What is ecommerce and ecommerce marketing?
When we talk about ecommerce, we’re talking about retailers that conduct business online. While ecommerce can include B2B (business-to-business), C2C (consumer-to-consumer), or C2B (consumer-to-business), we’re going to be focusing our efforts on the B2C (business-to-consumer) category for this guide.
Unless you live under a rock, it’s no surprise that ecommerce is booming with projections of nearly $194 billion in sales by 2024 from U.S. ecommerce apparel, footwear, and accessory brands. Ecommerce can cover a wide variety of industry categories including but not limited to: accessories, apparel, home, footwear, outdoor, food & drink, beauty, sports & activities, baby, and pet care & supplies.
When we discuss ecommerce marketing, we’re talking about the specific marketing mix for businesses that sell online. This marketing mix can be paired with brick-and-mortar marketing tactics (for those who do have storefronts) to create a holistic marketing strategy but for those retailers focused solely online, what marketing tactics should they include to drive purchases?
While the marketing funnel for ecommerce companies may appear to be the same as those who aren’t in ecommerce, it’s very different!
Just think, if you’re in ecommerce, your entire marketing funnel is online. The goal is to target and attract audiences online to drive purchases online or in an app, and then those people are marketed further post-purchase with upsells and other products through SMS, email, push notifications, or retargeting campaigns.
It’s a much more controlled funnel than say, in-person marketing like a billboard, ad in the mail, or radio where you have less control of the number of people who view your advertisement.
What does this mean for you? By having a majority of your marketing happening online due to the nature of your business, you can better track success and pivot strategies based on what’s working and what’s not.
Throughout this ecommerce marketing guide, we’ll dive into the three phases of creating a robust ecommerce marketing strategy: In the planning phase, we’ll discuss competitive research and understanding your industry category including any recent changes to the category, industry trends, and benchmarks. In addition, we’ll talk using your existing data to drive future marketing recommendations (ex. Do you have baseline data on paid ads? How about email campaign data?). While in the planning phase, it’s important to assess and look at other similar ecommerce companies. These strategies tend to focus on driving online purchases with CTAs like ‘shop now’ instead of ‘visit store’.
In the implementation phase, we’ll discuss taking that data from the planning and discovery phase and using it to drive the right marketing mix for your brand including email marketing, paid ads, search engine marketing (SEM), search engine optimization (SEO), and SMS marketing.
Finally, in the analysis and optimizations phase, you’ll fine-tune your strategy and optimize towards higher value tactics. It’s important to note that some of these channels and tactics are longer strategic plays so although they may not be huge money drivers now, they could be in the future. This is especially important when you are just starting or have a tight budget for things like paid ads.
Important ecommerce marketing definitions
Before we dive into the three phases, let’s get some standard ecommerce marketing definitions out of the way:
- LTV or Customer Lifetime Value: the total value of the customer over the lifetime of their relationship with your brand. This can be calculated by multiplying the customer’s value by the average customer lifespan.
- Top-of-funnel or TOFU: When we refer to the marketing funnel, we refer to the top of the funnel being the awareness part of the funnel and entry-point for soon-to-be purchasers. There are many top-of-funnel tactics for driving brand awareness including but not limited to SEM, paid ads, and SEO.
- Middle-of-funnel or MOFU – When we refer to the middle-of-funnel, we’re talking about the consideration phase of the marketing funnel which is ultimately trying to drive purchases of a product. This is generally targeting people who are already aware of the brand’s products and can include retargeting to those who have engaged with previous ads or email marketing communications.
- Bottom-of-funnel or BOFU – The bottom-of-funnel is referring to the purchase and loyalty phase of the marketing funnel. Generally, this part of the marketing funnel is geared towards creating retention and repeat purchases with post-purchase upsell opportunities.
- Customer acquisition cost or CAC – The cost for acquiring a new customer including any marketing efforts/ad dollars spent and sales costs involved.
