Amazon Selling Pitfalls Even the Savviest Sellers Forget [Infographic]

The Definitive Guide to Selling on Amazon

As a former journalist, the plethora of clickbait headlines across the web is nauseating.

I’ve had to draw the line plenty of times in my writing career, refusing to call something “definitive,” comprehensive” or “all-inclusive” if it wasn’t that.

This piece of content required no such moral delineation.

This book’s headline, Definitive Guide, is the only possible way to describe what you will find in the subsequent chapters.

It is by far the most complete and actionable information out there discussing how exactly to sell on Amazon.  

Here are some things you’ll find throughout the book.

Topics You Will Learn About In Our Selling On Amazon Guide:

  • The benefits of selling on Amazon.
  • Amazon success stories for inspiration.
  • How to determine if you should sell on Amazon.
  • Actionable Amazon SEO strategies.
  • Understanding the Amazon a9 algorithm.
  • 7 skills you must have to win on Amazon.
  • Pitfalls that trip up even the best Amazon sellers out there.
  • A step-by-step guide to determining your actual Amazon revenue.
  • How you could lose on Amazon by winning – and other tips and tricks to avoid a double-sided sword.
  • How expanding to Amazon helped a Water Polo company successfully sell swimwear to Alaska.
  • How to win the Buy Box, as told by Feedvisor, the unencumbered champion of Buy Box wins, where 82% of Amazon’s sales happen.
  • Why mobile matters most – 70% of Amazon customers made purchases on Amazon’s mobile site – and how to optimize for it.
  • Pricing and repricing strategies for both resellers and private label sellers alike – plus tips to make you more, faster.
  • How to get a 320% increase in sales in less than 10 minutes (hint: Amazon has SEO, too).
  • What The Mountain has to do with Amazon customer review legend – and how you can jump start your own with a simple email.
  • Growth hacking tips and tricks that could earn you $5,000 for every hour you spend focused on Amazon.

Take This Book With You

This full guide (all +17 chapters and +50 experts and their insights) is more than 35,000 words. That’s a lot to read on a screen.

So don’t! Download the guide below to print it out, take it with you, and start selling more on Amazon.

Download Now

This is actually the second publishing for this book – an updated version for 2018.

The original book was eight months in the making –– with the first email sent out to a subject matter expert on January 21, 2016. That first book launching in August 2016.

That timing is critical.

BigCommerce had just recently published the first ever Amazon Sellers’ Solution Provider Directory –– highlighting more than 200 solution providers across a wide range of Amazon needs and complexities.

It was our most downloaded piece of content at that time.

James Thomson, former head of Selling on Amazon and an an author you’ll see plenty of times throughout this book, was the mastermind behind that project.

His name and proposal landed on my desk in the hibernation days between Christmas and New Years, when most Americans and almost all retailers are in the throes of a rest period following the holiday rush.

“I know it’s the holidays, but please just hop on a call with him,” a colleague pleaded. “You’ll like what he has to say.”

That 30-page book published two weeks later, forcing itself to the top of priority cycles that typically take much longer –– especially with multiple team members out on vacation.

It was all hands on deck – and I had called them there, asking many to spend a few extra hours to help me make this book come to life.

I was putting my neck on the line – calling in favors before the first day of the new year even began.

It was that good.

Soon, I was sending James emails asking him to review a table of contents for a longer-form, more comprehensive piece on how to sell on Amazon.

It’s safe to say that my call with James that late December day was a light bulb moment for me.

“This stuff is complex,” I told him, “but the revenue opportunity for our customers is too ridiculous to ignore. Our merchants need the absolute best, most pertinent information to make this work. I won’t waste their time.”

He agreed, and the vetting process began. That first email went out. This 35,000+ word book had its first heartbeat of life.

The 2016 version had 15 chapters, featuring the insights of more than 30 Amazon subject matter experts.

This year’s version for 2018 has 17 chapters, featuring the insights of more than 50 Amazon subject matter experts.

A few include:

  • Andrew Tjernlund, Multi-Million Dollar Merchant and Amazon Consultant
  • Bryan Bowman, Founder, AMZ Profit Pros
  • Eyal Lanxner, CTO, Feedvisor
  • James Thomson, Partner at the Buy Box Experts, Founder of The PROSPER Show, Former Head of Selling on Amazon
  • Kai Klement, Co-founder and Multi-Million Dollar Merchant, KAVAJ
  • Kevin Rizer, Founder, Private Label Podcast
  • Lauren, Shepherd, Senior Marketing Manager, Teikametrics

We left no stone unturned, nor did we include any information we believed to be superfluous.

You will find everything you need to start selling and winning on Amazon in this book.

I can also assure you it will be a vital resource you continue to reference as you grow Amazon as a revenue channel.

Even for those sellers already highly profitable on Amazon, there are nuggets of insight to even further increase sales and operationalize your Amazon business.

What are you waiting for?

  • Dive in.
  • Take action.
  • Grow your business.

And let us know if you have any questions.

In the meantime, here’s the quick start list of everything covered in this book, boiled down to 8 steps.

How Do I Quickly Get Started Selling On Amazon?

  1. Decide on items you will be selling through Amazon.
  2. Choose your Amazon selling plan. The professional plan costs $39.99 per month and individuals pay $0.99 per item sold.
  3. Register to start selling.
  4. List your products.
  5. Drive traffic to your listings (described in detail throughout the guide).
  6. Generate sales.
  7. Ship orders.
  8. Get paid — payments when will be deposited in your bank account.

Want more insights like this?

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Amazon &How To Sell Online &multi-channel &multichannel &omnichannel admin 13 Dec 2017 Comments Off on The Definitive Guide to Selling on Amazon

The 8 Tools and Strategies Proven to Acquire New Customers & Increase Customer Engagement

How is a sinking ship different from a failing ecommerce site?

At least the captain can go down with their ship!

You can’t – so you better do everything in your power to keep the customers coming.

As we approach crunch time in the world of online shopping, now seems like as good a time as any to review the best tools and techniques for acquiring new customers, increasing repeat business, and minimizing loss.

The whole ecommerce game boils down to getting people to buy your product. And then, hopefully getting some of those customers to come back again and again.

Whether you’re new to ecommerce or a grizzled vet who remembers what it was like to sell on eBay, this guide should give you some new ideas and reinforce old ones, including:

  • Why actionable, helpful content is your responsibility (i.e. curation isn’t key)
  • When to ask customers for reviews (and then how to use those!)
  • How to do influencer outreach to earn increased SEO (the science + the art)
  • How to use live chat to increase conversions and customer loyalty
  • Why your site doesn’t need to be beautiful, it needs to be helpful (and what the difference is)

You’ll also find recommendations on BigCommerce apps and integrations that fellow entrepreneurs use to succeed.

