Ecommerce Evolved

1. Evolve Beyond the Storefront: Embrace Funnel-Based Ecommerce

You should never spend any customer acquisition marketing efforts or dollars on sending visitors to your online store.

Funnel-Based Approach. Traditional ecommerce focuses on the storefront, but evolved ecommerce leverages sales funnels to guide customers through a structured buying process. This approach significantly increases conversion rates and average order values compared to simply directing traffic to a product catalog.

Stand-Alone vs. Upsell Funnels. There are two primary types of ecommerce funnels: stand-alone funnels, which bypass the storefront entirely and are used for external marketing, and upsell funnel paths, which are integrated into the existing store and activated after a purchase. Both types are essential for maximizing sales.

Buyer's High. Sales funnels capitalize on the "buyer's high," the dopamine rush customers experience after making a purchase. By offering order bumps, upsells, and downsells during this period of heightened receptivity, businesses can significantly increase their revenue per customer.

2. Recurring Income Core: The Foundation for Predictable Growth

Recurring income should be the focal point of your entire business.

Predictable Revenue. Recurring income provides a stable and predictable revenue stream, reducing the volatility often associated with ecommerce businesses. This stability allows for better financial planning and investment in growth initiatives.

Types of Recurring Income Cores (RICs). There are several types of RICs, including consumable subscriptions, subscription boxes, digital memberships, newsletters, buyer's clubs, and associations. Businesses should choose the RIC type that best aligns with their products and target market.

Retention is Key. Once customers are enrolled in a RIC, retention management becomes crucial. Strategies such as providing exceptional value, tracking churn rate, and addressing drop-off points can significantly increase customer lifetime value.

3. Profit-Driven Product Selection: Margin Matters Most

If you can’t get 150 percent markup on your product, consider choosing a more lucrative product.

The 3X Rule. A key principle in product pricing is the "3X Rule," which states that products should be marked up at least three times their production cost. This ensures sufficient profit margins to cover operating expenses and advertising costs.

Private Label vs. OEM. Businesses can sell their own branded products through private labeling (rebranding existing products) or original equipment manufacturing (OEM), which involves creating entirely new products. Private labeling is a good starting point, while OEM offers greater differentiation.

Product Selection Criteria. When selecting products, consider factors such as niche specificity, durability, quality, demand, retail price, margins, weight, and uniqueness. These criteria help ensure that products are profitable and appealing to the target market.

4. Conversion, Sales, and Profit: Maximize Every Opportunity

A basic ecommerce sales funnel boosts average order value by 20 percent.

Conversion Tricks. Conversion tricks, such as retargeting, product reviews, landing pages, and unique mobile checkouts, can significantly increase the percentage of website visitors who become paying customers. These tactics address common barriers to purchase and create a more compelling shopping experience.

Sales Boosts. Sales boosts, including loss leaders, tripwires, flash sales, and phone support, incentivize customers to buy both now and in the future. These tactics create a sense of urgency and value, driving sales volume and customer acquisition.

Profit Maximizers. Profit maximizers, such as free shipping, shipping and handling as a profit center, and ride-alongs, increase overall profits without requiring significant additional investment. These strategies optimize existing processes and create new revenue streams.

5. Know Thy Customer: Deep Dive into Demographics and Behavior

The reality is, your business is not unique.

Demographic Data. Understanding customer demographics, such as age, location, gender, income, and education, is essential for targeted marketing. This data helps businesses identify their ideal customer and tailor their messaging accordingly.

Social and Behavioral Data. Social and behavioral data, such as leisure activities, sites frequented, niche influencers, and content consumption preferences, provides deeper insights into customer motivations and interests. This information informs product development and marketing strategies.

Customer Avatar. The culmination of customer research is the creation of a customer avatar, a detailed persona representing the ideal buyer. This avatar serves as a guide for all business decisions, ensuring that products and marketing efforts resonate with the target audience.

6. Conquer the Competition: Research, Reverse Engineer, and Innovate

The more places they find your product, the more money you'll make.

Identify Key Competitors. The first step in competitive analysis is to identify the top five to ten competitors in the target market. This can be done through Google searches, SEMrush, and Alexa.

Document Competitor Operations. Once competitors are identified, businesses should document their branding, value proposition, pricing, product presentation, shipping policies, call to action, promotions, mobile optimization, and social media presence. This provides a comprehensive overview of their strategies.

Reverse Engineer and Innovate. The final step is to reverse engineer the competition by becoming a customer and experiencing their sales process firsthand. This allows businesses to identify areas for improvement and develop innovative strategies to differentiate themselves.

7. Data-Driven Decisions: Unlock Hidden Profits in Your Business

It costs money to make money.

Internal Data Analysis. Businesses should analyze their internal data, including sales data, basket analysis, sales forecasting, inventory forecasting, channel analysis, and customer analysis, to identify patterns and trends. This information informs strategic decisions and optimizes business operations.

Low-Hanging Fruit. By profiling their buyer's list, creating custom audiences on Facebook, and leveraging honeypot traffic, businesses can quickly capitalize on easy-to-reach opportunities for increased revenue. These tactics require minimal effort and deliver immediate results.

Data-Driven Promotions. Use data to create specific promotions for specific customer segments or times of the year. This ensures that marketing efforts are targeted and relevant, maximizing their effectiveness.

8. Advertising Channels: Own, Control, and Influence Your Traffic

The One Who Can Spend the Most to Acquire a Customer Wins.

Traffic Types. There are three main types of traffic: traffic you own (email lists), traffic you control (paid advertising), and traffic you don't control (organic search). Businesses should strive to own as much traffic as possible, as it is the most valuable and cost-effective.

Paid Advertising. Paid advertising is the most important marketing channel because it provides on-demand access to a targeted audience. Facebook Ads is a good starting point due to its low entry barrier and precise targeting capabilities.

Avoid Channel Dependence. Businesses should avoid becoming overly reliant on a single marketing channel, as channels can change or dry up. Diversification is key to long-term success.

9. Front-End Focus: Acquisition, Indoctrination, and Value Delivery

If you’re not willing to spend money in your business, go get a job.

Front-End Goals. The primary goals of front-end marketing are to convert traffic into prospects, convert traffic into customers, and convert prospects into customers. Profit is not the primary focus at this stage.

Active Advertising. Active advertising involves buying traffic to generate visitors for landing pages, funnels, and squeeze pages. This requires a significant investment of time, effort, and capital.

Content is Queen. In today's marketing landscape, content is as important as the offer. Businesses should create engaging and valuable content that attracts their target audience and establishes them as experts in their field.

10. Back-End Brilliance: Customer Lifecycle and Retention Strategies

The more places they find your product, the more money you'll make.

Customer Lifecycle. Understanding the customer lifecycle, from new customer to loyal advocate, is essential for effective back-end marketing. This involves segmenting customers based on their behavior and tailoring marketing messages accordingly.

Back-End Active Advertising. Back-end active advertising focuses on repeat purchases and customer reactivation. This involves using targeted offers and promotions to encourage existing customers to buy again.

Email Marketing on the Back End. Email marketing is a powerful tool for nurturing customer relationships and driving repeat sales. This involves creating targeted email campaigns for new customers, VIP customers, and win-back campaigns for inactive customers.

Last updated: April 24, 2025