- Return on ad spend or ROAS – This is used to analyze the effectiveness of a paid advertisement. This term is very similar to ROI but is related specifically to paid ads. Like ROI, the higher the ROAS the better the ad campaign is performing.
- Content Management System or CMS – This is typically software that helps companies operate the backend of a website without coding new pages and content each time. WordPress, Squarespace, and Shopify can all be considered CMS as they let you manage content and pages on your website.
- Cost per lead or CPL – This is the cost to acquire a new lead through paid ads and is calculated by dividing ad spend by leads acquired.
- Conversion rate – Broadly speaking, the conversion rate is the percentage of people who take the desired action (in most cases, completing a purchase or action on a website).
- Key performance indicator or KPI – These are key metrics used to assess business goals. Conversion rates, ROI, and site traffic are all KPIs that companies can use to benchmark and measure success.
- Keyword – Keywords can be used in SEO to help pages rank in more favorable positions in Google, Bing, and other search engines. They can also be used in SEM to target specific words and searches.
- Pay-per-click or PPC – This is a paid campaign type where a company pays per a clicked ad (alternatively, there’s pay-per-impression or PPM).
- Return on investment or ROI – Much like ROAS, this is calculating the return on investment which can be calculated by dividing net profit by total investment (ad spend, marketing efforts, etc.) x 100.
- Search engine results page or SERP – This is the list of entries that appears in response to a search. SERPs typically include both organic listings (unpaid) and paid search ads, with the most popular or authoritative results ranked first.
- Email Service Provider or ESP – This is the tool used to send emails to subscribers in your database.
Now that we’ve defined some of these popular terms, let’s get into the planning phase of ecommerce marketing.
Step 1: Planning
Determine your objectives & conduct research
This is the most important stage in your ecommerce email marketing strategic planning. Success doesn’t happen by accident. You need a game plan that includes these key elements:
- A clear objective. Your ecommerce marketing strategy should support the objectives of your marketing program. Do you need to increase revenue? Cut costs? Step up acquisition? Reduce churn? Each requires a different strategy to carry out, and each strategy will have different tactics to make it happen.
Here’s an example:
- Marketing objective: Increase revenue by 20%.
- Marketing strategy: Use email to drive more sales and AOV (average order value).
- Marketing tactics: Use search to send more shoppers to the website. Add an email opt-in form to the search landing page to build acquisition. Send an email with an incentive to purchase a product at full price instead of a discount. Text customers that an offer is about to expire.
- KPIs to measure success. The click rate is a popular metric, but this metric only measures activity on a search ad, email, or text message. If you’re trying to raise revenue, as in our example above, you’ll want to measure this number as well. Revenue generated is typically a metric you can get either in your ESP (email service provider) or Google Analytics (talk with your data team or tech team to see if they can help you set up).
- An understanding of the industry and trends. Once you set your objectives, strategy, and tactics you can start researching both your competitors and related industries to get a better understanding before setting creative and copy into motion. This step is crucial to see what others in your space are doing, to draw inspiration, and to identify potential opportunities for your ecommerce brand to stand out against the hundreds of thousands of other online retailers. Check out a few of the resources below to research your industry and direct competitors:
- Facebook stalking (no joke) your competitors to see currently active ads competitors are running and CTAs (are they building awareness, or directing them straight to purchase on-site?) for Facebook and Instagram.
- Trade groups and publications can provide insight into what’s happening in your specific industry including spend and trends. Here are a few of our favorites:
- Your marketing vendors can also provide invaluable information on industry insights such as:
- And, of course, our very own MailCharts allows you to understand what emails are being sent within your industry. MailCharts has thousands of emails from the top names in ecommerce collected over the past 5 years.
Different channels to consider in your ecommerce marketing mix
After you’ve defined your objectives, it’s time to start analyzing the different marketing channels. There are many marketing tactics, but the ones we’ll be focusing on are: SEO, Search Engine Marketing (SEM), SMS Marketing, Paid Ads, and Email Marketing. It’s important to note that not all marketing mixes are the same. You’ll have to optimize towards what works well for your brand and what fits within your budgets. Let’s dive into some of the potential marketing tactics below.
