– Ecommerce trends such as retention, customer lifetime value, SMS marketing, blended ROAs, and community building are all reactions to changes in privacy laws and the cost of advertising.
– These trends should have been the focus of brands all along, rather than being reactionary.
– The current approaches to retention, measuring lifetime value, SMS marketing, and building community have their flaws and need to be improved. Brands should focus on long-term strategies rather than short-term revenue targets.The key action item is for brands to shift their focus from reactionary tactics to forward-looking and future-oriented strategies in order to build long-term success.E-commerce trends that everyone seems to be talking about right now are retention, customer lifetime value, SMS marketing, blended ROAs, and community. However, the dirty little secret is that all of these are reactions to changes made to privacy laws and the cost of advertising. None of the above are new; they should have been the focus of brands all along.
The bigger problem with retention is that it is currently being done through half-baked loyalty programs or chasing people with discounts. It has mostly been pushed through email, SMS, and direct mail.
Measuring lifetime value accurately is nearly impossible due to various factors that can influence it, such as experience with the product, new products added, limited edition products, collaborations, and more. The question of how long a lifetime is also arises.
SMS marketing has emerged as another channel to contact people because their inboxes have become too full and companies send too many emails. However, as a more “active” channel, it requires someone’s attention, resulting in a higher unsubscribe rate. The threshold of collecting a phone number needs to be balanced with the intent of the party, as drop-off rates are high when people are prompted for a phone number.
Blended ROAs have always been my north star metric, but they have become more popular these days due to issues with tracking accurate attribution. No single platform can accurately track attribution, and as a result, people have turned to this methodology to justify costs because the return on ad spend is not what it used to be.
Community is perhaps the most misunderstood aspect of what people are talking about. I have not seen a brand do it properly yet, as they build a community without a blueprint on how to actually make it happen. It is a reaction to increased ad prices.
As brands scaled, they became comfortable with paying for traffic. However, they are now realizing that paying for traffic has become very expensive. Therefore, the theme here is that everything is reactionary.
The challenge for brands today is to be forward-looking and future-oriented rather than reactionary. They should build processes that make sense for the long term, rather than chasing revenue targets for the next quarter. Short-term thinking and sprints will ultimately lead to failure in the long run. #marketing #ecommerce #strategyhttps://www.linkedin.com/in/jivanco