Ecommerce is a not a uniform business model. The strategies and tactics that promote growth differ for each target audience. In this blog, we’ll talk about:

• Different types of ecommerce models

• Growth strategies for ecommerce businesses

• The different ecommerce platforms available

• Financial considerations

• Emerging trends to watch

Let’s jump in. 

Different ecommerce models

B2B ecommerce

The popularity of ecommerce for business buyers is skyrocketing, with the share of revenue from digital channels projected to reach 56% in 2025. The question is, how can companies best exploit this shift from the face-to-face selling that was once the norm?

To  begin with, it’s important to take into account the differences between the typical consumer transaction and the typical business transaction. Consumers may see an item they like on an ecommerce site and buy it in a few minutes. The sales cycles in business can literally take months, with buying decisions involving multiple stake holders and several layers of approval.  Order values are typically much higher in B2B than they are in the consumer world, and may involve pre-sale negotiations.

Promoting growth means taking these factors into account, and then making the buying process as simple and convenient as possible. Buyers are often under a lot of pressure, and convenience can give your business a significant competitive advantage. 

Here are some tactics that work: 

Self-service portals. When given the option, many buyers prefer a self-service option to buying from a human sales rep. Self-service portals provide this option. They enable customers to browse, place orders (based on pricing agreements if they exist) , and gain access to information that you don’t wish to reveal to a more general audience. 

Personalization. In B2B ecommerce, personalization can be based on an individual or an account. In either case, personalization can be used to display only items that the buyer will be interested in buying, and exclude the rest of the catalog. Personalization by individual can be used to display only items (or quantities) that the individual is authorized to buy.

RFQ workflows. In many cases your customers will want a quote before buying, and there are B2B platforms that can handle this. The front end of the process is similar to a straight sale. The buyer specifies the desired item and quantity, and perhaps some other requirements, such as a specific delivery window. The last step, however, generates an RFQ instead of putting items in a shopping cart. Sometimes the RFQ will need to be circulated internally before a response can be generated, but in many cases the whole process can be automated. Either way, an RFQ-friendly ecommerce site offers a new level of convenience to buyers with a single source of communication instead of multiple back-and-forths via phone or email.

Gated content. One good way to fill the front end of the sales funnel is through gated content. Roughly a third of potential customers are willing to supply contact details in exchange for white papers, market studies and the like which they consider valuable. Assuming you can provide a compelling offer, this is an excellent source of zero-party data to begin the marketing process.

Zero- and first-party data are important for personalized upselling and help encourage re-ordering via deals that are most likely to appeal to specific buyers or accounts. 

B2B ecommerce will likely be the dominant purchasing mode in the not-too-distant future, and you not only need to offer it, you also need to manage the transition within your business. The role of sales people as order-takers will significantly diminish, while their importance of winning new customers and maintaining long-term relationships will increase.

B2C ecommerce

B2C  ecommerce is playing an increasingly important role in retail, accounting for 16.4% of total U.S. retail sales in 2024. Gap, Macy's, and Bass Pro Shops are primarily traditional retailers with extensive physical store networks. They have adapted their business models to include robust online selling channels which act as intermediaries, selling products from various brands (including their own) to consumers.

D2C ecommerce

Before the internet, the only way for a major brand to have a direct-to-customer relationship was with branded brick-and-mortar outlets – a very expensive proposition. Today, D2C ecommerce makes that relationship much less difficult, and less expensive.

D2C is attractive for several reasons. With no intermediaries, D2C companies can obtain higher margins. This in itself is a major benefit, and it’s quantifiable. 

Perhaps more important for long term growth, the D2C approach gives you complete control over the brand presentation. This lets you build a personality customers can relate to. There are all sorts of brands, from clothing to cosmetics to power tools to soft drinks that have managed to spark emotional engagement, and any D2C company has this possibility.

You also have complete control over the customer experience (CX), which is just as important to customers as the products themselves. You also have the ability to collect zero- and first-party data that enables personalization, a key component in building a winning CX. Performance data can also be collected to help identify under-performing touch points that need attention. 

