Countdown to the Summit: Formulating Your Perpetual Growth Strategy

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Thursday, May 20th, 2010

Today’s Yahoo! Store Blog post comes from Scott Smigler, president of Exclusive Concepts, Inc., a Yahoo! Small Business partner that helps online retailers to increase revenue, get smarter, and do more with less. Services include advanced search engine optimization, profitable PPC marketing, scientific conversion testing, and optimized lifecycle email marketing.

Good afternoon folks! This is Scott Smigler from Exclusive Concepts, Inc., a Patron Sponsor of this year’s Yahoo! Merchant Summit, and I’d like to thank you in advance for spending the next few minutes with me.

Given that the Summit is just 22 days away, I’d like to offer you some feedback about how I think you can leverage this invaluable one-day event for the benefit of your business. I believe the Summit will be a good time to reflect on your growth strategy. To get the most out of it, my number one suggestion is that you show up on the morning of June 11 prepared to see the forest for the trees.

A tremendous amount of knowledge will be transferred to you from subject matter experts, fellow merchants, and the Yahoo! Merchant Solutions team. Rather than simply leaving the Summit with many pages of notes that you intend to act on when you return to your office, focus instead on creating or iterating your “big picture” growth strategy. When you are clear on where you want your business to go, why you want to get there in the first place, and how you will get there, the entrepreneurial process can be pure joy – and the results will follow. Bottom line: Think strategically.

Here at Exclusive Concepts, we have created a framework called the Perpetual Growth Strategy that enables you to leverage a plethora of marketing techniques in a systematic way, in order to accelerate growth while creating greater efficiencies along the way. When you recognize that all marketing activities can be leveraged simultaneously such that the whole is greater than the sum of its parts, you are on your way to achieving perpetual growth.

Here are four critical components to any store’s Perpetual Growth Strategy, along with some tips. Think about how these four components can work together in order to propel your growth.

Search Engine Optimization

By now all of us should know how critical the concepts of relevance and popularity are to ranking higher in search engines. You need useful content that helps shoppers to make buying decisions, and the pages on your website must be deemed “popular” and “authoritative” by virtue of the network of sites that link into your site.

As search engines and shoppers evolve, however, being a master of search engine optimization alone won’t be sufficient to propel the growth of your business. Think about how other marketing activities and analysis can help you to not only improve your rankings, but more importantly, improve revenue growth.

Quick Tip: Use Yahoo! Web Analytics to make smarter decisions about which keywords you will optimize your site for.

How: Identify the most highly visited pages on your website and identify which keywords bring traffic to those pages. Then, analyze the bounce rates of each of those keywords (the rate at which people who find the page using a specific term leave immediately). You may find that certain pages are optimized for keywords that really aren’t a great fit for that page, in which case you may iterate your SEO strategy and target those keywords on a different, more relevant page. Or, you may decide that by addressing usability issues on that page, you can improve bounce rates on underperforming keywords.

Results: We believe that lower bounce rates lead to higher search engine rankings, which leads to more traffic. Lower bounce rates will also lead to higher conversion rates, which will lead to higher revenue.

Bounce rates report in Yahoo! Web Analytics

Pay-Per-Click (PPC) Marketing

Best practices in managing pay-per-click (PPC) marketing campaigns have changed signifigantly over the past 12 months. The search engines recognize that for advertisers to continue investing in PPC, return on ad spend must be much higher than what it has been in the past. As a result, search engines are implementing new features to ensure that the right ads are shown to the right people, and that the landing pages shoppers find when they click on those ads will be relevant to their search. In addition, search engines are improving reporting, and enabling advertisers to integrate third-party tools to gain granular insight into the performance of campaigns in order to optimize them.

These efforts are working and the payback for creating an optimal approach to PPC marketing increases each day. To truly leverage PPC, think about how it can inform, and be informed by, your other marketing activities – from search engine optimization to email marketing. To quote Alec Baldwin’s character in 30 Rock, Jack Donaghy, “Go Deeper.”

Quick Tip: Use data from your email marketing efforts to see which product categories produce sales to shoppers that result in frequent repeat purchases, and factor “lifetime value” into your PPC bid strategy.