If there’s anything you want to add, please leave us a comment or email us – don’t be shy!

Customer Acquisition Tactics: The 4-Step Process

Customer acquisition is the process by which ecommerce brands actively find and then convert net new customers to their sales cycle.

Many brands think that to effectively create a customer acquisition cycle, all you need to do is launch your website.

But that is far from the reality. Once you launch, you need to then:

  • Create targeted ads on Facebook
  • Install 1-step checkout
  • A/B test your copy
  • Get niche bloggers to talk about it

That’s how net new customers will come.

Let’s go a layer up here, though. Good customer acquisition breaks down into four major categories:

  1. Promotions.
  2. Design.
  3. Testing.
  4. Outreach. 

If you nail these four areas of ecommerce customer acquisition, you should expect to do pretty well at convincing Joe Web Surfer to buy your stuff.

What is cost of customer acquisition?

The cost of customer acquisition is typically referred to as CAC, and it is easily broken down into a simple formula.

It is the cost spent on acquiring new customers (marketing expenses) divided by the number of customers acquired for that given period.  

For example, if you spend $100 in a year and acquire 100 customers, your CAC is $1.

Additional Recommended Reading

In case we’re moving too fast: here’s a comprehensive guide on how to drive traffic to your ecommerce site.

Customer Acquisition Strategy Ideas + Examples

1. Give ‘em a deal they’ll never forget.

What’s the last thing you bought online?

Chances are, it probably was on sale, came with a discount code, or was shipped to you for free.

People love discounts.

Giving someone the feeling that they “won” a deal is a powerful way to make them like your product more than a competitor’s.

You can go about promotions in a variety of ways.

Use your social media channels to run ads featuring a coupon that’s redeemable on your website if you have a pretty solid target demographic figured out.

If you’re more into drip campaigns or interacting with customers off of social media and perhaps have a popular blog, your email list is a bona fide money-making machine.

Encourage people to subscribe to your email newsletters and occasionally reward them for access to their inboxes with an exclusive offer.

Additional Recommended Reading

To get the most out of welcome emails, check out these battle-tested templates.

If you have a less popular item in stock or dwindling inventory of a SKU that’s no longer made by your suppliers, put it to use either as a limited-quantity loss leader or throw it in as a freebie on orders over a certain quantity.

Not only does this free up valuable space in your ecommerce fulfillment warehouse, it gives customers the warm and fuzzy feeling that comes from getting a great deal.

Don’t forget that when you’re crafting deals to lure in new customers, you should pay attention to related trends or the time of year.

That could mean putting together ads that drum up anticipation for the winter holidays or spoofing the new hit TV show that everyone in your demographic follows.

The only thing better than a sale is a sale that connects with the lifestyles of the people who are your customers.

BigCommerce app that could help: Coupon Pop entices new visitors to become customers with instant pop-up discount offers designed to get sales.

2. Design your website to be helpful, not sophisticated.

No one cares if your website has 1080p image sliders or embedded QR codes.

The only thing that matters is that a first time visitor can find what they’re looking for, and then buy it from you.

So keep things simple and easy to use.

Use an ecommerce database (otherwise known as a search bar) for customers that actually answers their queries — and leave breadcrumbs for them to navigate your selection of items if you have an especially large inventory.

When a visitor is ready to make the leap into becoming a customer, make sure your site has a 1 page checkout to keep things as easy as possible.

Write detailed product descriptions that tell your customer exactly what they’re getting when they order from you.

If you sell clothes, include specific sizing charts and model dimensions. You wouldn’t buy something online without knowing what you were buying — so take that into consideration when you think about your customers.

That said, writing an immaculate product description is only the first step to true customer satisfaction.

The real test is ensuring that your order fulfillment process 100% ensures that your customer get the correct product, in the right size, and on time.

Whether these operations are handled in house, or outsourced, the financial cost and soft costs of mispicks, lost inventory, and late shipments can be disastrous to your bottom line.

Additional Recommended Reading

Need to explore different fulfillment tactics more? Check out our article on ecommerce fulfillment, self fulfillment, and dropshipping.

Another underrated feature of any good ecommerce site is load time.

If you’re using a bulky web platform or cheaping out on server space, there’s a good chance you could have a higher bounce rate as visitors decide it’s not worth waiting for a page to load.

You can’t afford to lose traffic just because your load times are slow. Optimizing page load times is fundamental to your site’s chances at success.

Additional Recommended Reading

Need ideas on ecommerce store design? BigCommerce wrote a thorough guide with great examples from around the web.

BigCommerce app that could help: Live Chat Inc. One of the classic drawbacks to shopping online is that customers can’t try on or test out products.

While futuristic solutions such as virtual reality shopping could change that, specialty or customizable items will be a tough online sell so long as customers feel like they can’t know for sure what they’re buying. One method for covering that gap of uncertainty is a customer-facing live chat integration.

ZenPro Audio’s Story

Warren Dent is the owner and founder of ZenPro Audio, an ecommerce site that sells high quality audio equipment and products.

At this price point, most folks have various audio needs and order size requirements, making the product difficult to sell without direct interaction with individual customers.

That’s why Dent decided to install a live chat app. He explains the benefits best:

“I tried a half dozen or so live chat apps, and always ended up coming back to LiveChat. It’s not the cheapest. However, it has the ability to customize the chat window with logos and avatars, allows file transfers back and forth with customers, and is fast and responsive.

The admin page is very clean, and the chat page to me was the most sensibly laid out. Popup notifications work, and when you click them it carries you to the open tab and chat for immediate response every time.

The incoming chat sound is spoken as “incoming chat” which also makes sense to me, when a customer is initiating.

Afterwards, standard message sounds apply.

You can watch your customer type in real time which can be helpful.

Also, customer support is outrageously awesome –– and work, of course, via live chat. They’ve never been unavailable when I had dozens of requests to tweak my design etc.

I tried the rest and found the best in my opinion anyhow.”

How ZenProAudio 2X’D AOV

Live chat isn’t the only tool that helps convert. See how Klarna can turn prospects into customers for high-priced items.

Get a 100% Increase in AOV with Klarna

3. A/B test everything.

A/B testing is important not to see which designs are best or to use data to outwit other colleagues (though it can do both of those as well). No, A/B testing is about figuring out which options produce the highest numbers of conversions.

Ecommerce conversion rate optimization is the #1 tactic to growth for brands past the startup stage.

Why?

Because the more customers you convert (moving the needle from 2% of site visitors to 5%), the more money you make, the lower your CAC (the calculation of which is explained earlier) and the less you have to spend to acquire that customer again.

