What is e-commerce branding and why is it important?
If you want to be in e-commerce for the long-haul and build something meaningful rather than a fly-by-night drop shipping business reselling cheap Chinese trinkets, you must build a brand.
Building a strong brand pays off, this is because shoppers freely admit they will pay more for a branded product even though they know it is physically identical to an unbranded alternative.
But first, it’s important to define what a brand is, so you know what you’re striving for.
The first thing to understand is that your brand isn’t your product because it can be ripped-off. We’ve all seen Chinese manufacturers bring copycat Kickstarter products to market before a project has even finished raising funds.
Products can be copied. Brands, on the other hand, can’t. That’s because they exist independently of the product or service you offer.
Jeremy Bullmore of branding agency, J. Walter Thompson once said, “A brand is not a process, a product or people. It can live on after processes and products have changed – and people have died.”
This means that a brand’s qualities are purely in its customers’ minds. It has nothing to do with the people, products or processes behind the company. These things can all change like Bullmore said, people move on or die, internal processes change and products evolve.
What’s more, your brand isn’t just your logo or color scheme. Too many entrepreneurs starting up e-commerce stores get caught up on their logo design but don’t think about the things their logo represents that will eventually become their brand.
Sure, your logo symbolizes your brand but it’s how people feel about your business that becomes your brand.
Your brand also isn’t relentlessly repeating a vacuous tagline around in the hope that it will do all the heavy lifting of building a brand for you. Your brand is built by consistently doing what you’re best at.
Why strong brands dominate e-commerce branding
Professor Andrew Ehrenberg, who along with his team did more research into branding than anyone before or since, found that the key difference between a strong brand and a weak one, was that strong brands simply have more customers.
So if nothing else, the main incentive for your Shopify store to become a market leading e-commerce brand is to gain an advantage over your competitors.
And once you take the lead, your competitors will forever be playing catch-up because you have the following advantages:
- You make more profit by selling more products at the same price. Or by selling the same amount at a higher price with a greater margin.
- Higher customer lifetime value. Your customers are worth significantly more to you because they stay with you longer, buying more in the process.
- You can afford to pay more to acquire or keep a customer.
- You benefit from economies of scale because you’re shifting more volume. This means you can squeeze your supplier costs and achieve a greater profit margin so you can undercut your competitors.
- People have more trust in strong brands. They’re more forgiving of your mistakes because they believe you’ll put things right.
So getting and keeping customers is the one thing you should be thinking about night and day to build a solid brand.
You must build a brand, but not through brand advertising
If your brand becomes synonymous with a particular category (e.g. Amazon for everyday household goods, Sephora for beauty, Etsy for handmade items) you gain a tremendous advantage over your competitors.
But how you go about building a brand has changed dramatically in the last 15-years. e-commerce branding is no longer about spending as much as you possibly can on low-response ads that mention your name anywhere and everywhere.
Brand strength today is built order by order using direct-response advertising that can be quantified and measured to the penny using sophisticated click-tracking technology. Leveraging ad platforms like Facebook, for example, can bring you new customers for under $10 a pop.
If you know how to make your offering work, each of those new customers you snag will bring in more than $10 (say, $30 or more) of profit over their lifetimes.
This allows you to reinvest that $30 in more online marketing to get yet more customers. Rinse, lather, repeat. And there you have it, a growth (and profit) generation machine.
And once you get to the stage that you’re spending millions of dollars on direct-response advertising, you can think about more traditional brand advertising. But definitely not before.
Once you can afford it, your brand marketing will help give an extra nudge to customers you have touched before with your direct-response advertising off the fence.
Here’s the thing that many marketers miss, if done right, your brand marketing will become just another form of direct-response advertising.
For example, Zappos.com, the online shoe retailer scooped up by Amazon in 2009, didn’t run its first television ad until 2008, even though it was founded in 1999.
Think about it, if you track and measure your marketing results on a multi-attribution basis, any brand marketing you run becomes yet another form of direct-response advertising.
If you are not seeing enough of an uplift in your word of mouth or direct “type in” traffic (where people type your brand name straight into Google) to justify the cost, then you should rethink your brand advertising strategy.
Here’s another quick tip: Test lots of different marketing channels like comparison-shopping sites that you’ve never worked with, affiliate networks or even new advertising techniques like using Instagram influencers.
Measure your results on a multi-attribution basis and invest in the ones that work best. You might be surprised where the highest return-on-investment comes from.
And remember, you absolutely must pay close attention to your ROI and tweak as necessary.
But there is something else, it’s important to point out that penny-at-a-time advertising doesn’t guarantee you will actually succeed in building a viable brand. There are some other ingredients you’ll need to bake your brand…
A Strong Value Proposition for Your e-commerce Branding
Your brand is derived from your value proposition. This is essentially, how you do what you do that offers value to your customers and why you’re different.
If you don’t know where to begin with building a strong value proposition, a good place to start in e-commerce is being cheap, fast and free.
What I mean by this is, it’s all too easy for today’s savvy web shoppers to quickly find out the true market value of an item. So being cheap is a must if you’re in the commodity product business.
Fast delivery is also essential, if you can’t deliver an order with a working week, your conversion rate will suffer, big time.
If you can’t offer free shipping either (with or without a qualifying threshold), you’ll also be turning customers away in droves.
On top of that, if you can differentiate your Shopify store from everyone else’s in a meaningful way, then you’re onto a winner. A good way to do this is by having a user-friendly guarantee and returns policy.
Heroic Customer Service
Paying Facebook and Google to drive new visitors to your store is only the first step. To build a brand and a sustainable, profitable business, you want those customers to come back to you again and again.
