How to Boost Your Online Store Margins Without Acquiring New Customers

ecommerce store margins

Customer A bought $45 worth of merchandise and you never heard from her again. Customer B bought $15 worth of merchandise and she also left a few items in her shopping cart. Our final person, Customer C visited your site randomly, but hasn’t decided to buy anything yet. Which of these customers should you pursue further? It can cost 7x more to acquire new customers, but for some reason companies spend most of their time on customer acquisition as opposed to retention.

Why is this the case? Wouldn’t you rather spend less to improve your online store margins without having to acquire new customers?

Logic tells us this is certainly the case, but figuring out how to improve your sales without expanding your customer base turns you to a different discussion. You don’t want to boost your margins, you need to boost your sales; and the only way to go about doing this is by taking advantage of those current customers. Keep reading to learn how to boost your online store margins without acquiring new customers.

Package Together Your Related Merchandise

The related items module below your product pages makes perfect sense for recommending other products that might go well with something in the shopping cart. The only problem with this is that your recommendation system lacks control.

You rely on an algorithm to pair your most related content, and then you provide the option for customers to buy these items at full price together.

Now, lets say a relatively loyal customer comes to your site looking to buy a pair of bike shoes for their next big triathlon. They notice a few related items at the bottom of the page such as a helmet, bag, wetsuit and goggles. The customer figures she would rather buy the shoes from you, since she can’t find them anywhere else, and try her luck finding cheaper prices on the other items.

You lost a bigger sale. Why did this happen?

Your items weren’t packaged together for the customer’s benefit. How would the customer respond if she noticed a single product package with shoes, a helmet, a bike, hat and goggles for a discount (Like we see on the TriSports.com website below.)

Ecommerce boost sales

Now you’ve got her thinking. The time your customer could spend looking for cheaper deals is rather valuable, so there’s a good chance she opts to go for your package, increasing your sale and making her happy to complete most of her shopping in one place.

Plugins or Add-ons to Accomplish This

You actually don’t need any plugin to package your products. Simply take pictures with all of the items in one shot and generate a single product in your store.

Advertise Free Shipping (But Put the Clocks Against Customers)

Ecommerce free shipping

Free shipping has an unusual effect on people shopping for items. We all know how annoying it is when purchasing a $5 pen online, then landing on the checkout page only to have that miniscule purchase shoot up to $12 just because of shipping.

It stinks, and all of your customers know it. This presents a wonderful opportunity for you and your online store. What if you advertised that your store offers free shipping on select sales? Already doing that? What about making the offer more specific and alarming?

To start, a free shipping banner is useless unless customers see it, so include the banner on every page of your site, in a clear spot like in the header. Explain to them that a price threshold is in place for free shipping.

If Billy has $45 worth of merchandise in his shopping cart and notices that you offer free shipping at $50, guess who’s going digging for something else to buy? Billy!

The idea is simple. Give your customers a taste of something free and they are more willing to buy another item (improving sales and hopefully margins) just to get rid of that shipping fee. You can see (in the screenshot above) how Kutoa Health Company clearly displays free shipping benchmarks in their header.

Want to cook things up even more? Add a timer (or clock) to the free shipping module to give customers the push they need. When Sharon fills her cart with $25 worth of merchandise she might notice the free shipping sign and say that she’ll continue shopping tomorrow. Who knows if she will actually come back? Grab the sale now by showing Sharon the clear incentive for buying in the next hour or so.

Plugins or Add-ons to Accomplish This

Tag On Creative Upsells Throughout Every Step of the Sales Process

Ecommerce upsells strategy

Yes, the related products discussion has been beaten to death, and that’s why I don’t want to simply talk about offering related products to people throughout your sales process. Sure, if you don’t offer related items then you should implement the functionality immediately, but I want to explore some more unique opportunities.

This discussion works into your overall strategy a bit, but it’s always nice to be on the lookout for new ways to make money. Let’s say Yolanda comes to your handcrafted iPad case store and is ready to check out. She has four cases in the shopping cart. How can you upsell her without just shoving more product down her throat? Here are a few thoughts:

  • Offer to gift wrap her items for a small fee (Our screenshot above shows how Bloomingdale’s charges for a couple versions of gift wrap.)
  • Recommend some reading for her on your blog and implement an affiliate program in your articles
  • See if she would recommend some of her friends for a small gift card
  • Simply ask if she wants to throw a few gift cards into her shopping cart
  • Ask if she wants her cases customized (custom engravings, logos, colors, etc.)

Plugins or Add-ons to Accomplish This

No plugins or add-ons are available for this, but you can learn how to offer gift wrapping with this Shopify documentation.

Learn How to Segment Your Rewards Programs

The rewards program is a wonderful way to identify your most loyal customers and bring them back for more. That said, many companies don’t take advantage of the power that rewards programs offer. In general, your rewards programs give you loads of information on the customers, from email addresses to where the people live.

Take time to segment your rewards members in different levels. That’s right, some of your members are better customers than others. Figure out which ones purchase the most and start targeting them more with even better deals. Analyze what types of products they enjoy and send them some freebies or simply separate them into a completely new email list to target them with unique emails.

Try-Shopify

Ecommerce offers strategy

Plugins or Add-ons to Accomplish This

If you’re running the Shopify system I recommend checking out the S Loyalty: Loyalty Suite add-on since it allows you to create advanced rewards types and check back in with which of your customers are the best of the best.

The WooCommerce Beans plugin is one of the ideal options for WordPress.

How Are Your Receipts and Marketing Emails Working for You?

Ecommerce news letter strategy

If you haven’t already stumbled upon it, check out the Receiptful plugin. The tool reeks of customer retention, because each and every receipt you send out has an offer or upsell on it. Marketing emails are a must, of course, and I would recommend you implement an email marketing campaign, but your receipts go out automatically.

You hear that? Automatically. You set them up once and never look at them again. These messages are going out to your current customers, and they entice folks with coupons for more chocolates, bikes, bathing suits or whatever it is you sell online.

Is your online store the best it can be? If not, drop us a line in the comments section to explain how you think you can use the advice we talked about above to satisfy your current customers, and in turn, watch more money move into your pockets.

Image sources: peddhapati, beta-j

Feature image curtsey of Dmitry Zelinsky

 

Catalin Zorzini

I'm a web design blogger and started this project after spending a few weeks struggling to find out which is the best ecommerce platform for myself. Check out my current top 10 ecommerce site builders.