3 Key Ways to Diversify Your Ecommerce Store
To achieve diversification, it's important to focus on a niche, test your products and double down on your brand.
One of the most interesting areas for an entrepreneur to get into right now -- and one of the most popular -- is ecommerce. Ecommerce enables online stores to cut out the middle men who usually take a 50 percent cut of an entrepreneur's margin, and sell directly to their end consumers.
Not anymore. Given consumers' ability at this point to buy almost anything online, businesses are taking advantage of customer acceptance of ecommerce. Indeed, this model has flipped traditional industries on their heads.
As an example, until recently, people used to buy mattresses in stores. Then along came Casper, a startup that sells mattresses directly to consumers online. The company was a smash; it hit $1 million in sales in its first month along.
The rapid adoption of ecommerce in the mattress industry proved a disruptor for an entire industry.
But ecommerce is not always about success. The problem facing many would-be entrepreneurs in this space is that as each industry becomes crowded with ecommerce companies, diversifying their products becomes harder. That is where solutions like Oberlo come in. Oberlo is a plugin for Shopify stores that enables entrepreneurs to import hundreds of products within minutes.
Diversification is crucial for any ecommerce entrepreneur, as starting a ecommerce store can be a struggle. If you’re such an entrepreneur looking to learn how to make your store different, follow the three tips below:
1. Identify your niche.
One of the most important parts of starting any ecommerce store is connecting with the right customers. To make better advertisements and have higher conversion rates, you need to understand what niche your ecommerce store is targeting. So, think about where you’re from, what your products stand for, how your products are made.
For example, Original Grain, a growing watch company that crafts watches from wood, focuses its brand on sustainability. This enables it to definite a target niche within the millions of watch buyers worldwide. When Original Grain runs advertisements, its ads are focused. If, instead, it tried to target people outside its brand, chances are Original Grain's conversion rates would suffer.
2. Test your products.
The biggest mistake ecommerce entrepreneurs make today is investing too heavily in inventory. Being an ecommerce entrepreneur is all about balancing your cash flow, especially when you have marketing, management and inventory costs. This is why ecommerce entrepreneurs have turned to drop shipping.
Drop shipping is an ecommerce strategy where a store doesn't hold inventory. Instead, when a store sells a product, it purchases the item from a third party and has it shipped directly to the customer. As a result, the merchant never sees or handles the product.
Double down on branding.
If you’re entering an industry already crowded with ecommerce stores, you’re going to need to invest in branding. Traditionally, branding has involved several touch points across traditional advertising placements, on billboards. Nowadays, brand touchpoints stem from social media.
To increase your brand awareness, start investing in your social media presence. This means growing a large following, interacting with your followers and utilizing social media influencers who have a large following. This will validate your brand as one of the top ones in its respective market.
Though starting an ecommerce store is relatively easy, diversifying it from competitors is hard. That's why it's important to focus on a niche, test your products and double down on your brand. Try putting these strategies to work!