Both SEO and search ads mesh well with email marketing. We’ll cover paid search next, but for SEO, you can use what you know about your customers from your email program to help you choose keywords that your customers are more likely to use in search.
Although you don’t have to pay for results, doing SEO right means taking the time, and paying someone who knows how to write and format search-friendly copy. This sets up your site to be as attractive as possible to search engines and their users. Search engine optimization is more than just the unpaid version of search ads. SEO is what you do to improve both the quantity and the quality of the traffic coming to your website from organic (unpaid) search engine results.
The number of visitors on your site is important, but search engines factor in the quality of that traffic as well. If visitors click on a search result and go to your website but then leave right away, that tells the search engines that your site isn’t very valuable. That, in turn, will hurt your search ranking.
You can fix these problems two ways – making sure your site is technically correct, from title tags and meta descriptions to link setup, and writing content that appeals to search engines and appeals to visitors.
Many ecommerce marketing teams keep email and search separate, but that’s a big mistake. Email and search are the most effective and efficient when they work together. Keyword research is a key factor in figuring out how to produce search ads that drive the most traffic for the least amount of money.
Search-specific tools can help you with this. So can your emails! Your email subscribers are like a microcosm of your market. Use what you know about your customers from your email program to do a keyword search. Also, run inexpensive tests on email copy (message content, calls to action, etc.) to find the words that resonate most with your customers. Use those results to research the best keywords in your price range and write search ad copy.
Optimizing both SEO and search ads (often called pay per click, or PPC, because you are charged per click) is essential for your marketing program. Although search ads can give you immediate results, spend can skyrocket quickly, especially if you use high-demand, expensive keywords. Plus, even though your paid ad will be more visible on a SERP, there’s no guarantee it will be the top result.
Pictured above: an example of a search ad on Google search
Keyword research is a major component of paid search. The goal is to use keywords that match the ones your customers are likely to type into a search engine, but the bidding systems that platforms like Google Ads and Bing Ads run will charge premiums. As you saw above, this opens up another cross-channel opportunity with email.
Copy testing is another major step in fine-tuning your paid search. You can vary the call to action or descriptive copy in your test ads and find out quickly which one drives the most conversions.
Short Message Service (SMS) marketing can either stand on its own or extend your ecommerce email marketing program. Like an email, your text messages drive action to a website landing page where the conversion happens, such as a purchase, registration, download, or other activity.
It’s ideal for ecommerce brands because they can cover both promotional campaigns and targeted updates like shipping confirmations, delivery notices, and other alerts. Because it’s all opt-in, you don’t have the same problems with spam filtering and blocking that email presents (although, you do have to be careful that subscribers have explicitly opted to receive communication and that they have an easy way to opt-out).
But the nature of text messaging means SMS marketing has four limitations:
- Character limit – You can send up to 160 characters in a single message – basically, your call to action and a link.
- Images– SMS does not allow images. However, MMS messages do! MMS messages operate similarly to SMS but generally are more expensive given they contain images.
- Timing – Even the most dedicated phone users have to sleep sometime and won’t appreciate a middle-of-the-night text about your latest offer. A lot of tools that support SMS marketing don’t allow for sending during these odd hours.
- Explicit Permission – Even in the United States, which still allows opt-out email messaging, you have to get permission to send promotional texts. Beyond this basic step, you also need to persuade customers to allow your texts to show up on their lock screens for immediate visibility.
Online paid ads
Paid ads are everywhere. As technology changes and social media platforms rise and fall, paid ads will continue to change. For our purposes, we’ll divide online paid advertising into four distinct buckets:
- Paid Social – This includes the awareness and engagement ads you’re familiar with on Instagram, Facebook, and LinkedIn.
- Product Ads (through Amazon) – This ad type is specifically for those selling products on Amazon wanting to target Amazon users. Product ads through Amazon include sponsored products and brands.
