Digital Horizons

The 4 Lever For Explosive Ecommerce Success

• James Walker & Brian Hastings

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Unlock the secrets to skyrocketing your e-commerce success with our latest episode of Digital Horizons. Ever wondered how small changes can lead to big profits? We promise you'll discover how mastering conversion rates, traffic, average order value, and lifetime customer value can transform your online store, whether you're just starting with modest sales or managing a booming business. We dive deep into the art of optimizing your marketing budget by focusing on quality over quantity in traffic, revealing how these four critical levers work in harmony to drive substantial growth for your e-commerce journey.

But that's not all! Get ready to revolutionize your sales strategy with innovative techniques that enhance your revenue stream without sacrificing the customer experience. From compelling order and sales packaging to the clever use of postcard automation, we provide actionable insights to encourage customers to spend more. Embrace last-chance offers and exclusive discounts to boost your average order value while strengthening your brand. This episode is your guide to achieving a robust, sustainable growth trajectory through smarter, more efficient sales strategies.

The Digital Horizons Podcast is hosted by:

James Walker - Managing Director WHD
Brian Hastings - Managing Director Nous

Speaker 1:

Welcome to Digital Horizons, the channel for marketers, business owners and entrepreneurs who want to know what's working in the marketing and digital space.

Speaker 2:

Welcome back.

Speaker 1:

So today we are going to be talking about the four levers to e-commerce growth. What we're referring to here are four different areas or functions within your e-commerce store that you can pull and this is why we call them a lever to really increase your overall revenue and sales percent increase year on year in its views. Yeah, yes, I feel like.

Speaker 2:

Yeah, it does feel inappropriate, but yeah, somehow that's yes, so I guess you ought to think about these, is that?

Speaker 1:

if you've got an online store and say you're making a very small amount here, let's say $1,000 a month and you want to grow your online store.

Speaker 1:

So we want to look at your conversion rate. We want to look at your traffic website traffic. We're going to look at your lifetime value and your average order value. These are the four areas that you can pay attention to, and if you just make a small incremental change or you focus on each of these to continually improve, they're going to have a combined effect that's going to be far greater than the individual part.

Speaker 2:

It's while I'm picking the next thing to watch, I do chuck and just watch one of them.

Speaker 1:

So I guess, if I'm doing, it a little bit more than I used to, then I'm sure others are as well. Yes, oh, really, absolutely.

Speaker 2:

Yeah, that's true. I think going back to there about what this means for advertisers is it's just proof that you can be on the big screen in and pay normal for this via youtube ads, instant 100.

Speaker 1:

So I guess, like as a bit of an example here so let's think about, you've got a online store, as I said, you're making a thousand dollars a month within your sales and say you're driving traffic and you're getting 100 hits. So if you were to think, all right, well, if I'm just getting 100 hits and I was to increase my conversion rate by, say, 10%, then my current conversion rate's one. So now I've got a 1.1% conversion rate and then you want to then increase your traffic by 10%, it's going to add into it. Now this is some stuff on ChatGPT, because I can't work out the maths of it.

Speaker 2:

Yeah, I'm glad you've done this beforehand. I couldn't work it out. Are we going to have to figure out these maths on the spot?

Speaker 1:

So if you're thinking about it, though, is a 10% increase in your conversion rate. That's not hard right. So I mean, there's things you can do right now that we're going to give you some tips and advice within this series as to how to do these things. But if you were to go from a one to a 1.1% conversion rate, that's basic stuff. But then if your traffic then increased, and then you increase your average order value so say, your average order value was $100 and you increase that to 110.

Speaker 1:

Again, strategies to very easily increase that to it and then you're looking at your lifetime value. So if you're looking at your customers and you're like, all right, I want my customer maybe just to purchase a little bit more within their lifetime of working with them by 10% Again, very easy task to do. So the overall impact is just going to have a flow. On the flow, in fact, increase your traffic. Conversion rates are up, they're buying more, they're buying more often. Your overall revenue from your store is just going to start going up in a very strong curve. Yeah.

