It seems like everyone is talking about e-commerce and for good reason. According to Forrester Research, a global research and advisory firm, more than 60 million websites were planned for creation in 2013. Forrester also predicts that the U.S. e-commerce growth across all industries will see volume sales rise to $262 billion this year; a 13% increase from the previous year.
“The growth of e-commerce — which already accounts for about 8% of total retail sales in the U.S. — is expected to outpace sales growth at bricks-and-mortar stores over the next five years, reaching $370 billion in sales by 2017. By that time, e-commerce is expected to account for a full tenth of all retail sales in the U.S,” states Forrester.
Unfortunately, e-commerce is similar to traditional business in one regard: most e-commerce initiatives will underperform or fail in their first year.
Pricing is fierce in today’s increasingly competitive environment. Declining labor costs have driven prices so low that we’ve created a “free, perfect, now” mentality with the consumer.
On the business side, the emphasis on ROI has created a fixation with short-term results — at the expense of building the brand infrastructure necessary for greater and more significant long-term revenue growth.
In other words, e-commerce is one of the most competitive areas of business today. Despite this fact, many are tempted to invest primarily in the technology without first taking the critical step of developing the brand strategy.
Branding: The first step in creating a successful online business
Why make a significant investment in branding upfront when cutting corners on branding will enable you to use those dollars for online marketing instead?
Why not get the website up and running and invest in branding when you can afford it, a little at a time?
Website technology is expensive, and it is tempting to put off the investment in brand strategy; but I believe that the brand strategy is the first step in a winning e-commerce program. Below are 17 reasons why your e-commerce strategy should start with a killer brand strategy:
1. Business Valuation
If you ever plan to sell your online business or go public, your brand will be a key asset. According to The New York Times, the Apple brand was recently valued at more than $98 billion, which is an impressive 57% of annual sales.
2. Global Potential
We’ve seen clients increase their sales exponentially by going global. But it takes a smart brand strategy to capitalize on your global potential.
3. Customer Lifetime Value (CLV)
If you want your customers back, you have to be positioned in their minds; the right brand strategy will do just that. According to Adobe, only 8% of visitors are repeat customers, but they make up 40 % of the revenue.
4. Strategic Planning
Do you know where you want to be in 5 years? The right brand strategy can actually drive your strategic planning.
5. Financial Planning
Your brand strategy should drive your marketing plan for the next 5 years and enlighten your technology investment as well.
6. Organizational Readiness
Getting your e-commerce team on the same page is no easy trick. A robust brand strategy will provide the consensus you need to move the ball forward in all areas of your company.
7. Talk Value
According to the Customer Insights Group, 78% of consumers say they talk about their favorite brands. That means if your customers believe in you, they will do a lot of advertising for you via social media and word of mouth.
Breakthrough brand strategies are built on compelling insights based on primary and secondary consumer and market research. These insights can be the difference between success and utter failure.
9. Lifetime Value
According to Clickfox, 50% of purchasers say their relationship with a brand starts with the first purchase. The long-term potential of that relationship can only pay off if you’re building it on a solid brand foundation.
10. Bigger Purchases
According to the 2012 Brand Loyalty Study, 68% of consumers say they are more likely to buy more from a brand they love.
There are a million options out there and your competitor is only a click away. Be the one customers remember.
Tie your optimization to an authentic brand strategy to make the right first impression.
Your brand is the vehicle for continuity in a fully realized chain of experience that connects emotionally.
14. Increased Profit
Apple, the most valued brand in the world, had only 8% of the cell phone market in 2009, but 32% of the profits. The stronger your brand, the stronger your margin and influence over the marketplace.
A strong brand strategy will light the way to the right technology and architecture for your e-commerce site.
The brand strategy should be the cornerstone of the online user experience.
17. Other Online and Offline Impact
Your e-commerce site will be used to research purchases in other channels. Whether they end up purchasing at their favorite neighborhood retailer or Amazon, the brand will be what they remember as they shop.
Download our 17 Reasons infographic below for a quick checklist of why your e-commerce initiative should start with a killer brand strategy.
With 60 million new websites every year, you need to bring your A-game. Set the pace for your category and maximize business value long-term by building your e-commerce site on a solid and inspired brand strategy. Give me a call and let’s talk.