It’s smart for your brand to have a test plan for online shopping website optimization. That means that you:

  • Mark on Google Analytics every time you launch a new test
  • Have a standard for how long you run them and how many visitors must experience both versions
  • Have a process for executive approval to launch the winner
  • Move onto the net item to test to increase conversions
  • Repeat as needed.

This is especially true with copy on landing pages and product pages.

If there’s one thing you should remember about copywriting, it’s this:

The sole purpose of the first sentence in an advertisement is to get you to read the second sentence.

Copywriting guru Eddie Shleyner said that, and he knows a thing or two about what works and what doesn’t.

Without good copy — without the sort of hook, line and sinker content that gets customers’ eyes moving down the page — your product is as good as dead.

So write product copy.

  • Test out a sentence.
  • Test out your tone.
  • Test out corny jokes.
  • Test out every facet of your website.

Not just the words themselves, but the layout of your website. Does it make sense to have the product search bar tucked into the top right corner, or would you have larger order sizes with a full-width behemoth?

Do blue “buy now” buttons get more clicks, or are they outperformed by red? Is “buy now” a better CTA than “get this?”

The more you know, the better your ecommerce businesses will do.

Here’s a list of 5 fundamental parts of your business that need testing; if you can’t do it, then find someone to do it for you. It’s simply too important to not take into consideration these ecommerce testing scenarios.

5 Ecommerce A/B Testing Ideas:
  1. Product copy
  2. Landing page/lead magnet layout
  3. Email drip campaign copy
  4. Blog content: Video vs infographic vs photo gallery vs test
  5. Advertising layout + copy

Best BigCommerce app for this: Visual Website Optimizer gives you 7 different testing options, including conversion tracking and A/B testing.

Additional Recommended Reading

If you’re stuck on optimization ideas, check these landing page and checkout page design articles.

4. Reach out to influencers.

People who work in marketing either love or hate influencer outreach. It just depends on your personality and whether you like cold-emailing folks to ask for favors or not.

What no one denies is that working the back channels of major media websites or Page 1 heavyweights is not an option if you want your business to succeed.

It’s mandatory.

So how do you stock your pipeline full of quality influencers? This largely depends on where it’s most effective for you to do your marketing.

Additional Recommended Reading

Stuck on influencer marketing? These nine influencer marketing case studies should help.

Building up a catalog of valuable backlinks usually starts with the content you create.

Quid pro quo is a reliable strategy for breaking into more venerable websites. If you allow someone from a relevant website to write a guest post on your company’s blog or simply link to one of their posts from somewhere on your site, you can leverage that into getting a guest post or backlink on their site.

Depending on what sort of audience you’re targeting, it might be more effective to seek out backlinks via an Instagram or Youtube channel instead of on a facebook page or on a blog post.

How do you know which channels make the most sense? By looking at our Google Analytics or BigCommerce Analytics to determine from where your most profitable traffic is coming –– and then working with influencers to get more of that.

In terms of finding influencers, free tools such as the BuzzSumo trial version or Google Alerts go a long way to connecting you with people and media channels who can make a difference.

While it’s not cheap, Pitchbox is a highly effective platform for performing keyword matches on influencer sites in your niche and scraping contact info for you to cold email in automated sequences.

It’s a huge time-saver and can get you handfuls of backlinks, especially if you craft a winning cold email.

Examples of Ecommerce Influencers:
  • Ezra Firestone
  • Richard Lazazzera
  • Sujan Patel
  • Noah Kagan
  • Shayla Price
  • Krista Fabregas
  • James Thomson
  • Daniel Wallock
  • Rieva Lesonsky
  • Andrew Youderian
  • Emil Kristensen
  • Tracey Wallace

Overview of Customer Engagement Tactics That Work

Customer engagement is how much interaction your marketing, merchandising and business as usual activities inspire in your customers. In other words: how often do your customers engage with you?

Customer engagement is a good measuring stick for customer lifetime loyalty and a brand’s overall messaging effectiveness.

Brands typically begin measuring customer engagement once a prospect has bought something –– or turned into a customer.

This is because once you have those new customers coming through the door, it’s time to focus on the next step: getting them to buy again.

What can you do to foster a better relationship and drive trust with your existing customers and ensure that they come back to you for future purchases?

The key to converting new ecommerce customers into repeat customers lies in keeping them interested in what you’re offering. How you do that depends most of all on your brand and what you’re trying to accomplish by engaging with them.

Good customer engagement breaks down into four major categories:

  1. Rewards
  2. Social media
  3. Content creation
  4. Post-purchase experience
6 Examples of Customer Engagement Strategies

1. Build loyalty through rewards.

Making your product appealing to customers on an emotional basis is a powerful way to build loyalty.

After all, when marketers use words like “loyalty” that have emotional connotations, it’s clear that the endgame is to make people feel like your company is more than just a brand and they’re more than just customers.

They want to feel valued.

How do you make someone who paid hard-earned cash for your product feel special? You reward them for it.

  • Give out discount codes to customers who review you on Amazon.
  • Have a digital punch card on hand for repeat buyers so they get their 6th product refill for free.
  • Organize members-only meetups and get your customers talking about your brand to each other and within their social circles.

You can grow customer lifetime value in just a year if you follow these tips.

True brand loyalty – “My daddy only drove Fords and so do I” – is incredibly valuable, hard to fake, and hard to earn.

By showing your customers that you’re willing to give them an exclusive discount, you demonstrate that you want their business and want them to feel satisfied with your product.

Best BigCommerce app for this: Smile.io incentives customers to share your brand with their friends through social media as well as encourage customers to post positive reviews in exchange for future discounts or redeemable rewards points.

Formerly known as Sweet Tooth, the app integrates with BigCommerce businesses with the sole purpose of building customer loyalty through incentives such as discounts and reward points.

Lisa Chu, owner of toddler fashion company Black n Bianco, knows the importance of keeping her customers hooked to her brand.

“Month by month my conversion rate and traffic started to increase [with Smile.io]. By rewarding our customers I built brand loyalty and created a positive feedback cycle of happy, passionate and vocal customers. Rewarding them really helps keep my brand relevant and competitive. Smile.io is the perfect app because it incentives customers to post reviews (especially the positive kind!) and share our brand with their friends through social media.”

After using BigCommerce for 4 years, Black n Bianco integrated Smile.io led to an increase in customer engagement of 38%.

Most businesses would kill for that sort of return on their investment. Maybe you don’t need to kill at all; you can test ride it and start getting the love from your customers you always dreamed of.

2. Reflect your audience’s tastes in your social feed.

There’s nothing sadder than seeing an inactive social media page for an ecommerce business.

How are you supposed to connect with your customers?

Have them call an (800) number? That would be acceptable if your customers were in the senior age bracket and this was 2010.

But even grandma has a Facebook account these days, so you pretty much have no excuse.

Do some research and put together a core list of social media channels you want to focus on.