Speaker 2:

Yeah, yeah, yes, yes, yeah, no. I find if I open YouTube it is 100%. But I mean traffic on its own can be completely waste of money and unless you're paying attention to these other areas because, imagine, I need to spend, I'm paying a dollar a click and I want to go from 1,000 to 2,000 clicks per month. All right, well, that means you're going to spend $1,000. But if you increase your conversion rate and increase your average order value slightly, you can spend half that and still generate the same amount of sales.

Speaker 2:

So paying attention to all of them, and how they work and combine together and actually start looking at the maths as to what you can achieve far better than just dumping a bunch of money into traffic when you could just be converting more customers on a smaller budget. I think it's a great plan. It's the proof that the audiences are there and that you can get that big screen quality content in your ads. It's in this data. So let's see more and more YouTube advertising on media plans. That's right, yeah, and I think for us, that's really exciting.

Speaker 1:

So let's think about the first one, which is traffic. All right, traffic's an easy one. Traffic's something that we probably talk about the most often, in terms of a lot of the stuff that we talk within this channel is about how to drive quality traffic to your website, not just a snippet told in your YouTube show.

Speaker 2:

Yeah, yeah, yeah, via TikTok, yeah.

Speaker 1:

Yes, 100%. So when we're talking about traffic, I mean I've heard it referred to as the traffic shops. So you go to.

Speaker 2:

Facebook and you buy traffic you go to Google.

Speaker 1:

You buy traffic. But that's essentially what you're doing when you're running campaigns on there is, you are paying money to these platforms to advertise, to drive traffic to your website. But there's a very big difference in the quality of traffic that you can achieve with these different platforms and the way that you structure your campaigns and your strategy. So feel like not all traffic is equal is a very important way to look at it, and then, you've got to, and no one ever watches it.

Speaker 2:

Yeah, I know how it feels. We've done it a few times. Yeah, if you're used to that sugar, hit TikTok and you're trying that YouTube-length approach and it might be TikTok's attempt to try to, you know, eat some of YouTube's lunch. Yeah, You're making a TikTok's attempt to try to eat some of YouTube's lunch. Yeah, you're making a decision. Yeah, imagine going. Yeah, now I'm in a 28-minute sort of run-through.

Speaker 2:

They did incentivize TikTok, that is they did incentivize creators to create more over-a-minute-long videos, a reward for high-quality original content that is long, using an optimized rewards formula focused on four metrics originality, play duration, search value and audience engagement. They're really my play for that longer form content and piecing it to creators to say make longer content.

Speaker 1:

That's right. So I guess key is really looking at the messaging within your ad content when we're talking about social campaigns, because you want to be attracting the right people. You don't want to just be going, all right, cool, going to run a MaxClicks conversion or whatever they call it.

Speaker 2:

Oh, TikTok is paying creators. Yeah, they will generate clicks, but if your messaging isn't right and attracting the right people to click on your ad and jump traffic to your website your message to your offer any of this, what we're talking about here in terms of increasing the revenue.

Speaker 2:

But I think at the moment it's a little bit of a joke when people sort of say, oh, I got views and I got $4.80. So, yeah, yeah, I think we've hit like five pieces of brand news in this one go, because that's the door that's coming early next year. Yeah, yeah, everyone else has it, but we're lost so a lot covered in that one piece of YouTube news.

Speaker 1:

Next one average order value AOB.

Speaker 2:

This one to me seems like the most lush one. If you can just get everybody to buy heaps, spend more money. That's it. That's the ideal.

