10/02/2022
How Does Ecommerce Make Money?
So, how exactly do ecommerce businesses make money? Here are a few ways.
They invest in their owned marketing channels. When all of your customer communication happens online, investing in your owned marketing channels (like your website and email) is a must.
“Email lists and websites are the two only things you can own on the internet. Everything else is just rented.” — Tobi Lutke
There are so many channels where you’re just “renting” space, so it’s important to build your email list and have a great website.
Email lets you communicate with people one to one, versus one to many (like Facebook ads, YouTube, influencers, etc.). You control the creative, and the end-to-end experience (which emails they receive and when).
Your website is your digital storefront. It’s how customers browse and buy your products, and shapes the experience (and impression!) they have of your brand.
They market in multiple channels. Multichannel marketing is marketing that reaches a target audience through multiple communication channels and platforms throughout the customer journey.
The advantage of using multiple channels is that you’re able to promote and sell your products anywhere a customer spends their time, from Facebook to emails to SMS.
Three is better than one, right?
Right! According to Shopify, multichannel marketing and selling increases revenue by an average of 38% with one channel, 120% with two channels, and $190% with three channels.
With these numbers in mind, it’s clear that ecommerce merchants have the potential to rake in some serious dough when using multiple channels to market their products.
They make personalization a #1 priority. 91% of consumers are more likely to shop with brands that recognize, remember, and provide relevant offers and recommendations.
Ecommerce businesses that connect with customers through highly personalized methods of communication cater to exactly what online shoppers are craving—a personalized experience with a brand.
Whether it’s sending emails that highlight product recommendations, tailored popup forms that remind customers of items left in their cart, or a personal note from the founder with the purchase, a brand that goes the extra mile to make personalization a priority brings in more revenue than a business that puts personalization on the back burner.