The plan of attack for successful customer engagement varies depending on your goals and what network you’re using.

Tractor company John Deere uses a clever Instagram hashtag that their customers might use when they’re out in the field on a combine harvester or perhaps dressing up their youngest as tractors for Halloween.

It connects the image of practicality and reliability that characterize the brand with current owners, aficionados, and potential future customers.

Le Creuset knows its customers tend to be passionate about cooking and swoon over food porn. There’s no better social media platform for this than Pinterest, since the focus is on images (in this case of gorgeous browned crusts, sumptuous stews, and other culinary delights).

Oftentimes their enameled cast iron pots are not even in a shot; all you see is a close-up of a freshly-prepared meal with a link to the recipe.

This exemplifies the goal of social media and online customer engagement: you’re not trying to upsell, you’re giving them value for something they already got.

In some ways, this overlaps with the goal of creating loyalty. Either way, the end result is the same: by reflecting your customers’ tastes on the appropriate social media channel, you keep them interested and poised to buy from you again when the moment presents itself.

3. Create useful, actionable content.

It’s not just enough to share other peoples’ creations on the company Twitter account.

You need to proactively create content that your customers will appreciate and find useful.

If done right, your content should not only augment the experience of your customers; it should also be shared and reposted by other influencers, too.

Quality content comes in a variety of forms.

  1. You could release a series of guides or mini ebooks that correspond to the product you sell.
  2. Maybe host a YouTube channel or a podcast with tailor-made episodes.
  3. Or pay bloggers to publish short stories that feature your item just as it was intended.

Whatever content you make, it should connect existing customers to your brand.

So what does useful, actionable content look like in the real world? Here are a couple examples.

Blue Bottle Example

If you’re a coffee addict, you’ve probably heard of Blue Bottle — they’re a heavyweight in the world of subscription premium quality coffee.

They have a few brick and mortar locations, but the creme de la creme of their revenue comes from their ecommerce store.

For anyone who loves coffee, their website is a treasure trove of useful information about how to make the perfect cup.

Whether that comes in the form of a Bialetti or a cold brew, Blue Bottle has step by step guides with clear photos and written instructions that walk you through the process of making coffee the way you like it.

When creating content to engage with existing customers, they asked one simple question — What’s the best complement to our excellent coffee? — and the answer was this series of useful guides.

Excellent content doesn’t need to sell your brand at all; it just needs to feature it.

Ipsy Example

Ipsy understands that principle and that’s why their partnership with popular makeup and cosmetics artists on Instagram is such a brilliant idea.

They run a subscription service that sends out a personalized selection of sample-sized cosmetics and makeup once a month, and they use Instagram for the heavy lifting of content creation.

The brand re-posts images with permission from Influencers like Ashly to help grow their audience and engage with fans.

Turn Your Instagram Fans Into Customers

Instagram Shopping is now available for U.S. sellers. Install it here. And download the guide below for 80+ examples of brands already using it.

Get 80+ Instagram Shopping Examples Now

4. Follow up on purchases.

There’s one other way that your business should cater to existing customers: right after the sale.

As you probably know from experience, after you buy something the novelty slowly fades away.

Sure, you’re going to be addicted to your new PS4 for the first couple months that buy it. But eventually other distractions or new toys get in the way and all of a sudden the only reason you use it is when you want to watch Netflix on a Sunday night.

When a new customer comes along and buys something from you, don’t wait til the novelty has worn off to approach them with a social sharing incentive or free product in exchange for answering a survey.

While this is anecdotal and not the same as a scientific survey, most online shoppers I know tend to leave reviews for products within a week after they made a purchase.

Additional Recommended Reading

If you’re having trouble with abandoned shopping carts, you might want to learn how to reduce them — and gain more purchases.

Greg Bullock, director of marketing at longtime BigCommerce website TheraSpecs, has advice for any ecommerce business looking to increase customer engagement in the post-purchase phase.

“Like most ecommerce companies, we use an automation tool — in this case ActiveCampaign — for outreach before and after a purchase. Our precision-tinted glasses often require some time in order for customers to experience relief for their light sensitivity, and we want to experience that journey with them as well as help set and manage their expectations.”

Keeping in touch with customers and demonstrating that you care about their experience after the sale helps to create a positive feedback loop.

That’s only natural when someone places their trust in your brand and is rewarded with a quality product and a friendly email asking if there’s anything that can be done better.

Bullock says that looking for feedback is even more important if a customer isn’t satisfied with their purchase:

“We have automated emails that go out from our service team to learn more about how TheraSpecs are working, and we want to engage with that customer in order to share in their joys of relief or provide service if there are any issues. For those who offer positive feedback, we like to delight them by offering a discount on their next purchase as well as the opportunity to share their story on our blog and social channels.”

This is why following up with customers matters: if you do it right, it just turns right back into good marketing for your brand.

Key Metrics For Customer Engagement:
  • Email open rate
  • Email click through rate (CTR)
  • New versus repeat visitors
  • Time on site
  • Bounce rate
  • Frequency rate (how often the same visitor returns)
  • Repeat purchase rate
  • Customer loyalty program activity

The Complete List of Tools

Here is a final list and links to all the tools mentioned in this piece:

  1. Active Campaign
  2. Smile.io
  3. Buzzsumo
  4. Pitchbox
  5. VWO
  6. Live Chat
  7. Coupon Pop
  8. Klarna

What’s your secret to winning new customers and making repeat ones? Tell us in the comments below!

Want more insights like this?

We’re on a mission to provide businesses like yours marketing and sales tips, tricks and industry leading knowledge to build the next house-hold name brand. Don’t miss a post. Sign up for our weekly newsletter.

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acquisition &Ecommerce Marketing &How To Sell Online David Venne 05 Dec 2017 Comments Off on The 8 Tools and Strategies Proven to Acquire New Customers & Increase Customer Engagement

Ecommerce Shipping: Your Step-by-Step Guide to Shipping Profitability

Putting an effective ecommerce shipping strategy in place is one of the most impactful steps you can take to grow your business online.

While many brands start out in ecommerce by taking a simplistic approach to shipping –– like offering free shipping across the board or showing unmodified UPS or USPS rates –– the most successful merchants use strategic shipping options to differentiate themselves from their competition and increase margins.

Of course, while shipping can be a powerful point of differentiation for your brand, it’s important to make sure that your company can actually act on the strategy.

This requires coordination between multiple teams within your organization, all the way from your marketing team to your fulfillment team –– and several others in between.

Establishing an shipping strategy for your online store lets you ensure that everyone involved in this pipeline knows what’s going on and their part in the process.

In this guide, we’ll walk you through the absolute must-haves and must-knows for a solid ecommerce shipping strategy that makes both your margins and your customers happy.

