Ecommerce Marketing: The Basics

Background:

I run a digital marketing agency focused on ecommerce and have been selling things online since 2015.

I’ve recently seen a lot of posts on here about ecommerce, which inevitably lead to questions about how to advertise. This is such a big topic that these questions usually don’t get answered, so I thought I would make a couple of quick write-ups to give people an introduction. A lot of people see marketing as a mysterious black box. Understanding the basics is actually pretty easy if someone explains it to you, but it can be hard to find good information, because every time you Google something related to this topic it’s just a bunch of highly SEOed articles trying to sell you stuff.

So what I’m going to do is write up a series of posts about different aspects of ecommerce marketing for entrepreneurs. My goal with these articles is not to teach you to be an expert, which would be impossible without a huge amount of time and a lot of learning by doing on your part. What I want to do is to give you a threshold level of understanding so that you can either build your own hacky marketing or understand it well enough to hire and evaluate a professional without being taken advantage of or feeling like you have to commit to something that you don’t understand.

I’m going to assume that you have basically no background knowledge, so sorry for the repetition for people who do already know some of the basics (especially in this first post). Also, I’m writing up these articles when I have time, so I can’t commit to any kind of publication schedule. But I’m also writing them as I go, so if you have any questions or major areas you want to ask about, go for it, and I’ll do my best to answer all of your questions over time.

This post will cover:

• What is marketing and why does it matter?
• Understanding the customer journey and creating a “heartbeat” for your business.
• Sales, marketing, personalization, and segmentation
• When you should do the marketing yourself, and when to hire someone else to do it for you

As you can see, this first post will be focused on the theoretical background. In future posts, I’ll get a bit more granular about what exactly to do.

Note that this series is focused on marketing for ecommerce (selling products online), but most of what I describe here can also be applied much more broadly.

What is marketing and why does it matter?

It’s really common for first-time entrepreneurs to take a “build it and they will come” approach to business. I see this all the time on Reddit. Somebody creates a cool product, maybe posts about it on social media somewhere, and then realizes they have no idea how to find customers and comes here asking for help. The thing is, you can have the most amazing product in the world, but if your potential customers don’t know about it, nobody is going to buy it. One of the biggest lessons that every entrepreneur learns right away is that finding customers takes a lot of effort. In fact, marketing is usually one of the most expensive things, if not the most expensive one, that any company does... whether that company is one guy drop-shipping out of his bedroom or Coca Cola.

Marketing is the art of promoting your business to potential customers. This includes strategizing, advertising (actually running the ads), targeting and market research. We’ll be talking about all of these different areas. You need marketing because you need customers. Customers are the lifeblood of your business — without them, you won’t last long.

Advertising costs money! Expect to spend money to acquire customers. This is something really important to get into your head, and it’s one of the many, many reasons you don’t want to start a business without access to money to fund it. For some reason, many people expect to get customers for free, when they would never expect to manufacture or ship a product for free. Don’t make this mistake! It is not just okay, but pretty much a necessity to spend money in order to get customers. But as long as each customer is bringing in MORE money than you’re spending to acquire them and fulfill their orders, you’re still making money.

Understanding the customer journey and creating a “heartbeat” for your business

Before going any further, let’s start with some basic frameworks for how to look at a business, because everything I say later about marketing is going to be based on this way of understanding things.

Think of your business as a process of selling (and delivering) products to individuals. Sometimes, this process is described as the “customer journey,” which is the story of a single customer from the time they first hear about your business until the very end of their interaction with you. Every customer follows this journey. Now, every customer is unique, so the exact path that they follow through this journey might vary a little bit, but they’re all more or less following some variation of the same route.

As a simplified example, let’s image a company that sells hot sauce online, which I’ll call Crazy Peppers. Their customer journey is: the customer first sees an ad on Facebook or Instagram, clicks on the ad, goes to the website, browses around through some sales content they have posted, then chooses one of their two different kinds of hot sauce, adds it to their shopping cart, and buys. Later on, they follow-up with an email asking the customer to leave a rating and review of the product, and offering them a special discount on another bottle if they want to restock.

