When it comes to protecting your eCommerce company from rising inflation, you have a few options. Try some of these techniques to beat back rising consumer prices and stay ahead of your competition.
1. Cut Unnecessary Expenses
This may go without saying, but companies incur plenty of “hidden” expenses that erode their profit margins.Case in point: All those subscriptions that you’ve forgotten about. Many products and services require you to pay for them on a regular basis, such as quarterly or annually. However, it can be easy to “set and forget” the subscriptions you’ve signed up for.
2. Stock Up on Supplies
Though some experts are hopeful that supply chain worries are nearing an end, one of the largest shipping companies isn’t so sure.Let’s say you know you’re likely to get a seasonal bump in sales on some of the merchandise you sell. It may be wise to purchase as many of those items as you can immediately. Or, you may want to source them from a variety of vendors rather than sticking with one.
3. Outsource Wherever Feasible
Outsourcing remains one of the most reliable ways to spend less without sacrificing the quality of your services. When you outsource, you remove a lot of the overhead that can bog you down.4. Improve Cash Flow
Making improvements to your cash flow means you’ll be able to make payroll, buy products and pay bills. A proven way to increase your cash is to shorten the time it takes to get paid.Alternatively, you might want to add more bulk-buying incentives to the table such as discounts for purchasing multiple items. Allowing a customer to shave dollars off an order when buying two, three or more items is a win-win solution. You get more cash from the sale than you would have and your buyer has gotten a deal.
5. Concentrate on Marketing Your Bestsellers
You may or may not know what your best-selling products are. It’s worth finding out for sure and then promoting them ahead of other items.Don’t worry if your bestsellers aren’t the highest-priced items in your eStore. You want to find products with strong profit margins, such as those with significant markups. And those won’t necessarily be the ones with the highest price tags.
Once you’ve named your top products, make sure you’re showcasing them in your advertising.
6. Maintain a Buzzworthy Customer Experience
Every time a customer has a gold medal experience, your company wins.It isn’t necessary to spend a fortune to improve your customer experience, either. Removing clunky user interfaces or solving inadequate packaging problems can smooth out the rough spots.
7. Automate Whenever Possible
How many repetitive processes do your employees engage in daily? If the number is high, you’re probably losing more money than you realize.The more tasks you can automate, the less time your personnel will spend on mundane duties. Best of all, you’ll reduce the risk of human error.
To figure out where and what to automate, ask your team to find areas of repetition in what they do normally. Then, consider options that could help you automate some or all of those responsibilities.
8. Revisit Your Pricing Strategies
Contrary to popular belief, it’s okay to raise prices now. That’s what 40 percent of businesses say they’re going to do—and they’re looking at a 10 percent price hike at minimum. However, the key is to raise prices reasonably.For example, doubling the price of an item probably isn’t wise unless you can justify the price hike. On the other hand, a slight pricing jump might make shoppers grumble, but most of your fans will stay.
9. Seek New Customer Pools
If you’re able to bring more customers into your eCommerce store, you’ll be statistically likely to increase your sales. Tapping into new audience personas can be one way to entice more customers.For example, you might not realize that you’ve been overlooking a significant population of potential buyers until you conduct internal marketing research.
A fast way to uncover possible new customer buckets is to look at your current buyers. See which buyers have the highest single and lifetime sales. Do they represent audiences you haven’t been marketing to?
10. Attract and Retain Talent
In addition to other economic concerns, the labor market is having struggles of its own. Yes, job openings declined in Q2 2022.Nonetheless, The New York Times explains that employers are still having trouble filling seats. So holding onto the team members already invested in your eCommerce company makes a lot of sense.
11. Drop Unproductive Marketing Tactics—but Keep Marketing
You might be tempted to slash your marketing budget. Don’t. Just rework it.For instance, use data from Google Analytics to determine which marketing methods are working like a charm and which are duds. Temporarily put a hold on the duds and spend more on the marketing you can count on.
Certainly, you can still try some innovative marketing efforts. Be willing to shelve them if necessary. Test something you haven’t tried, run a few experiments, and see what happens. But make sure you’re holding onto the marketing that you know always drives business.
You can’t stop inflation. That’s a fact. Nevertheless, you can stop it from ruining your eCommerce business. Consumers may be buying more selectively, but they’re still buying. Your job is to make sure they spend their dollars on your merchandise.