Written by: Silvia Myers, Executive Contributor
Executive Contributors at Brainz Magazine are handpicked and invited to contribute because of their knowledge and valuable insight within their area of expertise.
How to Create a Profitable Online Store In This $5.4 Billion Industry Without Having To Discount Your Products Or Worry About Changing Algorithms
Let's be honest for a few seconds. How many of you worry about the economy and things that are outside your control? How many of you fret about these external circumstances affecting your eCommerce business?
I know for a fact that many eCommerce store owners also lose sleep worrying about things like low product potential, their products not being popular enough or large businesses forcing them into price beats.
Similarly, people also worry about the eCommerce industry forever changing. Because frankly, it does take a while to figure out how it works only to then see it being replaced with something new.
Let’s take social media as an example. It takes a while to figure out the Facebook algorithm and before you know it, you need to learn Instagram and then get interrupted by TikTok. It’s crazy, frustrating and requires lots of your time and energy. I totally get it.
Over time, I've heard the following phrases from product makers and brand builders inside the eCommerce industry over and over:
"We live in tough times."
"People have less money and spend less..."
"The retail industry has shrunk…"
"Social Media ads have got too expensive..."
"It's too late to get into online retail..."
"There's too much competition..."
"It's not a good time to start a business when we don’t know what’s going to happen…”
The list goes on and on.
And look, I don't want to downplay any of the risks, dangers and effects.
But then, I do want you to be open-minded for a few minutes. I need you to join me to take a look at the things that are really happening in the eCommerce industry. I also want you to see how this impacts product makers and brand builders now and into the future.
An Increase In Online Spending
Whilst we do live in uncertain times, one thing is certain. Since the pandemic, the spending in the online space has not just grown – eCommerce spending has hyper-accelerated.
And not by a little – By A Lot.
I want you to consider a few numbers. I didn’t make them up. They are from reputable information sources such as Shopify statistics.
Within a few years, online retail has experienced tremendous growth in different markets worldwide. By now, online shopping levels are at over 160% in the USA alone, since the pandemic began with the same trend continuing worldwide.
Essentially, this growth has shown that the global ONLINE RETAIL industry IS Currently WORTH $5.4 TRILLION.
But that's not the shocker. As exhilarating as this growth is, online retail accounts for just about 20% of the entire retail industry. This means we've still got 80% (about $21.6 billion) to go with many other types of retail businesses.
But despite these shocking and exciting numbers, some of you still worry about scaling your business. You ask questions like, 'How am I, a small unknown new business flying solo, going to compete with everyone else?'
Before we delve into dissipating your worries, let me show you some actual facts and the results of some relevant research.
Research has shown that 75% of consumers are buying from new brands. Again, I didn’t make this up. It comes directly from the desk of McKinsey.
We’ve never seen this in the history of online retail before. What it shows us is that consumers do not really care if you're small, new or unknown. they only care if you are online and ready to serve them with your products!
With that out of the way. Do you now see that your success in the online retail market has nothing to do with how long you've been in business? Can you also see that your previous level of online visibility has nothing to do with how much progress you can make in eCommerce this year and in the future?
Honestly, there have never been more favourable conditions for the online retail industry than there are now. As a result, anyone who intends to venture into eCommerce today has more chances to succeed than they might have had a few years ago.
Of course, these favourable conditions might not be here forever. But they'll be available long enough for those who seize them to build a profitable and lasting business to leave a legacy in the eCommerce industry.
So, if you're struggling to grow your sales in eCommerce, it's definitely not because the conditions are bad.
It’s because you’re steering your business down the wrong path. What do I mean by that?
It simply means that you're running your boutique eCommerce store with the wrong tools, systems and/or strategies. It leaves you feeling like it’s too hard like there are no opportunities or like there is no demand for your products. As a result, you’re limiting the potential of your online store.
If you continue this way, all you'll keep seeing is how hard it is to make even a single sale because you may be unable to cut through the noise, stay competitive and get your products seen or found by the right customer.
To understand how building a successful online store works, you need to understand the iceberg principle first. What you see on the surface are the overall conditions – like the overall economy, how favourable the business environment is, or even the social media platform algorithms changing. But all these things you see on the surface only make up about 10% of the whole success of your online store.
The rest, the 90% of it or so, live underneath. Here you’ve got things like your tools, systems, strategies, methods and the activities you do daily. These are the real drivers of a successful and sustainable online store.
And if these things are not ticking along and your fundamentals are set up to fail, I don’t care how favourable the conditions are, how fast is the industry growing or how popular your products are. Your store won't be making any sales, your efforts won’t turn into profits and you won’t be able to sustain your business.
Over the years, I’ve seen stores with popular products, great margins and favourable market conditions fail just because they didn’t have the right strategies and methods in place. On the other hand, I’ve also seen online stores with quirky, unknown products that never turned trendy grow quickly and sustainably just because they approached it with the right method and a strategy.
So first, stop worrying about the environment and the conditions and start steering your business down the right path with the right tools, strategies and methods.
But how do you know if you’re steering your boutique online store the right or the wrong way?
You know you’re going the wrong way if…
You’re putting in a lot of effort, but see little results
You binge on YouTube for the latest tips, and tweak every feature possible and yet, your sales never record any significant change
You pay a lot of money to social media platforms for ads, because all that you see around you gives you the impression you have to part with your money to have people see your products.
You’re unsure of your business
You're not 100% clear on why you’re doing certain things, what’s your actual system or strategy and what you need to be doing and in what order.
You’re not confident that what you’re doing will get you anywhere…
You get traffic to your online store but get no sales
Here’s what to do to start thriving in this booming eCommerce industry
As soon as you've discovered that your eCommerce store is operating with the wrong strategy (or no strategy), I’d like to congratulate you – half of your battle has just been won.
Next, you need to find a strategy that’s not just proven, but also works for a small online business. Gone are the days when product makers and brand builders could just ‘model’ what big retailers do.
Remember, you’ve got a fraction of the resources big businesses have so following case studies of big brands and marketing agencies won’t do you any favours.
Instead, go for something that suits your product and philosophy better – something more boutique that’s specifically designed for small businesses with limited resources.
And lastly, go for a strategy that doesn’t rely on the mainstream stuff but focuses on the hidden “level ten” opportunities. It’s easy to find well-known mainstream strategies but typically, by the time you get to it, they’re overcrowded and require a lot of effort and big budgets.
Instead, you want to go for something less competitive and easy to get into. After all, you’re a product maker or a brand builder and your unique online store needs you to be there rather than worry about the competition.
What’s next?
The conditions for boutique online stores have never been better but there has also never been so much noise, overwhelm and the constant feeling of ‘pushing uphill’ to try and get ahead. The key to this is to recognize how are you steering your store and pick the right strategy to support your small business.
Silvia Myers, Executive Contributor Brainz Magazine Silvia Myers is co-founder of Traffic Ninjas, teaching product makers and brand builders how to sell their incredible products online without having to discount or spend their hard-earned cash on things that don’t work.
Together with her husband and co-founder, Kristen, Traffic Ninjas equip eCommerce stores with an underground Ninja method specifically designed for small business owners, teaching them how to be profitable and sustainable and actually earn an income from selling their products.
The Traffic Ninjas community has grown from Sydney, Australia to 35+ countries around the world with small business owners achieving amazing results.
