Today I’m going to be busting a few myths and sharing some insights about what is and isn’t working right now when it comes to eCommerce marketing in a world where data might be king but it’s also a whole lot less available and trackable than it was before last year’s Apple iOS update changed the way we can track the online behaviour of our audience.
In the past we could use a piece of code called a pixel provided by the ad platform – Facebook being a big one here – which we then placed on our website and which would track the online user behaviour of anyone who clicked on our ad and came to browse around our website. This kind of data is what is called ‘third party data’ because it was one platform (Facebook) tracking people’s online behaviour across external sites or platforms and then giving that data to us as the business owner.
On the one hand, this setup gave us valuable information about our customers’ buying behaviour, and we could learn with a great deal of accuracy what ads they responded to and that motivated them to complete a purchase, and we could show ads to customers at various stages of their buyer journey based off where they dropped out of the website. Like, did they look at the products? Did they add to cart? Did they initiate checkout? The messaging we’d use in ads showing to customers at various stages throughout that process would be different. So as a business owner it was pretty amazing to be able to track all of that and retarget those visitors with appropriate ads.
From a consumer perspective though, it probably wasn’t the nicest thing knowing that brands could have that much detail about our shopping behaviour and preferences, and it was a bit of an eerie experience being constantly followed around online with ads that were about the exact product we just looked at.
So the thing about this setup was – consumers didn’t necessarily give Facebook permission to track their online browsing behaviour once they left the Facebook or Instagram platforms.
However, there is a way around this that does give us detailed insights into our customers that we can use for the purposes of marketing and advertising, and it’s completely above board.
But before we dive further into this episode, let me share how you can get your hands on an awesome free resource that’ll help you grow your business of your dreams…
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OK, let’s dive into the episode and talk all about marketing your eCommerce business in the current digital world we all now operate in!
First, let’s have a quick chat about some common mistakes eCommerce brands are making with their marketing.
1. Not understanding their data and what metrics indicate profitability and growth.
I’ve heard many people say to me that they are allergic to spreadsheets and don’t understand numbers.
And I understand that if you’re a creative type of person you’d want to play to your strengths and spend most of your time creating content for social media and of course creating new products to sell.
But I’m here to tell you that the single biggest mistake that business owners make, particularly those using digital marketing of any kind – organic or paid and selling via an eCommerce store – is not understanding their performance metrics.
There are many numbers you need to be across, but here are some important ones to start with:
- Conversion rate
- Average order value
- Customer lifetime value
- Repeat purchase rate
- Cost per acquisition
- How much is traffic costing you
If you can improve each of these metrics by 25%, you can grow your business by more than double, and as long as you have plenty of product to sell you can achieve this in a very short space of time.
Regardless of whether you’re working with an agency or freelancer – who should definitely understand and report on this data – or you are running your own marketing in-house, you still need to understand this data yourself.
This information is knowledge and power – and it’s where you’ll get your confidence to scale and grow because you can see definitively that you are growing profitably.
To give you an example – when one of our agency clients first came to us she had an old website that was not converting at a great rate, she’d never done any email marketing before, and she had tried Facebook ads without much success.
Her previous agency, or it might have been a freelancer I don’t remember now, could clearly see that the ads weren’t working, but didn’t really understand how to improve the situation. They started reaching for other strategies like SEO.
But what needed to happen was:
- Improve the website conversion rate by redesigning the website to make it easy to use and highlight the most important content so potential customers could land on the website and immediately understand with absolute clarity what the brand was selling, who it was for and how to get it;
- Start using email marketing, particularly automated emails, to help increase that conversion rate of website visitor to new customer – particularly important when you sending paid traffic to your site; and
- Then start running paid ads to driving consistent traffic to the website, making sure that the ad messaging is dialled in and campaign is setup correctly, and then optimise the ads for improved results over time.
Now this brand is consistently selling and growing and has reached some milestones such as double the highest ever month of revenue compared to a year ago.
2. Thinking about marketing and advertising in a vacuum and not understanding how intertwined each facet of building your brand and generating sales has become.