Brand personality, a personalized CX, and high-performance touch points (like fast, accurate search) all contribute to consumer trust and confidence.. Two other tactics that work are encouraging user-generated content, especially reviews, and establishing relationships with influencers. Both of these can help build a sense of community. Put together, the final business result of these efforts is a steady customer base with low churn and growth through higher customer lifetime value (LTV).

Hybrid and marketplace sellers

One option for growth is expanding beyond D2C to a hybrid approach, where you sell through both your owned channels and marketplaces such as Amazon, eBay, Walmart or others. The primary benefit of the hybrid approach is  scale. Access to more potential customers is no a small benefit. For example, 63% of customers begin their product searches on Amazon, so if you’re there, your brand will have a lot more exposure. 

Another benefit offered by some marketplaces is fulfillment services. These can eliminate the headaches of fulfillment logistics. Some marketplaces will handle fulfillment for your D2C channel as well. 

There are drawbacks to selling via a marketplace. These include fees, lower margins and limited access to the data you need to establish deeper relationships with your customers, like email addresses, to cite one example. Also, selling in a marketplace gives you less control over your branding and makes loyalty-building efforts more difficult. On a deeper level, you are at the mercy of the marketplace where you choose to sell. A simple change in an algorithm over which you have no control could cause your sales to plummet. 

One other important issue in the hybrid model is channel conflict. You should definitely consider instituting a minimum advertised pricing (MAP) policy, and monitoring your channels to see that it’s being followed. (Amazon, for one, will not enforce MAPs.) You may choose to sell some items only via your D2C channel, in which case pricing won’t be an issue. 

Core ecommerce growth strategies

Strategies for customer acquisition

Growth begins with awareness. There are numerous options for generating awareness, and all of them have their pros and cons. Here are some of the approaches you can explore and test for ROI.

Search engine optimization (SEO). The argument in  favor of SEO is based on two statistics: 36% of all shoppers begin their purchasing journey with a Google search, and of those, roughly 75% don’t look past the first page. If you want to get noticed by this large audience, you have to do well with organic search. SEO can’t guarantee results, but it can certainly improve your chances.

Public relations. From articles posted on branded media outlets to on-air interviews to product placements to celebrity endorsements, PR agencies can put your brand in front of large audiences. PR efforts don’t typically lead directly to a sale, but they can be extremely important in building brand visibility and credibility.

Social media. A presence on the primary social media platforms has become almost a prerequisite for being in business in the twenty-first century. These platforms all offer an opportunity to present your content. Audience demographics vary, as do the way content is presented, and you need to investigate which make sense for your brand. You should focus on only a limited number , because social media demands considerable work to prevent your content from becoming stale. 

Influencers. There are influencers in every market segment, and their numbers are increasing. Influencer recommendations carry at least some measure of objectivity and credibility vs. advertising, although this may be diminishing. Another trend with influencers is the tendency to make it very easy to buy a mentioned product, with clicks that lead directly to a shopping cart.

Social commerce. All the major social media platforms have buy buttons or the equivalent that can take visitors who see something they like directly to a shopping cart. There are fees associated with these transactions that vary from platform to platform.

Paid media. This can include advertising on the web, as well as the traditional channels (TV, print, etc.). Online, paid media have the important benefit of being highly targeted. 

Email marketing. With the right list and the right message, email marketing can be extremely effective in attracting customers. 

Retargeting campaigns. Shoppers who have visited your site are a special class of customers for one very important reason.  They have already shown interest in your brand. For this reason alone they deserve extra attention. The details of a retargeting campaign can be somewhat complex. For example, shoppers who merely visited your site should get different retargeting messages than those who abandoned their shopping cart. But finding ways to reach them with tailored messages is worth the effort.

The keys to optimizing these programs are focus and measurement. It’s best to zero in on a few programs, give them the resources they need, and then measure results. Most of these options are complex, and trying to engage everywhere at the same time isn’t viable.

Referrals. Beyond direct outreach, another important source of customer acquisition is referrals. You have satisfied customer, and you can often turn them into advocates in ways that go beyond casual word-of-mouth. This strategy is definitely worth pursuing. Referral programs can both reduce cost of acquisition and increase retention rates.

