Ecommerce Directors’ Top-5 Nightmares
“Most of the customers add items to the cart but they never pay! I am wondering – what can be wrong? Does it depend on the weather or the planets’ movements?!”
Here is what I’ve heard from my friend sharing his pains being an ecommerce director. Is it difficult to run an online store? As you can see, yes. Are the problems you may face being a director solvable? Also yes!
Let me share with you some e-commerce directors’ top-5 “nightmares” as well as the ways to solve the issues.
Did you know that, according to Baymard Institute research, an average cart abandonment rate in 2023 is 70.19% ? It means that only 3 of 10 customers will succeed to checkout at the end of their customer journey. Does it always depend on the online store? No.
The reasons of cart abandonment are the following:
On the online store’s behalf, what can be done to reduce cart abandonment due to “too long / complicated checkout process” is the UX optimization. The ideal checkout flow needs to contain 12-14 form elements.
Making the shipping free is also a great way to reduce the cart rate abandonment. According to Jungle Scout, 66% of American consumers expect free shipping on all online orders, while 80% expect free shipping when ordering a certain dollar amount of products.
In terms of marketing, there are various ways to combat cart abandonment:
- Sending personalized follow-up emails, reminding the customers of what’s in their cart
- Using retargeting for cart abandoners
- Utilize exit-intent pop-up
Reducing customer churn
Churn is a real headache for many companies as it shows how good (or bad) they are at keeping customers by their side.
If you are an e-commerce director, you may know that attracting new customers costs more than retaining the existing ones. According to research done by Frederick Reichheld of Bain & Company, increasing customer retention rates by just 5% increases profits by 25-95%. Consequently, increasing customer retention is not only cheaper, but more profitable!
You may be thinking of many reasons why the churn occurs, but the most correct way to discover the reason is to ask customers.
Customer churn rates need to be tracked permanently. Hence, we have created a Customer Churn Analysis report template. Check it out, if you want to be always up to date with your e-commerce store’s customer churn and performance!
Actually, engaging with the customers is also a key to reduce customer churn. It is important to remind them about the company, to appear in customer’s infospace. According to the Adobe Business report, the most efficient customer engagement channels for B2B companies to reach out to their existing customer base is through email marketing (79%).
As the ways to reduce customer churn I can highlight:
- Testing a range of discount offers to customers
- Offering the ability for the customers to pause their subscriptions
- Preemptively engaging at-risk customers with discount pricing
- Offering genuinely special offers to at-risk customers
- Proactively emailing or calling at-risk customers
Seasonality brings fluctuations in demand that can be a huge challenge for ecommerce directors. For many retailers, the period leading up to Black Friday, Christmas and New Year is their busiest, for example. For others, it’s the summer.
The busyness of certain periods of the year means that heads of ecommerce must be fully prepared for what’s to come. This means:
- Creating a data-driven strategy well ahead of time
- Backing up everything
- Optimizing products
- Checking site speed and performance
- Optimizing pricing and discounts
- Targeted marketing campaigns
Identifying hidden anomalies
With so much data flowing through their online store, it can be difficult for ecommerce directors to see the hidden anomalies that threaten business success. Unless they’re (extremely regularly) taking a granular look at all their KPIs, anomalous data can fall through the cracks.
These anomalies can vary in their impact, but not knowing about them can be devastating. And no online retailer is big enough to be safe from anomalies either. Not even Amazon, who in 2019 accidentally priced down a mop by 90% in their ‘deal of the day’, then disappointed buyers by abruptly canceling their orders. No matter how great your ecommerce strategy is, and how well prepared you are, if you don’t know exactly what’s going on in your data, you always run the risk of errors toppling everything you’ve built. This is why BI tools that can identify unusual metrics can make-or-break an online retailer.
Hiring data talent
Obviously, any head of ecommerce wanting to improve the data culture of a company is eventually going to want to hire data talent to help the efforts. However, hiring data and analytics talent is increasingly difficult as demand skyrockets. And, without the appropriate talent to drive data initiatives, corporate analytics is seriously limited.
There are a few ways that ecommerce directors can tackle this problem, including improving their hiring practices. But the easiest and cheapest way is to invest in effective BI tools that help them tackle some of the problems a data science team is commonly tasked with.
Using our marketing report templates for ecommerce, you can fully replace data talents and get an extended overview of your e-commerce performance in just 5 minutes!
Ecommerce directors, share your biggest challenges and fears in the comments section! I will be excited to hear about it from you!