Ecommerce Shipping Best Practices

  • Be sure to assemble the right team: Every department in your organization has a job in relation to making shipping work for your online store.
  • Set clear goals: Do you want to increase margins? Go international? Define your goals and measure against them.
  • Choose a shipping strategy: There are 4 main options, and free shipping isn’t always the best.
  • Make the leap: implement and iterate. That’s the only way you’ll get better.

Let’s dive in.

1. Assemble the right team.

Identifying the right people to help make this decision for your business is the first step.

This requires that you bring into the conversation the right stakeholders within your organization.

Here’s a quick breakdown on how to think through the process and pull in the appropriate stakeholders.

2. Define The goals for your shipping strategy.

Once you’ve identified the key teams in your company who will need to be involved in establishing your strategy, you need to define what you want to accomplish with your ecommerce shipping strategy.

There are many areas of focus here, but the most typical are these.

Ecommerce Shipping Strategy Goals:
  • Increase conversions.
  • Increase average order value.
  • Expand market or target audience.
  • Decrease costs.
  • Improve operational efficiency.

3. Choose between ecommerce shipping solutions and options.

Once you’ve identified the right team and goals for your business it’s time to get down to the work of choosing a strategy that is going to work for your team to accomplish the goals you’ve set.

We’ll identify a number of available strategies here with the pros and cons for each.

None of these are exclusive of one another and most successful online store will implement several of these options to form a complete strategy for your unique scenario.

First and foremost, though, as the ecommerce manager or project owner for shipping strategies, you need to approach the business understanding key elements of the shipping industry.

Here are the crucial considerations you must take into account.

3 Crucial Shipping Considerations

From the hundreds of surveys, polls, and studies published each year on ecommerce, one thing is clear:

Offering the right shipping rates and options to your customers is crucial to your success as a retailer.

Getting this piece right can make the difference between losing a customer if you charge too much and losing your shirt if you charge too little.

And it’s not just cost that makes a difference. Offering the right shipping options to your customers at the right times plays a critical role in reducing cart abandonment and increasing revenue.

Taking full control of your online store’s shipping means that you can offer the lowest shipping rates possible, still cover your costs, and offer the options your customers want.

Here’s a quick list on how to properly think through what you can offer, including when and why, to maximize sales and decrease costs.

The most important factors to consider when taking control of your shipping can be broken down into three areas.

3 Most Important Ecommerce Shipping Considerations:
  1. Product size and weight: What’s the difference in size and weight from your smallest, lightest SKUs to your largest, heaviest SKUs?
  2. Shipping destinations: Where are you shipping to –– domestic or international?
  3. Shipping options: What are the best shipping services or carriers for your unique needs?

1. Product size and weight.

The first of these, product size and weight, is often the easiest to get your head around and has the biggest impact on the approach you take.

If your products are relatively uniform, then going with a per-item, zone-based approach, where the shipping price varies by your customer’s location and not by product size or weight, works well.

This is also a great place to build easy to understand promotions like $10 shipping per order, $5 shipping per item or even free shipping over $50.

For retailers with varying sizes and weights among your product set, getting rates directly from a carrier like UPS, DHL, Australia Post or others is a great way to ensure the rates you’re offering to your customers are the best possible ones.

The important thing to focus on here is making sure your products have accurate weights and dimensions so that the rate you get back from a carrier is as accurate as possible.

To do this, break your products into groups and focus on getting product weights and dimensions for the heaviest or largest 20% and smallest or lightest 20%.

This will have the biggest effect on your shipping rates and offer the best return on investment.

2. Shipping Destinations

Shipping destinations can be just as crucial as product dimensions and weight.

Again, in a simpler scenario like domestic shipping, a flat-rate or free shipping option works well.

To step it up a bit, set rates based on zones. For example, if you’re located in New York, offer a cheaper rate for the mid-Atlantic region and increase the rate as you radiate out from there.

Pro Tip

Shipping internationally normally necessitates getting a rate straight from a carrier like the USPS, DHL or others. Rates can vary significantly even in neighboring countries and it’s difficult to build your own rates for these scenarios.

3. Shipping Options

Managing your shipping options allows you to delight customers and keep costs in check.

Look beyond the big-name carriers and you’ll find a world of opportunity to offer same-day delivery, next-day delivery or timely and cost-effective delivery for even the largest items.

In major cities, you’ll often find local delivery and courier companies that will deliver more quickly to your customers than the big carriers at very competitive rates.

Top Ecommerce Shipping Options:
  • Free in-store pickup
  • LTL freight carriers
  • Same-day delivery
  • Free shipping

Pro Tip for B2B

If you’re shipping especially large items or do a lot of large B2B shipments, using an LTL (Less Than Truckload) freight carrier becomes a necessity.

Local couriers often don’t offer a way to fetch rates in real time for shipments, but it can be worth your while to build up a table of rates based on number of items or weight in order to offer these options to your customers.

The important thing when looking at any alternate ecommerce delivery option is to make sure that you control when and where it’s shown.

  • If you’re based in Sydney, you probably don’t want to show your local delivery courier as an option for a customer from Paris.
  • The same can be said for showing an LTL freight carrier as an option for someone who orders a single t-shirt.

Taking control of your online store’s shipping ensures that you aren’t leaving money on the table or risking your success by charging too little. Even small changes here can pay enormous dividends in cart conversion, controlling shipping costs, and delighting customers.

How to Ship Items Sold Online:
  1. Make an online sale.
  2. Determine which products to package and the total size and weight.
  3. Confirm the shipping destination.
  4. Determine which shipping carrier is being used and calculate the shipping cost.
  5. Send the package out via the appropriate carrier.

Your 4 Ecommerce Shipping Options

Now that you have all of this considered, you’re ready to face the gamut of questions and potential push back from other teams.

Here are your shipping options and strategies available.

Top 4 Ecommerce Shipping Options
  1. Free shipping
  2. Flat rate and table rate shipping
  3. Live rates from a carrier
  4. Mixed and alternative strategies

1. Free shipping.

Free shipping may seem like the simplest strategy and it’s grown massively in popularity since Amazon introduced Free Shipping for orders over $25.

Free Shipping Benefits:
  • It’s easy to explain to customers.
  • It responds to customer expectations.
  • It has a positive effect on conversion rates for customers who make it to your checkout funnel.

Of course, free shipping may be free to your customers –– but not to you.

You’ll still need to pay the carrier and you’ll have to make sure you’re making enough on each order to cover the associated shipping costs.

This is why you’ll see that most companies (Amazon included) only offer free shipping over a certain price point and only on specific products.

If you choose to offer free shipping, it’s vitally important to understand its impact on your bottom line. Even if you’re making more sales, if you’re losing money on each one it’s of no benefit to your bottom line.

