December 16, 2020

Scaling Ecommerce Growth: Partners vs. Agencies

By John LeBaron / Brand Growth

We’re about to say something you might find surprising: working with an agency is not the most effective way to grow your ecommerce business. Sure, agencies offer the expertise and the perspective you need to excel, but gone are the days when an agent could give a brand all the resources they need to thrive.

Brands today deal with far more complexities than agencies are equipped to solve, and to win big, brand leaders need a different relationship with the body helping them manage their brand. If you’re looking to scale your growth quickly and at less cost with the expertise you need to win in every corner, you should consider working with a partner instead of an agency.

An agency vs. a partner

When we talk about a “partner,” we mean someone who prioritizes your brand’s success, has a real relationship with you, and brings a full deck of experience to the table to help you thrive in every element of your business. Agencies can partially get you there, but there are some key differences that make a partnership with a company like Pattern a better option for growth.

Partners give you a wider breadth of expertise

Agencies rely on a fairly antiquated, specialized model for success. The upside to that is you get an expert with a honed focus helping you win on platforms like Amazon. The downside is that, while an agency might have expertise on one element of your ecommerce business, let’s say marketing, they may not be great at things like SEO, content syndication, or listing optimization. They might be well-versed in one platform, but not have the depth of experience to help your brand win on another. In a market where omnichannel is king, that can create some serious blindspots.

Double Your Resources With the Benefits of an Ecommerce Partner Over an Ecommerce Agency | Pattern

What tends to happen when a brand works with an agency is they don’t just stick to one agency. They have to make contracts with other agencies to help them cover the bases of their ecommerce business left uncovered. This creates a spendy smorgasbord of a team that can be difficult for brands to manage.

A partnership with Pattern gives you centralized expertise for every channel of your business at significantly less cost to you. This includes expertise on advertising, domestic sales, international sales, SEO, customer experience, design, different marketplaces, and more. Instead of jugging five or six accounts you only have to worry about one. You’re working with fewer personnel, but even more expertise.

Partners have aligned financial incentives

Working with an agency can often undermine the very thing you’re trying to achieve because of how agencies are incentivized. Let’s say you want to grow your brand at a lower cost. While you’re incentivized to keep ad spend low, an agency might be incentivized to spend more because they get a commission of the funds that your brand is spending in a given marketplace. They might be bonused based on something like Advertising Cost of Sales (ACoS) and therefore bid on branded keywords that cost less but only give you vanity metrics instead of driving incremental sales.

Pattern Partner Key Outcomes in Their First Year Revenue Growth

In a partnership with Pattern, your incentives are our incentives. Our brand managers are compensated for helping you hit your revenue and growth targets, not based on how much you spend. Brands working with Pattern ultimately spend less than they did on their own or with an agency because we offer more bang for their buck and put them first. We, in fact, cut you a check upfront, not the other way around.

Partners offer more flexibility

Most agencies expect their clients to commit to a contract of several months or several years. That can be draining financially and it can be difficult if your relationship with an agency sours over time.

The average contract with Pattern only requires you to commit to sixty days out, and we give you the best value for your dollar so that when the time comes, you feel incentivized to stay. 97% of our new clients do.

How Pattern helps brands grow their revenue

Unlike working with an agency, working with Pattern as your partner means you’re armed with every tool you need to tackle every problem you have across your ecommerce channels. We’ve got the tech and the data to back you up.

Pattern helps brands rapidly increase their growth at a significantly lower cost through an ecommerce equation focused strategy: Revenue = Traffic x Conversion x Price

Ecommerce Equation to Grow Revenue | Pattern

Once brands are able to increase their traffic and conversion and get control of price, they’re primed to watch their long-term profits and ultimately their revenue grow. Here’s how a partnership with Pattern can do that.

Increased traffic

Getting more traffic to your listing is an important way to grow your brand, whether it be paid traffic, organic traffic, referral traffic, or others. Pattern helps you expand your traffic tributary both on an organic front by optimizing things like your digital shelf and analyzing your product destiny as well as a paid front by using technology to accelerate your dominance and authority along a vector of keywords. SEO is our first language.

Another way we increase your brand’s traffic is by helping you show up on new marketplaces. If you’re on Amazon today, but you’re not on Walmart, you can safely assume you’d get a 10% lift in traffic just by showing up on Walmart (one of our brands saw a 771% increase in YoY sales). The same goes for international platforms, like Amazon.UK, Tmall, and JD.com. Having a presence on a wide variety of markets is a significant way to increase traffic to your listings. While a single agency may be ill-equipped to take your business global and won’t have access to all of the resources you need to succeed on these platforms, Pattern does.

Pattern has a network of highly trained experts with boots on the ground in every major market in the world. We help you sell your product to international audiences and get your product on international platforms so your brand can grow on a global scale as well as a domestic one.

Increased conversion

Traffic has to convert to sales for your business to grow, and in order to effectively increase your conversion, you need to have access to the data on what works and what doesn’t. If you’re in a 1P relationship with Amazon, you can’t get that data. Amazon doesn’t share it with their 1P brands. As a third-party seller, Pattern does.

We give brand leaders the data to inform their branding decisions by performing A/B testing to determine what works best and what doesn’t. We look at everything from your product photography and page content to what customers are saying they like or dislike about your product in reviews. We work to optimize your titles, your descriptions, and image stacks so they’re slick and informative to customers. The quicker your product listings answer the questions a customer has when they go searching for your product, the higher your add-to-cart rate will be.

Another way we tackle the conversion vector of your ecommerce business is through promotions, coupons, or virtual bundles that entice shoppers to buy.

Most brands may have a conversion rate of 3 to 10% on a given listing. At Pattern, we have listings that convert to 40%. Just by increasing this one lever of your ecommerce business, you can 4x your revenue.

Price control

You really can’t optimize for traffic and conversion in a meaningful way until your authorized seller has some control over the Buy Box, and that requires control over your pricing and distribution online. Without control, your margins and your profits across ecommerce and brick-and-mortar channels get sliced.

Let’s say the MAP price on your product is $50. Without control, it might show up in the Buy Box for $25. That’s 50% margin lost on every single sale, and left unchecked, the seller creating this erosion can make it bad enough that your distributors are coming to you and demanding you lower the cost of your product so they can afford to sell it.

Pattern helps you restore your margins and protect them so your profitability is protected, too. We help you see where erosion is happening, kick out bad players, and give you the teeth to enforce your policies so it doesn’t happen again.

Revenue

Once your business is optimized for traffic, conversion, and price, you’re prepared to see your revenue and your margins grow. Most brands that work with Pattern are more profitable from day one, and Pattern works to ensure that growth is sustained overtime by using premiere technology to help your brand improve its customer experience and maintain a dominant presence on ecommerce marketplaces. An agency might get you to the curb. We get you through the door with quickly and effectively scaled growth.

To learn more about how a partnership with Pattern can help you grow your ecommerce business profitably, contact us below.

More Resources
Digital Shelf, SEO, & Advertising—How to Optimize Your Amazon Strategy for 2021
The Great Debate: Is Revenue More Important Than Profit?