- Display or Native Ads – Display includes the traditional banner ads you’re used to seeing but also includes a more sophisticated ad type, native ads. Native ads serve relevant content on publications throughout the web. These can be disguised as ‘sponsored’ content on sites like BuzzFeed, The New York Times, and more.
- Video Ads – This group could technically be a part of the paid social category, but because the requirements are drastically different than normal paid social campaigns, we’ve decided to split this out.
When running paid ads online, it’s important to keep the following KPIs in mind: return on ad spend (ROAS), customer acquisition cost (CAC), cost per click (CPC), conversions, clicks, click-through-rate, and impressions. Depending on where your paid advertising initiatives fall within the marketing funnel will determine which metrics you’ll want to analyze and optimize towards. For top-of-funnel brand awareness campaigns, measuring off of impressions is going to make more sense than conversions to purchase from that person.
You’ll also want to take a look at the different requirements for each as you’ll likely need some creative imagery, video, or content to include in your ad.
Pictured above: A carousel paid ad example for ecommerce retailer Inkkas
Email marketing strategy for ecommerce
Email marketing is our bread and butter, we could literally talk about it all day (and we do!). There’s a lot of great opportunities to uncover in this channel (and we’re not just saying that). Email is the perfect way to stay in touch with new subscribers who have yet to purchase and post-purchase for creating loyalty and driving LTV. Like paid ads, this channel can stay with customers throughout the entirety of the marketing funnel. For email, we’ll break tactics down into two large buckets:
- Triggered workflows are automated campaigns set up to fire whenever someone completes the desired action. A few examples of triggered campaigns include:
- Welcome Series: This is pivotal to set up regardless of the products you sell. Typically, welcome series see high open rates so they’re great for sharing information on your brand and products with the goal of conversion to purchase.
- Transactional emails: This includes order confirmation, shipping confirmation, and any transactional details essential to the customer’s account. Because these are not categorized as marketing sends, they can bypass your unsubscribed filters. Typically the first touch of this triggered workflow fires immediately after purchase.
- Account confirmation: This type of triggered campaign can be used similarly to the welcome series but for those who create an account.
- Back in stock: These can be triggered by inventory updates as long as your website is passing that data to your ESP. You could also include an option on your website for visitors to be notified when a particular item comes back in stock.
- Win-back campaigns: This triggered campaign type can be used for subscription services once someone has canceled or for past purchasers/engaged potential customers who haven’t engaged in a while.
- Cart Abandonment: This is the abandoner series you’re likely to be more familiar with as it’s when a known website visitor adds something to their cart but doesn’t complete a purchase (generally between 30 minutes to a few hours)
- Browse Abandonment: This operates similarly to cart abandoners and can feel a bit big brother-ish as it relies on browsing data of known site visitors. It uses this information to send a relevant email to purchase browsed items.
- Scheduled campaigns are generally the calendar campaigns you schedule out for a given month. Typically, these can be geared towards a specific event, time of year, or current collection. A few examples of scheduled, one-off campaigns include:
- New product or collection launch: This can be a one-off send or be multiple touches over a few days but generally focus on a single product or new collection such as a fall collection or shoe pattern.
- Holidays and upcoming events: Depending on the holiday, this can also be multiple email touches and have the same look/feel. Typically, these include promotions, too.
- Curated gift guides: These guides can be used around a holiday or be curated guides that stand on their own. Typically, these gift guides have a particular theme they center around.
It’s a good idea to take a look at the following metrics when determining email success: open rate (effectiveness of subject line), click to open rate (is the email content engaging), conversion (whether to purchase or complete a specific action), deliverability (is the email going to the inbox), and revenue driven from that email.
Step 2: Implementation
Depending on what channels you’ve decided to focus on, you may be overwhelmed with the various tools out there. For every channel, there are thousands of tools and services that can help you achieve your desired result: more sales. Don’t get too tool crazy though, when you’re starting, just test a few to see what mix works. The more tools you register for, the more of a headache it’ll be down the line (especially as your ecommerce business grows).
