The E-Commerce Goldmine

The e-commerce market is growing, no question about that. Over 20% of retail worldwide is online and that number is rapidly increasing. Some of the worlds biggest companies are in online retail providing stiff competition to offline stores.

Anyone can do E-Commerce

For sure, anybody with access to internet can setup their online store in a matter of days. By leveraging social media in most cases, there have been some crazy success stories from young entrepreneurs monetising their reach by engaging in E-Commerce. Given that anyone can do e-commerce provides very steep competition in all areas of the game, from attention marketing to the vast choices of sites that sell you pretty much the same thing.

90% of all E-Commerce businesses fail within 120 days of launch!

That's a very high failure rate, this largely comes down to practically no entry barriers and high competition - between 12-24 million e-commerce sites.

This creates a challenge for e-commerce entrepreneurs of standing out. What is different about your store compared to your friends?

Traditional E-Commerce Model

Marketing (outbound, social media, search, ads etc) -> Leads, Traffic, Promo -> Conversion -> Fulfilment -> Profit -> Repeat

The model is simple and if you can get the rates and costs right, you win. If not, like most, you lose. If you hit a jackpot, each cycle gives you profit and you increase your volume each time by reinvesting your profits into marketing - seems obvious, why change what's working.

An Overlooked Opportunity

E-commerce entrepreneurs, from one-man companies to multinationals, rarely think about leveraging repeat sales and turning their customers into members. Think of it this way, if I'm running an e-commerce store and I say my product is great versus your friend who tells you about a great product that they bought from my e-commerce store - who would you trust more?

Customers can be (and should be) your greatest brand advocates. However, in order for them to care, you should care about them and provide ongoing value, compared to one-off value.

A Win-Win

By providing value to customer over time, they become part of your community and as your community grows, your brand starts to be worth something. You begin to stand out from the other millions of online stores that sell the same thing. Think of the following:

• Engagement: You need people to be engaged to even know who you are, whether it's a piece of content or a useful feature in your app

• Service: This makes people feel valued, a key point for success

The Economics

By leveraging repeat sales, you don't spend for customer acquisition. No need to waste money on ads and suffer low conversion rates. In the long-run, a community will lift your business way beyond others that reuse the traditional e-commerce model over and over. Besides, it gives you an opportunity to offer other services to your valued network that go beyond your site, from subscriptions to upsells and memberships perks, there are many ways to keep your audience engaged, interested and paying.

Circular Economy and Renting

Another avenue that you may want to explore to differentiate your e-commerce business is a renting model. In the long-run, you have the opportunity to make a lot more in revenue from renting something out than simply just selling it. Besides, if the item is expensive and not used often, you can appeal to a greater pool of potential buyers.

This approach is more sustainable in the long-run, gives you a chance to form a members community and contributes to global sustainability initiatives. This renting and leasing market has it's nuances, is more difficult to manage but also has much less competition. Your returns from running this business are far greater and you often connect with your customers better than you would by just selling them something once.