9 Ways to Recession-Proof Your eCommerce Business
Times of economic uncertainty can undoubtedly be the cause of sleepless nights. And, c'mon - it would be weird if worries about customers' ability or willingness to spend and other general financial concerns didn't get to us!
But savvy entrepreneurs have a way of always getting creative when times seem the toughest. This is where brands, especially smaller ones, get to show off their flexibility and ability to pivot in ways that giant corporations simply cannot.
For small eCommerce brands specifically, there are some quick changes you can make to your online store to ensure you can weather any financial storm that may lie ahead. In this post, we'll explore practical ways to recession-proof your eCommerce website. We will discuss strategies for rethinking marketing, focusing on customer retention and inventory management. Bonus: these are all relatively easy-to-implement, low or no-cost ideas you can implement immediately to boost average cart values, deal with lower conversion rates and cope with less traffic to your site. Let's dig in!
Add subscriptions to your mix. If you find that customers routinely return to your shop to buy the same products repeatedly, make it easy for them by offering those same products as a subscription. Offer a discount versus paying for the same products or services piecemeal. Not only will your customers enjoy the savings and added convenience, but you'll also be able to add recurring revenue to the books.
Don't give up on your free shipping offer. I cannot preach enough about the importance of a free shipping offer. If you must rethink pricing, preserve and protect your free shipping offer with your life. Price-sensitive customers hate feeling like they were nickel-and-dimed over shipping fees and like thinking they're getting a great deal. Better yet, a free shipping option for orders over a certain amount helps boost your average cart values and reduce abandoned cart rates by people surprised by shipping costs.
Focus on customer loyalty. You know that saying about how acquiring a new customer costs more than keeping an old one? It's true. With the prospect of smaller average cart values or less traffic overall due to tightened budgets, focus on customer loyalty first and foremost. You can do this in many ways, such as setting up a loyalty program that allows customers to pay for purchases with earned points or perks.
Rethink marketing. You can reduce wasteful spending and boost revenue by cutting back on digital paid spend and going straight to the horse's mouth. Rather than continuing to invest in expensive paid advertising, consider shifting your focus to utilizing customer data to guide your marketing decisions. Consider leveraging the power of small influencers (or even your own satisfied customers!) to help spread your message. Another idea is to explore collaborations with relevant brands and creators and consider offering products as gifts to small influencers to help build brand awareness.
Manage inventory better. Does it seem like there's always either too much or too little stock on hand? If you need help with the former problem, try focusing on building industry partnerships or collabs to introduce your products to new markets. If the latter is more of your issue, it might be time to start looking for new suppliers closer to home or sourcing from multiple suppliers. And for all, try adding a custom label to products you can keep consistently in stock and ready to ship so customers know they can get those items right away. I've seen a few brands do this or even create whole "Quick Ship" categories, and I think it's such a great idea!
Focus on your brand. To make the most of limited resources, prioritize establishing a solid brand. This involves ensuring consistency in your message, tone, and visual identity, as confusing branding can hinder customer conversion. Additionally, take time to evaluate and improve your customer service and clearly understand your target audience. Remember that you can't appeal to everyone, so focusing on a segmented marketplace actually allows you to best serve your core customers.
Boost customer confidence on the product page. Optimizing your product details pages can impact your bottom line in two ways. First by increasing customer confidence in their purchase decisions and second by reducing costly returns. Be sure to include detailed and comprehensive product descriptions that accurately convey the features and benefits of the product. Incorporate video - especially 360-degree views that allow customers to thoroughly examine the product from all angles and better understand what they can expect. Also, ensure you're displaying customer reviews, as they can help build trust and provide valuable insights into the product's performance and suitability. (For more tips on optimizing your Squarespace product pages check out this post!)
Incorporate user-generated video. Studies have repeatedly shown that videos (especially short videos that answer the question "Why should I buy?") are great conversion tools - but video production can be overwhelming and expensive. Luckily, videos from past customers are just as helpful as content you might produce on your own - acting as part social proof and part explainer video all in one.
Expand local pickup & delivery options. If you're an online seller that also offers in-person buying opportunities, the Venn diagram of online customers and in-person customers probably has a ton of overlap. Offering local pickup options (and/or delivery if you can swing it) has a few benefits. First, it's generally faster and cheaper than shipping goods, which can appeal to shoppers on a budget. Second, it allows you to build stronger personal relationships with your customers and invite them to explore other offerings they may have yet to consider. Don't have a brick-and-mortar location? Try teaming up with another local business that does and see if they'd be open to allowing your customers to pick up from their location - this could be a win-win for both companies!
Silver Linings
Looking at the list above, I see a few themes that may just be the silver linings. One of the biggest is that, in many ways, while eCommerce opens up the whole world to us, locality still matters. Whether we're sourcing products from suppliers closer to home, building relationships with micro-influencers, or offering ways to bring online convenience to brick-and-mortar shopping - I love to see it!
Also, let's be honest: only some businesses have the strength or fortitude to ride out a downturn. While that's definitely sad, it also opens up opportunities for newcomers to the market to step in and fill in the gaps. Starting a business in a downturn can help you seize market share and build a strong foundation coming out the other side. If you've been sitting on a big idea, this may be just the time to take your shot.