Now, as I said, this is a really simplified example, but hopefully it gives you a concrete sense of what I’m talking about here. The customer journey is a really central concept in marketing, and business more generally, so you’ll hear a lot more about this in the future.

A key takeaway here is that you are creating ONE central process for your customers to go through. Sure, there are some minor variations on it to take into the account that each customer is a unique individual (do they spend their time on Facebook or Instagram? do they want to buy the regular hot sauce or the XXXtra spicy? do they need to read a testimonial before they believe it’s good?), but every single customer goes through roughly the same journey. I like to think of this as being a single “heartbeat” of your business. Your job as an entrepreneur is to figure out how to create this heartbeat, and then how to make it stronger and faster.

It’s really very simple. This process, this heartbeat, is the core of your business. As you run your business through time, it’s just this process firing over and over again as more and more customers move through your machine. Meanwhile, you’re working on improving this process to deliver a better customer experience and make the most possible returns. So look at your business as a huge sequence of customers being brought through your machine. And how does this all relate to marketing? Well, marketing is the first step in the process: the way that you acquire customers and kick off the whole process.

Sales, marketing, personalization, and segmentation

In the previous section, you might have noticed that there is a tension between the fact that every person is different, and the fact that you as a business want to build the most repeatable and simple processes possible. From a business standpoint, you always want your processes to be as scalable as possible. If everyone were an interchangeable automaton, life would be really easy for the marketer. (Un)fortunately, this isn’t the reality that we live in.

Enter sales. What is sales? Well, there are all sorts of ways to define it, but for the sake of this conversation, let’s look at sales as something distinct from marketing. In this context, sales means selling your product in a personalized way to an individual customer. In other words, marketing is talking a large number of people at once, and sales is talking to a single potential customer. Marketing is more general, and sales is more personal. Marketing comes first in the customer journey and sets the stage for sales, which closes the deal.

Now, why wouldn’t you just always want to have as much sales as possible? The answer is that sales is really labor-intensive. You need a highly-skilled salesman to talk to an individual potential customer. In contrast, marketing allows you to spend the same amount of money to reach thousands of people at once. Marketing is also way less intrusive. Many people wouldn’t take time out of their day to speak to a salesman for a product they’ve never heard of, but they might read an advertisement. But the personal attention of sales is very powerful, and, if you could, you would want to use this as much as possible.

Now, for ecommerce, you may not want to do much sales at all. Maybe the only sales you do is exploratory (you’re trying to learn about your target market by talking to potential customers) or in response to questions that are sent in. As a general rule, the less expensive, and the less confusing, a product is, the more you can rely on marketing instead of sales.

The best marketing takes the personalization of sales and incorporates it into the marketing. In the olden days, then might have meant adding some local flair to your advertisements. But now, thanks to all of the information that exists online, it has become much easier to make very highly personalized marketing campaigns that speak directly to different customer segments. In fact, segmentation is one of the most important topics within marketing, because it’s what allows for us to design a system that sends the right message to the right people — while wasting as little time and money as possible. This is a big topic that we’ll return to later to discuss in more detail, but I want to introduce it now to give you a sense of where we’re going.

Marketing is never done

Okay, so, one other thing I need to explain at this point is that marketing isn’t something you can just set up once and forget about. It requires constant attention and improvements, like a garden that needs to be watered and weeded. There are all sorts of reasons for this, from changing market conditions and competition, to how the experimental method in marketing works to optimize your processes over time. I’ll talk much, much more about this in future posts (look for the topic of “split testing”), but for now it’s important to make clear that marketing is something that will require dedicated attention for the entire lifetime of your business.

Should I do this on my own or hire an expert?

(Moved to a reply because I was over the character limit)

Up next

Whew, this turned out to be way longer and more time-consuming to write well than I expected for a first introduction (when am I going to learn that every big Reddit post is always like this?).

Anyway, so far this article has been focused on the theoretical basics. In the next article, I’ll dig into the details of the different kinds of marketing that exist, including things like performance marketing (which includes Facebook and Google ads) and search engine optimization.

Like I said, I haven’t written anything else yet, so if you have specific requests, let me know and I’ll try to answer your questions. You can sign up here to be notified by email about future posts in this series.

Until next time!

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