The most basic approach to obtaining referrals is to encourage positive reviews, and make it easy for customers to post them on your site with minimum friction. You can more aggressively drive referrals through dual incentive programs. Here’s an example: You offer your existing customers 10% off their next purchase when they refer a new customer, and that new customer also gets 10% off their initial purchase. These programs have the potential to launch a chain reaction, where the new customers become advocates.

Strategies for conversion rate optimization (CRO)

The customer journey has many touchpoints, and the performance of each one can affect your CRO. When you improve the user experience, you improve your chances of a conversion. Obviously, this is a very complex subject, but here are some options that have proved successful. It’s best to proceed step-by-step plan, with careful testing to see which changes actually boost the CRO. 

Review basic performance. It’s important to make sure that your site works properly. You shouldn’t assume that, as there are frequently coding errors that fall through the cracks. Make sure that all the buttons on each page actually function, and that pages load quickly. Verify that there are no navigation problems. 

Identify trouble spots. Tools like Googles GA4 can show you exactly where you’re losing customers, e.g. on collection pages, on product pages, at the shopping cart or elsewhere. These are the touch points where you need to focus your attention. 

Improve Search.  Since 43% of users on retail websites go directly to the search bar. Intelligent search, such as offered by Algolia, can ensure that customers find the products they’re looking for (assuming you sells those products). Accurate search results can significantly lower bounce rates.

Personalize the CX. There is broad agreement within the ecommerce community that personalization works.  According to McKinsey, personalization strategies can increase revenues 5% to 15%, and marketing ROI by 10% to 30%. There are numerous tools available that can utilize historical and real-time data to personalize the CX, and most do not involve large capital expenditures. You can also use this data to personalize product recommendations to capitalize on upsell and cross sell opportunities 

Modify your layouts. Aesthetics is important in layouts, but functionality is even more important. For example, if you want more people to search from a landing page, make sure the search bar is large enough and easy to find. Simple changes like this can make a difference. Tools like Hotjar and FullStory show you how users click, scroll and move their mouse on individual pages via replays and heat maps. You can use this information to guide design changes.

Optimize for mobile. More and more of your potential customers will be using a mobile device, and it’s extremely important that the CX they encounter is clear and easy to use. In the best case, your CX will be native to the mobile environment, not adapted.

Reinforce trust signals. The most important trust signals come from UGC such as reviews, and you should make them prominent. Other trust signals include secure payment options (e.g. well-known credit cards), and third party logos from professional organization or prominent companies that are customers. 

Create urgency signals. You can use real-time urgency signals, such as limited time offers (sometimes measured in minutes) or notification that only a few more items are in stock.

Test systematically. The best way to test is to use A/B testing, which can either be done on a before-and-after basis or by testing two different approaches on separate segments with statistically identical profiles. 

Strategies for retention and lifetime value

Some of the most important factors that influence customer retention occur after the sale. The mechanics of how an order is delivered make a lasting impression. Did it arrive on time? Was it in good condition? In addition to actual performance, you should use proactive communication to make your company look reliable and professional. It is easy to supply tracking information, along with a thank you message and perhaps a special offer. As with the CX during the pre-purchase phase, personalization strengthens the appeal of your brand. 

Of course in addition to making your customers feel good, you want to make more sales. One tactic that works well with consumables or other repeat purchase items is replenishment flows. These are typically email messages that (gently) remind your customers that it’s probably time to replace items that they previously bought. This process is entirely automated, and it not only encourages repeat sales but also helps maintain brand awareness. 

If your business has a problem with churn, you should seriously consider investing in churn prediction software. These AI-powered tools can detect at-risk customers before you lose them. This lets you take measures to keep them on board, such as special offers. 

Finally, you can offer a formal loyalty program. Typically, such programs involve discounts, which means they are not free – but they are often successful in reducing churn and increasing LTV. Roughly two-thirds of retailers currently offer such programs, a good indicator that they work.

