A successful eCommerce business requires a lot of effort, time, and decisions that need to be made at the right time. Most new eCommerce businesses focus on optimising their product descriptions, better checkout experiences, or user-friendly websites. While these strategies are equally important, focusing on creating an eCommerce business plan is the best way to start, together with constantly reviewing and improving it. As you grow, this plan will keep your business ahead of the curve.
What is an eCommerce business plan?
An eCommerce business plan is a strategic blueprint that outlines the steps required to start your online business, grow it, and turn a profit. These plans outline detailed actions that take the business from an idea to its first sale. The best eCommerce businesses have a detailed eCommerce business plan with a set timeline for achieving milestones along the way. By improving and following this plan, you will be able to test your products, adjust pricing, and launch promotions to make a profit.
Key steps to improving your eCommerce business plan
Creating a thorough eCommerce business plan takes time and effort as every aspect of the plan needs to be thought of and reviewed in detail. According to a study published in Forbes, 90% of e-commerce brands fail within four months of launch.
To avoid failure, a roadmap must be created in the very first year of your business – this will help you find a clear focus for your product and its price points. This roadmap will be a multi-year plan (usually three or five years) that outlines all the various product offerings, the different stages of business development and specific goals for each one.
A critical and often neglected step in creating a successful eCommerce business plan is understanding how it relates to the competitive landscape. Include information about the market in which your eCommerce business will operate, the trends and forces that are shaping the industry, and what your company can do to improve its offering.
Types of data you should track
As with any other business, an eCommerce business has its pros and cons. It is not possible for any single company to excel everywhere, but how it is managed is very important. There are several metrics that you can use to analyse your progress. Some metrics should be measured on an hourly, daily or weekly basis and will help you track your growth. Here are some of the important things to track if you are looking to make an impact in your eCommerce business:
Website traffic
What’s the difference between organic and paid traffic? When you start an eCommerce business, you will be asked this question a lot. Customers have a lot of choices online and while Google Ads clicks will help, your website traffic should rely on organic traffic using keywords. To measure how much attention a particular keyword gets, you need to track that keyword’s performance, conversion, click-through rate, organic traffic, etc. Keep track of your customer’s journey, find out where they come from and why they are visiting your website.
Conversion rate
Your conversion rate can either refer to the number of leads or sales that your product provides or the number of customers you are able to convert through your sales funnel. The conversion rate should be a factor that you take into account when designing your business plan. If your conversion rate is not high enough, then you may need to invest in improving your content or your call-to-action buttons in order to boost it. The industry leader of conversion, Hubspot, have a great article that can assist in understanding CRO.
Audience and behaviour
Analysing the demographics of your target audience can provide insight into their geographic location, age, gender, interests, and preferences. Clicking on content, deciding on products they’re interested in, and buying are all factors that determine consumer behaviour. This may include information about how long a customer spends on the site before making a purchase or leaving.
Paid marketing activities
To evaluate the ROI of Facebook, Instagram, or any other platform where paid ads are used to boost web traffic, you need to gather the data from these sources. It’s also a good idea to watch your revenue in relation to your ad spend – this is calculated by dividing revenue by ad spend. You can test the effectiveness of your ad spend through this metric, especially as you scale your campaigns.
Conclusion
There is no doubt that the eCommerce business market is challenging to navigate. To break through the noise, it is essential to remember that you should be developing your eCommerce business plan in a dynamic way that allows you to shift gears and adapt to the ever-changing dynamics of your market. As you embark on your entrepreneurial journey, all this additional knowledge will empower you to build a solid foundation for success.