SEO & search ads
Search is a primary acquisition tool for most ecommerce brands. You can choose from hundreds of them, available on their own or a part of a multichannel toolbox. Your needs and your budget will dictate which ones are right for you.
The search experts at MailCharts recommend exploring these two well-established tools:
- SEMrush: Offers SEO, paid search and social media marketing tools
- Ahrefs: SEO tools (search rank, link analysis, link building, etc.)
SMS marketing and email marketing go hand-in-hand. Some ESPs (email service providers) have SMS as a capability (such as Klaviyo and Braze). If an ESP doesn’t have capabilities within the tool to send SMS, they likely can integrate through an API or native integration. It’s important that SMS and emails work together as they’re similar forms of communication to active subscribers. Twilio is another popular SMS tool that has a native integration with ESP Iterable.
Online paid ads
Once you’ve decided what platforms you want to use for paid advertising, it’s time to select the tools you’ll need to be successful! Social media platforms allow for easy set up of ads on-site, so those are a good starting point and as you’re probably already familiar with social media, the UI is relatively familiar too.
Once you’ve got the basics of these social media platforms, you can expand to additional tools for native advertising such as TripleLift and Taboola. You can also start expanding to sponsored content on Amazon if you’re selling there.
With paid ads, the options are truly endless and new technology and functionality are popping up every day.
To execute your email marketing campaigns, you’ll need to set up an ESP hooked up to your brand’s domain (email service provider). This should be integrated with any other tools you’re using including your CMS (ex. Shopify, Magento, WooCommerce, etc) to map transactional data for those awesome triggered campaigns you’ll want to set up. There are several options to consider when selecting an ESP including:
- How flexible is the ESP? Does it allow for customization/personalization?
- Is it easy to use and get up and running?
- Does it have the key integrations you currently have in your marketing stack?
- What reporting functionality would you like to control in the ESP? Does it have the reporting functionality you need?
In addition to your ESP, you’ll also want to consider the following:
- A deliverability platform to help you monitor how successful your email is across email clients. If you have poor deliverability, chances are your email isn’t making it to the inbox and is instead trapped in the spam folder and appearing on email blacklists. Consider a market-leading option like Validity Everest.
- If you’re new to coding emails and email templates, consider adding email rendering functionality that’ll show you how your email will appear across all email clients. (Everest can help here, too!)
- Once you’ve established the core email technology and have begun setting up the basics, you can continue to look into personalization tools.
- A tool to monitor industry trends. Oh wait…that’s us! Here at MailCharts, we have several ecommerce industries highlighted within our tool which essentially operates as Google for the best of the best emails from the past 5 years. Gain insights, get inspiration, and pivot campaign ideas based on what others are doing in your industry.
Step 3: Analyze & optimize
Now that you have an idea of what types of channels you want to run with and the tools to help you achieve your goals, it’s time to set up your channels and watch the magic happen!
If you’re a lean team, by no means do you have to set this up all at once. Focus on the biggest drivers first and factor in budget considerations (i.e. if you have tight budgets, consider focusing on email and if you have a small email list start with paid acquisition).
After you’ve successfully launched your first campaigns, monitor over the initial few days of launching to ensure the campaign is working as expected. After about a week or so, see what data you have available so far and any significant initial insights.
It’s important to look at the KPIs by channel to determine success. For example, the way we measure paid ad performance isn’t going to be the same way we measure our SEO or SMS success. Unfortunately, there’s no one KPI that rules them all (or our jobs would be a lot easier).
If you’ve got baseline data from the previous program set up, great! Compare your new campaigns against the old ones to see if this new campaign is converting more people than the previous set-up. If these campaigns are net new, consider adding A/B tests on copy or creative to see if one performs better than the other and continue to build on that baseline.
Ecommerce marketing is a beast. While email is only a small component of the larger ecommerce marketing strategy, it’s an important one. With MailCharts, whether you’re a beginner or an experienced email marketer, you’ve got the tools to monitor ecommerce industry trends and gain inspiration. Sign up for our free plan and view email data for our brands and industry groups.