How: Ensure your PPC campaign is organized similar to how your site is organized, and if your approach to email marketing leverages behavioral data to present offers to shoppers based on their past purchases, measure the performance of your campaigns and factor that data into your bid strategy. For example, if you find that you have an effective approach for converting shoppers who purchase high definition television cables into buyers of more expensive electronics, than outbid your competitors on the commoditized terms that traditionally you may have stayed away from. This will be easy to do if your Pay Per Click campaign is organized properly.

Results: By considering the long-term value of shoppers to your bottom line, you can allocate your PPC budgets more strategically, which will lead to higher profits and revenues.

Conversion Testing

Most online merchants have never run a single statistically valid conversion test. In order to maximize the ROI of all of your other marketing campaigns and to fuel the perpetual growth of your store, it’s time to start testing. By using data to make prudent decisions, you can gain a competitive advantage over your competition.

Not only will your site turn more browsers into buyers, you will start learning about your shoppers various “shopping personalities.” This will inform which shoppers you seek to attract to your site, how you more effectively convert these shoppers into buyers, and how to retain these shoppers so that they buy from you again and again.

Quick Tip: Use analytics to find out which shoppers your website is ignoring, and utilize testing to figure out how you can cater to those shoppers rather than continuing to ignore them.

How: Yahoo! Web Analytics will enable you to see what percentage of your visitors are accessing your website from their mobile phones, or from browsers like Safari, or who bounce quickly after reaching your site. Identify big “buckets” of ignored shoppers, formulate hypotheses about how you can engage and convert these shoppers, and then conduct conversion tests in order to identify changes you can make to your website that you are confident will improve conversion rates.

Results: Through the process of testing, you will learn more about the multiple segments and personalities of shoppers to your site, which will inform all of your marketing activities. You will also increase your conversion rates, which will enable you to invest more in marketing your website. This will enable you to grow sales profitably and rise to the top of your category faster.

Browser version report in Yahoo! Web Analytics

Email Marketing

The secret to email marketing is sending the right messages to the right shoppers, at the right time. Sending one-size-fits-all blasts to your entire database may keep you top-of-mind and support your branding, but if you really want to maximize sales from past shoppers you will want to adopt a systematic approach that caters to the lifecycles of each one of your shoppers. This systematic approach starts with being strategic about which keywords you optimize your site for, what marketing messaging you use to convert those shoppers into buyers, and the proper timing of relevant follow-up emails to inspire repeat purchases.

A common example we offer is that if someone buys dog food from you today, chances are they will need to place another order for dog food in a month or two. Use testing to calculate the optimal timing of messages to dog food buyers so that your email promotion arrives at the right time, and ensure that it is promoting the right products. Shoppers appreciate relevant emails, but if you start promoting cat nip to dog food buyers, at best your emails will begin to be ignored, and at worst you will be reported for spamming.

Quick Tip: Consider segmenting your email database based not just on a shopper’s past purchases, but also on a greater understanding of that shopper’s overall needs.

How: Begin developing theories about the personalities of your shoppers. Some may exhibit “methodical” shopping traits, which may mean that they prefer lots of text and explanations about the products they will purchase. Others may exhibit more “spontaneous” shopping personalities, and for them, less is often more. Understanding the personalities of your shoppers within the context of their past purchases will help you to tailor your email marketing campaigns to them, and will also be very helpful as you create conversion tests to convert visitors into shoppers in the first place.

Results: By utilizing a lifecycle approach to email marketing, you will increase the lifetime value of each shopper, thereby enabling you to market your store more aggressively and achieve perpetual growth.

Bringing It All Together

I have no doubt that you will leave the Yahoo! Merchant Summit with many valuable tips for optimizing the growth of your business, but don’t forget to think about the big picture and to plan strategically. To achieve systematic, perpetual growth, all of your marketing activities must complement, inform, and strengthen your other marketing activities.

I will be on several panels at the Yahoo! Merchant Summit and look forward to sharing more tips with you like the ones above!

Scott Smigler
President of Exclusive Concepts, Inc. and Guest Blogger for Yahoo! Small Business
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