Regardless of the background, you’re coming from; it is possible to build a successful business if you’re diligently dedicated to achieving set goals. E-commerce is probably one of the most popular go-to ideas for making a company in 2022. Only in 2020, e-commerce sales spiked to 18% of all total retail sales worldwide.
People have seen the benefits of shopping online and why it works – it’s now definitely here to stay. Even if you had the know-how, one question boggles all minds – what is the best way to think about going into this venture? Ecom Dave, an expert in the market who has helped build multiple eight-figure e-commerce businesses, offers his opinion on the most important questions when starting an e-commerce business.
Why would you enter the market?
There is a lot of useful and not-so-useful information circumventing on the Internet regarding the success formula needed to build an online business. Everyone has “the answer,” “the most hidden secrets of the trade,” and tries to explain how a profitable e-comm business is built. But, as per Ecom Dave, the truth is a little less hidden – a successful business is built on a simple law of supply and demand and the resourcefulness of the business owner.
Nowadays, being in the selling business has never been more challenging. In the US, the Consumer Price Index has risen to over 8%, with more people trying to cut back on spending. Even in these times of record-high inflation, buyers are still coming to retail and online shops. The market size speaks for itself.
There are over 2 billion online shoppers worldwide, with online retail sales amounting to 4.9 trillion USD and a tendency to grow by a staggering 50% in the next four years. Even not developing your e-comm brand from scratch and succeeding is possible, as almost 40% of all e-commerce sales in the US went through Amazon. Anyone reading this data would agree that there is room for everyone, even the newcomers.
How do you get a competitive advantage?
As per Dave, besides brand building, the essential factor for positioning is the personalized experience for each customer. One of his first e-comm ventures involved selling diaper caddies. As he says, being unable to do lower prices than the competition and not standing out enough brought him out of that specific market.
In retrospect, he would probably give away another cheap complementary product with the more expensive one, like a bundle or something similar. That would give his customers a sense of value and allow him to get better reviews and more loyalty from his customer base. Even the market statistics with larger e-comm companies show these trends for the following period. According to Twilio Segment research from 2021, 85% of e-comm businesses think they offer personalized experiences, while only 60% of customers agree with them. 70% of brands will cut budgets for brand-building expenses to provide more customer satisfaction. Enough said?
Do you want your brand to stand for something?
Since the pandemic, 78% of businesses believe brand purpose is now more critical than ever. When you look back on the law of supply and demand, there is now more demand than ever for relatable products that solve a problem—identifying what products sell and why can make all the difference. As per Dave, several factors should be considered when positioning your brand behind a cause.
Some include building trust with your customers, giving appropriate discounts, and gaining a competitive advantage. The last one might seem the most important. Still, the trust factor is vital, especially when using a third-party platform like Amazon, where one bad review can do much damage.
Also, it’s not a secret that the new generation of buyers is different. A unique selling point is essential but communicating that is another story. Attracting loyalty might be done through going green or standing by a worthy cause in which you believe. However, Dave points out that it might be best to get behind a cause well-informed. That’s mainly because e-commerce is profit-driven, and selected products should be chosen to correspond with the actual demand for the products. Selling should never exist for the sake of itself.
Learn how to handle orders
This is a statement rather than a question but knowing how to manage inventory and juggle between suppliers and customers is crucial if you want to succeed in this branch at all. As ECom Dave points out, mirroring good sellers on Amazon is excellent. Still, trouble is coming your way if you cannot meet demand.
Choosing good products for yourself can depend on the previously mentioned factors but is mainly driven by your budget. For example, ordering products with low manufacturing prices and high value is the primary sales principle. It shouldn’t be overlooked since having a comfortable quantity of products for a reasonable price is always better than counting on selling lower amounts for higher prices. As Dave points out, people love a bargain, and it will allow your business to do better deals and increase loyalty among customers.
All in all, e-commerce is more than welcoming for new entrepreneurs looking for success. However, mentoring is always welcome since any new business venture is better done when you have someone more experienced to lean on. If you have more questions, they are already answered through ECom Dave’s course on e-commerce. Master all skills necessary to succeed and cover all these topics in greater detail and more. Maybe the best question is – why not go through your e-commerce experience with one of the industry’s leading experts?
Written in partnership with Luke Lintz
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