The most effective approach to free shipping is to only offer it for orders where you know you’re making enough on the sale to cover shipping and still make a profit.

This means setting a free shipping order subtotal threshold that makes sense for your business and, maybe, excluding products that are too heavy or bulky for you to offer free shipping on.

We’ll dive more into exactly how it implement free shipping for your business later in this article, if that is the route your team chooses.

2. Flat rate & table rate shipping.

One extremely effective way to avoid some of the challenges of Free Shipping is to go the flat rate or table-rate route.

What is flat rate shipping?

Flat rate shipping is something like $10 shipping regardless of order value (see, for example, Overstock.com who charge $2.95 to most locations in the United States).

What is table rate shipping?

Table-rate shipping is a bit more complex, but doesn’t have to be much more so.

Customers in certain regions, like the United Kingdom, prefer table-rate shipping versus being charged a live rate. For example, a merchant with a warehouse in London might charge customers near the city a certain amount, say £5 per order, with rates going up to £10, £15, etc. as you get further away from the fulfillment center.

You might also charge based on the order subtotal ($10 for orders up to $50 in value, $5 for orders up to $100, and free for orders over $100). Alternately, you might charge a different rate for certain groups of products or set rates based on the order weight.

3. Live rates from a carrier.

If the most important factor for you is to offer the best possible rate while still covering your costs, getting live rates in real-time directly from a carrier like UPS, FedEx or DHL may be the best way to go.

While it’s harder to use this approach as a promotional tool (the rates may vary significantly depending on what the customer orders and the distance from your warehouses to the customer), you can ensure that you’re offering the cheapest possible shipping option by charging your customer exactly what you’ll be charged by the carrier.

Especially if you’re in a market where many of your competitors are offering live rates, it may be important to do so.

This means that for lightweight orders or customers located near your warehouses, you can often offer significantly cheaper shipping than your competition while still making sure your costs are covered.

Of course, it doesn’t have to be as simple as plugging into a carrier like UPS and showing exactly what UPS returns for each order.

You can add a surcharge if you want the shipping charge to cover things like packaging and your cost of fulfillment. You can also discount the rate returned to be that much more competitive over others in your market.

4. Mixed and alternative strategies.

While these three options are the most popular and frequently used, thinking outside the box and mixing and matching these approaches can be extremely effective.

This allows you to balance your revenue needs with promotional opportunities.

For example, offer free standard shipping (with no delivery commitment or a range commitment like 5-10 business days for delivery) alongside other options like Expedited shipping (for example, 3-5 day delivery at a table rate based on order value) and live rate options for Second Day and Overnight delivery.

Here’s are a few great options.

Best Ecommerce Shipping Alternatives to Free Shipping: 
  • Standard shipping + Expedited shipping
  • Free shipping + Standard shipping + Expedited shipping
  • Standard shipping + In-store pick up + Same day delivery
  • LTL freight + Standard shipping

Pro Tip

In addition to these most popular approaches, offering additional, less orthodox options can help you stand out from the crowd.

For example, free in-store pickup can drive customers to your retail locations (resulting in additional traffic and sales at your brick and mortar locations).

If you’re selling particularly large or heavy items, offering LTL freight delivery on your website can help keep costs down while making it easier for customers to place larger orders online.

The Holy Grail of a Profitable Ecommerce Shipping Strategy

There is no doubt about it, free shipping is the holy grail of online commerce. You only need to look at Amazon Prime to see this.

Amazon net shipping costs were more than $1 billion per quarter in 2014. They chose to subsidize shipping heavily as part of their growth strategy –– very heavily in my opinion.

Pitney Bowes published their 2015 Holiday Shipping Survey in the last week and it makes for an interesting reading. Here are some of the more relevant and poignant points:

  • 93% of consumers say shipping options are an important factor in their online shopping experience (up a massive 24% from 2014)
  • 88% said that free shipping with 5-7 day delivery time is more attractive than paying a fee for 1-2 day faster delivery
  • 3 in 5 consumers have increased their total spend in the past to qualify for free shipping
  • 68% have used a free shipping coupon code

Given all of these data points, what’s interesting is that only 22% of merchants feature information about their shipping policy on their homepage.

My advice –– go fix that.

So, if 9 out of 10 of your customers are considering this, as the data suggests, then you need:

  1. To indicate current shipping promotions above the fold on your homepage
  2. A link on your homepage detailing your shipping policy, not just around pricing, but time in transit, returns policy and even the carriers you are using if possible
  3. Careful thought about what your shipping policy should be –– write it down and flush it out, make the numbers work

Do you really need to offer free shipping?

But, here is the issue: how exactly does a merchant make money in this scenario?

Free shipping, particular in the U.S. and Australia is very hard to do –– and Amazon is proof that businesses need a pretty big financial reserve to make it work.

At ShipperHQ, we have dealt with merchants facing this conundrum for a number of years, and we have seen a number of solutions to the problem.

We have assisted many thousands of merchants in their setup, so let me share with you my recommendations with you on how to tackle this issue.

Here are the top considerations when trying to decide if offering free shipping benefits is right for your brand.

How to Offer Free Shipping and Still Make Money:
  1. Determine the vertical you’ll sell in.
  2. Decide if shipping is a marketing expensive or cost of goods sold.
  3. Offer free shipping to limited regions.
  4. Surcharge your expedited rates.
  5. Determine your monthly shipping expenses.
  6. Clearly showing delivery time to customers.
  7. Offer free shipping after conditions are met.
  8. Use shipping as a promotion.
  9. Install a shipping solution.

1. Consider the space in which you work.

As a merchant, you need to think about your market sector, your competition and the space in which you play.

You might not need free shipping.

This is especially true in the B2B ecommerce space, where what might be more important is accurate dimensional based pricing.

If you have customers that are loyal to you, they will appreciate you passing on your negotiated rates to them and giving them the choice over urgency of delivery.

If you are competing based on product price, then it may be that you have no ability to absorb free shipping costs.

It’s all about information accuracy, and using multiple carriers where required so you can offer the best and cheapest service.

2. Decide if shipping is a marketing expense or COGS.

This plays into my comments above. You need to decide whether shipping is part of your costs of goods sold, or whether it’s a marketing expense.

Or, maybe it’s a combination of both.

Do free shipping and related shipping promotions drive your sales up enough that you can justify it partly as a marketing expense?

3. Offer free shipping to limited regions.

As a starter, I’d say in the U.S. you should limit free shipping to the U.S. 48 contiguous states.

Alaska, Hawaii, Puerto Rico –– sorry you are out of luck. People in those places expect to pay extra for shipping.

APOs and PO Boxes are other areas for which you can switch off free shipping. If you take a look at Jet.com they follow this policy. Copy it.

4. Surcharge your expedited rates.

We know how this works.