There are quite a few options to choose from when it comes to managing retention. The best way to choose among them is to follow the oft-repeated advice: Listen to your customers. This means proactively soliciting voice-of-customer (VoC) input via surveys such as  Net Promoter Scores (NPS), Customer Effort Scores (CES) and Customer Satisfaction (CSAT). You can also review online chat sessions or even set up focus groups. 

However, listening alone isn’t enough. You should develop a formalized  VoC feedback loop that includes data collection, analysis, action and measurement of results. Performance data from your ecommerce platform can tell you where touch points are under-performing. VoC information can help you understand how to fix them.

Strategies for market and product expansion

One more growth strategy to consider is expansion, either into new markets or with new products. Offering your products internationally, or in another specific region, gives you access to new customers and can certainly benefit the front end of the sales funnel. International marketing does pose significant challenges. You have to deal with language localization, both for product presentation and customer support, and machine translations can’t always be trusted. There are compliance issues with some products. Finally, you need to deal with currency exchange. This is typically not a major problem, but it has to be addressed.

You can also develop new products. Data from intent-based search and product reviews can point your new product teams in the right direction. You can also create “new” products by bundling what you already have.  

Growth via modular tech stacks, AI, and operational leverage

Ecommerce technology is evolving from monolithic platforms, where all functions are interconnected, to modular stacks based on what’s called composable architecture. It’s important to understand the basics of this new approach because it lets you more easily add capabilities you currently lack – capabilities that will drive more conversions and higher AOVs. 

Composable architecture and scalability

The first step in the move towards composable architectures was the development of so-called headless architectures, which separated front-end functions like display from back-end functions. This meant that marketing departments could make changes in some aspects of the CX without having to involve IT. 

The next step was the codification of a broader view of composable architecture known as MACH. This acronym stands for

• Microservices, a coding approach that involves functional building blocks

• API-first, another coding approach that prioritizes easy connectivity using built-in Application Programming Interfaces (APIs) 

• Cloud-native, refers to solutions that are designed and built to take full advantage of cloud computing models

• Headless, a type of architecture that separates back-end and front-end operations

There’s no need to understand all the technical details of MACH, but you should be sure that any new solution you consider is MACH-compliant. This way you’ll avoid integration problems down the line. Examples of MACH-friendly plug-in solutions that support revenue growth include best-in-class solutions like Algolia for search, Klaviyo for email, and Contentful for CMS. , 

Leveraging AI

AI lies behind virtually all of the emerging tools that power ecommerce growth. At the front end of the buyer journey, ecommerce systems equipped with solutions such as Algolia’s AI-driven search engine gives customers more relevant search results faster and with little need for multiple searches. Ranking is adjusted based on customer data, including real-time data,  to further improve relevance. More relevant searches lead to higher conversion rates, and when they’re delivered almost instantly, the CX is improved as well. 

Algolia also utilizes AI to aid merchandizing, for example by automatically building categories and collections to give customers a “window shopping” experience that’s personalized to their intent, or re-ranking results to push the highest-converting results to the top of the page where customers are more likely to convert. 

In addition to front-end improvements in discovery and merchandizing, AI is now playing a role in back-end functions such as inventory forecasting and dynamic pricing. Generative AI can be used to automate the production of ad copy, PDPs, personalized email and other creative tasks. Automating these functions enables your company to scale faster with fewer resources. 

All of these solutions benefit from having as much customer data as possible, and customer data platforms (CDPs) are now available to provide a unified view of the customer in real time, drawing upon sources such as your ecommerce platform, CRM systems, websites, , social media and POS systems. These systems are an ideal source of data for the components of a modular stack, providing a “golden” source of truth.

Fraud prevention

Fraud prevention is another area where AI excels. Because it doesn’t rely on fixed rules, AI-powered fraud prevention systems can identify and adapt to new fraud strategies and defeat them. This is of direct benefit to ecommerce operations, because less fraud means fewer chargebacks, and chargebacks are both time-consuming and expensive. 

Having a secure payment infrastructure with risk detection tools not only ensures efficiency and helps with operational margins. It also contributes to a better CX.

