Saturday, November 7, 2009

10 Ways Small eCommerce Sellers Can Compete with the Big Guys

Browsing items in Google BaseImage via Wikipedia

The following tips come to you courtesy of

Paul O’Brien.

Paul is VP of Sales & Marketing for, the free online financial management platform that tracks business performance, income and expenses so sole proprietors and small business owners can put their taxes, bookkeeping, and back-office on autopilot.

1. Track Your Best Customers: Offer special deals for those customers who order the most volume. Not only will you further your relationship as a vendor, but you’ll be able to maintain your margins and secure future business. Best way to do this? Bookkeeping. Be sure to record every sale and associated expenses clearly and consistently and you can review a report of who bought what, when, and with what impact to your bottom line. does this all automatically with a handy report of your best customers.

2. Offer Special Discounts: Timing is everything. I know, we all hate hearing holiday music and seeing the decorations in stores BEFORE Thanksgiving but the fact is, the holiday shopping season has started. Learn from the brick & mortar stores: promote the bargains, offer packages or discounts for bulk purchases and recognize that people want to get in and done. Offer short term promotions to entice them to wrap up their purchases by buying everything from you.

3. Don’t Miss Tax Deductions: If you sell online, you’re very likely work from home. Don’t be afraid to plan on taking the home office deduction, especially if you have your inventory in your house. What else can you write off? eBay sellers, do you hop garage sales on the weekend looking for steals? Are you keeping track of that mileage?

4. Check out Comparison Shopping Sites: To divert customers from mass retailers, many small businesses are looking into online comparison shopping sites to reach a larger audience and attract sales. Check out free shopping sites like Google Base to get started. Use SingleFeed to distribute your products to multiple CSEs (comparison shopping engines), optimize performance, and do it all at the right price.

5. Simplify Checkout: Believe it or not, 3 steps to checkout has a higher conversion rate than making it easy for customers to check out with just one step. Don’t put everything on a long form; walk them through the process. Order Review > Shipping Info > Payment.

6. Organize Sales and Manage Inventory – Work with manufacturers, vendors, and drop shippers now to ensure inventory is available and shipping is on time. Their ability to fulfill your needs can make or break your store during the holiday.

7. Effectively Market Your Promotions: The best form of marketing is retention; you’ve identified your best customers and converted hundreds more through the holiday season, keep them around in 2010 by creating e-newsletters them know what’s hot with your store.

8. Be Up Front and Clear about your Shipping and Handling – 72% of customers who abandon an online shopping cart do so because shipping charges are higher than they expected.

9. Offer Free Shipping - 61% online shoppers prefer to shop with a retailer that offers free shipping, 60% claim free shipping is a reason they are more likely to shop online, and 90% believe free shipping offers would entice them to spend more online. According to a Wharton study, free shipping offers that save customers $7 is more appealing to most shoppers than a discount that cuts the price of a purchase by $10!

10. Don’t Worry About Others’ Conversion Rates: Benchmarking your own store against everyone else will only give you headaches. Spend a couple hours with Google Optimizer and learn how to do basic A/B and Multivariate testing. The best thing you can do for your business is focus on improvement. A 10% increase in conversion rates (say from 5% to 5.5%) puts 10% more sales in your pocket and improves your ROI on EVERY marketing campaign.

About The platform is fast-becoming the go-to resource for e-commerce sellers, as their newest integrations with PayPal and eBay allow millions of merchants to automatically record their sales and track their growth across multiple ecommerce channels, including etsy, eBay, Amazon and the Yahoo! Store. Business owners no longer have to manually record each sale they've made in multiple marketplaces or even in their own store; online merchants managing their checkout with PayPal, have sales automatically recorded and reported with

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  1. Great Ideas Marlene - Thanks!

    Beth Chekrowsky

  2. It's a good top 10 list, but I'll disagree with a few...

    "Simplify Checkout" - I do not think 3 is the optimal number of steps. The blog you link to was from 2007, and the sampling was quite small. I personally believe (after 13+ years as an ecommerce hosting provider) that TWO steps is optimal. Step 1 is the cart with shipping, tax, items, etc... Step 2 is checkout with address and payment. That seems to convert the best for our clients.

    "Offer Free Shipping" - I agree this can be helpful for more sales, but higher product prices to offset free shipping can cause comparison shopping engine users to not find your products in the first place.

    A good compromise is to offer free shipping if the customer spends $XX at the store. This can help drive up the overall sales totals per order, which can help offset free shipping.

    The biggest advantage a small merchant has can be in customer service. Be personal, send a free gift, hand-written note, follow up email/phone call, and make the customer feel like they are important, even if they just bought a pencil. That kind of feeling is viral.

    Rob - LexiConn

  3. @Rob
    Great points. On your first, bottom line is certainly test and optimize. My experience holds the 3 steps true even with a study from 2 years ago.

    As for free shipping, you touched on a great debate for which my two suggestions really counter each other. Many believe Shopping engines are all about pure, direct performance; that is, Clicks to conversion = ROI, without looking at the bigger picture. I that case, optimizing to the CSE (Comparison Shopping Engine) makes sense. On the other hand, the shopping engine is just one channel in your arsenal and the free shipping impact to your overall conversion rate might (might) be worth more.


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