  • We go to a store advertising free shipping.
  • We shop.
  • Then, we get to checkout and find out it’s going to take 10 days to deliver.

Amazon is the master of this. They will purposely hold the shipment back for a few days if its free –– and how frustrating is that!

The reasoning is that, by this point, we are committed to the sale. We’ll then think, “Oh, another $10 bucks I could get this faster.”

This where your opportunity lies: surcharge the expedited.

There will be a segment of customers (especially as the holidays get closer) that will pay extra to get it faster. This surcharge can offset the free shipping you are offering other customers.

5. Take a monthly view.

Some merchants want to look at every single order and ensure they make a profit.

In some cases that’s necessary. But I’d say in most cases, taking a monthly view is a better option.

You win some, you lose some. It’s an iterative process.

You should understand your shipping rules and be able to correlate what’s happening with your charges against your own policy.

At the end of the month –– are you happy with the results?

6. Show delivery time.

People are becoming more and more impatient. And, more and more used to having readily available information.

For example, I order a pushchair from Europe. Just when is it going to arrive?

Having that estimated number of delivery days, or an expected delivery date, is becoming more important.

Once you have that, you can then have more leverage around upselling faster services.

It’s my belief that offering “Next Day Delivery” with no actual information about whether that means tomorrow or next week will soon be a thing of the past.

People are much less tolerant now, and they have greater choice to shop elsewhere.

7. Offer free shipping after conditions met.

Try pushing up your minimum order price to qualify for free shipping. Does it affect sales? Maybe.

Run an A/B test to see what the impact is.

You can advertise free shipping on your site, but qualify that it only applies on your small goods, a certain category or maybe you want to just offer it on your big ticket items.

8. Test offering free shipping promotions.

We all love a promotion. Does it need to be free shipping? I don’t believe it always does.

Maybe you publish list rates for UPS, but then offer 20% shipping discount to your returning customers via an email campaign.

Or, just charge shipping on the highest value goods.

For example, if I buy a kayak, I might pay shipping for that, but any other goods in the store ship for free.

There are many, many combinations you can do here which give customer reward and encourage a higher dollar price.

9. Using an ecommerce shipping solution.

Now that you’ve started thinking about all of this, you may be wondering how you can achieve it.

We have your ecommerce shipping solution: ShipperHQ.com.

It’s the most advanced shipping rate calculator and manipulation platform in the world and is all about the rating.

Most shipping software out there will focus on that label, the last mile, first mile and all around shipping fulfillment. But they don’t care about the customer experience, and frankly they should because that’s where it all starts.

At ShipperHQ, we do care. We put the merchant front and center. There is no right solution here –– its merchant specific. With knowledge and the right partner, you can achieve what you need for your store.

Shipping is pretty interesting, and it should be a big part of your online strategy. Remember though: it’s your cart, your shipping and your rules. Be agile, learn, improve and iterate.

A Quick + Easy Outline to an International Shipping Strategy

Cross-border ecommerce is seeing huge growth.

  • A third of online shoppers have purchased goods from another country.
  • Those living in Australia, Canada and Russia are the most likely to buy internationally.
  • In Asia and India –– two of the fastest growing markets for ecommerce, with YoY growth in the 30 or more percentile –– marketplaces similar to Amazon and eBay make it easy for international companies to test product market fit.

Now, how do you bring those customers back to your site for purchase once you’ve determined demand?

Many online stores find shipping items internationally nearly impossible given the regulations, rules and risks associated with each country.

To overcome that initial fear of international shipping, it is important to know what shipping options and fulfillment services provide low costs and risk.

Once you have a clear understanding of how international shipping works, researched the services that best fit your company and put an international shipping strategy in place, you will be able to open your online storefront to a global audience and break into the global market.

Here are the top considerations you must go through before you launch an international shipping strategy.

5 International Ecommerce Shipping Considerations:
  1. Are you product suitable for international shipping?
  2. Is there international demand?
  3. Which shipping services will you use?
  4. Do you know about harmonized tariff codes, duties and taxes and more?
  5. Watch out for restrictions!

Shipping internationally opens your market to a potential three billion consumers. But, before you build your international shipping strategy you should determine if it is right for you.

You don’t want to put time, effort and money into this if you aren’t going to come out with profit.

Here are a few things that come into play with international ecommerce shipping.

1. Is my product suitable for international shipping?

Know what it takes to ship your products out of the country –– or if those products are even suitable for such long distance shipping. Ideally, you ship items that are sturdy and compact to avoid an item breaking in transit, which can leave a bad customer impression.

If you are shipping perishable goods or large items, you may want to keep these items solely available to your domestic customers.

It is also important to be aware of any import and/or export restrictions subjected to the product and specific countries. Here’s a short list of items prohibited from international shipping:

  • Aerosols
  • Air Bags
  • Alcoholic Beverages
  • Ammunition
  • Cigarettes
  • Dry Ice
  • Explosives
  • Fresh Fruits and Vegetables
  • Gasoline
  • Nail Polish
  • Perfumes (containing alcohol)
  • Poison

This should not stop you from shipping internationally altogether and we’ll go over how you can restrict items from shipping to certain destinations in a bit.

2. Is there demand for my product?

Do the research! It is pretty easy to determine if there is demand for your product if you have already had requests from international customers.

But, if you don’t have the luxury of knowing who already wants your products, you should look into what is currently being offered in countries you want to ship to. Try to find out if there are similar products being sold and what the competitors are doing.

In the same way you’ve built your national audience, you’ll want to access the competition and get your goods in front of your target audience.

But, international consumers shop differently than you are used to.

In Asia, for instance, Rakuten outpaces Amazon. If your goods sell well in the U.S. on Amazon, consider placing your product on Rakuten to test out market fit and demand.

Here are larger international marketplaces to keep your eye on as you expand. These are great places to test out your product offering before launching a site-wide campaign targeted to international customers.

  • Rakuten: Asia, especially Japan, though the company is expanding outside of Asia as well, B2C marketplace
  • Alibaba: Asia, China in particular, B2B marketplace
  • Taobao: Asia, China in particular, B2C marketplace (the B2C side of Alibaba)
  • Snapdeal: India, B2C marketplace
  • Flipkart: India, B2C marketplace
  • Amazon India: India, B2C marketplace
  • Mercado Libre: Latin America, B2C marketplace

3. Choosing the right service.

Determining the best way to ship internationally comes with its own obstacles and you should do your research before opening your gate to the world.

Some important factors such as shipping costs, tracking, delivery times and guarantees will come into play when you are looking into services.

One service does not fit all. Know what international shipping service is the best fit for you and your customers’ needs.

Here is what to think through when identifying the best international shipping solution for your business.

