Part One of a two-part series in which 18 industry experts share their most effective eCommerce growth hacks. Powerful insights from investors, analysts, and SaSS founders, and more.
The year isn’t over yet.
There’s still enough of 2016 left to post some big growth wins. But how are you going to do it?
You can scour your data for revenue sinkholes, run experiments on a hunch, or sift through dozens of blog posts about hot new (and untested!) trends.
Or you can rip a page from the playbooks of today’s most influential minds in e-commerce.
These pros know which risks pay off and when to pivot to take advantage of new opportunities.
They’re people whose opinions and smarts I deeply respect—and now I’m sharing their knowledge with you.
- Part 1 (this post) gets you into the heads of people in the E-commerce Ecosystem: investors, analysts, and SAAS founders. These people don’t run retailers, but they watch them. Lots of them. They see what’s working and what isn’t.
- Part 2 contains insights from E-commerce Operators: CEOs and CMOs at large and small retailers. They’ll share the successes they’re seeing within their own companies.
Investors & Analysts
Jeremy is one of the most knowledgeable e-commerce VCs I know. (He’s also the most dapper.) A Partner at Lightspeed Venture Partners, Jeremy’s e-commerce investments include LivingSocial, Bonobos, PetFlow, Slice, and The Honest Company.
Growth Hack: Target Your Best Customers
Not all customers are equal. Identifying and catering to your best customers and getting them to buy more, buy early, and buy often is a key growth driver for the e-commerce companies in my portfolio.
Eric Roth from Lazard Freres
Eric Roth is a managing director at Lazard Freres who eats and breathes e-commerce. I saw him do both at a midtown steakhouse—I ordered a steak, he ordered conversion rates. As a member of the firm’s Consumer/Retail Group he has advised companies on all phases of mergers and acquisitions, most notably Oriental Trading on its sale to Berkshire Hathaway and Buy.com on its sale to Rakuten.
Growth Hack: Leverage your branding
Retailers who invest to develop their own brands are able to significantly enhance contribution margin, resulting in incremental marketing dollars that can be redeployed to significantly enhance customer acquisition, retention and reactivation.
Carson Biederman from Mustang Group
Carson Biederman is taking an innovative approach to private equity: running a fund that buys and scales middle-market e-commerce companies. His Boston-based Mustang Group invests in companies with revenue between $5 million and $100 million. Investments include Vermont Teddy Bear and Cascade Lacrosse.
Growth Hack: Off-line and in-person builds growth
Developing off-line sales and marketing channels has been an important lever to accelerate already strong growth in our portfolio companies: catalogs, outbound calling to high AOV existing customers, pop-up retail and commercial/corporate sales are some of these areas of off-line focus.
Jason Pressman runs the enterprise e-commerce practice at Shasta Ventures and invests across a range of sectors, including software, SaaS, cloud and consumer services. Prior to joining Shasta in 2005, Jason was vice president of strategy and operations at Walmart.com, where he took the online retailer from zero to large-scale revenue in five years.
Growth Hack: Segmentation offers the personal touch
One of the top growth levers for our e-commerce companies has been developing one-to-one relationships with customers. To be clear, these aren’t totally customized. Instead, these relationships are about thoughtful segmentation and messaging to customers so they look forward to hearing from us and then find the entire buying experience to be fun.
Charlie O’Donnell has been an active member of the NYC venture capital and startup community for 10 years, in roles ranging from institutional fund investor to venture capitalist to entrepreneur. While at First Round Capital his e-commerce investments included Refinery29 and Chloe + Isabel.
Growth Hack: Video content for high-impact marketing
While I’m not excited about video as an investment, it can be a great marketing tool—a way to establish your brand and draw customers in via engaging content.
Sam Mallikarjunan from Hubspot
Growth Hack: Upping the velocity of content creation
Our primary growth channel has been an aggressive re-investment in blogging, including our new e-commerce blog. We’re segmenting topically as well as dramatically increasing our velocity of content creation. So far, we’re seeing roughly a 12% month-over-month increase in traffic (and we have a fairly mature traffic base to begin with).
Janus Jagd from Cylindo
Janus Jagd is the founder and CEO of Cylindo, a profitable and growing provider of visualization software to home design retailers and e-commerce sites. A former game designer, he is working to bring game mechanics to the buying process.
Growth Hack: Context boosts growth
For our customers (furniture retailers) a top growth lever is context. Selling settings or complete room designs as opposed to single items—showing how products fit together and how they look in your space prior to purchase—has a documented positive effect on cart size. We build our platform around supporting that strategy.
Sina Djafari from Duoplane
Sina Djafari is the founder and CEO of Duoplane.com, the drop-shipping SAAS solutions company. At Duoplane, his team has built drop-shipping automation software that plugs into any e-commerce front end.
Growth Hack: Look to joint ventures for a smooth revenue stream
On the revenue side, I think the biggest opportunity is working with companies or individuals that have a strong following/audience to create an e-commerce presence as another revenue stream. This could be done through a licensing arrangement or for a profit-sharing model. Some examples:
- A cooking blogger with a large following can create a mini-store with a curated selection of cooking tools and ingredients
- A company that creates instructional videos on crafting is in the perfect situation to sell crafting supplies
- A hotel chain can sell lifestyle goods consistent with their brand and experience
I think there are opportunities to do this in a repeatable way so that e-commerce is essentially a utility that you can plug into, but the higher margin play might be in the licensing model.
Sean Ellis is the father of modern growth hacking. His approach, which focuses on using customer information to improve usability, directly or indirectly, contributed to the success of Dropbox, Lookout, Xobni, Grockit, Eventbrite, Webs, World Golf Tour and Songkick.
Growth Hack: Keep looking for today’s opening
I believe that there is no single opportunity. My ideas are triggered by the specifics of an opportunity and user needs.
Neil Patel from Kissmetrics
Growth Hack: Reclaim shopping cart sales
For most e-commerce companies that I have worked with, shopping cart abandonment has been one of the biggest levers. From using remarketing to email automation to even optimizing the flows for conversions, this is where you can drastically increase revenue.
Mark Macdonald from Shopify
Mark Macdonald runs content marketing at Shopify. As blog editor, he turns out consistently epic—and cart-agnostic—content about e-commerce. And with his vantage point he can see what is succeeding among new Shopify stores.
Growth Hack: Let your customers do the selling
We’ve seen a lot of our merchants find success with Instagram this past year—especially lifestyle and fashion brands. Instagram is giving retailers the opportunity to make people care about their brand and market the lifestyle around their products, not just the products themselves.
Some retailers are even incorporating user-generated Instagram photos into their product pages that show their products being used by real people. This not only builds community, but it also provides powerful social proof for the retailer. Black Milk Clothing does this particularly well.
In Part 2, we continue with seven insights from e-Commerce Operators – CEOs and CMOs at large and small retailers will share the strategies and techniques that are working with their companies.
Now I’ll turn this over to you: What are these people missing? What was the biggest opportunity you saw this year?