It's understandable why so many businesses are going online, with worldwide eCommerce sales exceeding $1 trillion in 2012. Amazon, one online store, in particular, continues to set the bar for online shopping. Amazon now generates north of $100 billion in annual revenue, and its product range appears to have no bounds. Amazon's online success enabled everything from Amazon Web Service (AWS) to gadgets like the Kindle and Echo and Jeff Bezos' business, the rocket company Blue Origin.
Moreover, Amazon knows how to sell online. This accomplishment took years to achieve, and it owes a lot to Amazon's growth strategy. Regardless of its size or stage of development, any eCommerce firm may benefit from Amazon's experience in growing its business and attracting and retaining more customers. Here are six key lessons that explain why Amazon has been so successful and how small retailers can use them to strengthen their eCommerce business.
6 lessons all small retailers can learn from the rise of Amazon
Amazon is a master at figuring out what its customers want and utilizing that knowledge to boost sales. If you've ever done any shopping on Amazon, you've probably come across categories like "suggested items,", often bought together, etc." Amazon recommends other things you're likely to buy based on your previous purchases (and those of other customers) as part of its perfect online experience. They make the customer's purchasing (and upselling) procedure simple. Aside from their on-site post-purchase suggestions, most Amazon emails recommend things based on previous purchases. Alternatively, you may be offered suggestions for complimentary products when you make a purchase. This recommendation engine accounts for 35% of Amazon's income, and the company saw a 29% boost in sales after installing it. They may better understand consumer wants and improve customer experience in the future by successfully exploiting their customer data.
Amazon has mastered the subscription model. Rather than spending money on marketing and traffic every month in the hopes of converting at least as many consumers as the previous month, why not keep your present clients for the long haul? In this manner, once you've acquired a customer, you'll be able to ensure continued revenue and expand your customer base. That's why Amazon offers subscriptions for commodities like food and household goods, which we're more inclined to buy again. There's also Amazon Prime, Kindle Unlimited, and other services. You can put a larger emphasis on recurring earnings as a small business owner. There are numerous alternatives available, ranging from loyalty cards to subscription programmes. In the long run, this business strategy is superior. It's cost-effective and built for long-term performance and revenue development.
The majority of your experiments as a new or growing business owner will fail. That is how fresh ideas are generated. There is no room for improvement without failure. You could say that Amazon was built on failure, with so many failed items and initiatives. There was A9 Search, Amazon Auctions, and a slew of other failed marketing operations, to mention a few. Don't be scared to experiment with diverse marketing strategies. Some will turn out to be gold mines, while others will fail. Simultaneously, only take sensible risks. For example, if you're redesigning your newsletter, don't send it out to your full list; instead, pick a portion and test it there.
It's now relatively simple to do numerous internet experiments, ranging from split testing to surveys to simply experimenting with different marketing methods and channels. Even as a small firm, you have access to all of these resources. You can innovate like any other big firm to stay ahead of the curve with a little planning. For Amazon, this approach has proven to be extremely profitable.
Many firms are preoccupied with what their rivals are doing. They forget that if they focus solely on providing the most incredible experience to their clients and do so effectively, their competitors will merely become followers. Early on, Amazon learned that the only things that matter to customers are rapid shipping times and excellent customer service. If you send an email to Amazon, you will receive a response within 24 hours. Their delivery service is also so good that it is now posing a significant challenge to FedEx.
One thing Amazon excels at is customizing the buying experience for each customer. Amazon understands that the more relevant a product is to a user, the more likely they are to buy it. Amazon can teach online shops how to tailor the purchasing experience as much as possible. Although this is easier said than done, many popular eCommerce systems allow third-party plugins to perform similar tasks. Showing users recently viewed products is a simpler approach. It's not quite as sophisticated as Amazon's extensive personalization system, but it's a beginning. it is a straightforward way to tailor the shopping experience while increasing average order value.
When it comes to internet selling, there's no need to reinvent the wheel. Amazon and other large retail websites have paved the road for online success. Online shops can use Amazon's methods and tactics to become the "Amazon" of their industry by learning from them.