Fulfillment and operational speed

The connection between your fulfillment strategy and growth may not seem obvious, but it’s important. To begin with, high shipping costs and slow delivery times are a major cause of shopping cart abandonment. Speeding deliveries and being transparent about shipping costs can lead to more conversions. Another aspect of logistics that’s important to consumers is an easy return policy. 

You have three options to maximize fulfillment for growth. The first is moving to a third-party logistics (3PL) strategy. This option removes all the complexity and headaches of the fulfillment process. It’s also the option that’s most easily scalable for growth. The second option is to keep fulfillment in-house. This means you have complete control over the process and the CX. A third option is a hybrid approach. 

Overcoming organizational and technological roadblocks

Ecommerce doesn’t operate in a vacuum, and any ecommerce growth strategy needs support from other parts of the organization to be successful. Marketing must be involved for consistency of messaging. Sales will be affected if ecommerce growth diminishes the need for personal selling or order-taking. The data essential for success will likely be in silos owned by multiple groups that never had to cooperate before. All the teams involved in fulfillment logistics will need to scale if a growth initiative is successful. 

In short, ecommerce growth involves change management, and all the business units just mentioned may resist change. You need to be prepared for this, and find ways to build consensus. Also, many of the individuals who end up interfacing with ecommerce in one way or another will need training. 

One way to get all the people involved on the same page is through quantifiable, shared, high-level KPIs that everyone can understand and agree upon. It helps to build agile, cross-functional pods or squads around growth goals. Finally, it’s best to start with pilot programs and phased rollouts that give various teams time to adjust to ecommerce growth. 

Planning, execution, and measurement

Prioritizing growth strategies by ecommerce stage

Two key factors that influence the development of an ecommerce growth strategy are brand (or product) maturity and tech stack readiness (along with internal IT capacity). 

Is your brand new to the market? Accepted by early adopters? Established within your category? Dominant? Each of these stages requires different allocation of resources and different messaging. A new brand requires more marketing resources (advertising, PR, social media outreach, etc.) In the early adopter phase, brand awareness diminishes somewhat in importance, while outreach, e.g. via email, becomes more important. Also, you should focus attention on turning early adopters into brand advocates. Once a brand matures, the focus shifts to incremental growth through CRO tactics, special deals and the like. 

The maturity of your tech stack is another important consideration. If you don’t have a headless platform that separates front-end and back-end functions, you should consider moving to one. Obviously, this is not a trivial decision, but a headless architecture enables the operational scaling that growth will require, both on a day-to-day basis and at peak periods.

With these two areas in mind you can craft a strategy that defines what you want to accomplish and what tools you need to succeed. 

Financial considerations and ROI modeling

Every growth strategy has cost/benefit implications. Here are some key areas to consider.

Acquisition vs. retention. It’s a business truism that acquiring new customers is dramatically more expensive than keeping the ones you’ve got, and retention should be at the top of the list more often than not. In ecommerce, retention strategies have another advantage. They will often involve only internal resources, with relatively few external expenditures. For example, setting up a loyalty program costs nothing. Yes, there will be internal costs in terms of employee hours, and margins may be slightly lower, but these costs are very low compared to an ad campaign. The cost/benefit ratio will be good.

There are external solutions for improving retention, and although they’re not free, they typically have SaaS business models that meet the ROI criteria described below. 

Acquisition strategies, notably online advertising, can be highly targeted, and both the costs and the results of options like Facebook/Instagram ads, Google Search ads, Linked In sponsored content and YouTube in-stream ads can be precisely tracked for click-throughs. The same is true for email campaigns. 

The results of SEO can be tracked on a before-and-after basis, while public relations campaigns and the effect of a social media presence are difficult to directly translate into ROI.

Investment in technology vs. manual effort. The choice to automate should be based on ROI and break even point for any given tool.  With the rise of AI, many tasks related to ecommerce can be automated, with results that are equal to or better than manual processes. The negative with automation is the potentially high initial cost, which includes not only direct costs associated with the tool itself but set-up and training.

