Whoever can spend the most to acquire a customer wins.
This is likely a phrase you’ve heard before in the marketing space, and it only makes sense, right? It’s easy to assume whichever company has the most money comes out ahead against their competitors. But what it REALLY means is the companies that can spend $10 and still profitably acquire a customer versus the ones that can only spend $5 are the ones that are going to be able to scale ads to really make their efforts fruitful…and the way we’re able to sell more to each customer is actually NOT in pricier products.
Instead, it’s by having a more complex back-end system, subscription services, up-sells, and other things. In this episode, I’m going to give you the 7 most important things to test for to determine whether or not an e-commerce product is going to have massive scalability potential. While you don’t have to pass all 7 to be successful, being able to find a product that passes as many of those checks as possible is what really separates a seven-figure e-commerce brand from the rest of the pack.
1. Target Market Accounts
It’s optimally ideal to pick a niche for your product. However it can come with a caveat; namely that sometimes we can pick niches that are too small. That said, it’s not always as daunting as it seems to look at a much larger market and want to play into it as a newer, small-scale business. But that doesn’t mean you can just throw yourself into the deep end and expect to float to the other side without swimming.
A simple way to test the waters is to see if what size following the biggest page in your market has. Ideally we’d want to find an account with at least 1 million followers, and hopefully there are a couple of them. If there’s not, and the biggest page in your market only has around 100 followers or so, it’s going to be hard to scale in this niche market because there isn’t a very large audience to appeal to…which leaves a lot more work to do in order to become the new big account around to ever get above 100k followers. However, if the big accounts in the same market are well over 1 million, and you look to do paid posts with them, you have a much higher potential to grow your account to at least a 100k.
2. Target Market Hashtags
After researching other accounts in your industry to see how they’re handling marketing strategies it’s crucial to make sure to use effective hashtags on your posts. I would make sure to use the biggest tags in your industry with your main (largest) tag hitting at least the 10 million mark, followed by 2-3 with at least 2 million. This doesn’t only make your content relevant and searchable within industry-specific posts, but helps your content reach a wide enough audience to gain more attention over time.
So unless we see at least 2-3 million uses from our main hashtag and at least 10 million from the top tag it’s going to target too small of a space.
3. Subscription Models
Aiming for viral posts is a great way to reach the largest audience possible and there’s much to be said for your audience helping spread the word. Your products should be marketed to create a willingness in your customers to want to relay the experiences they’ve had by using your product. Word-of-Mouth is a powerful, tried and true way to market your product and it only builds you a stronger reputation over time.
But by offering your customers something more than a face-value product, such as a subscription, you provide more incentive for long-term return on your investments. Your customers are actually happy to be part of a weekly, monthly, or yearly subscription service they can count on getting new products from, even if the products are selected randomly. It doesn’t only leave a sense of surprise and excitement, but makes them feel as though they’re part of something special and makes them want to, dare we say, BRAG to their own followers about being part of your market in some way.
4. Emotional Purchases
Products that fulfill a purpose for a customer are an easy win, but being able to create an emotional connection with them is even better. Until your product becomes exciting enough for customers to want to buy on the spot, you likely have to run sales to keep your profits up. However, with emotional purchases they don’t just buy your products to complete a task or cross off a check-list item anymore, they do so because that emotional attachment produces a strong bond that it becomes more of a WANT than a need.
If not just on brand loyalty alone, an emotional purchase can involve an impulsive desire to who the consumer can show the product off to. Being able to appeal on a deeper level with your customers alleviates the need to always be a sales-oriented company.
5. Upsell Potential
While it’s true that if your product has a subscription model it likely has plenty of upsell potential, it’s also possible to have a product with upsell potential without needing to run it under a subscription-based service. One of my favorite ways to accomplish upselling is through a funnel. As a proponent of ClickFunnels, it makes an upsell incredibly easy.
For example, say you’re selling a product for $10. The customer clicks “checkout” and it brings up a dialogue box with the option to add an additional product as a special deal or at a fraction of the initial price. All they would have to do is click on “Add to Order” to make things easy. It creates less work for the user with a quick and effortless way to get an additional sale for your products.
And it doesn’t end there…even if the customer refuses that “special offer” as an add on, you could continue with another option such as actually asking if they’d like to start a subscription service or, at the very least, even offering them another deal. Using something as effectively simple as ClickFunnels or a funnel-based purchasing model creates a lot of upsell potential for your product while giving the customer a variety of interesting options they didn’t think to look for.
6. Customization & Personalization
A popular part of e-commerce is giving the user the option to customize their product in some way. Customers may want a product for what it is but, much like providing them with a product that creates an emotional attachment, allowing them to have their own sort of “signature” or personality instantly heightens their desire to have your product.
Though it ultimately creates that emotional impulse with the customer, it also creates more work to customize your products (potentially in an infinite number of ways). However, this isn’t necessarily a bad thing…because it allows you to charge a higher price when you give them the option to customize your product for themselves (emotional purchase as well as upsell potential).
7. Giftable Products
This really goes hand-in-hand with the customization & personalization factor. It’s clear that anyone loves being able to customize a product for themselves to show off to friends and family…but when they see the ability to customize it to their own liking for themselves, they easily think of how they might be able to do it for someone else.
Maybe they order a coffee mug the first time around with a photo of their dog on it. Every time they enjoy a cup of coffee they admire the photo, attaching emotion to the product. Now, because they enjoyed the experience from start to finish (and continually do so), they want to pass that feeling on to someone else they care about. This then creates reorder potential for your product from the same person.
It’s an effective way to add value without adding cost because in the end they’re purchasing your product more on an emotional decision rather than simply to fulfill a need…an empty space in their cupboard, so to speak…which can greatly increase your profit margins and gain repeat customers.
Though there are even more methods for testing how your product scales in your market, these are my definitive 7 that should be most paid attention to. Examining these will truly help you refine your marketing process and optimize the niche and customer base your targeting. Make sure to listen to the full episode in my discussion with Peter Pru to hear more details on defining e-commerce product scalability.