It’s tempting to fall into the trap of thinking you can just get some ads running and then you won’t have to think about your marketing anymore.
You might not think like that, but plenty do. I see it all the time. I do get it though – I mean, in an ideal world it would be very nice to be able to tick things off your business to-do list and never have to look at them again.
But this just isn’t how things work in the digital world.
First of all, you need to treat your website as a constant work-in-progress. You should always be monitoring your conversion rates and other website performance metrics and finding ways to optimise and improve. Don’t assume that whatever your website looks like now, or the last time you worked on it, will be good enough to receive paid traffic and convert that profitably into sales.
Secondly, don’t assume that customers will come to you via just a single channel. This one is a common pitfall right now. Brand owners want to track sales from individual channels, whether that be Google ads or Facebook ads or Email marketing, but the fact is that a single touchpoint brand doesn’t exist anymore.
Customers are interacting with us via multiple channels now and we need to approach marketing accordingly, knowing that each platform will influence and enhance the results of the others and that the sum of the results across multiple channels will be greater than an individual channel on its own.
For example, when you run Facebook ads or send marketing emails you will always see your Direct and your Google traffic and sales go up – both organic search and paid.
It just makes logical sense as a consumer you know you will look at stuff on your phone and then come back later and google for the thing.
But as a business owner you need to avoid the mistake of thinking that only Google ads work and to cut out the rest. Your brand and your rate of growth will suffer as a result.
So, considering this multi-channel buying behaviour, what do you do to understand how well your paid advertising is doing? Because clearly there will be some overlap in traffic where customers convert after interacting with ads or marketing on more than one channel.
You need to have a way to measure and attribute the effectiveness of your advertising.
We recommend tracking your MER – Marketing Efficiency Ratio – to see the overall effectiveness of your advertising and then use your platform metrics to make sure you’re getting a great return on ad spend per channel plus use the platform metrics to help optimise your ads.
MER is fairly simple – it’s overall revenue divided by overall ad spend and then expressed as a ratio. And you need to look at the profitability of this against your own unique situation, taking into account your profit margins and customer lifetime value, so that you can achieve a profitable result for you.
The other thing to remember when it comes to the necessity of this multi-faceted marketing approach is that you need to keep driving it with ongoing brand-building and promotional activities.
You need to keep giving your audience a reason to buy, and you do this by having a marketing calendar that covers new product launches and new promotions, which you then roll out across all your channels, so that you always give customers a new and different reason to buy from you.
You really can’t just handball your marketing to someone else and not remain involved. It should be a collaborative approach, at least to the strategic planning anyway.
3. Not understanding how digital platforms now work and the importance of collecting zero-party data.
And perhaps I should have started here…
It is essential that you understand the way that digital media and online marketing now functions. Because a LOT has changed over the last year since the Apple iOS update happened that I mentioned earlier.
In addition to what I mentioned earlier about how the pixel tracking worked and how Facebook could track when someone clicked on your ad and went to your website and the code could track what they did on your website, whether it was looking at products or adding to cart or making a purchase.
In addition to that, Facebook also knew all of that about everyone who spent time browsing any website or app that had a Facebook pixel code installed on it.
And all of that data was fed back into the Facebook algorithm. The system had SO MUCH data – it was a piece of cake for it to place an ad in front of the exact right buyer for your product.
This is how you would see ads for products that were almost creepy in how specific they were to what you were looking to buy.
So what happened about a year and a half ago now, was that Apple released an update to their operating system, which impacted anyone who uses an iPhone, iPad or Mac computer or watch.
And this update essentially changed one crucial setting: Instead of users being automatically opted IN to have all their browsing behaviour tracked in that way and to have the option to opt-out – where you’d literally have to dig really deep into all your settings to find the opt-out option.
Instead of that, now users are automatically opted out of 3rd-party tracking and are instead offered the choice to allow tracking.
3rd party tracking means – a platform other than the website directly visited by the user, tracks or assists in tracking the user’s visit to the site. IE Facebook tracking the browsing behaviour on other people’s websites, even if those website visits didn’t come as a direct result of someone clicking on your Facebook ad.