There are some areas where humans may out-perform AI-powered solutions. These include 

• customer service that benefits from a human touch

• large B2B deals where transactions (e.g. sales) may be automated over time but where a human closer can help start the process

• creative processes where, at minimum, human supervision is required

• merchandising where you choose which products to display for upcoming sales

Owned vs. paid media. The choice between owned and paid media as growth tactics will normally be driven by one question. Who is your audience? If your target audience is new customers, owned media usually doesn’t make sense, because of its limited reach. SEO can help your visibility, but without it the chances that non-customers will see product listings are not high. 

In contrast, all the paid options for new customer acquisition offer good-to-excellent targeting. On the internet, your message will reach the eyes of your target audience. Whether that exposure will lead to a sale, however, is a different question. Click-through rates are quite low, and conversion rates even lower. You should always run a small-scale test for any paid option to confirm that it delivers an acceptable ROI.

When your target audience is existing customers, owned media can promote growth via new products, new details, and simple reminders. 

Track key metrics and ratios

There are two metrics commonly used to measure the financial impact of a new tool.

• LTV:CAC, the ratio of the customer lifetime value to the customer acquisition cost. For example, if you spend $50,000 for an email campaign and gain 900 new customers the CAC will be 
  
  $50,000 ÷ 900 = $55.55. 
  
  Generally speaking, an LTV:CAC of over 3:1 is considered a good investment. In this example, the hope would be for an LTV of 3 X $55.55 or roughly $167.

• Time to break-even, the cost of a tool or platform divided by the monthly increase in revenue. If a tool costs $30,000 and results in a lift of $1,500 per month, the payback period would be 
  
  $30,000 ÷ $1,500 = 20 months. 

There are two caveats here. Firstly, cost calculations need to include not only actual expenditures, but the cost of internal resources, which may involve IT hours or training. Even more importantly, it’s misleading to use topline revenue as a measure of success. To measure the true value of a tool, you should calculate the lift in terms of contribution margin, which is the sell price minus all the associated variable costs, e.g. raw materials, labor, packaging and shipping. This number may not always be easy to obtain, but it’s worth the effort if you want accurate ROI evaluations.

Set strategic KPIs

Once you have determined the relative importance of acquisition, retention and expansion in your business plan you should establish KPIs for each of these areas. KPIs help focus teams and offer an objective measure of success. One common formula for guiding your efforts in areas like revenue, margin, CAC:LTV, repeat purchase rate, AOV and so on is the SMART formula:

"S"  Specific. Goals that aren’t specific, like “Improve site performance,” don’t give the people involved enough guidance to move forward. 

"M" Measurable. This is arguably the most important. When goals aren’t quantifiable, success is difficult to define.

"A"  Attainable. Goals need to be realistic. 

"R"  Relevant. Goals need to be in line with larger business objectives so that success will make a difference. 

"T"  Time-bound. Every goal should have a deadline to ensure focus.

Prioritize for ROI

In some cases, growth for growth’s sake does make sense, particularly at the early stages of a brand’s or product’s maturity. But generally, businesses will be on a more solid footing when they prioritize for ROI. One tool for evaluating various growth strategies is the impact vs. effort matrix. Basically, it asks the old question, “How much bang will I get for my buck?” In ecommerce, the “buck” may include not only effort but literal bucks, i.e. operational or capital expenditures. 

This matrix aligns with another approach, MVP, which is often championed by venture capitalists working with start-ups. MVP stands for minimum viable product. For start-ups, the idea is to get to market as quickly as possible with a product that works while investing minimum effort. In ecommerce, the idea is to prioritize achieving growth rapidly rather than spending too much time getting the “perfect” growth solution.

Test, learn, and adapt

It’s best to begin growth initiatives with pilot programs and use A/B testing to determine their viability. Given the granularity of data that’s now available, it’s possible to evaluate the ROI impact of programs on the level of individual channels, and similarly isolate the impact of technology investments. This enables you to find scalable wins while reducing waste.

Emerging trends and innovation that could drive growth 

Experience-led commerce

The retail industry in general has been putting more and more emphasis on the shopping experience, and ecommerce has not escaped the trend towards “experiential retail.” Enhancing the online experience has become an important path to growth. Offering an increasingly personalized customer journey can build both revenue and loyalty. By promoting UGC, brands are supporting a sense of community revolving around their brand.

