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For most ecommerce brands, the last few years have cemented something they’ve known all along: in ecommerce, no two years are ever alike.
2023 will be no different. Recessions and the cost of living crisis will be hitting consumers' wallets, impacting many ecommerce businesses and leaving them with less spend for traditional brand-building activities like ads, PR and social.
All the while, the struggle to create content that breaks through is more challenging than ever. The number of businesses selling online skyrocketed during the pandemic, meaning there’s more competition than ever when it comes to getting your content in front of the right audience.
In this blog, we’ll examine the six defining strategies we believe all ecommerce businesses should consider to grow their brands over the next 12 months – all with a bit of help from Nick Knuppe, Senior Director of Marketing at Juni.
While next year looks increasingly unpredictable, Nick suggests it’s important to “go into 2023 focusing on what you can predict with confidence.”
There are several key areas where Nick suggests shifting focus to:
Customers who have bought from you are more likely to buy again if they have a good product or customer experience. Focus on maximising their value with consistent nurturing like newsletters and offering exclusive discounts. If something goes wrong, especially for complaints in a public forum, handling an issue well with a good outcome can lead to a valued customer.
Past data is a valuable tool to know where to prioritise your resources, especially if you’re looking at a smaller budget. If you aren’t already, consider moving towards a data-driven strategy with consistent measurement.
Nick suggests you should “examine past data to understand which channels are your best performing and most cost-effective. Kill or pause the ones that aren’t.”
Although going into such an unpredictable year can feel daunting, you’re not alone. “There are hundreds of businesses like yours going through the same challenges,” says Nick. “Seek out partnerships to cross-pollinate your products and promotions.”
Your product is both your brand and your marketing investment. Now’s the time to get smarter with price promotions, gift with purchase or trade exchanges with advertising publishers.
In a downturn, battening down the hatches and waiting for the storm to end can seem like the easy option. But it’s not always the best one.
Instead, when money is tight, investment needs to be focussed on the balance between nurturing both your current and new customers. Nick suggests moving away from generic, industry-standard ‘self-help’ content and doubling down on highly targeted, localised campaigns that focus on building an internal, professional community. The right community can deliver cost-effective engagement, feedback and retention.
Succeeding with this approach in an efficient way requires smart investment that factors in spending across the entire company. “Surviving and growing during a downturn is all about balance. So you need to clearly understand all your key KPIs like Return on Ad Spend (ROAS), ROI, CAC, LTV, and gross margin. It’s all about the complete picture.”
The brands that combine this level of financial detail with targeted investment will give themselves a great chance of growth going into the next 12 months.
We understand that not all ecommerce brands will have the cash flow to maintain marketing spend. No matter how efficient they are.
Those brands can still grow in 2023, but they need to stay visible.
When sales are down and the focus is on fighting fires elsewhere in the business, it can be easy to take your eye off your community. But rebuilding those connections once the good times roll back around is hard.
Luckily, there are several low-cost ways to stay visible in a meaningful way that can result in leads further down the line:
If your content is experiencing high engagement, identify what’s working and continue testing that theme, format or channel. If not, then start experimenting. Consistency isn’t just about choosing the right content - it’s also important to post regularly to build visibility.
With fewer sales going out the door, you’ve got time to get personal. Consider handwritten notes and small freebies in your parcels. These will likely then be shared on social media.
Encourage customers to share success stories and problems they've had – and how they solved them. Profile customers or interview them on their experiences and stories.
Founder and staff profiles are a great way to grow your brand image further and share what makes you and the team tick.
Respond to comments with feedback, ask follow-up questions and tag other customers. By actively engaging with your community, you can build support for your brand beyond purchases with customers by spreading the word on social channels and giving honest and insightful feedback.
For consumers today, it’s all about authenticity, with 88% saying it’s a key factor when deciding what brands they like and support. When people perceive that a brand is distinct and aligns with their personal values, it's a powerful competitive advantage.
But brands must go beyond just talking a good game and actually be the change they claim to want. “There’s always going to be a new trend to follow, so make sure you’re not just jumping on the bandwagon,” Nick cautions. “Customers will see right through this, and it’s a lot easier to be destroyed by public opinion than to build public support.”
Take sustainability. Are you examining your supply chains? Adjusting your packaging and materials? If not, should you be posting about how important that stuff is? But if you are, that gives you a platform to have these incredible conversations and create experiences that can resonate with customers. Plus, you’re saving the world!
Whatever your mission, as you work towards it, make sure to shout about your wins. Encourage your community to join in. Partner with your competitors on industry-leading projects. Show your community that this is more than just lip service.
Then, shout about your losses too. “Sharing mistakes,” says Nick, “makes your business feel more human and adds another layer of accountability.”
It feels like an odd thing to say about a platform with over 1bn users, but from an advertising point of view, TikTok is still relatively untapped by direct-to-consumer ecommerce brands.
DTC brands are still pushing the majority of ad spend on other channels. On average, 20% is spent on Google/search, 17% on Facebook, and 12% on Instagram and YouTube.
In contrast, the average spend on TikTok is just 3.7%, making it potentially fertile ground for brands willing to take the risk, but you’ll need to act fast.
DTC ad spending on TikTok surged 231% over the past year, hitting $30m in Q2 of 2022, the highest growth among all major platforms. This is less surprising as TikTok is now the most valuable platform for DTC advertisers, with costs considerably lower than Facebook and other major social media companies.
All of this can contribute to brand growth in 2023. The short videos that TikTok is built around are proven high-performers, offering the highest ROI of any social media strategy. While the platform’s video editing capabilities are a great way for brands to showcase who they really are.
We especially like Gymshark’s strategy. The fitness brand’s approach to the platform has seen it gain over 4m followers at a relatively low cost by utilising fitness influencers, a constant stream of viral videos, user-focused and generated content, giveaways and more.
In the UK, almost nine-in-ten consumers are planning to reduce their spending over the year ahead by stopping non-essential purchases, with the typical UK household cutting £887 of its discretionary spend through to April 2023.
“For brands to grow in this environment,” says Knuppe, “they have to be seen to be solving an essential problem.”
That doesn’t mean changing your product but the positioning of your brand. Again, this all comes back to focusing on your key customer profiles. If you can truly understand that group, their challenges will become clear, and you can position your brand and products correctly.
To find out more about your customers, look at your social followers or who’s engaging with your ads. There are great in-house tools like Facebook Insights and Twitter Analytics or external platforms like Hootsuite and Followerwonk to help.
Once you’ve identified your customers, the next step is understanding their challenges—the best way to do this is simply by talking to them. Engage in the comments, send out surveys, and create WhatsApp groups. Not only will this give you a deeper level of understanding and guidance on positioning – but that level of engagement can help build your community.
Whatever the budget or financial restraints, ecommerce brands must attempt to build an authentic identity and narrative that genuinely reflects their work. This means investing efficiently and positively while resisting the urge to cut where possible. Meanwhile, those that cannot afford to invest should focus on community building and lead generation.
While 2023 will undoubtedly have its challenges, it also invites you to innovate and get creative to keep brand growth on a stable trajectory.
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Juni is the financial platform built for ecommerce. We give you a unified view of your finances, with cards, mulitcurrency accounts, and banking, accounting and advertising integrations - all in one place. We can even help boost your cash flow with working capital, cashback and more.
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