International Carriers

This could be a good choice for smaller companies because you will have the backing of a large company such as UPS, FedEx and DHL. These companies have years of experience in shipping both internationally and domestically.

With international carriers you will experience a higher level of international shipping services as they offer door to door tracking and guarantees in pricing.

Since they are a larger company, their prices tend to start out higher, but there are options for negotiation.

National Carriers

This is the in-between option of international carriers and international freight forwarders.

National carriers, such as USPS, Australia Post and Canada Post, focus on servicing a specific country.

These companies normally offer lower prices than international carriers but you won’t have the detailed door-to-door tracking that you will find with the other carrier services.

International Freight Forwarders

An international freight forwarder manages your shipment from beginning to end.

This is a good option for merchants with a larger shipping budget as the prices are slightly higher than international and national carriers.

This service will make breaking into the global market a little easier, and is is just about as simple as if you were shipping domestically. You send the package to the international freight forwarder’s hub and they take care of preparing and processing customs and other documentation involved in shipping internationally.

The following international freight forwarders (or 3PLs) are considered best-in-class, with the highest number of customers and revenue.

Best in Class Ecommerce Freight Forwarding Solutions:
  • DHL Supply Chain & Global Forwarding
  • Kuehne + Nagel
  • DB Schenker Logistics
  • UPS Supply Chain Solutions
  • Kintetsu World Express
  • Panalpina
  • Expeditors
  • Nippon Express
  • SDV (Bollore Group)
  • Hellmann Worldwide Logistics

4. Know the correct shipping terminology.

No matter what route you take when choosing a service for your international shipments, it helps to know some of the terminology so you can have educated conversations with carriers.

Here are some key terms you should know to ensure you keep your new global customers satisfied and avoid any unwanted surprises –– for you or your customer.

Harmonized Tariff Code

Each of your products will have a harmonized tariff code which is required when preparing your commercial documents. This code indicates the description of the product and is legally required in many countries.

If you fail to put the correct code for a product, your shipment can be delayed or could result in higher duty and taxes. If you are unsure what code goes with a certain product, you can use the HTS search here to figure it out.

Customs Documentation

You will be required to complete documents for your international shipments. The set of documents you need to complete are dependent on the details of your shipment.

These documents include:

  • Commercial invoice: The commercial invoice determines the true value of the product you are shipping and is used when calculating the duties and taxes. This is completed by the exporter and is required by the foreign buyer to prove ownership and arrange for payment.
  • Export declaration: The export declaration is a form that provides information on amount, nature and value of your product to the statistical office for compilation of foreign trade data and serves as an export control document.
  • Certificate of origin: The certificate of origin is an official document authenticating what country a shipment has come from and is prepared by the exporter.

Duties and Taxes

Duties and taxes are imposed by the country importing the shipment to generate revenue and protect local industries against foreign competition.

These are usually paid before the goods are released from customs and are based on product value, trade agreements, country of manufacture, use of the product and the product’s harmonized system code.

These fees can be paid by the customer (delivery duty unpaid), or the merchant (delivery duty paid). It is important to know the difference between the two before you make your first shipment as you don’t want to unknowingly leave your customer with additional fees when they receive their package.

  • With delivery duty paid (DDP), you as the merchant are responsible for paying all duties and taxes. This includes all costs from your warehouse to the end destination such as transportation, customs clearance and handling expenses. The delivery duty will be paid by the carrier and that bill will be sent to you. If you have the means to do this, it is a much better option as it results in a richer experience for the customer.
  • In contrast, deliver duty unpaid (DDU) requires payment from the recipient. You will still be responsible for transportation costs, but the customer is then responsible for paying the duty and other clearing expenses upon arrival. If the customer is not made aware of this before hand, it can lead to a sticky situation and a very unhappy customer. If you use this method, be clear on product pages that this is the case. Do not wait until after shipment to alert the customer.

5. Beware of shipping restrictions.

You may find that some of your products are legally restricted from being imported to certain countries or it can even be illegal to export the product from your country.

You wouldn’t believe some of the items we have found to be restricted from certain locations!

It is important to remember that customs has the right to stop the shipment of any package.

Don’t let this scare you off from breaking into the global market. You will just need to make sure you take these restrictions into account when you begin strategizing the shipping methods and options you want to use.

You can carry out these restrictions by using options embedded into your platform.

For instance, use customer groups to allow shoppers from various countries to buy only those products you know you can export.

This give you more control over the product offerings you display for those groups –– and allows you to collect email addresses to better market to that segment.

For a more sophisticated option, look into using a shipping rate management software such as ShipperHQ. These programs will automatically take into account a customer’s final shipping destination and alert them to issues with any items in their cart based on their location, or updated shipping prices (including DDU, if applicable) on the checkout page.

Either way, you will need to have the ability to enable restrictions for products based on origin and destination of shipments in order to scale your international selling.

In all, breaking into the global market can seem a bit overwhelming, but once you take the leap, you’ll open your business up to a larger purchasing audience, significantly increasing your sales and revenue.

There is a whole world out there potentially searching for your products. With a few steps and a smart strategy, you can be there to answer their search.

Making the Leap: Implementation & Analysis

With the right team in place, your goals clearly defined, and your approach or approaches chosen, it’s time to implement your ecommerce shipping strategy.

Each team member or team leader should be clear on their responsibilities. You don’t have to do everything all at once but everyone should be clear on their responsibilities each step of the way.

  • Your marketing team should be ready to communicate your new approach to your customers and potential customers
  • The web design or development team should get your site set up to offer these new options
  • Your fulfillment team should be ready to make use of your new options and know how to handle each option the customer chooses
  • Your customer service team should be educated in the benefits of each option you’re now going to be offering your customers.

Shipping Solutions for Ecommerce Sellers

You aren’t alone when it comes to shipping hassles. You also aren’t alone when it comes to finding the right solutions. There are plenty of them. These are business which dedicate their entire staff to helping you figure out how to ship faster and more affordably.

Each of these solutions helps with a variety of things, but most offer:

  • Shipping label printing on-demand
  • Multi-warehouse pick, pack and ship rules (ShipperHQ’s speciality, especially with more complex needs like freight.)
  • Packaging and label customization and branding

Here are a few of the top ecommerce shipping solutions.

  1. ShipperHQ
  2. Shipstation
  3. AfterShip
  4. ShippingEasy
  5. Shippit

Once your new approach is live, make it the responsibility of each team to report on how well things are going for them.

Often, a new approach will take some time to bed down so if you have the evidence to back up your changes be prepared to stick with it and make some adjustments as you go.

Want more insights like this?

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Ecommerce Marketing &free shipping &How To Sell Online &shipping David Venne 17 Nov 2017 Comments Off on Ecommerce Shipping: Your Step-by-Step Guide to Shipping Profitability

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