AR and VR are some of the most dramatic examples of experience retail in the ecommerce context. The ability to virtually try on clothes before buying them or see how a piece of furniture looks in your home are genuinely new experiences that not only provide novelty but also genuinely help customers make good buying decisions.

Live commerce, also known as  livestream shopping or shopstream, is another approach to immersive shopping. Numerous brands are now producing live video streams than enable shoppers to interact via typed questions and comments, and of course to buy items via clickable buttons. 

New approaches to loyalty

Some brands are augmenting conventional loyalty programs with app-based VIP programs, which let members buy through an app on their phone, with no need to sign on via a web browser. Like conventional loyalty programs, app-based programs include discounts, deals, and the like, although they have a higher level of immediacy as they can send time-sensitive offers to mobile devices, sometimes based on location or time of day.

Some loyalty programs employ gamification to encourage a higher level of engagement and interaction through elements that may involve luck – spin the wheel to win – or skill – find your way to the hidden treasure. 

Retail media networks 

Ecommerce companies are increasingly recognizing the value of their first-party data and are leveraging it to build retail media networks. These networks allow brands to advertise directly to consumers on the ecommerce platform, using the platform's rich data about customer behavior and preferences.

By providing targeted advertising opportunities, these retail media networks create a new revenue stream for the ecommerce company while also offering brands a powerful way to reach their desired audience and measure campaign effectiveness. This trend capitalizes on the direct relationship ecommerce businesses have with their customers, transforming transactional data into a valuable asset for both the platform and its brand partners.

Social proof and user-generated content

Real-time social proof is gaining currency as a means to add urgency, and exploit FOMO (Fear of Missing Out) to increase conversions. Examples are often pop-ups with messages like, “23 people are looking at this property right now” or “12 sold this week.” 

Visual UGC, such as video reviews and informal snapshots including the product, are becoming more common. UGC in general helps establish a sense of trust, and even community. Visual formats lend a sense of authenticity. The message is simply stronger when you can see the person delivering it.

Because UGC is so valuable, it makes sense to proactively invite customers to provide it and offer them incentives, such as one-time discounts. You’ll get the best results if you provide guidance that encourages support of the brand promise. For example, “Show us how [product X] helped you save time with [task Y].” You should make sure the UGC you encourage will be in a format suitable for multi-channel use (Instagram, TikTok, Linked In, etc.).  Whenever possible, include a hashtag. 

Payment and channel innovation

New forms of payment and new shopping channels offer growth opportunities worth exploring. Buy-Now-Pay-Later programs, which can be administered by third-parties with no credit risk to the seller, promise higher conversion rates and higher AOV. Loyalty points programs can also boost AOV because a larger purchase means more points or advancement to a higher tier in the program. 

Another avenue for growth is the sales channels now embedded in popular platforms like TikTok Shops and Instagram Checkout. Large retailers now promote advertising via retail media networks, platforms owned and managed by large retailers. Walmart, Target and Instacart, are good examples. The ads are clickable. Typically, the buyer journey leads to a shopping cart managed by the retail network, not the advertising company.

Sustainability as a brand differentiator

Sustainability is an important factor in buying decisions for 70% of consumers, and that means that sustainable marketing makes a difference. While carbon footprint reduction, eco-friendly packaging, circular marketing and other such business practices are not the purview of the ecommerce team, they can be leveraged in marketing efforts. In some cases, sustainability can be a competitive advantage, contributing to stronger brand affinity.

Conclusion

Modern ecommerce growth demands more than tactics. It requires team alignment, the ability to iterate quickly based on data, and smart technology to support growth efforts. In the technology arena, AI, modular tech stacks and the personalization they enable are crucial to success.

Algolia is a recognized leader in product discovery, conversion uplift and scalable personalization, empowering ecommerce teams to harness the levers of growth. Contact us to get a demo to see how Algolia will work for your business, or sign up today to try Algolia for yourself.