To get customers coming back in droves, you need to knock their socks off with extraordinary customer experience. This mindset is a value that needs to permeate everything you do in your company.
As Amazon CEO, Jeff Bezos said, “Start with the customer and work backward.”
On top of offering low-cost products and getting them out the door quickly, you need to bend over backward to deliver friendly customer service end to end.
You need to see your customer service reps as a salesforce, not a necessary evil who are solely there to deal with difficult customers. Train them to treat your customers like they’re working at the Four Seasons hotel chain. Never rush customers off the phone or be clipped in your email replies.
It’s a good idea to empower your reps to please customers first and save costs later. At Zappos, for example, a rep once handled an eight-hour, customer-service phone call, whilst another arranged delivery of some fresh flowers to show sympathy to a recently bereaved customer who wanted to return her deceased husband’s shoes.
Even though the Zappos examples are extreme, they’re the inspirational stories that help define a nurturing culture and fuel powerful word-of-mouth referrals. You can’t deny that is an example of e-commerce branding that could pay dividends.
As you grow, this mindset and culture need to be instilled throughout your entire company; You and your senior management team should spend some time taking customer-service calls to connect with your customers and understand their frustrations and desires.
And another thing, impromptu surprises for your customers, such as unsolicited coupons, refunds or credits, gifts, or even just patience, apologies and empathy go a long long way.
Think about it, most other industries today like banking, utilities, and insurance give such an infuriatingly rubbish telephone or email-based customer experience that it makes it surprisingly easy for you to give your customers a heroic experience and show you genuinely care.
What’s more, little surprises can easily be baked into your core offering. Again, Zappos has a 365-day return policy with free return shipping. Their customers gleefully take full advantage by returning almost 40% of the things they purchase on the site but are fiercely loyal because of it.
It’s a good idea to carefully monitor your customer-service metrics such as average wait time (email and phone); abandon rate; average call length; and the number of calls/emails needed to resolve an issue.
There is a significant increase in call abandon rates after 90-seconds of wait time. If you can answer 90% of your inbound calls in 120-seconds from when the customer first dials your number, you’re well on your way to becoming a cut above the rest for your customer-service.
But there is something else here, whilst you should always strive to absolutely delight your customers, don’t be shy of firing the perpetually annoying ones who waste your time and lose you money.
Whenever a customer calls to moan about a product or claims they never received it, check to see if they’re a first-time caller. If they are, cut them some slack and do whatever it takes to make things right (a full refund, express shipping, etc.).
On the other hand, if this isn’t the first time, don’t be afraid to give them some tough love. If you have proper tracking in place, look to see which marketing channels or products drive these sub-optimal customers, then tweak things to reduce them or at least make them more profitable.
So, borrow the notion of customer obsession from behemoths like Amazon and Zappos who are built for the masses.
But you can also learn from the likes of outdoor pursuits store, REI.com, for instance, which is built for a niche segment of the market. They have been successful by delivering an extraordinary customer experience tailored for their particular audience too.
Leverage your best customers for your e-commerce branding
The rise of Facebook, Twitter, and other social media platforms as well as niche blogs, mean your customers now have very public loudhailer to broadcast their feelings about you, good or bad.
Because this cuts both ways into e-commerce branding, your disgruntled customers have a very vocal way to complain. But social media (and review platforms) also mean that your biggest fans can be heard more, too.
It’s your job to take full advantage by identifying your best customers. They are your most profitable customers, who come back to your store over and over again.
You must do everything it takes to keep them happy. You might even try dubbing your most loyal customers “VIP’s” like Sephora.com does.
This may seem arbitrary, but people are naturally proud of being loyal customers of products and services they value. So, make these customers realize you value them as evangelists or VIP’s.
Invite them to VIP-only events or sales, and send them special emails to get their feedback. This also serves to encourage their customer loyalty.
But you can do more. Think about Amazon Prime where consumers pay an annual fee to participate. But once customers sign up, they get free shipping on all their orders, not just those over a certain amount.
This program is incredibly effective at turning repeat customers into truly loyal customers. The logic is that once you’re a paying member, you’ll always consider Amazon first when you want to buy a new book, a Bluetooth speaker or a backpack.
It works because you’ve got to get your money’s worth since you paid an initiation fee to get into Amazon Prime. Amazon’s goal with this program is for its site to become a daily habit for its customers. It clearly works because Prime customers spend about $1,200 per year on average, compared to about $500 per year for non-members, according to CIRP.
Yet another gambit is to create a loyalty-points system, as we discussed in detail in this article.
Give your e-commerce branding personality
Playing it safe and “trying to be all things to all men” rarely works. It often makes you just plain vanilla and frankly, boring. If you run a niche store, giving your e-commerce branding a distinctive personality will help set you apart and make you memorable.
Brands like Firebox.com, Betabrand.com, JPeterman.com, and Shinesty.com have nailed this. You’d do well to read their product descriptions and About Us pages and emulate a tone that works for your brand.
While there may not be a clear and concise formula for building a great brand, I’m certain about one thing: It’s virtually impossible to build a brand through the “throw enough shit at the wall and see what sticks” approach to e-commerce branding. So don’t try it.
All of your marketing should be measurable and profitable. If you follow the advice in this article and steadily increase your marketing spend in an ROI positive way, you’ll lure more and more consumers to your Shopify store—and eventually, your brand will emerge. If it doesn’t, you’ve almost certainly been ignoring these principals.
The Shoptimized™ Theme, the highest converting Shopify theme will help bring in more customers and allow your brand to emerge.