Get up to date with this week's ecommerce headlines from around the globe.
Amazon’s record Prime Day results
Taking place from Tuesday 12th to Wednesday 13th, Amazon’s annual Prime Day this year drove the 2022 record for online sales. This year’s Prime Day marks the biggest ever Prime Day event in the company’s history, with over 300 million items purchased globally. The first 24 hours of the event made Tuesday the busiest day for total U.S online spending, which jumped 7.8% from one year ago. The average Amazon Prime customer ordered $54 during the first 36 hours of Prime Day with top-selling items being Fire TV Sticks, Echo Dots, and gift cards.
Amazon to create over 4,000 jobs in the UK this year
Amazon has announced that it will be creating more than 4,000 jobs across the country this year, split across technology, warehouse and office roles. This recruitment push will take its UK workforce to 75,000 people, having created 40,000 new jobs over the past 3 years.
Amazon could be phasing out its private-label business
Amazon is reportedly phasing out its private-label business, including its AmazonBasics range, and are considering blending its private-label selections. Despite recent rapid expansion and offering cheaper alternatives to household names, the company has seen its private-label brand sales falling as those of rivals Walmart and Target soar.
Amazon launches a Tesco Clubcard Price Match for its Fresh stores
As inflation and cost-of living rises, Amazon appeals to customers as it carries out a Tesco Clubcard Price Match scheme at its Fresh stores in the UK. Prices of everyday groceries “matched and locked” to Tesco Clubcard deals every week but the scheme will only apply online rather than in Amazon Fresh stores.
Shopify’s app downloads slow down as the company struggles to keep up with Amazon
Canadian ecommerce giant, Shopify, has seem app downloads fall. The company is facing challenges such as customer retention and package-tracking capabilities, likely to be hindering their success. Although, the slowdown in app downloads could also be attributed to decreased consumer spending and rising global inflation.
Shein is planning to go public in the US by 2024
Shein is set to launch its first public offering in the US within the next 2 years, but is facing environmental, social and governance concerns that could slow down the plan. The company was recently valued at $100 billion USD despite allegations of dangerous working conditions and fast and prolific production chain, but major investors are not being put-off.
Buy-now-pay-later boosts sales for 75% of UK retailers
As a direct result of offering BNPL payment options to customers, 75% of retailers in the UK have seen improvements in at least 1 area of their business sales and performance metrics. Over 17 million UK consumers have claimed to use BNPL services, which has led to new customer acquisition improving for 59% of retailers.
Ecommerce sales are on route to exceed $1 trillion this year
A recent piece of research has predicted that ecommerce sales will rise to $1 trillion by the end of this year, which is double what it was in 2018. Ecommerce sales soared amid the pandemic, described as “four quarters of hyper-growth”, but shoppers are now more cautious in their spending habits as a recession looms.
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Developing your ecommerce strategy for digital marketplaces like Amazon, Walmart, Tmall, and Alibaba gets complicated fast—there’s a lot to think about, including marketplace SEO, product photography, advertising tactics, disjointed sellers, distribution logistics, managing ratings and reviews, and more. It can be overwhelming for brands, especially those with small teams, to know which behaviors to optimize for for the highest gains in profitability.
The good news? Revenue performance all comes down to data. Pattern was built on a data science approach to ecommerce success. We find the patterns that drive profitability, then apply them to boost our brand partners’ revenue on ecommerce channels.
And a key pattern we follow for all brands on digital marketplaces is the ecommerce equation: revenue = traffic x conversions x price x availability. As brands zero in on these four pieces of the equation, they can simplify and focus their efforts to reach truly profitable ecommerce growth.
The first part of the equation is traffic—you need to get people to see your listings if you want to generate sales. There are two ways to drive traffic to your products: through organic search and paid search. Striking the right balance between both for your brands is crucial to driving enough of the right traffic to your products, ultimately increasing your ecommerce revenue.
Knowing this, Pattern provides the resources and technology needed to drive traffic to your product listings. Our brand management team, advertising specialists, and SEO technicians work in harmony to create a unified strategy to boost your brand’s organic profile and balance that with a paid advertising approach that works for your brand and listings.
Using this method, we took Feetures socks from ranking on longer-tail terms like “no show athletic socks black” to driving traffic on parent keywords like “no show socks.”
Getting customers to your product listing is only half the battle. Once on your listing, you need customers to convert. Conversion is key to the ecommerce equation because it leads to real product purchases and revenue. Traffic without conversion leads to more time and ad spend without the ROI.
Optimizing your images, product description, bulleted details, customer reviews, and buy box performance is key to successful conversion. If you’re going to spend time and effort driving traffic, you should make sure customers can easily and clearly find what they’re looking for when they arrive at your listing.
While your imagery and descriptions are important, you also need to build customer trust to drive conversions. Studies show that your customer service efforts matter too—84% of people trust online reviews as much as friends, making strong reviews an important factor of conversion on marketplaces.
The good news is as you provide a quality product and a great marketplace experience, you’ll build brand equity, increasing your customer loyalty. Then, as your reputation, reviews, and traffic grow positively, marketplace algorithms will recognize your popularity and improve your rank accordingly. Rank drives both traffic and conversions, helping you to optimize your performance further. As your brand equity grows, your conversions will continue to grow with it.
While setting a strategic price is an important step in your ecommerce strategy, it takes more than that to truly control your price on marketplaces.
Without proper control and with wide distribution, your product could end up in the hands of disjointed sellers who lower your marketplace price to sell their inventory and make quick profits. With one seller lowering price online, other authorized sellers and retail partners are forced to lower their price to compete, creating price erosion and sending your brand down the profitability death spiral.
This Death Spiral damages brand equity, hurts conversions, and can lead to Buy Box Suppression on Amazon, hindering traffic as well. And as prices get lower and lower, your profit margin withers away, decreasing your overall revenue.
Using our data-driven insights and Pattern’s eControl partner Vorys, we help brands implement narrow distribution, identify and take-down unauthorized sellers, eliminate price erosion, and control their price online. Focusing on price control, Pattern helped LifeSeasons, a premium supplement company, take back 91% control of the Buy Box on Amazon.
The last piece of the ecommerce equation is availability. It makes sense to think of availability as a contributing factor in conversion, but we felt that it’s important enough to call out on its own—you can fully optimize your traffic, conversion, and price, but without availability, you can’t grow revenue for your brand.
A lack of availability leads to stock outs, losing conversions to competitors, losing possession of the buy box, poor customer reviews, a decrease in traffic…the list goes on. The best-performing brands on ecommerce digital marketplaces optimize their availability with high-end technology, optimize their cash on hand, and inventory time on hand to keep the ecommerce equation powered and optimized in their favor.
Pattern is committed to solving the ecommerce equation. We partner with brands to provide the expertise, resources, and technology needed to drive traffic, create content that converts, protect price, maintain availability, and ultimately accelerate ecommerce revenue and profitable growth.
Interested in improving the results of your ecommerce equation? Schedule a call.