Speaker 1:

It is money to buy heaps, Spend more money. That's it. That's the ideal, it is. The way that we can approach this is we can use the order upsells. There's the cart upsells, there's packaging, there's bundling, post-cart automation. So someone's purchased and then you're sending out an email automation to get them to add something else to the cart as a last chance, exclusive offer. You get your success pages where people jump on and then it's like hey, by the way, if you add this to cart right now, here's a discount. Add this in, cost you nothing more for your shipping, and then you can get the average order value increased. So I guess it's just looking at all the different things that you can go from people arriving onto your website to increase their cart size. That's not going to have a negative impact on the user journey. I'll guess that for a call it's possible.

Speaker 1:

100%, 100% yeah yeah yeah, yes, yes for that sort of stuff so yeah, 100% for that sort of stuff.

Speaker 1:

So yeah, yeah, yep, yep, that's right. The next one is going to be your conversion rate. Now, conversion rate is something that I think people do pay a lot attention to, so I think probably more so analyzed than AOV and lifetime value, because it's something that is which I think is great. I think it's something that is always on your face. I think it's a really good use of AI that hopefully won't flag too many uncanny valley issues for advertisers if they're going to measure that number.

Speaker 2:

The image animation. I do it really well for stats If there's just a little bit of movement. B before you even start working with them what that animation of an image will look like. But they're basically saying if you use these tools, it'll get you away from using a static image and you go and get a higher conversion rate from your ads, they stated here.

Speaker 1:

on average, I've seen an 11% higher click-through rate and a 7.6% higher conversion rate compared with those that don't use the tools. So there's a bit of a hint for one that we can put up into our levers series in the next couple of weeks as well. I think that consumer journeys are now so complex and so many touch points, so many things need to happen, that you might be like oh, I've had a whole bunch of traffic come to my site they haven't converted.

Speaker 1:

but then down three, four weeks back they've come through from another campaign, hit your website and converted. So I guess, are you looking at your conversion rate from a session point of view or are you looking at it from a user point of view?

Speaker 2:

How many people have visited your website overall and converting within their journey there? I can wrap it up with yes.

Speaker 1:

Yeah, look, I can't wait.

Speaker 2:

Yeah, even our Ken's team that have a bunch of static ads. We can put the power in their hands to test some of these Gen AI tools and lose the lever on the conversion. Well, that's it for Brand News this week. We'll be back next week Releasing longer content.

Speaker 1:

And then they're getting every month that month. That's right. It's building your asset like you're improving your asset. It's your own platform.

Speaker 2:

Yeah, you're not just turning on the tap harder and for longer in the paid side of things.

Speaker 1:

So use for really looking at the messaging within your app, or if it works that, um, when, that's right. And then, yeah, that's right about you. They're spending more, they're converting more, you're driving a truck, so it's fine. Now the final one and this is again another one that probably a lot of businesses aren't paying huge amounts. They probably know that this is important, but they're probably not looking at it. So this is the final one is your lifetime value.

Speaker 2:

There is a TikTok creators platform. A joke for people. How can we?

Speaker 1:

increase that. How can we encourage?

Speaker 2:

repeat business subscriptions.

Speaker 1:

Is it through post-purchase automation to try and get people to come back? Is it reminders?

Speaker 2:

I think we've hit that speed. If it's consumable within the typical usage rate of 30 days, are you reminding them? Hey, you're going to be running out, they'll buy some more shit, they're excited for that Average order value A or B.

Speaker 1:

It's a good deal. It is Different ways, so the ways that we can approach this is we can use the order. Part of sales is packaging. There's postcard automation, so someone's purchased and then you're sending them to get them to add something else to their card as a last chance.

Speaker 2:

No exclusive offer, you get your own.

Speaker 1:

It's a subscription, by the way here's a discount add more and then you can get the average order value increased and all the different things that you can go from people arriving onto your website to increase their cart size. That's not going to have a negative impact on the user journey. 100%, 100%. Are we a lot more healthier? A lot more healthier, yeah.

Speaker 2:

Like branding. Yeah, you know, having people, yeah, yeah, yes.

Speaker 1:

How to improve your overall revenue using these levers. Yeah,