At the time when this was rolled out, there were some pretty conservative estimates of how many people would worry about opt-ing out.
But does anyone want to hazard a guess at how many Apple users opted out of tracking?
I’d love you to tell me your best guess…
83%! Literally more than 4-fifths of Apple users don’t allow their browsing behaviour to be tracked!
Of course there are still android users who this doesn’t apply to – though I’m sure their turn will come soon enough – but in terms of consumers and the sorts of buyers with high purchase intent, a massive portion of those are iPhone users so we just absolutely must find a way to conduct our marketing so that it works within the constraints that these privacy and tracking restrictions present us.
It’s a lot to take in and it really is a big change to how we have thought about paid Facebook advertising. It has certainly affected the way that we set up and run ads on Facebook and instagram, but in my opinion this is not something to fear. The updates actually present you with a golden opportunity to leap ahead of competitors who are lazy marketers!
Which I think is actually quite exciting! What we’re seeing is a return to a focus on knowing who your audience is, creating your own content and increasing the engagement with your audience.
We literally need to train the algorithm to know who your audience is – by creating great content that appeals to your ideal customer and really engages them. And of course, making sure we toe the line with content trends, like using video for instance, because this will give you a lot more reach with your audience just because it’s the type of content favoured by the platforms right now.
And then, instead of relying on Facebook’s ability to hyper-target down to the individual and just rely on the FB data machine, instead we need to focus more on building our audience, engaging with that audience, and also to using advertising not just to drive traffic to your store but also to build your email list – which is an audience you actually DO own.
How does email marketing work to build an audience, and convert new and repeat sales?
Klaviyo – being the email platform we recommend because it’s purpose built for the eCommerce business model – allows you to collect your own data on your customers. This is called zero-party data, because these contacts are giving you permission to record information about them.
Klaviyo allows you to track their browsing and shopping behaviour on your own website and this allows you to not just send them relevant messages on email and SMS, it also allows you to build high quality audiences in your FB ad account, to enable you to show your ads to the right people and increase your return on ad spend.
Klaviyo literally acts like the glue between all the other platforms.
Sure, we can track any user behaviour our audience takes when they remain on the social media or ad platforms, but once they leave those platforms we can’t track them accurately unless we entice them to subscribe to our own database and can record their behaviour ourselves with permission.
So just on its own, there is enormous value in a Klaviyo database of customers will give you the sort of data and information about your buyers that you can’t get anywhere else.
The data in it will help you improve the effectiveness and profitability of your paid advertising on Facebook and Google, which is super enticing on its own.
But in addition, that database becomes the gift that keeps on giving in terms of the revenue you can generate from it. You can potentially generate 25-30% more revenue with a well-designed email marketing strategy, and the ROI on that is incredible because the revenue vs app subscription fee you pay for Klaviyo is crazy, it’s like a 3800% ROI.
So when you think about spending money on paid advertising and how much return on investment you need in order to make the advertising worthwhile and profitable for your business – you want to make sure you give yourself the best chance of increasing that ROI. This is where getting people to subscribe to your email list helps, because it absolutely increases your conversion rate from website visitor to buyer, as well as increasing your repeat purchase rate as well.
OK guys – that’s the 3 pillars you need to focus on getting right in your business. Now you have the plan, you need to consistently execute, monitor and optimise. This iterative, multi-channel approach is how you win the game of eCommerce in 2022.
But without a plan like this in place, then you’re basically planning to fail, and unfortunately more eCommerce businesses will fail than succeed in 2022.
Hopefully that’s not going to be you though, and you’re keen to replicate this system in your own business.
And to do that, you have 3 choices: figure it out alone via trial and error, learn from someone else who already knows how to do it, or outsource it.
Each is a valid choice, and each will take varying lengths of time.
If you’d like to speed up the process of learning or implementing and getting results faster, please reach out to me because there are a variety of ways I can help you depending on the stage of business you’re at.
This is what I do and love to do every single day. Whether you’re looking for coaching to help you to learn and implement these things, or if you’re looking for a team of experts to outsource to, just head over to catherinelangman.com/work-with-me to find out about working with me.